I actually don't see much cause for concern in the US right now. All the economic indicators are looking good. What concerns me is China. That big spike in SHIBOR last week could really spell trouble for the world economy. Since Chinese economic indicators aren't always considered reliable, I think many banks/investment managers may under appreciate the risks with China.
Politicians throughout the years have given jobs for votes and inflated the public sector because of this. We have learned to have things come easy and have become lazy as a nation. <http://www.nytimes.com/interactive/2015/06/22/business/international/greece-crisis-portraits.html>
The national debt tally at Treasurydirect.gov hasnt moved in about 4-5 months. I wonder whats going on?
I'm not knowledgeable enough to speak to it with certainty, but if that's whats going on, this is really bad.... And you're exactly right. That's what banana republics do...
Russia is being badly hurt by low oil prices. This was entirely foreseeable if you realize that the US controls oil prices (with the help of Saudi Arabia) in order to improve its position against China and Russia. China gets hurt by high oil prices, Russia by low. Most recently, this is why oil prices crashed back when Russia invaded Georgia and then again with the recent stuff. But it's been going on for many decades. There's a book "The Oil Card" which is worth reading. I realize that the premise of The Oil Card is shocking, but if you trade as if it's the truth, you wouldn't have gone too wrong. US military might is partly economic, partly military, and partly diplomatic. The diplomatic power arises mostly because the US is the world's leading English speaking country. And it is a fact of world history that, over the long term, countries that speak the same language tend to work together (when they're not in conflict over a civil war like the Koreas now). Thus the only country happy to join Hitler's Germany was Austria. The world has something like 350 million native English speakers and they happen to reside mostly in countries that are technologically advanced and militarily powerful. The "anglosphere" frequently goes to war as a block. Spanish is slightly larger but the Spanish speaking countries are not so advanced. Then there's Mandarin but China is rather insular. As far as military might, the stuff in Iraq (or Vietnam) are not wars lost by the US. If a country loses a war it's pretty easy to tell. The government falls and foreign soldiers occupy the capital. None of that has ever happened in the US. (The British did manage to briefly occupy DC back in the war of 1812 but the US government soldiered on and they painted the presidential palace white to cover the smoke stains.) The Vietnam war was part of the conflict with the Communists. The US won that conflict. The USSR government collapsed. The Chinese government adapted to capitalism. As to what is happening in Iraq, it's not obvious to me that the result was unintended. The thing that the world superpower has always done is to stir up trouble in potential rivals. In terms of world native language speakers, right after English comes Hindi and then Arabic. (Russian, Japanese and German are #8, #9 and #11.) If the Arab speaking states were united they would be fairly strong, especially in oil. But somehow things don't seem to be going that way right now. Where are all the "pan arabists" now? Gaddafi was killed with US assistance even after he gave up terrorism. Saddam was taken out by the US in a war based on silly charges of WMDs. And now Syria is looking to fall apart as the US supports rebels even though it might mean a win for ISIS. Meanwhile in Iraq, the US does almost nothing against ISIS. But the funny thing is that ISIS is acting against fellow Moslems. Who'd a thunk. And as far as economic might, the US is a leading country in technology but it's now become the world's largest fossil fuel producer or close to it. The US is the world's largest exporter of food. And while the US army is fairly small, US has the world's best navy by quite a wide margin. The combination of these things means that in the event of even conventional war, the US can bring any nation quickly to its knees. China used to feed itself, now it imports huge amounts of food and that is expected to continue getting worse for years. The net result of this is that China is in absolutely no position to fight a war -- and they're not preparing for one. And Russia? It barely has the economy of Italy. After things calm down with Russia, expect US foreign policy to subtly undermine other oil producers, probably with civil wars. They are our competitors now. It's true that the US military is very expensive and, in fact, the US cannot afford it. But the US doesn't have to be able to afford it. US military costs are paid for by foreign countries through a combination of our budget deficits and our trade deficits. We give them paper, they give us the US military. Will that change? Sure, someday. But the trade deficits are driven by the improving economies in the rest of the world. (As they become stronger, their economies get bigger and their central banks need more reserve currency. So they have to buy more dollars from the US.) Maybe things will turn around but it certainly isn't going to happen in the next few years. I'd guess it will take the leftists about 30 years to bankrupt the US and when it happens, it really will be a trade deficit turning into a trade surplus that will drive it.
Have you ever asked yourself, 'Why is the U.S. Dollar so strong compared to other currencies?" No, I don't suppose so. All your predictions have been wrong so far. When do you expect them to start being true. Do you ever read the Financial Times? No, I don't suppose you go much beyond You Tube.