Honestly, the question about how things will go down is the million dollar question.
The short answer is that nobody knows, but we do know it won’t be good.
And if anyone tells you they know exactly how it will implode, well, I would take that with a whole bag full of salt, let alone a grain.
Here’s a few ideas for your inspiration, so to speak.
Some Black Swan trigger event hits and causes a massive sell off, affecting both the stock and bond markets. Considering the global nature of the finance situation, my guess is that it wouldn’t be limited to New York.
Automated trading platforms would pick up on the initial signals and take things for a ride straight down. Automated crash controls would kick in to shut down markets.
The next day the markets open and those automated trading platforms probably tank the market down to the crash control stop points within an hour or two. Repeat this for a couple days until they decide to keep the markets closed for good.
At some point panic sets in and people go and get cash out of the banks. Banks run out of available cash, resulting in runs on other banks and bank holidays.
Within a week or two, pure chaos sets in. Think “Patriots, The Coming Collapse” by Rawles. That sort of thing.
This is similar to the first one. The Euro bombs, and the impact is global. All the big boys are highly leveraged with derivatives and credit default swaps, which will completely flatten them in the case of a major currency default like that.
Money will flood into the US as quickly as possible. Rapid movement of money forces inflation through the roof. None of that helps the big banks resulting in a domino style impact to the rest of the country and the world.
Results? Probably similar to above
The Slow Burn
This is the painful one. National debt continues to roll up. Unemployment increases and businesses shut down. Government tries to step in, but they have to pay for it somehow. Cue printing presses.
Interest rates start moving up as bond rating agencies continue to tank the national credit rating. Things become more and more expensive. People put up with it as best they can but the impact hits close to home. Food becomes harder to find. Gas is expensive with all of the resulting trickle down effects.
Crime continues to move upwards, and even nice suburbs are no longer as safe as they were. Inner urban areas? Not a great plan. Police budgets are axed as cities struggle to pay for anything at all, which means that the cops aren’t coming for most crimes. And the criminals know that.
Things continue to unravel slowly but surely. People make do the best they can. Think the Great Depression for some hints.
This begins similar to the slow burn, but ends up rolling out of control much faster. Essentially the ramp is steeper.
Pretty soon paper money isn’t worth much, and the value drops weekly, then daily, then eventually hourly.
People try to convert that money into goods as soon as possible before the value goes down even farther. Employees begin insisting on more frequent pay cycles to help cope with the ever changing prices.
Eventually paper money isn’t worth anything and people use barter, metals, and other currencies.
Things unravel at a faster pace every day. This is Weimar Germany in modern times.
What’s My Prediction?
I don’t have one. I think some scenarios are more viable or likely than others, but I’m not going to try to guess what’s going to happen. The fundamental preparations for these things are pretty much the same in my mind, it’s just a question of how much time between the ‘signal’ and the ‘impact’ if you will.
I do believe that the farther the can gets kicked the worse the pain and impact will be. I also believe that the banks and other folks in upper echelons of world economics and politics are doing their best to get themselves positioned for a massive reset.
I wouldn’t be surprised if they caused it intentionally once they’ve decided they’ve stolen as much value from us as they possibly can. Besides, the sooner they crash the system, the faster they can start building it back up to do this all over again.
If we let them.