MOSCOW -- For a decade, Russian academic Igor Panarin has been predicting the U.S. will fall apart in 2010. For most of that time, he admits, few took his argument -- that an economic and moral collapse will trigger a civil war and the eventual breakup of the U.S. -- very seriously. Now he's found an eager audience: Russian state media.

In recent weeks, he's been interviewed as much as twice a day about his predictions. "It's a record," says Prof. Panarin. "But I think the attention is going to grow even stronger."

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.

But it's his bleak forecast for the U.S. that is music to the ears of the Kremlin, which in recent years has blamed Washington for everything from instability in the Middle East to the global financial crisis. Mr. Panarin's views also fit neatly with the Kremlin's narrative that Russia is returning to its rightful place on the world stage after the weakness of the 1990s, when many feared that the country would go economically and politically bankrupt and break into separate territories.

Crisis denialists are still around but are slowly and grudgingly giving way to the reality that global capitalism is in serious crisis as recession lurches toward depression in a continuing downward spiral.

Nearly every new data release confirm it. On November 19, housing starts and permits hit record lows, according to the Commerce Department. At an annual 791,000 rate last month, they were the lowest they've been since number tracking began in 1959 and are down 4.5% from a revised 828,000 September reading. Building permits were also worrisome at an annual 708,000 rate (down from 805,000 in September), breaking the previous 709,000 March 1975 low figure.

With supply way exceeding demand and prices in near free fall, no end of this is in sight for an industry perhaps facing its most challenging environment ever. The National Association of Home Builders (NAHB)/Wells Fargo November housing market index shows why. It fell to a seasonally adjusted 9 reading - its lowest recorded level since the index first began in 1985 and below its October reading of 14. Any number below 50 indicates contraction.

In addition, the Mortgage Bankers Association's (MBA) weekly purchase loan index fell 12.6% in the week ending November 14. At 248.50, it's at its lowest loan applications level since December 2000. This signals weak future home demand at a time when it's woefully weak and declining. There was more bad news on November 20 as well as weekly initial jobless claims keep rising. This time by a higher than expected 27,000 to 542,000 in the week ending November 15 - the highest level since July 1992. The four-week average is its highest since January 1983 as employment keeps deteriorating at an increasing pace. Read more