One financial doomsday scenario

That the US is going broke is no longer a moot point for many. The signs are everywhere; the mathematics too obvious. To understand the latter, see The Continuing Spiral to Bankruptcy, Spiraling to Bankruptcy or Welfare States R.I.P. The timing and the manner in which this plays out is not easily forecasted. The key point in trying to forecast this particular problem is when and how the politicians respond. No politician ever wants to address a problem that inflicts pain on his/her constituents. Unfortunately, the possibility of solving this problem without inflicting pain is impossible. That option disappeared years ago.  Based on the universal political characteristic -- cowardice -- politicians never take painful actions until forced to do so. Markets will eventually be the force that causes action. The ensuing events will not be neat and tidy. One way or another, the welfare states will be dismantled. Whether this dismantling is partial or total is...(Read Full Post)