Are we heading for disaster if our economy is mainly finance based?

Answer 1

People tend to point out that our manufacturing industry accounts for only ~13-18% of GDP, while leaving off the fact that this comes out to nearly $2 trillion/year.

So no, I don't think we're headed for disaster.

Answer 2

I suppose I am the only person who is going to answer, no.

First, the economy is mostly service based but not finance. There is little chance that it will become financed based.

If I had to guess the future is that the economy will become dominated by education, health and entertainment.

Declining manufactering does not mean we are headed for disaster.

Agriculture was the basis of all economies for thousands of years. Today it is only a few percent of the US economy. Still we are the largest exporter of food and there is certainly no shortage of food in the United States.

This is because modern farms are so productive that we require very few farmers.

In the future we expect the same thing to happen to manufactering, only a few people will work in manufactering but they will make tons of stuff.

Answer 3

I would think we could be heading for disaster being that we are a nation which is mainly finance based. Most peoples lives are just a vicious circle of debt where they get up in the morning, goto work to earn enough to pay the mortage, the car, the bank loan for that nice holiday in the summer, general living expenses which are far from cheap and supposed to have a life as well which I should think is near impossible. Our country, again is just repeating this, they borrow money then spend a lifetime paying it back, taxing us, the citizens huge rates in order to pay it back. If these companies responsible are in trouble they kindly pass that problem onto the customer by means of raising rates, prices for services and products. Obviously this can only go on for so long then it all starts to tumble and I for one beleive that we'll all go down because of it. Maybe not in the near future but it'll happen........

And may I say that I Myself am not a slave to the economy, I ive by my means, As i would say if it's not in the bank or in your pocket then you can't really afford it.

Answer 4

Heading? We're almost there!
We produce very little but consume a great deal. We outsourced our factory jobs to poor countries. Remember when everyone thought that was a smart idea? Cheaper products. Then they started outsourcing call centers. Then high-tech stuff and engineering. Remember Ross Perot's "Great Sucking Sound". Its here. The only thing that we are selling overseas right now is Debt Instruments like our Treasury Bonds which we will have to pay back in the future. Our one major export is war and aggression. Even that we are doing badly. Our troops should be winning but we are again losing the battle from the boardroom. If you don't think Iraq is Vietnam redux you better take a closer look at history. Afghanistan is going to play out for us the same as it did for the Soviets, the Brits, etc. Our soldiers win the battles but we lose the wars. Now we're hitting Somalia again. The bills are piling up by the billions of dollars.

One thing of note that I read the other day - There is a great public outcry about the obscene profits that oil companies are making. But the financial services giants like Goldman Sachs are making even more monsterous profits paying multi-million dollar bonuses to employees and there's not a peep from anyone! Notice the drop in oil - why on no news? Goldman readjusted one of their indexes and put less weight on oil - the price drops - same thing happened last August. Nice and quiet. Think Goldman had been shorting oil beforehand. You bet. Goldman is so entrenched into the current administration as to make you wonder who works for who. The problems in our economy go real deep and go back for many years. The Fed has been manipulating the system for too many years. The economy is not a machine that you can constantly tune. It will fight you back and that day of reckoning is coming. Maybe as soon as this summer. Watch the Dollar. Its dropping like a rock. There are now as many Euros in circulation as the dollar. There goes our status as the world's reserve currency. Watch gold its become a safe haven for capital flight. Its a sea-saw fight but the dollar is losing badly. Another thing to watch is called the VIX index. This measures the compacency of investors. Typically when it is very high things go very wrong. Its very high as people are feeling pretty sure of themselves. We're so close to the tipping point that one Sigma-10 level event is going to screw everything up big time. We're playing a heavy duty game of chicken in the Persian Gulf with a man know to be ready to die and let everyone in his country die for Islam while our own leadership thinks they're on a mission from god. If you want to see a little clearer what's going on I'll give you some links below. Some of it may sound extreme (not like neo-nazi extreme but out of the mainstream media) but take a good look around you. Its all sourced from the media with links. But its up to you to do your own Due Dilligence. Interesting times await us. Crisis and Danger = Opportunity. Good Luck!

Answer 5

Of course. But don't expect the oinkonomic parasites to admit it. Just make sure that, unlike the Depression, we confiscate all their wealth and property when their leeching causes a crash.

To prevent change that would keep the system going by changing it to production rather than parasitism, the fascists practice mind control. But first they have to humiliate people so that their patsies will worship them as extreme father-figures who can do anything they want to increase their wealth. The nonsense about "creating" jobs is the function of both a father and a god. Wimps glory in being dominated by such a Master.

Also, they create a designated dissent that is purposely disgusting to and contemptuous of the workers. These agents provocateurs run the government, which the parasites pretend to be the people's champions against, in Bad Cop, Good Cop playacting.

Wall Street parasitism is similar to a case where NFL players would get about 50K a year and all the money they produced would be leeched by bookies taking legal bets at the games.

Answer 6

because enron is the tip of the ice berg the mountain that was exposed was the vertical economy model that has no linnar traits, straight up (vertical economy)=the mega blocks of cash were riped off and stacked straight up on the profit schedules of the stock exchange~as the monster profits were not corporately held but were funneling in to privite accounts the system will fail from the lack of the employees making a living, sooner or later the message came through that the mexicans had to come here and replace us cause of the enormous needs to escape with the cash~the 911 thing had this mind set that it is everyman for them selves and the bail out was not going to come from the government for the middle east crises, the corporation and industrialists knew that the game had ended, and went all out to rape the system as fast as they could and leave the system because it wasn't going to be able to produce america and war with the same money, someone was going to be left out and war mongers addiction is priority over corporarte bail outs, so the think tanks scrambled to plan B and that was screw every body in america, cause that is their job, as soon as the message got out the people just stunned had no leadership anywhere to address the collapse of the fabric that made sense any more, all the hired politicans had agendas and quickly just played dumb and we will watch the latino dope runners come (walking~dog~home) over the border with no idea what happened but it is good for them, will tell u how bad it is when the land here no longer has a price tag u can afford, because they are first going to buy every car lot empty and then move to the land and housing, with their sub minimum wages, they took us back forty years to a time when these wages were for teen agers, the vaults are full to the brim with lies and cheats and big brothers think tank solutions, the more people coming over the border will artifically hold the prices too high, but that has nothing to do with how illegal it looks,they left the people of america with purse string cut and the ball game has changed and the think tanks sucks, but that is the business of givernment by and for the people as we delegated our representives with our lives to do what they felt best and they felt they should get their now and u can send more money when you figure out how, in the mean time try to learn spanish cause they (politican) are going to listen to us cause we lost our clout, if u haven't noticed, we probably lost it all tooo if you haven't noticed that either

Answer 7

I think so, currently only 13% of our economy is manufacturing based and about 30% finance, I think. I think it makes for long-term instability. Also, it causes an very unfair distribution of wealth in the country.

Answer 8

It depends on what you want to define as 'disaster' and for whom. Disaster for the average American worker - no doubt.
Disaster for the Big Corps and influence peddlers? - no way.
This country is losing a war it doesn't even know it is in.

Ironic that the Chinese have a saying:
"Unless you change your direction, you will likely end up where you are heading."

Answer 9

Not as long as people still need financial services.

One reason Britain resisted joining the Euro is that foreign exchange transactions (including sterling-to-euro) are a HUGE generator of revenue for the City of London. There is a massive flow of money into Britain from abroad thanks to our financial services industry.

All it then needs is for the 20% (say) of the population who actually MAKE anything to generate enough wealth - then what they have is spread around between all the people who sell them life insurance or issue their credit cards or whatever.

Answer 10

Absolutely. Ever since Margaret Thatcher and the Tories decimated our manufacturing base we have been living on borrowed time. And the population is too brainwashed to see it.