Say Hi! to America’s latest product innovation. It’s called the New Economy and is being paraded, perhaps appropriately, along with a host of here-today-gone-tomorrow miniaturized electronic marvels. [That’s ‘built-in obsolescence’ for the uninitiated, the bedrock on which the modern global economy has been constructed and was, grandiloquently, predicted to last forever.]

The real economy was traded away for a make-believe substitute. When that collapsed, so did Americans’ wealth in their real estate, pensions, and savings. Their jobs started disappearing too.

Paul Craig Roberts, author of The Tyranny of Good Intentions, says the New Economy is based on services. "Its artificial life was fed by the Federal Reserve’s artificially low interest rates, which produced a real estate bubble, and by ‘free market’ financial deregulation, which unleashed financial gangsters to new heights of debt leverage and fraudulent financial products."

The debt economy caused Americans to leverage their assets. They maxed out numerous credit cards. They worked as many jobs as they could find. Debt expansion and multiple family incomes kept the economy going.

"And now suddenly Americans can’t borrow in order to spend. They are over their heads in debt. Jobs are disappearing," says Roberts. "America’s consumer economy, approximately 70% of GDP, is dead. Those Americans who still have jobs are saving against the prospect of job loss. Millions are homeless. Some have moved in with family and friends; others are living in tent cities. There is no economy left to recover."

The US government’s budget deficit has jumped from $455 billion in 2008 to $2,000 billion this year, with another $2,000 billion on the books for 2010. Oblivious to the reality, President Obama has intensified America’s expensive war of aggression in Afghanistan and initiated a new war in Pakistan.

There is no way for these deficits to be financed except by printing money. As dollars are printed, the growing supply adds to the pressure on the dollar’s role as reserve currency. Already America’s largest creditor, China, is lobbying for a new reserve currency to replace the dollar before it collapses.

Chalmers Johnson had this to say in Nemesis, published in 2006: "Regardless of who succeeds George W. Bush, the incumbent president will have to deal with an emboldened Pentagon, an engorged military-industrial complex, our empire of bases, and a fifty-year-old tradition of not revealing to the public what our military establishment costs or the kind of devastation it can inflict . . . The United States today, like the Roman Republic in the first century BC, is threatened by an out-of-control military-industrial complex and a huge secret government controlled exclusively by the president." [Obama, needless to say, is quite comfy with that exclusivity.]

The US government’s budget is 50% in the red. "That means half of every dollar the federal government spends must be borrowed or printed," says Roberts. "Because of the worldwide debacle caused by Wall Street’s financial gangsterism, the world needs its own money and hasn’t $2 trillion annually to lend to Washington."

With the King of Pop Michael Jackson’s passing, another fiction of America’s mega wealth was also laid to rest: even those living in gated mansions in LA are dying a little each day from debt stress, wrote Pam Martens in CounterPunch magazine. "A good chunk of the globe shares Michael Jackson’s lifestyle: too much spending, too little income, too much stress from worrying about it."

According to public documents, Jackson was believed to be paying 20 per cent debt interest on approximately $270 million in loans, or roughly $54 million per year, according to the New York Times. His income was far below that amount, thus leading him further and further into debt to continue debt-servicing.

"Looking at the photograph of the happy, bubbly face of the 11-year old Michael Jackson and the gaunt, stressed out face of the 50-year old Michael Jackson, I am haunted by what the faces of our grandchildren will look like when they’re 50 if we continue allowing our government to spend wildly beyond our means, including hundreds of billions to prop up zombie banks," mused Martens.

Noting that Jackson’s fortunes got an earnings bump from his death, she added, "The same fate does not await our national Treasury."

Matt Taibbi, writing in Rolling Stone, on ‘The Great American Bubble Machine’ said: "The basic scam in the Internet Age is pretty easy even for the financially illiterate to grasp. Companies that weren’t much more than pot-fueled ideas scrawled on napkins were taken public via IPOs, hyped in the media and sold to the public for megamillions. It was as if banks like Goldman were wrapping ribbons around watermelons, tossing them out of 50-story windows and opening the phones for bids. In this game you were a winner only if you took your money out before the melon hit the pavement."

For decades mortgage dealers insisted that home-buyers make a payment of 10 percent, show a steady income and good credit. "Then, at the dawn of the new millennium, they suddenly threw all that shit out the window and started writing mortgages on the backs of napkins to cocktail waitresses and ex-cons . . .".

And what caused the huge spike in oil prices? Take a wild guess, prompts Taibbi. "Obviously Goldman had help in turning the once-solid market into a speculative casino, and did it by persuading pension funds and other large institutional investors to invest in ‘oil futures’ — agreeing to buy oil at a certain price on a fixed date. The push transformed oil from a physical commodity, rigidly subject to supply and demand, into something to bet on, like a stock. Between 2003 and 2008, the amount of speculative money in commodities grew from $13 billion to $317 billion, an increase of 2,300 percent. By 2008, a barrel of oil was traded 27 times, on average, before it was actually delivered and consumed."

Arianna Huffington, having visited Pompeii recently, couldn’t help thinking of its people wiped out in 79 AD by a volcanic eruption – which naturally got her thinking a lot about present-day warning signs. "In the case of Pompeii, the warning signs included a severe earthquake in 62 AD, continued tremors over the ensuing years, springs and wells drying up, dogs running away, and birds no longer singing. And then the most obvious warning sign of all: columns of smoke belching out of Mount Vesuvius before the volcano blew its top, burying the city and its inhabitants under 60 feet of ash and volcanic rock."

But the warning tremors were dismissed as "not particularly alarming because they are frequent in Campania." There is currently plenty of alarming smoke pouring out of our economic Vesuvius, but it too is being dismissed, she noted with growing alarm.

"The biggest warning sign that the natural order of things has been disturbed is how many of the very people responsible for the economic collapse not only are still in power, but are still lining their pockets with outrageous windfalls - courtesy of the American taxpayer."

After the earthquake that severely damaged Pompeii in 62 AD, the first buildings reportedly repaired were Pompeii’s famous brothels. "The metaphor holds," noted Arianna, "only in 2009, we call them Goldman, AIG, Bank of America, and Citi. Though that is probably unfair."