Alstrynomics....We Are All Dubai
Once its oil reserves were running out, Dubai was basically a ocean front sand due trying to be a port. However, if you invest hundreds of billions of dollars and loan billions as well....you can even turn a sand dune into the world's most luxurious playground for the uber rich.
At one point, little Dubai was home to about 20% of the world's cranes. Dubai was consuming massive amounts of contruction resources and materials....much of it simply a product of borrow and spend and little attention paid to need. Indoor ski slopes, couture and gold sinks were nothing special...but when you lend enough......you can really spend.
The problem comes in when you can't borrow anymore.
If you think about the American economy, we really are not too much different than Dubai. Much of our economy was simply driven by borrowing and spending. Real Estate was the catalyst but it spread to cities, counties, states, schools, hospitals, business, private equity, federal government, auto loans, home equity loans, vacation loans, credit card etc.......
Most of the jobs of Fools was dependent on customers borrowing, the company they worked for borrowing, or the customers of the customers borrowing. Heck, even Dubai's borrowing had a postive impact on the American economy though contruction related services and goods.
It became evident in 2006 that the debt levels were unsustainable as the bankers had infected the economy with a debt load that the bankers knew could never be paid back. The only way much of the debt and jobs were maintained was by lending more money to service debt. Borrowing to pay debt became known as extend and pretend.
It was debt that drove the purchase of goods and services. The m0re debt we accumulated, the bigger the burden it became to service.
At this point, our entire economy is burdened with over $50 trillion of public and private debt....mostly private. Now that the bankers have cut off credit, our revenues are evaporating and it is getting impossible for more and more to service debt and meet monthly obligations at the same time.
Just like Dubai was a ponzi scheme of borrow and spend, so is the American economy and Benny Bin Laden knows this.......and knows exactly what will happen as the bankers cut off credit. If we continue with the current zombution polices....I can assure you America will economically implode and there will be social unrest.
Our economy is not structured for mass unemployment and poverty. Nor is our society like many third world nations. As we proceed with zombulation, much of our nation will resemble more and more like Degtroit. We are only in the early stages and we are firing large numbers of police officers, fire fighters, hospital employees, and teachers due to evaporating tax receipts.
Whoever wants to identify their occupation, I will show you how borrow and spend drove your job and income....my guess is it will be nearly all of you. And without a change in policy, most fools will lose their jobs as most of us get zombulated either through loss of job or government needing all of our assets to maintain itself.
Food Stamp Use Soars Across America
1.01.10 ZOMBULATION NATION.....and time for a pancake party.