It’s not fun being a doomsayer. It really isn’t.
In spite of what some say, I’d much rather live in a world where the day-to-day struggles are easily manageable, the future looks exceptionally bright, and one can readily enjoy life’s simple pleasures — like the beautiful weather we are having in New York today — without having to worry about the system falling apart and crashing down on top of us.
But anyone who takes the time to carefully look around and analyze the situation can see that many of the excesses and imbalances that brought us to this point — and which inspired me to write my March 2007 book, Financial Armageddon — are still there.
While the government may have bought some time with its decision to abandon prudence and rationality and, instead, mortgage our children’s future to the hilt (mainly to help its powerful friends in the financial world), the problems have not gone away.
If anything, many of them have gotten a lot worse, suggesting the eventual fallout will be massive and far-reaching. Take, for example, the meltdown in municipal finances. According to a new report, "New Fiscal Year Brings No Relief From Unprecedented State Budget Problems," from the Center on Budget and Policy Priorities, a non-profit think tank, it seems that the worst is yet to come.
The unprecedented state fiscal problems brought on by the worst decline in tax receipts in decades show no signs of letting up. On July 1 — the start of the fiscal year in most states — an unusually high number of states were still struggling to adopt budgets for fiscal year 2010. Most states have adopted budgets that closed the shortfalls they faced with a combination of federal stimulus dollars, service reductions, revenue increases, and funds from reserves. But these budgets are already falling out of balance as the economy has caused state revenues to decline even more than projected. States will continue to struggle to find the revenue needed to support critical public services for a number of years.
The Center’s most recent survey of state
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Philip R. Davis is a founder Phil's Stock World, a stock and options trading site that teaches the art of options trading to newcomers and devises advanced strategies for expert traders...
Ilene is editor and affiliate program
coordinator for PSW.