There’s a guy near my work who has been predicting that God’s wrath will soon destroy the filthy and hedonistic United States. It is only a matter of time.
Seriously, if somebody has been predicting something being just around the corner for a long time – whether it be food capsules, faster than light travel, financial ruin, or whatever – odds are that your assumptions are wrong.
Or the 1930s.
-Joe
We have trouble with uncertainty.
And how long will you keep saying it?
That’s why I have all those coins in my purse, too. And the ten-pound note in my wallet. They’re my hedge against the collapse of the economic system, I tell you.
Eh- really, they’re because I’m too lazy to go to the bank and change the ten-pound note (which I’ve had for at least four years, since that was the last time I was in the UK) or find a Coinstar machine to deal with the change.
I figure it this way: It’s very likely that the people who, in good economic times, predict that the fundamental nature of the economy has changed, that stock or housing prices will go up and up forever and that recessions are a thing of the past, are wrong. It’s also very unlikely that the people predicting doom and gloom and the total collapse of the dollar and what-not are wrong. There’s a chance that either of them are right this time, but that’s not the way to bet.
Also, historical parallels aren’t really parallel. You can use parallels to some historical situation somewhere in the world to say pretty much anything you want about any current situation.
Apparently not. I think you hit the nail on the head here. We’re hopelessly self-absorbed.
Given enough time, anything is possible. To put it another way: if you’re unwilling to put a specific time frame on this and to back up that time frame with a coherent argument, then that’s an empty statement.
As an aside, can someone explain to me how hyperinflation is even possible? I can understand sky-high inflation rates, and currency devaluations that happen overnight. But what I can’t understand is how hyperinflation where prices change on a daily basis can last more than a few days before people stop accepting the currency at all. It seems that hyperinflation requires some sort of predictablility in it to last more than a week or two, unless you’ve got a government that requires acceptance of the currency literally at the point of a gun. But in that case, it’s functionally equivalent to the government simply stealing the goods at the point of a gun and giving nothing in return except worthless paper scraps.
I think the reason for all of that is simple. Impending doom sells books and newspapers and gets people to watch TV news.
Oh I think we Canadians could give you a run for the money but the fixation on “Doom in America” I see on this board is just weird.
I’ve never felt it necessary to specify a date that this will happen. In fact, Monetary Policy since I started feeling this way has only become increasingly likely to lead to something akin to this result, as we’ve seen the dotcom bubble, then the housing bubble, coming soon the next bubble, probably commodities but I wouldn’t bank on them bursting the same way (meaning that there is too much money floating about chasing after different things in succession) …along with a serious decline in the value of the Dollar vis foreign currency.
So perhaps maybe we won’t see 1922 German/00’s Zimbabwe style “paper money = toilet paper” degrees of hyperinflation, but we may well reach a point where we see multiple years of double digit inflation, loss of wealth and an eventual realignment of the “Dollar” similar to past efforts with the Mexican Peso and other currencies.
You mean, a replay of the 70s?
Sure, that’s possible. But we’ve had pretty low inflation since the 80s. If we’ve been mismanaging our economy for the last 3 decades since the 70s, how did we whip inflation? And another 70s style inflation crisis would be bad, but it’s not collapse of Rome bad, or even Great Depression bad.
Three decades of little change is not indicative of a similar rate of change in the future. Just ask the people who took out ARMs when fixed rate mortgages were at historic lows. Low inflation through the last 20+ years has been achieved in a significant part by squeezing suppliers to keep costs low, through outsourcing to virtual slave-labor producers and every other trick in the book to avoid paying higher costs for goods.
At some point, those tricks fail. Just look at China. Prices and wages are now raising at rates significant enough to cause real price increases here as well as leading the middle men to begin casting about for the next low cost providers (like Vietnam).
The other, very real long term effect of increasing wealth of formerly impoverished nations (such as China and India) is the increasing demand for the same raw materials and commodities that we formerly purchased on the cheap and/or were quite handily capable of maintaining low prices for. Copper, Steel and other metals are going through the roof because we don’t just have a half billion First World Consumers and 5.5 billion Impoverished anymore. Billions are crawling out of abject poverty and seeking the same wealth we have. Likewise with Coal and Oil as those people’s power needs rises, likewise Corn and Soybeans as their diets improve. All this means that real prices of a lot of things that we’ve taken for granted as being relatively cheap, are in the process of rising, and that is going to carry through the entire chain.
On the other side of the coin, we have trillions of illusory Dollars held up in debt/debtor status around the world. While a lot of it does real good for the owner states, allowing them to improve their infrastructure and standards of living, we’re reaching a point where large amounts of it simply cannot be redeemed. I just don’t see how China can successfully turn over more than a trillion dollars of US promisary notes at this point.
(The positive side of that is that our economies are so interconnected and interdependent that War would be economically ruinous to both sides.)
At the end of the day, that’s the Ponzi scheme. The Chinese and OPEC have taken in so many Dollars that they have an serious interest in maintaining the value of the Dollar, at the risk of destroying nearly everything they’ve gained if they were to, as some powers (Iran) have suggested, simply dump the dollar. There’s nowhere to ‘dump’ those dollars, people, without rendering them worthless.
The problem is that the government is just issuing paper across the board, i.e. every body has access to it. Granted, in today’s modern economy, especially as one as sophisticated as the US where paper money isn’t as widely used, hyperinflation will probably be short-lived as the US economy will just be in utter collapse and will be bailed out by IMF and the World Bank, then the rest of the wold goes to hell (or it might have happened before, but I digress…)
It also depends on the definition of hyperinflation (see wiki). If it’s one of those that happens over the course of the year, then the government can better respond by printing more money. But, at that point, I think everyone around will know what’s happening and there will be other problems, like riots on the street, food shortages, gas lines, and massive, massive civil unrest.
According to Wikipedia, Medicare is available to US citizens and legal residents over 65. Medicaid is probably what you were thinking of; it is limited to people of lower income.
There are a couple of problems with this. Theoretically, at least, Social Security is something you’re supposed to get back after decades of paying into it. It’s not just a gift from the government to the undeserving. Secondly, given the rating and underwriting practices of the health insurance industry, I doubt that most people over 65 could buy their own insurance, given that they often have a basket-full of various maladies that they need treatment for. Sure, a retired couple might have been successful and prudent enough in their working life to have put a million or so by for their golden years, but a couple of serious illnesses could wipe most of that out if they had to pay out of pocket.
If you saved your silver dimes you are making out quite well now.