There are many things that could collapse the house of cards, several countries are moving towards towards the pricing of oil in euro's as well as the potential to switch to the euro as a reserve currency.

All it would take is for a couple of large countries to stop buying our treasuries and other investment vehicles, worse yet start selling them. Currently we are paying them 3.5% (10 Yr bond) and devaluing the currency by 8% so they are losing money just holding our debt.

Luckily, most countries that this is the case still needs to keep us as customers or it would already be over. Hopefully as these countries buy up america, they will be less likely to collapse the economy.

>I've read several articles that point out that the potentially biggest shoe that could drop would be for the Chinese to change from pegging the Yuan to the dollar to pegging it to the Euro. It would basically be the final straw showing the lack of faith in the dollar in international markets.
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>>We will not officially know when the recession started (by technical definitions) until many months after it occurred, MANY smart people believe we are already in one. You obviously have an understanding of the markets and are doing due diligence in your stock selection, so you are likely to do OK, but MOST investors don't have a clue, and this type of market is dangerous for them. As for debasing the currency, not the best thing to hope for, but that is where they are taking it regardless.
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>>>Firstly, recession is not here (yet?).
>>>In regard to stock selection, P/E ratio should not be used as a primary factor in turbulent times. It should be replaced with Debt-to-Equity (low debt, to be simple) and Price-to-Book ratios. It ensures that business is durable and you buy it cheap. Low US dollar is the key ingredient indicating that US-based manufacturing stocks is the way to go, because every day of low dollar greatly increases their competitiveness on both international and domestic markets.
>>>In regard to customers: our big-heart government (regardless to party affiliation) will take care that rank-in-file customers will have enough paper to go shopping. It is a very easy and well-known technology, I mean printing.
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>>>>I agree there is value in individual well selected stocks, but you need to consider as we go into (are in) recession that multiples will contract as earnings decrease making the current P/E a less reliable indicator. The fact that many corporations are light on debt with strong balance sheets is one of the few things this economy has going for it, but as consumers pull back with the loss of wealth effect (housing & Stocks) and increasing costs (gas, food, borrowing) the corporations won't have enough customers to buy their products.
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>>>>Your posts remind me of a response I got a couple of months ago from Chris McCandless saying there was absolutely no reason to fear a recession, LOL