Does Rubin’s 1987 Black Monday Warning Deserve Our Attention?

EDITOR'S NOTES

Robert Rubin, one of the old titans of finance, just dropped a warning bomb so loud it should have echoed across every trading floor and government office in America. But did anyone listen? Probably not. I’ve combed through his recent CNBC appearance, and let me tell you — there’s plenty of noise out there, but Rubin’s words cut through the fog. In this piece, I highlight the few truths he told that align with what many of us already know: the debt is out of control, the government is flying blind, and the market’s sleepwalking into disaster.

Derek Wolfe Dec 8, 25

Remember October 1987 — Because We’re Ignoring All the Same Red Flags

Rubin’s insistence on remembering October 19, 1987, isn’t just nostalgia — it’s a flashing red light. Black Monday didn’t need a catalyst. It was the result of systemic pressure, blind faith, and mass complacency. Sound familiar?

Today’s markets are doing the same dance. High-frequency trades, blind money pouring into AI, valuations untethered from reality — all while the foundations of the economy rot beneath us. Rubin’s warning isn’t theoretical. It’s historical — and we’re repeating it, step by stupid step.

The Debt Is Not Just High — It’s Unsustainable

Rubin’s focus on debt-to-GDP levels is one of the few honest assessments we’ve heard from a former insider. The Congressional Budget Office puts it at around 100%. Rubin says that’s laughably optimistic — Yale’s Budget Lab estimates 130–140%. That’s banana republic territory.

You can’t spend like a drunken empire forever. Eventually, the bill comes due. But instead of reform, our political class keeps hitting the debt pipe and praying for another miracle — maybe another war, maybe another bubble.

We’re Already Seeing the Consequences — Even If the Media Won’t Admit It

Rubin points out that we’re already seeing the early symptoms of debt toxicity: weakened public investment, weakened national security budgets, and rising interest rates.

He’s right. But here’s what he doesn’t say: it’s intentional. Starving public infrastructure while propping up corporate welfare is policy — not accident. And interest rate manipulation? That’s the Federal Reserve squeezing the middle class to keep the Ponzi scheme from collapsing.

The Political System Is Utterly Paralyzed

Rubin laments that Washington can’t deal with debt, AI, or anything of consequence. No argument here. The government’s operating like a failed startup with no product, no plan, and too many lobbyists.

And when Rubin says the system won’t act until it’s too late — he’s not being cynical. He’s being accurate. Politicians don’t solve problems. They ride them until the crash.

Inflating Our Way Out? That’s a Knife in the Back of Every Saver

Rubin fears that the government will try to monetize the debt — basically printing money to buy bonds and keep the illusion alive. I share that fear. Because when they do, it’s not the hedge funds or government contractors who suffer. It’s you. Your savings, your retirement, your purchasing power.

And remember: inflation isn’t just a tax — it’s a theft. Quiet, legal, devastating.

AI Is Just a Distraction from the Real Fire

Rubin mentions AI, but doesn’t let it distract him. Good. It’s a sideshow. Yes, AI will disrupt jobs. Yes, there’s a bubble forming. But the real crisis isn’t innovation — it’s insolvency.

The tech giants can take a hit. But when Uncle Sam’s IOUs become worthless, everyone takes a hit. Especially those without offshore accounts and lobbyists on speed dial.

No, We Won’t Grow Our Way Out of This

Rubin crushes the fantasy that we can “grow” our way out of this debt. That would require growth rates unseen in modern history. The math just doesn’t work. What we need is discipline. What we have is dysfunction.

He suggests a mix of tax hikes and spending cuts — fine. But let’s be honest: this system can’t even pass a budget, let alone make sacrifices.

Conclusion: Complacency Is the Real Killer

Rubin’s final words — “it will all matter when it does” — are haunting. Because that’s how every crash works. It doesn’t matter until it really matters. And by then, the exits are jammed, the assets are frozen, and the public is left holding the bag — again.

If you think this is alarmist, go read a history book. Better yet, read your brokerage statement after the next “event.” We are sitting on a powder keg of debt, delusion, and digital distraction — and nobody in charge is even pretending to have a plan.

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