“How did you go bankrupt?” Bill asked.
“Two ways,” Mike said. “Gradually and then suddenly.”
The dialogue above is from Ernest Hemingway’s 1926 novel, The Sun Also Rises.
It’s often attributed to Mark Twain or F. Scott Fitzgerald, or misquoted as something like “At first you go bankrupt slowly, then all at once.” But the theme is the same.
Nations go bankrupt in the same way. Banking collapses occur in the same way. Currency crises strike in the same way. They all happen gradually… and then suddenly. Sometimes overnight.
History is generous with examples of entire nations that have suffered this fate, from the collapse of the Soviet Union in 1991 to Argentina’s millennial financial crisis in 2001.
The warning signs are always there, even at the beginning. Over a period of years, sometimes decades, a tiny trickle of warning signs turns into a steady stream… and eventually a great flood.
The United States is clearly within this model, somewhere between a steady stream and a great flood. It shows.
Last night, after more than two weeks of utterly embarrassing theater, the government in the Land of the Free inked a deal to kick the can down the road a few more months. And in doing so, they set a very dangerous precedent.
As part of the bargain codified in HR 2775 (which President Obama signed into law), the Treasury Department is authorized to SUSPEND the debt ceiling. In other words, for all intents and purposes, there is now NO LIMIT government borrowing.
This limitless borrowing authority will expire on February 7, 2014. But it sets the precedent that dismissing the debt ceiling is a perfectly viable course of action.
Congress has effectively removed their handcuffs… so you can almost assuredly bet down the road that this provision will be extended, and ultimately become permanent.
No one in the Land of the Free seems to care. But foreigners do. The lead commentary out of China’s state media the other day was very clear in its position:
“It is perhaps a good time for the befuddled world to start considering building a de-Americanized world.”
America’s dominance is coming to an end. Nearly every piece of objective evidence points to this conclusion– from the US government’s absurdly unsustainable finances to the worldwide backlash against their desperate spying tactics.
For several years now, this decline has been happening gradually. But we are quickly reaching the bifurcation point where the steady stream of warning signs will turn into an epic flood of consequences.
As these events unfold, this will become the biggest story of our time. The end of the US dollar hegemony will affect nearly every human being on the planet. And if history is any guide, what follows will be incredibly tumultuous.
The answer depends on what kind of person you are: would you rather be a year early or a day late?
If you agree with this premise and can see the obvious writing on the wall, one thing that’s absolutely critical is to have the right information about the solutions. And there are solutions.
For example, moving a portion of your savings to a safe, stable bank overseas gets your money out of a dying currency and declining country, away from the thieving bureaucrats in your home country.
And this is something that makes sense, no matter what. Even if nothing ‘bad’ ever happens, you won’t be worse off for having some savings in a strong bank overseas.
This is an incredibly sensible, simple step to take. But it’s imperative to have the right intelligence on how to begin. Where to go? Which bank? Who to contact?
Sovereign Man’s Offshore Insider: Starter Edition contains the most critical information and contacts you need to know to start taking action today, distilling years of my own personal experience and contacts into one low-cost action kit.
A small effort right now can make the difference between prosperity and despair down the road.
These are rational steps that prudent people that have seen the writing on the wall have been taking for centuries. I encourage you to take action now and be on the right side of history.