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Wednesday, September 21, 2011

A Repeat of the Great Depression is Our Best Case Scenario

President of the Ayn Rand Institute Yoran Brook says that we’re essentially out of solutions for the economic, financial and monetary crisis facing America. He joins The Daily Ticker to discuss the general sentiment from the institute’s recent Atlas Shrugged Revolution dinner, which featured attendees like Euro Pacific Capital’s Peter Schiff and John Tamny of RealClearMarkets:
The mood in the room was definitely that this country is heading towards some kind of collapse, some  kind of significant disaster. That everything kind of is lined up and nobody, really, in the political realm, out there in the culture seems to have solutions…

If we look long-term. If we look at the structural problems of the United States, at over $100 Trillion in unfunded liabilities, of ongoing deficits, of no political solutions, of nobody talking about real cuts, where does this all lead?

Unless we have real structural change I think it will [lead to disaster]… Unless you change the approach to government, unless you’re willing to challenge the very notion of what government needs to do, you’re not going to change it in a fundamental way.
…Unless you make a fundamental change in our approach to entitlement, in our approach to government, we can buy time, but we’re not going to change the outcome.

Unless there’s alternatives, unless people come up with real solutions, the crisis could be anywhere from a major economic depression and we learn our lesson and we climb out of it, to what happened to Rome, which really is the dark ages…
…I think we have to remember that…civilizations in human history have declined, they’ve disappeared…Sometimes in human history mankind has gone through long periods of time of just struggling, of it being very hard to survive.


Based on the assessment of Mr. Brooks, and that of other analysts and commentators (including ourselves), our best case scenario appears to be a major economic depression, not a short-cycle 18 month recession (or even double dip), but a long-term cyclical depressionary bust that occurs roughly every 70 – 80 years. It’s not just Yoran Brooks and alternative media that is warning of this possibility, but well respected and influential economists and business figures like Nouriel Roubini, who just today in an opinion piece for Reuters writes, “the risks ahead are not just of a mild double-dip recession, but of a severe contraction that could turn into Great Depression II,” and George Soros who recently wrote that more centralization is the “only way to forestall a possible financial meltdown and another Great Depression.”

In fact, it is our strong belief that, based on the high rate of unemployment (~23%), food stamp participation (~17%), foreclosures (officially in excess of 4 million home thus far), rising food prices (13.2% annualized), and negative GDP growth (~ negative 2.0%), speaking of  another Great Depression as if it is a future threat is inaccurate.

We are now well within Great Depression territory. It may not seem like a depression to the masses because of modern day digital currencies, centrally planned and managed economies, near tyrannical government control, the power of the global mainstream media to control perceptions, and the never ending bread and circuses doled out by politicians. But, make no mistake, we are already in the midst of Mr. Brook’s ‘best case scenario.’

Our only hope is that it does not go full-on worst-case scenario, because then we’ll be talking about the widespread collapse of entire nations, similar to the Roman example cited.

Author: Mac Slavo
Date: September 20th, 2011
Website: www.SHTFplan.com
Copyright Information: Copyright SHTFplan and Mac Slavo. This content may be freely reproduced in full or in part in digital form with full attribution to the author and a link to www.shtfplan.com. Please contact us for permission to reproduce this content in other media formats.
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