Is it economically possible for the U.S. financial system to collapse?
Answer by Nate Anderson:
Keep in mind that the U.S. Federal Government by all practical measures is completely bankrupt. There is over $17 trillion in, an annual deficit of about $1 trillion, and liabilities ( , / , prescription drug plans) totaling well north of $50 trillion.
The only thing keeping the U.S. afloat is the perception that its greatest export, the, still has value.
Unfortunately, we have been systematically destroying that value through programs like, which produced over $3 trillion of . We have more than tripled the base in a period of about 5 years:
The good news is that we are still the world's, but as history has shown, that can change quickly with rather disastrous results for an economy.
To answer your question directly, just as the U.S. financial system rose, it is possible (and inevitable) that it will someday collapse. I just hope that day is later rather than sooner!