Despite this, though, those who live within an empire often have a hard time recognizing this simple fact. In particular, many in the American empire, at least those at the heart of it, can't possibly imagine that it won't go on forever.
Well, Dmitri Davydov knows empires. And here he discusses the collapse of the Soviet Union, and compares and contrasts the situation in the United States (thanks to BC_Gold_Guy in this Kitco thread for the link):
I anticipate that some people will react rather badly to having their country compared to the USSR. I would like to assure you that the Soviet people would have reacted similarly, had the United States collapsed first. Feelings aside, here are two 20th century superpowers, who wanted more or less the same things – things like technological progress, economic growth, full employment, and world domination – but they disagreed about the methods. And they obtained similar results – each had a good run, intimidated the whole planet, and kept the other scared. Each eventually went bankrupt.There's a lot more, with nice PowerPoint style slides (rendered as embedded images so you don't need presentation software to view it, and can read the detailed commentary after each one). Definitely worth a look.
Turning to things that might help bring down the empire, there are reports that the Chinese government is ordering its financial institutions to stop lending money to their American counterparts. Then, not too long after those reports came out, there was a denial. Rather confusing; but then came a clarification:
Some Chinese banks have cut lending to foreign banks in China's interbank money market because of the global financial crisis, but trade continues and foreign banks remain able to operate, traders said on Thursday.
Dealers at over half a dozen Chinese and foreign institutions, who declined to be named because of the sensitivity of the issue, said U.S. and some other foreign banks were finding it harder to borrow from the market.
A number of Chinese banks have temporarily stopped offering new lending to U.S. banks in yuan and other currencies, because of uncertainty about risk, three traders said. Similar caution in lending has been seen in markets around the world.
"We have had difficulty borrowing money from Chinese banks since the start of this week," said a dealer at the branch of a U.S. bank in Shanghai.
However, he and others said U.S. institutions had not been completely cut off from access to funds.
So they're not forbidden to lend to American banks, but many of them seem to think it's a bad idea. I have a sneaking suspicion that their caution is quite justified. We've been hearing a lot about China's connection with the US (one of the posts that seem to lead a lot of people to this blog from search engines is this one, for instance), and they definitely hold a lot of American bonds, as do many other countries. Of course, they will take a hit themselves if there's a big selloff, and nobody wants to be the first country to start the dump, but once it starts it'll be like a stock market crash, but on a global scale.
Yes, we indeed live in interesting times.