We are entering an era of upright spikes. Clearly, the debt-driven global economy is spinning out of control. The aggregate value of the derivatives market is exploding [1] and meanwhile food prices are spiking. Both of these are threatening huge economic dislocation and subsequent social turmoil that–just as I predicted five years ago [2]–will topple governments. I stand by that prediction. (And, for the record, I’m not just talking about failed votes of confidence. I’m talking about revolutions.)
Note: Because SurvivalBlog’s diverse readership [3] expects access on mobile devices, I intentionally minimize the use of graphics in my blog. But this particular topic demands some graphics, so I’ve linked to charts on a variety of web sites. (My thanks to all of them. I recommend that you truncate the URLs on the graph links to take a look at the other content those sites. A lot of them are fascinating.)
Back in 2007, I addressed the Upright Spike in Technology Dependence [4]. But there are some other monumental shifts in progress, each with their own upright spikes. Consider these recent graphs:
- The U.S. National Debt [5], (which I addressed in an April 2010 SurvivalBlog article [6].)
- Food stamp enrollments [7] are at an all-time high.
- Debt in relation to GDP [8] is spiking, and the seemingly inexorable long term prospects [9] are that we’ll have our own Greek Tragedy [10].
- Oil prices are getting increasingly volatile, with huge spikes [11]. (We can expect the roller coaster ride in oil prices to continue.)
- Food prices are escalating [12].
- Residential mortgage delinquencies [13], although apparently past their peak, are still huge, and will depress the housing market for many years to come.
- Credit default swaps [14] (a type of derivative) are spiking, showing a huge underlying risk in global credit.
- The spiking price of gold [15] also reflects enormous risk in currencies and the global credit market.
- Long term Federal budget obligations are growing and expected to balloon to huge proportions [16].
Meanwhile, there are many more gradual changes are taking place, For example, see:
- Declining purchasing power of the U.S. Dollar 1900 to 2011 [17]
- Number of jobs moving offshore [18]
- Our foreign trade balance, particularly with China [19], is growing steadily worse. (And according to the CIA Factbook, we have the ignoble distinction of being the world’s worst [20].)
- Base metals prices [21] show that government figures on inflation are well-orchestrated lies.
- The Federal debt “limit” [22] has become a standing joke.
Conclusion
If the National Debt is not brought under control, we will someday see mass currency inflation–perhaps to Zimbabwean proportions. [23] Now that would be the upright spike that we all dread. If and when there is mass inflation, your only safe havens will be precious metals and practical, barterable tangibles [24]. (There will be no “safe haven” paper currencies.) My advice is to get out of Dollars and into tangibles, soon!