Will the second half of 2012 bring another financial crisis and, with it, the end of our beloved American Dream?<\/p>\n
Americans are still struggling to recover from the last recession, and another financial crisis so soon could spell even more disaster for millions of people and the American Dream.\u00a0 The following reasons should have every American concerned about the second half of 2012.<\/p>\n
The GlobalEurope Anticipation Bulletin<\/a> <\/em>(GEAB), which provides independent, \u201cstate-of-the-art analyses\u201d of geo-political and financial situations from a European point-of-view, has issued a \u201cred alert\u201d for a \u201cGlobal Systemic Crisis in September-October 2012.\u201d GEAB warns that the red alert is real, and that the \u201ccomponents of the global situation are in fact pointed in a negative, even catastrophic direction.\u201d\u00a0 Additionally, they state that they have \u201cnever seen the chronological convergence of such a series of explosive and so (many) fundamental factors (economy, finances, geopolitical\u2026) since 2006.\u201d<\/p>\n Global lending is slowing, and credit is beginning to \u201cfreeze up.\u201d\u00a0 Both of these are occurring while McAfee and Guardian Analytics reports that millions of dollars are being pilfered from banks worldwide through cyber attacks<\/a>.\u00a0 \u201cCredit unions, large multinational banks and regional banks have all been attacked.\u201d\u00a0 Money is disappearing at alarming rates.\u00a0 What happens if all the money in the banks suddenly \u201cdisappears?\u201d<\/p>\n Bank runs in Europe are increasing, occurring daily across much of southern Europe.\u00a0 Most of the \u201csmart money\u201d is already writing off southern Europe<\/a>.\u00a0 A financial collapse there could trigger a destructive worldwide recession.<\/p>\n The U.S. banking system is deeply integrated with the European banking system. The Euro banks are in serious trouble<\/a>, and what happens in Europe and its banking system affects the U.S.\u00a0 JPMorgan\u2019s trading losses<\/a>, which are Euro-centered, could reach $9 billion dollars according to the New York Times, <\/em>and possibly require a bailout.<\/p>\n Derivatives.\u00a0 Moody\u2019s recently downgraded the credit ratings of 15 major banks around the world, and many of these banks will now be required to put up billions in additional collateral monies against derivatives exposures.\u00a0 The largest U.S. banks, including Citigroup and Morgan Stanley, have more than $200 trillion dollars of exposure to derivatives<\/a>.<\/p>\n Derivatives play a vital role in risk management of both financial and non-financial institutions globally.\u00a0 There is concern, however, that derivative market operations destabilize the efficiency of these markets, especially if derivative instruments are misused.\u00a0 Also, with the derivatives market beginning to show signs of fracturing, at some point this situation will become a major disaster.<\/p>\n America\u2019s middle class continues to be \u201cgutted.\u201d\u00a0 America once had the largest and most prosperous middle class in the history of the world.\u00a0 Today, millions of Americans are out of work and millions more have found themselves newly \u201crelocated\u201d from the middle class to the lower class.\u00a0 The American Dream is systematically being destroyed. <\/a> \u201cClose to half of all American workers are living month-to-month, and many American families have gone deep into debt as they struggle to pay the bills.\u00a0 Millions more are falling into poverty each year and dependence on the government is at an all-time high.\u201d<\/p>\n Scores of U.S. municipalities are on the verge of financial disaster or bankruptcy.\u00a0 Just last week, Stockton, California, became the largest U.S. city ever to declare bankruptcy. <\/a><\/p>\n Many small business owners across America are facing financial ruin. According to the Christian Science Monitor<\/a>, more than half of all small business owners in America cannot even afford to put food on the table from their earnings; and another survey<\/a> found that almost a quarter of all small business owners have gone an entire year without pay.\u00a0 And with the Supreme Court upholding Obamacare, many small business owners say that they may have to let workers go because they won\u2019t be able to afford to keep them under Obamacare.<\/p>\n Our country is being divided into \u201ctwo Americas<\/a>.\u201d\u00a0 \u201cThe richest one percent now owns over 36 percent of all the wealth in the United States. That’s more than the net worth of the bottom 95 percent combined. This one percent has pocketed almost all of the wealth gains of the last decade,\u201d says Chuck Collins of the Huffington Post<\/a>.\u00a0 It\u2019s becoming clear that the American Dream is quickly becoming the American Nightmare.<\/p>\n As the \u201crich get richer, and the poor get poorer,\u201d we\u2019re watching a slow-motion train wreck unfold that no one seems to know how to stop.\u00a0 Have we already passed the event horizon?<\/p>\n