Chance of a Depression Now 5 Percent

For 2-1/4 years now I have been saying that there is no chance of a repeat of the Great Depression or anything like it — that we know what to do and how to do it and will do it if things turn south.

I don’t think I can say that anymore. In my estimation the chances of another big downward shock to the U.S. economy — a shock that would carry us from the 1/3-of-a-Great-Depression we have now to 2/3 or more — are about 5%. And it now looks very much as if if such a shock hits the U.S. government will be unable to do a d—– thing