Risk Of Future Upheaval In The U.S. Financial System

As seen in various surveys, market commentary, speeches, and risk indicators the nearly universal consensus among investors, government officials, and other observers is that the U.S. economy is (very) strong and the level of risk in the U.S. economy and financial system is (very) low.  Furthermore, this consensus viewpoint is that future prospects of substantial economic weakness and/or future upheaval in the stock market and other financial markets remains very low.

There are various indications – many of which have been discussed on this site – that this very widely-held consensus is substantially incorrect.  The level and manner of financial and economic activity continues to be accompanied by many highly problematical financial conditions, some of which have grown in severity.

From an “all things considered” standpoint, I continue to believe the overall level of risk is at a fantastic level, one that is far greater than that experienced at any time in the history of the United States.

These highly problematical conditions will lead to future upheaval.  The resolution of these problematical conditions will determine the ongoing viability of the financial system and economy as well as the accompanying quality of living.

As I have previously written in “The U.S. Economic Situation” updates:

My analyses continues to indicate that the growing level of financial danger will lead to the next stock market crash that will also involve (as seen in 2008) various other markets as well.  Key attributes of this next crash is its outsized magnitude (when viewed from an ultra-long term historical perspective) and the resulting economic impact.  This next financial crash is of tremendous concern, as my analyses indicate it will lead to a Super Depression – i.e. an economy characterized by deeply embedded, highly complex, and difficult-to-solve problems.


The Special Note summarizes my overall thoughts about our economic situation

SPX at 2770.72 as this post is written