5, you need to know that it follows Stage 3, in which there is peace and prosperity and favorable debt and credit
conditions, and Stage 4, in which excess and decadence begin to bring about worse conditions. This process
culminates in the most difficult and painful stage—Stage 6—when the entity (country, state, city, company, or
person) runs out of money and there is typically terrible conflict in the form of revolution or civil war. Stage 5 is
the period during which the interclass tensions that go along with worsening financial conditions come to a head.
How different leaders, policy makers, and groups of people deal with conflict has a major impact on whether the
country will undergo the needed changes peacefully or violently.
You can see signs of this happening now in a number of countries. Those that have adequate financial conditions
(i.e., have incomes that are greater than their expenses and assets that are greater than their liabilities) are in
relatively good shape. Those that do not are in relatively bad shape. You can also see that these different conditions
are big drivers of the differences in what is now happening to most aspects of these countries, states, cities,
companies, and people—e.g., their education, healthcare, infrastructure, and well-being. You can also see big
cultural differences in how countries approach their stressful conditions, with some approaching them more
harmoniously than others who are more inclined to fight.
Because Stage 5 is such a pivotal stage in the internal cycle and because it’s the stage that many countries are now
facing, I will devote some time to going through the cause/effect relationships at play during it and the key
indicators to watch in examining its progression. Then I will turn more specifically to where the United States
stands and how it might best handle its internal conflicts.