Many of us believe that the current state of unsustainable national debt, together with uncounted liabilities coupled with the danger of derivatives means that a harsh reckoning for the economy is inevitable. That it will come we do not doubt, but we do not presume to say we know when.
By way of illustration, the stock market has been operating for years now, really since Greenspan, on the assumption that the Fed has assumed moral hazard duties. In other words, so long as the Fed has our back, it will do what is necessary to pour money into the banks to prop the system up. We have learned that as bubbles burst the Fed will step in. So the market keeps playing because it believes the music will play on. Still, many are watching the Fed because the second they espy the mere wisp of an emanation or intimation of increased interest rates they will trample innocent bystanders in their rush out the door.
That a reckoning will come we think we are smart enough to know. But we don't know when nor do we know it's dimensions. If severe enough, it will lead to political as well as cultural disintegration.
Nathan's other maxim: the remedy for failed socialism is not genuine reform restoring capitalism but invariably imposing more socialism.
So we don't know what we are dealing with here, how close we are to the reckoning, the severity of the pain nor the degree of political derangement that will result. There are entirely too many leftists who would welcome a crisis that they would not let go to waste. My own view, we will not emerge more capitalist, more democratic or more constitutional.
