The end result of the global economic slowdown may be the U.S. announcing national bankruptcy as the government cannot afford the bailouts that it promised and the market will not bail out the government, Martin Hennecke, senior manager of private clients at Tyche, told CNBC on Thursday.
"We expect a depression in the United States. We expect a depression, very possibly, also in Europe," Hennecke said on "Worldwide Exchange."
"We already have $3 trillion of debt, as far as the U.S. government is concerned. These debt figures across the U.S. economy are rising very sharply."
When the government can no longer pass the United States' "immense debt" on to taxpayers, it will turn to the holders of U.S. dollars, leading to the eventual downfall of the currency, Hennecke said.
"Definitely, it (the dollar) is not a safe place to be invested in, as real inflation is closer to 10 or 11 percent than the actual inflation numbers given by the U.S. government," Hennecke said on "Worldwide Exchange".
Bailing out every industry and company that is in trouble will have consequences. Everyone is running for a handout. Every industry is too big too fail. But there can only be so much propping up until everything comes crashing down. CEOs and executives can basically bankrupt a company but if they are too big too fail they get a nice severance package as the public is forced to pick up the pieces. People who should be jailed or shunned are instead rewarded handsomely.
We already expect next year through 2010 already looks to be a troubling time, and this analysis sounds like it will be even worse than many expect.