The 700 billion dollar bailout is not over with, watch out for the later part of 2009.
The continued decline of the stock market, jobs, housing, manufacturing, service, banking and financial institutions.
As the water table of economic stability decreases many rocks will be exposed. What do I mean by that? There are many problems that are now hidden and as the troubles continue and the economy drops, these matters will be exposed.
States Face Financial Crisis – A recent study by The Center on Budget and Policy Priorities revealed that 41 states are facing severe budget shortfalls for 2009. Some states are worse off than others, with California ($31.7 billion) and Florida ($5.1 billion) leading the deficit pack. In all, the 41 states are currently facing a $71.9 billion budget shortfall. The key word here is “currently.”
Deflation/stagflation/inflation/hyperinflation – all these will occur on the heals of each other. What intervention factor will start the flow of the absolutely unsterilized $8.5 trillion dollars of liquidly into the business section? The answer is significant ‘fiscal stimulation’ through Quantitative Easing (aka wild-money printing). It will trigger the dollar’s demise by inflation of the dollar.
When road, schools, special education, music, athletic, teacher’s salaries, the no child left behind, road building and local infrastructure building providers are granted Federal contracts with Federal guarantees of borrowing, they go to the bank. Why bank against a Federal fiscal stimulus contract or guarantee will fail to lend up to 90% of the required funds? That will open the barn door of liquidity. This is followed by inflation then hyperinflation (a currency event not an economic event) all this in the midst of a deep recession.The answer to that question is also easy: $8.5 trillion in government bailout.
Social Security and other retirement accounts will become of little value.
The USA will bring most of it’s troops home to save on finances.