Doomsayers see disaster in debt

Doom and gloom, as the fashionistas might conclude, seems to be the new black. And the natural accessory, of course, is anxiety.

"Nothing is solved in this crisis," declared Marc Faber, a contrarian investor who writes a monthly newsletter, The Gloom, Boom & Doom Report.

"The government uses this crisis to expand like a cancer," said Faber, who spoke earlier this month on an economic panel at a meeting of the Chartered Financial Analysts Society of Detroit. He told the audience of money managers, financial professionals and their clients that there is no means of avoiding a final collapse of a boom that's brought about by a credit expansion.

Faber predicts that the United States is ultimately heading for hyperinflation, where the dollar ends up worth very little.

Kevin K. Yousif, president of the CFA Society of Detroit, and other advisers say the worst appears to be over.

"We're not at the brink like we were a year ago," said Christopher Ruth, chief investment officer for Comerica Asset Management.

Even so, Ruth acknowledged that rational people are alarmed these days when it comes to local, state and federal government budgets as they see deficits grow.

David L. Littmann, senior economist with the Mackinac Center for Public Policy, a research and educational institute in Midland, Mich., stressed again that Michigan isn't just dealing with the aftermath of a recession; auto manufacturing is in a secular decline.

Litttmann, who also spoke on the economic panel for the Detroit analysts group, said Lansing's policies of "tax, spend, subsidize and regulate" won't help matters.

Ruth noted that the lack of faith in government is one reason gold prices -- and doom and gloom scenarios -- are soaring.