It's unlikely that the US will ever really default in the near future. Why ? Well, the global economy is becoming more and more linked as time passes. A US default will trigger a collapse in the larger global financial markets. Do US creditors want this ? Nope. They'll just keep extending deadlines but of course this charade can only last for a certain amount of time. Personally, I think the collapse will not come from a US default but due to this bubble over extending itself and eventually popping in a Lehman'esque style.
An example of this is how last year India (a developing country, although with a rather large GDP) donated money to the European Union in the form of an economic stimulus, basically to prevent a default. The reason was simple, an unstable european market hurts growth prospects worldwide. There's a saying in India "When Wall Street sneezes the Indian markets catch a cold". An increasingly linked global economy puts economic stability at #1 on everyone's agenda. Of course, this is great for the US because they can wage wars, etc. etc. while taking on unlimited debt and no one wants to lift a finger (militarily, they can't - economically, they can't either because of the repercussions). Of course the bubble will pop at some point. We don't know when, though.
Just wondering what a crash of that magnitude would do to a city like Bangalore.
Big IT shops will shut down most of their operation. Several hundreds of thousands of people will lose jobs. They in turn will default on their loans. For those who don't know the real estate scenario in Bangalore, these days even mediocre 2BHK flats sell for >65 lacs. People who are in neck deep in debt, will default. Big real estate projects(which are a common place in Bangalore today) and even small time real estate builders will crash and burn. The lenders to those builders will in turn crash and burn.
A lot of bad blood will be eliminated and won't be able to come back for years.
But I think it will ultimately do good for IT community as a whole. The current scenario is full of super idiots powered by dirtiest form of politics climbing the corporate hierarchies and building their real estate wealth with that money and position.
I'll join you in the prayer too. But be very aware of the fact that once the investors and companies are off, even the bright ones around will have a tough time. IT(sic) would take a lot of time to stabilize in India.
My friend, it's not that easy. The guys who have already made it big (those in top management) have a great deal of financial security built up for themselves. The unfortunate ones would be the 'supposedly' good folks who have only been slogging while making those fat fellows richer. Now, again, much of the wealth and means of production is with the erstwhile PHBs. And now, they would have even better control on things as they won't have an organization to report to but can call shots by starting their own companies. And the 'good folks' will have nowhere to go but those firms, casue the other bigger/better ones are all gone by now. In such a situation, who do you think would still get jacked?
>>The guys who have already made it big (those in top management) have a great deal of financial security built up for themselves.
Not really, I agree for people at VP levels etc. But you could count these people in numbers of 10's.
Most people are neck deep in debt and lifestyle expenses. These are middle management layers. And I have no sympathy for them.
The most unfortunate ones will be guys who are not productive, who don't read or learn often and just don't have the appetite or the curiosity to work on difficult projects and build something of value. These are basically people who pick up programming because some one told them there is good money in it. And now the only way they can make it to the top is either by job hopping or doing all kinds of politics.
Either way with the growing start up community in Bangalore and what I have seen when it comes to meritocracy, its already becoming a trend that good people leave to either start up on their own, or help others.
An example of this is how last year India (a developing country, although with a rather large GDP) donated money to the European Union in the form of an economic stimulus, basically to prevent a default. The reason was simple, an unstable european market hurts growth prospects worldwide. There's a saying in India "When Wall Street sneezes the Indian markets catch a cold". An increasingly linked global economy puts economic stability at #1 on everyone's agenda. Of course, this is great for the US because they can wage wars, etc. etc. while taking on unlimited debt and no one wants to lift a finger (militarily, they can't - economically, they can't either because of the repercussions). Of course the bubble will pop at some point. We don't know when, though.