On Tuesday, Federal Reserve Chairman Ben Bernanke gave America a double dose of courage. He said the recession might end this year, and that regulators are not planning to nationalize banks.

It was enough to halt the stock market’s drastic losing streak—at least for a day.

But don’t be fooled by Bernanke’s hopeful prediction. After all, it is his job to talk up the economy.

On Wednesday, MarketWatch reported:

Bernanke tried to assure Congress and investors that federal regulators are not grasping at straws in the response to the financial crisis.”We’re not making it up,” Bernanke told the House Financial Services panel.”We’re working along a program that has been applied in various contexts,” he said. “We’re not completely in the dark.”

How should Bernanke’s assurances really be translated? According to economic analyst Mike Shedlock:

“We’re making it up as we go along.””We have no idea what we are doing so the program changes every day.””We are completely in the dark.”

The plain truth is that the economy is in far worse shape than policy makers admit. And America is clearly on the road to another Great Depression.

“There will be blood” is how the Globe and Mail sums up financial historian Niall Ferguson’s view of the global economic condition. In sharp contrast to Bernanke, Ferguson claims that based both on current conditions and historical, pre-war precedents, America is in for a long, difficult and violent road ahead.

Asked why so many government experts predict a quick return to normality, Ferguson told the Globe and Mail (emphasis ours throughout):

One possibility is that they don’t believe these numbers either. They feel that it’s good for morale. … We’re dealing with real people whose emotions influence their individual decisions, and the swing from greed to fear is a very spectacular thing when it happens on this scale.One possibility is that policy makers are lying in order to encourage people and prevent depression from become a self-fulfilling psychological conditions. … Maybe they don’t really believe this, but they’re saying it in order to cheer people up, and if they’re sufficiently consistent, perhaps people will start to believe it, and then it will magically happen.

But the biggest reason many so-called experts have erroneously and consistently predicted the imminent end of the economic crisis is that they base their estimates on simplistic models that “don’t really correspond to the real world,” according to the Harvard professor:

I mean most of these models, including, I’m told, the one that policy makers here use, don’t really have enough data to be illuminating …. You’re going to end up assuming that this recession is going to end up like other recessions, and the other recessions didn’t last that long, so this one won’t last so long. But of course this isn’t a recession. This is something really quite different in character from anything we’ve experienced in the postwar era. That’s why these projections give positive numbers for 2010. That’s the default setting. And it just seems to me ostrich-like, to bury one’s head in the sand and assume this has to end this year because, well, that’s what recessions do.It’s obvious, surely we know by now, that this is something quite different. It’s a crisis of excessive debt, the deleveraging process has barely begun, the U.S. consumers are not going to suddenly bounce back and hit the shopping malls just because they get a tax cut. The savings rate is going to continue to rise. These processes have tremendous momentum that quite clearly differentiates them from anything that we’ve seen, including the early ’80s, including ’73, ’74, ’75. Those big crises, the ones that we have lived through, were bad. But seems certain to be deeper, and more protracted.

Now that the made-in-America crisis has gone global, Ferguson, who is author of The Ascent of Money: A Financial History of the World, says conditions are especially dangerous. Countries are experiencing double-digit drops in exports, “depression-style contraction,” and the world is still in the “early stages of the game at this point.”

Trade wars and a revival of protectionism threaten. The system is “fragile” and “there is a real danger that globalization could unravel,” he says.

There will be blood, in the sense that a crisis of this magnitude is bound to increase political as well as economic [conflict]. It is bound to destabilize some countries. It will cause civil wars to break out, that have been dormant. It will topple governments that were moderate and bring in governments that are extreme. These things are pretty predictable. The question is whether the general destabilization … ultimately leads to something really big in the realm of geopolitics.

Be careful who you listen to. There are voices out there saying the worst is over. But among those analysts who saw and warned that this economic crisis was coming—like Peter Schiff, Noureil Roubini, Marc Faber, Bill Bonner, Richard Daughty and Mike Shedlock—the consensus seems to indicate that much worse is on the way. And that view supports Bible prophecy. Request a free copy of Herbert W. Armstrong’s book The United States and Britain in Prophecy for an in-depth study of those prophecies that are even now being fulfilled.