According to to the WSJ, Dr. Panarin, a Russian former KGB analyst, predicts that the US will disintegrate by summer of 2010. He actually made his prediction back in 1997 when this scenario really sounded ludicrous. Now its simply improbable!

Before you dismiss him as another crazy, check out his credentials. “Prof. Panarin, 50 years old, is not a fringe figure. A former KGB analyst, he is dean of the Russian Foreign Ministry’s academy for future diplomats. He is invited to Kremlin receptions, lectures students, publishes books, and appears in the media as an expert on U.S.-Russia relations.”

Here’s the gist of his argument:

Mr. Panarin posits, in brief, that mass immigration, economic decline, and moral degradation will trigger a civil war next fall and the collapse of the dollar.

He based the forecast on classified data supplied to him by FAPSI analysts, he says. He predicts that economic, financial and demographic trends will provoke a political and social crisis in the U.S. When the going gets tough, he says, wealthier states will withhold funds from the federal government and effectively secede from the union. Social unrest up to and including a civil war will follow. The U.S. will then split along ethnic lines, and foreign powers will move in.

California will form the nucleus of what he calls “The Californian Republic,” and will be part of China or under Chinese influence. Texas will be the heart of “The Texas Republic,” a cluster of states that will go to Mexico or fall under Mexican influence. Washington, D.C., and New York will be part of an “Atlantic America” that may join the European Union. Canada will grab a group of Northern states Prof. Panarin calls “The Central North American Republic.” Hawaii, he suggests, will be a protectorate of Japan or China, and Alaska will be subsumed into Russia.

Interest in his forecast revived this fall when he published an article in Izvestia, one of Russia’s biggest national dailies. In it, he reiterated his theory, called U.S. foreign debt “a pyramid scheme,” and predicted China and Russia would usurp Washington’s role as a global financial regulator.

Americans hope President-elect Barack Obama “can work miracles,” he wrote. “But when spring comes, it will be clear that there are no miracles.”

While I agree that the Federal Reserve is running the world’s largest Ponzi Scheme and that Obama may have a tough time working any miracles, I doubt that will necessarily result in complete disintegration of the US.

The US Dollar might lose its status as the world’s reserve currency and we might see a period of high inflation. The average American might also see a contraction in his or her standard of living, which is more of a regression back to living within one’s means since the days of excess spending are over. But so what if we become a little poorer or our standard of living drops a little. Poor people in the US still live better than poor people everywhere else.

And if, like Dick Cheney, you diversify your investment holdings into foreign currencies & bonds and buy some gold & silver coins you’ll be able to hedge yourself against any collapse in the US dollar or financial system.