Jay Midnyte

In the video below, Gerald Celente, the world's #1 trends forecaster, predicts the "worst U.S. economic collapse ever."

RT: How would you define the economic trend that you have forecasted for 2009?

G.C.: We’re going to see the economic collapse the likes of which the world has never seen before. It’s not only in the United States; it’s going global. At the end of 2008 we saw Christmas retail sales: women’s apparel down 23%; home furnishings and electronics off 27%; luxury items down 35%. These are Depression Era collapses. We saw major bankruptcies, such as retailers Circuit City and Linens and Things. One bankruptcy after another. Then we saw store closings. Starbucks, Home D&D Power and down the line.

The question becomes who is going to take all of the vacant retail space? Who is going to rent it? The answer is – nobody. Now we look at the financial collapse in 2008, we saw the Merrill Lynch mob go under the bed and the Lehman boys went bankrupt. You saw bond companies, brokerage firms, and banks go belly up. Who is going to rent all the vacant commercial business space that they used to occupy? The answer is – nobody. The commercial real estate collapse that’s going to happen in 2009 is going to dwarf the residential real estate collapse. (Read more...)

Gerald Celente made this bold forecast in February of 2009. In 2009, we've witnessed the failure of 84 banks, with Colonial BancGroup Inc as the largest United States bank failure this year and 6th largest of all time.

In the future, 2009 will look like a relatively quiet year in terms of the mortgage collapse compared to 2008 where subprime mortgages caused the banking collapse that led to over $1 trillion in bailouts (not including the trillions of dollars allocated to providing liquidity in the credit markets). See graph below:



Combining the current record delinquency rates in the mortgage industry with an increasing rate of resets for those who took teaser rates to buy a house, 2010 and 2011 might easily produce 1000 bank failures as predicted by Torrance Stephens. The graph below is scary:



The graph shows the next wave of resets to hit are in the option adjustable rate mortgages and Alt-A mortgages. Business Week calls Option ARM mortgages "the riskiest and most complicated home loan product ever created." Brokers received bonuses to tease consumers with low minimum payments that are scheduled to reset to much higher payment schedules. Refinancing these loans is extremely difficult because there are expensive penalties. How can a consumer refinance when their home equity vanishes as suddenly as it did in 2008 while the cost of food and energy increases? Now combine the Option ARM collapse with the Alt-A massive resets occurring at the same time!



Based on the information on the troubled real estate economy, this depression could last 5-10 years easily, if the whole U.S. economy doesn't suffer a sudden collapse due to the dollar crisis. Not to mention the commercial real estate collapse, a $1,000,000,000,000 healthcare reform, and perpetual U.S. military action abroad, the media propaganda would have one think the economy is well on the path to the old days of prosperity and economic growth!

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