As one of the tweeps who started the Global Financial Crisis 2.0 hashtag (#gfc2) on Twitter, I believe we’re right smack in the middle of a horrific financial crisis that will rival the first one in size and scope. I don’t take pleasure in that forecast for lots of reasons, mainly because of the extended misery that is being inflicted on people across the globe. But the global economy has become such a zombified Frankensteined creature of the financial elite that it’s not serving any useful function except to enrich those who already have a lot at the expense of those who have little.
If you accept that we’re in a financial crisis and that our political and economic leaders have little or no idea about how to cure it except to throw more money at the banks who are causing the crisis yet again, you’ve got to wonder what the end result will be. Like a nightmare that you can’t wake up from, the thoughts are extremely unpleasant, but riveting in some sense.
In the past 24-hours, I’ve seen several articles posted on Twitter that capture a view of what might happen if or when this crisis gets completely out of control. Here they are, plus a few comments:
- Nouriel Roubini channels Karl Marx: In a video interview with the Wall Street Journal, Roubini agrees with Marx’s conclusion that capitalism is ultimately self-destructive. The video 22 minutes long and well worth watching, but if you’d rather read an analysis, here’s one. Roubini dismisses the conclusion that we are at the point where capitalism will actually self-destruct; I’m not so sure. He does say that an economic depression is a possibility due to zombie housing, zombie banks and zombie governments.
- Buy gold, hide $$$ under your mattress: A really scary potential scenario of what could happen if the global economy completely unravels by David Freedom of The Victory Report sees money market funds collapsing, rampant inflation and high unemployment as well as a lot of social unrest. As ugly as this is, I don’t think it’s a scenario that’s out of the question. In some ways, it’s the logical outcome of years of inequality and fiscal/economic mismanagement.