You may recall that Secretary Hank Paulson warned in 2008 that the system was on the brink (and later wrote a book with the same title).
The situation was apparently so serious that Representative Brad Sherman (D-CA), in a speech on the House floor, said that if the bailout legislation wasn’t passed, there would be martial law in America as a consequence of the resulting collapse of financial markets and the economy.
This was the warning in 2008 from the head of our Treasury Department!
Nearly four years on, we’re hearing the same warnings, and governments in Europe and the United States are actively preparing for such a possibility.
In testimony before Congress late last year, Fed Chairman Ben Bernanke warned that a “disorderly default” in Europe would be a recovery ending event that may include runs on the banks and a “very, very bad outcome” for the U.S. economy.
As we approach yet another debt ceiling in the U.S. and require an additional $1 trillion just to keep the system afloat, we urge our readers to consider the distinct possibility that we remain on the brink, and are closer than ever before to a total breakdown in the financial, economic and social stability of the world.
A meltdown in Europe will not be isolated to just that continent. The contagion will spread to the United States, and the default of Greece and other sovereigns will be anything but orderly.
