Western Economic Crisis of 2026

2026 Western Economic Crisis
Historical Event
A homeless man on an abandoned city block in Brooklyn during the Western Economic Crisis in 2027
Event Summary
Date	2 Mar 2026 - 21 Oct 2029
Location	United States United Kingdom European Union Canada
Job Losses	49,232,104 (estimated)
Capital Loss	$9.2 trillion (estimated)
Outcomes	Collapse of Wells Fargo US sovereign debt default Rise of China as the world's number one economy Fall of the dollar as the world's reserve currency Great Southern Famine 2027 UK Homelessness Crisis 2028 Philadelphia Riots Third impeachment of President Donald J. Trump Rise to power of the Reform Party in the United Kingdom Exit of Poland and Bulgaria from the European Union IMF bailout of the US, UK, Canada and EU Beginning of austerity regimes in the US, UK, Canada and EU

The Western Economic Crisis of 2026 was a severe economic and financial crisis that affected most of North America and Europe during the late 2020s. The crisis began in the United States in March 2026, when a flurry of bank withdrawals from panicked customers led to a collapse of Wells Fargo & Co. In November 2026, the United States government defaulted on its sovereign debt for the first time in history, causing devaluation of the dollar followed by a massive crash in both the New York Stock Exchange and the NASDAQ. The financial contagion soon spread to several other countries, raising fears of a worldwide economic meltdown.

In the period between 1 January 2026 to 1 January 2028, the economies of the United States, United Kingdom, Canada, Republic of Ireland, Mexico, Argentina, Switzerland and the European Union all fell into recession. By the third quarter of 2028, the United States had lost its status as the world's leading economy to China.

At the height of the crisis in the US, more than 30 million people (or 22.7% of the population) in the American South suffered from food insecurity, leading to the Great Southern Famine. In 2028, widespread riots in Philadelphia resulted in the deaths of more than 2,000 people, leading to a declaration of martial law by the federal government.

In the UK, the inability of ordinary citizens to make rent or mortgage payments resulted in more than 2.5 million people (or 3.57% of the population) being rendered homeless, especially in the cities of Manchester, Glasgow and the southern parts of London.

"Decades from now, historians will look back on the Western Economic Crisis and place the blame on the disastrous trade policies of Donald J. Trump - and quite rightly so.

However, any sober evaluation of the global macroeconomic environment in the lead-up to the crisis will reveal that the US economy was, for decades, fueled almost exclusively by debt and asset bubbles. This was never going to be sustainable. The national debt was always a ticking time bomb, and it was a matter of time before it exploded spectacularly."

Keith Matsushita

Chief Economist, HSBC Bank

11 November 2033

In April 2029, the International Monetary Fund approved separate bailout packages for the US, UK, European Union and Canada. The total value of the bailouts was in excess of $30 trillion, with China, Japan, Singapore, Indonesia, Saudi Arabia, Oman and Qatar providing the majority of the funds. As a condition of the bailouts, each beneficiary country was required to sign a treaty committing to strict austerity measures until a certain amount of debt is fully repaid. Separately, China, Saudi Arabia, Oman, Kuwait and Brunei further extended bilateral loans to some of the affected countries, in exchange for significant concessions in the areas of trade, investment, technology and labor.