No one entered the temple yesterday and over-turned the tables of the moneychangers at Goldman, the Fed, or the ARMs dealers. The earth did not open and gobble up homeowners; nor did the Dow collapse, taking speculators and dreamers down with it.

A booming voice from Heaven was not heard straightening things out. "Now look what you've done," it might have said to the Bush administration.

Fire and brimstone did not rain down on the nation's Capitol...Wall Street...or even Hollywood, for that matter.

No, it was business as usual. And business as usual is confused...uncertain...nuanced and ambiguous.

Economists are beginning to take note of the housing slowdown, says Bloomberg. They now expect a "Slower US Growth Rate" for the year ahead...and maybe a rate cut, if things start to go bad in a major way.

Not so, says Investors Business Daily. Falling energy prices and rising stock prices dim prospects for a rate cut.

And who really knows? No one. It's all guesswork. And our guess is that Bloomberg will turn out to be more right than Investors Business Daily. The housing industry has underwritten consumer spending and GDP growth in the United States for the last five years. When the housing industry turns down...so do a lot of other things. Economists know this. They're betting - along with Alan Greenspan and real estate agents - that the correction in the housing market will take prices down less than two percent. We have watched the markets, the economy, and our fellow man long enough to know that anything is possible...but a decline of two percent seems like wishful thinking to us.

So, we leave that...and turn our attention to the big, wide world...and the vast panorama of history.

What are the serious challenges America faces?

'Terrorism!' comes the cry from the lumps.

Terrorists are a nuisance, not a menace. We can't think of a single major power...let alone a single empire...that was undone by terrorism.

But right now, the United States is spending a fortune on this nuisance. The total bill for the wars and occupations in Iraq and Afghanistan is expected to top $1 trillion. The whole business is no more than an invitation to squander money and lives in a campaign against nobody-who-really-counts...an invitation the Bush administration gladly accepted!

So, we ask again - what are the serious challenges faced by the U.S. Empire? Three stand out:

1) The empire is going broke
2) The empire is losing market share
3) The empire is running out of fuel

The first is no secret at all. The federal government is on the hook for some $55 to $65 trillion in expenses, beyond what it can reasonably expect in revenues.

There's nothing especially novel about this bankruptcy. Empires usually go broke...and then they collapse - or are destroyed by enemies. Military power follows economic power, at least in the modern world.

But why do thriving empires go bust? Why can't they make a profit in the empire business? Well, of course, at first they usually do. That's how they become great empires. Either by force of arms or force of commerce - usually both - they grow and expand. But there must be a flaw in the human character. Once it is set on course for expansion, it doesn't seem to know when to stop. More and more conquests lead to more and more battles...more territory to administer...and more military expenses. The United States now has more than 100 bases all over the world, and a military budget equal to that of all the rest of the world's nations combined.

Meanwhile, institutions age and wither like old trees. Gradually, they are taken over by parasites, freeloaders, and hustlers. In military matters, the defense establishment shifts from actually defending the nation...to expanding the empire...and then to expanding itself. Contractors grow fat and rich. Politics and profits dictate which weapons are put into service, not military necessities. Even wars are chosen for reasons other than their actual military benefits. Politicians need enemies. The military/industrial complex, as Eisenhower called it, needs a raison d'etre. The people themselves need to be scared and bullied into cooperating with the imperial agenda.

In the homeland, the mob of voters clamors for more protection, more benefits, more privileges and more entertainment. Gradually, old virtues of independence and thrift are swept away. Everyone comes to rely on the imperial state not only for handouts, but for emotional gratification. People cheer it on as if it were a sports team. Did the empire crush resistance in Baghdad? Hooray! Did it suffer a setback in Kabul? Well, no joy in Mudville.

George W. Bush is supposed to be a 'conservative' president, but he has actually expanded social spending programs more than any president in history. Like everything else, the old 'conservative' program has been corrupted by neo-conservative shills who serve the interests of the empire...along with their own interests, not those of the Old Republic.

Now there is no longer any major organized opposition to government spending. As a result, the nation is going broke.

But enough of this for one day...tomorrow, we take up the other major challenges America faces: losing market share...and running out of fuel.

Bill Bonner is the President of Agora Publishing.  For more on Bill Bonner, visit The Daily Reckoning.