Are you scared yet? . . .Why not?

Downsized: Global financial assets (stocks, bonds, used bikes...) lost at least $50 trillion in 2008, an amount equal to an entire year's global output in goods and services.

Thought Experiment: The current economic crisis seems intractable, with no easy solution in view. Think how much harder solving the economic crisis will be after the global food system collapses; for food is but petroleum converted to carbohydrates, protein and fat through the catalytic application of credit.

Downturn, Recession, or Collapse?

The economy will be in shambles throughout 2009 -- and, for that matter, probably well beyond. Source = Warren Buffett, Republican billionaire investor

The turbulence is actually more severe than during the Great Depression, comparing the current situation to the demise of the Soviet Union. Source = George Soros, Democrat billionaire investor

The global economy may be deteriorating even more precipitously than it did during the Great Depression. Source = Paul Volker, former Federal Reserve Chair under Democrat President Carter and under Republican President Reagan, and current economic advisor to President Obama

The late Rudi Dornbsuch of MIT knew a huge amount about financial crisis, and could distill a lifetime of study and involvement in collapses succinctly: “it always takes longer than you think; but when it happens, it always happens faster than you can imagine.” Source

BREAKING NEWS: Factory output is collapsing at the fastest pace everywhere. The figures for the most recent month available are, year-on-year: Taiwan (-43pc), Ukraine (-34pc), Japan (-30pc), Singapore (-29pc), Hungary (-23pc), Sweden (-20pc), Korea (-19pc), Turkey (-18pc), Russia (-16pc), Spain (-15pc), Poland (-15pc), Brazil (-15pc), Italy (-14pc), Germany (-12pc), France (-11pc), US (-10pc) and Britain (-9pc). Norway sails blissfully on (+4pc). What do they drink up there?

This terrifying fall has been concentrated in the last five months. The job slaughter has barely begun. Social mayhem comes with a 12-month lag. By comparison, industrial output in core-Europe fell 2.8pc in 1930, 5.1pc in 1931 and 3.9pc in 1932, according to RBS.

Stephen Lewis, from Monument Securities, says we have been lulled into a false sense of security by the lack of "soup kitchens". The visual cues from Steinbeck's America are missing. "The temptation for investors is to see this as just another recession, over by the end of the year. But this is not a normal cycle. It is a cataclysmic structural breakdown," he said. Source

UK: the next Iceland?

The top five U.K. banks have $10 trillion of [debt] assets and their [UK] GDP is only $2.13 trillion. The whole country could fall into the ocean. The top five U.S. banks [debt assets] represent only about 60 percent of GDP by comparison. Source

What is the capital of Iceland?
Answer: $25

"asking an economist to predict the future is like asking the Christmas turkey what's for dinner on Christmas: based on its entire lifetime of experience, the turkey expects to be fed on Christmas, not to be eaten. As far as the turkey is concerned, Christmas is a black swan-type event." Source: Taleb