The following forecasts are based on current analysis of economic trends coupled with political data that is showing that free market capitalism will continue to be bailed out by the shadow socialistic nanny state.Not a True Free Market SystemEveryone loves the free market system until they get burned and lose money. The U.S. will continue the use of socialism to bail out financial mistakes made in the free market in the coming years. The irony is China has become more capitalistic than America in recent years, they also have to placate the masses or answer to billions in the riot mode.Massive Bailout Not WorkingThe massive capital infusions that the federal government is using to solve America’s financial crisis is obviously not working and is equivalent to giving heroin to an addict. Cash infusions are only temporary fixes to our nations economic problems. In the long run the federal bailout only serves to further enslave the American public financially. The American economic empire is a financial house of cards teetering on the brink of collapse. A stiff wind and it could all go up in smoke.New Sub-prime Crisis on the WayThere will be more foreclosures in the not to distant future because the adjustable rate mortgages that were sold to prospective buyers with the use of low teaser interest rates allowed homeowners to buy more expensive homes than they could afford. These ARM’s are starting to change now to more expensive mortgages while people are being laid off or stuck in jobs that do not have raises built in. Thus mortgages that are now not very affordable. This implosion in the housing industry is going to present a serious problem to the housing market in the near future. There will be more defaults and foreclosures in the future.Deflation Giving Way to HyperinflationThe economic trend will be fueled by inflation with slight returns to deflation until around 2013 when a real concern will occur when the dollar loses its status as the global reserve currency. When this happens foreign dollar holdings will come flooding back into the national economy. This dramatic increase in the national money supply will trigger hyperinflation making those on fixed incomes and the working poor more unable to afford living expenses in the coming double digit recession.The 180 Trillion U.S. Derivatives MarketWhen U.S. banks want to gamble with your money they use high powered financial instruments, including foreign exchange contracts, interest rate contracts, equity linked contracts, and commodity contracts. These insurance contracts are called derivatives. Warren Buffet, one of the world’s most wealthy men, has another name for them, “weapons of mass destruction.” Credit default swaps are the most widely traded form of derivatives. There are over $62 trillion of these in existence. The total has it at $180 trillion owned by U.S. banks alone. There is over $500 trillion of derivatives that exist globally. When you consider that the entire world’s annual GDP is only $60 trillion, the problem becomes crystal clear. American banks hold three times the amount of the entire world’s GDP in the from of derivatives.Structural Problems Being IgnoredWith band aid patch answers and the true structural problems being white washed or completely ignored, the trillion dollar derivative market will start to break down. When this finally happens, somewhere after 2013, this will make the mortgage crisis look like a schoolyard picnic.Calls of Sacrifice Will EmergeAfter 60 years of consuming like mad and surviving on debt through credit cards and the like, the American consumption party will come to an end. When America’s credit induced hangover finally arrives, economic sacrifice will be the only available option. This constraint on mindless and needless consumer buying will be a huge inconvenience for most of the working class. The new generation X that has never been asked to sacrifice anything for anyone, has always had access to immediate gratification through credit cards, will be the ones that will most likely either buckle up for the long lean ride or come completely unglued when they are told they have to sacrifice. How these Americans adjust to the coming required years of forced austerity will directly determine Americas viability to exist peacefully in the coming years of the 21st century.