These 6 States Will Collapse During the Next Recession

Being on the hook is not going to be pretty when interest rates are raised back up, and debts come due. At a personal level, it will mean more stress and juggling to make ends meet. For the larger economy, it will mean cities and states unable to meet obligations or balance their budgets – ending in bankruptcy, and bailouts. Meanwhile, millions of people are relying on that money to keep coming in order to survive. Something is going to go very wrong.

Relying upon government to function and send you money is not a secure plan.

The mathematics are terrifying and dismal, and so is being caught up in these collapsing states.

In the next phase of the financial crisis, the debt supercycle will become the most defining feature of the big hurt that will fall on nearly everyone.

That’s the dire warning that Goldman Sachs issued about what they termed the Third Wave of the global collapse. But it hasn’t come, at least not yet:

This wave is characterised by rock-bottom commodities prices, stalling growth in China and other emerging-markets economies, and low global inflation, Goldman Sachs analysts led by Peter Oppenheimer said in a big-picture note.

This triple whammy has its roots in the response to the first two waves of crisis — the banking collapse and European sovereign-debt crisis — and it is all part of the so-called debt supercycle of the past few decades.

Unfunded liabilities for pensions and other state benefits are threatening the security and future of an entire generation of retiring, hardworking Americans.

The debt will be shifted for as long as possible… but eventually, someone will have to come to terms with it. The black hole totals up to huge sums of money; no one can pay; and the system is bankrupted, or services rendered become inadequate and farcical.

Forbes contributor William Baldwin describes the acute problem of “death spiral states,” which could actually be as bad as it sounds. It affects dozens of cities and municipalities as well.

Does your state have more takers than makers? Check it out.

California has a powerful economy, with 14 million private-sector jobs. It also has burdens: welfare recipients (12.6 million), generously paid government employees (2.1 million) and people collecting government pensions (1.3 million).

Add up the numbers. There are 114 clients drawing from the government for every 100 people chipping in by working outside the government and paying taxes. We’re calling this the Feedme Ratio. Six states have a number over 100.


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  • Howleyesque

    Somebody forgot to add Illinois to this list… it’s collapsing as I type this!

  • dcwc16

    The public employees and retirees think they will be taken care of (pension secure, pay above average) as they believe what the politicians and Union thugs tell them as they help destroy their own financial security by electing liberals. Eventually it will collapse and the taxes collected from the private sector will not cover the costs.

  • Vern Davis

    Hopefully the folks from CA jail all the politicians that caused this to happen!

  • Col. William Dexter

    Some cities will collapse, then some states, then the whole country, we have been hearing about this for many years, I started collecting articles about this problem when I saw a piece written by a financial “expert” that stated very clearly that the end will come this year, unfortunately he wrote this in 2011, and nothing much happened, but that didn’t stop him from re-publishing the exact same story in September of 2013. What about all the gloom & doom we were told about Jade Helm 15, especially that there would be a Jade Helm 16 this year, seems they have left that a bit late. Another hot topics is “will Trump fix the problem or make it worse, my take on this is, Trump will curb spending, reduce the size of the public service, including the military, maybe bail out a few cities that will default on their loans, but in 2024 when we wave goodbye to Trump, and welcome some new knight in shiny armour, hoping that he (or she) can fix our financial woes, and return America to its rightful place as leader of the free world and plenty of money and good times for everybody, it will be just another case of deja vu.
    The big bang theory, of going from what we have to nothing, overnight, isn’t going to happen, it is more likely that as our economy winds down, government downsizing everything, wage cuts for everybody, and one day we will start manufacturing again, maybe because we can’t afford the Chinese imported items that we have for 20 years thought were better than the “Made in USA” products.