The economic collapse to come

wow... I can't believe I am writing this, but I am. Read the economic depression to come, and tell me if I was nuts back then - I even think I am nuts, but I can put everything together now... and it makes sense...

Currently, there are huge deficits, people losing jobs, states robbing municipalities of their money, the federal government robbing citizens of their tax dollars, and so on. This collapse is coming from the inside - and it stems from the inability to raise taxes to pay for deficits that are ever increasing. Why are they increasing? For multiple reasons - The first and probably most important reason is from the collapse of the automakers - and there'll be more to come over the years - The inability to sell the 10 million needed units will have the Government Managed car companies reducing the amount of dealerships, which is already happening. This will drive tax revenue for cities downward, and effectively bring the tax revenue for states down. As the states begin to increase taxes on businesses, they will slowly make their way from heavily taxed states to lower - as seen by the film industry. Consumers will follow. As taxes go up, people will spend less and less for obvious reasons, which will have an effect of less tax revenue for the federal government - as people spend less, more businesses will pay less taxes because of less taxable income or they just go out of business.

Moreover, when the states, like California, begin to become so insolvent, they are forced into bankruptcy, the federal government will step in and bailout those states - causing massive debt loads for the government. Soon, it will get to a point where the dollar isn't worth nearly what it was and the interest rates are going to soar because of the default risk associated with it. We will see a collapse similar to that seen in and around 1994 with Mexico, but the problem being is who will bail us out like we did to Mexico? China?

Well, with that, the major businesses will slowly be bought by countries that have more money than us - China - and we will slowly lose our economic power to generate internal profits.

I want to elaborate about what I see for national security, but for fear of big brother, I choose not to - This is only a prediction and is not reality, but at the rate we're going, it will be reality.

What can fix this? Well, for starters, we need to tax more. We need to renegotiate government union contracts. We need to get rid of the pensions (sorry seniors), especially those that pay 90% of your highest grossing year, we need to quit paying our CEO's 100x more than the lowest paid worker. We need the government out of business. We need to let things fail.

Unfortunately what my resolutions are sound a bit two faced - How can we let big business be free of regulation, but also have CEO's earn only 10x the amount of it's lowest paid worker? Well, we also need to understand we're not a consumer based economy anymore, and the days of buying the Hummer with the McMansion for $500K is over.

We have officially started the new economy, but everyone believes it's going to be just like last time (look at the stock market and home sales numbers), but it won't be. The next wave of the economic collapse will be disheartening to everyone who is jumping in to buy homes now. This will be a long and painful depression that will effect everyone, but we need to prepare for the future and quit living for today.