(News & Editorial/Cash is King, at least at first)
A. Top 10 Preparedness Reasons to Carry Cash
17 August 2012, Prepography.com, by Andrew J. Jackson
Pasted from: http://prepography.com/top-10-reasons-to-carry-cash/
Our world is so digitized and automated that a lot of folks have stopped carrying cash. Think about it…when you’re checking out at the grocery or hardware store…how many people in front of you whip out a piece of plastic to pay for their purchases. Some days it seems like the era of the good old American greenback is over (we’ll leave the discussion of real money versus fiat currency for another day). You can now even make some payments at the checkout counter with your cell phone. As attractive as the idea of going cash free is to me…after all my wife knows where I keep my wallet…I refuse to stop carrying cash for the following reasons:
- Purchasing Privacy: I’m just old fashioned enough that I want to keep my business to myself. I know it’s becoming an outdated notion in this overly digitized world full of instant electronic over-sharing, but that’s how I feel. Read my article The Top 10 Reasons to Be a Stealth Prepper for more information on why privacy is so important.
- Service Interruptions: There have been a number of credit/debit system service interruptions over the last few years including at least one that lasted several weeks. When traveling I make it a point to carry enough cash to get home without any help from plastic. Make sure that you can get yourself home if a computer glitch or cyber attack shuts down your plastic
- Cash is King! Cash Discounts… by offering cash you can often strike a better deal when making purchases. I use this technique all the time when dealing with tradesmen and contractors.
- Cash Only Establishments: There are also places where cash is the only option like garage sales (good for purchasing inexpensive preps and may not take checks) and restaurants in smaller towns (I still see the ‘no out of town checks’ signs as I travel the back roads).
- Rise of the Underground Economy: Increasing taxes and regulations are driving more and more commerce underground (a variation of what Arthur Laffer discussed with his Laffer Curve…to be discussed in a future article). I can foresee the possibility that in order to purchase certain good or services in the future you can only do so with cash as whole segments of the economy potentially go underground.
- Bank Runs: The Federal Deposit Insurance Corporation (FDIC) and the National Credit Union Association (NCUA) have largely put a stop to individual bank runs, but as I learned the hard way if the regulators take over your bank (happens after hours on a Friday) then you might not have physical or digital access to your money for a couple of days. The whole government insurance of individual deposits is starting to look like the fox guarding the hen house as our elected official spend us into the poor house…if a bank run happens it’ll be big…and you’ll need more cash than you are carrying in your wallet. What will a bank run look like in the 21st Century… I think it will look like long lines at the ATM and even longer lines at the stores trying to stock up before the credit/debit system gets shut down.
- Reduce Temptation: If you have issues exercising discipline in your use of credit than transitioning to cash only transactions may help you reduce the temptation to overspend…to make sure that you have money left over for your preps and prep education (prepucation).
- Change is Good: Coins that is… some vending machines and the good old fashioned payphone (if you can still find one) might only take change. I remember many times when I was thankful the I had the coins to get a drink from the vending machine at a highway rest area because there was nothing else open that late…the same could hold true if there’s a cell phone service interruption following a computer glitch, cyber attack or natural disaster.
- You’re not getting any interest on it now anyway. Depending on how much cash you decide to carry this may or may not be an issue…but it’s not like you’re earning any interest on that money anyway.
- I might get robbed! Bear with me a minute on this one. If I’m robbed I would rather hand over a few hundred dollars in cash than my wallet. If I lose my wallet I must cancel all my debit and credit cards, I must contact the state to report a stolen driver’s license and concealed carry license and I must worry about my military identification getting into the hands someone who has demonstrated that he/she doesn’t honor the compact that we’ve made to become a civilized society. Additionally, with my wallet the thief has my address which would make it easier for him to victimize me again. If the thief doesn’t have a firearm the money will be flying up into the air so that he can focus on it as I run the other way. Last thing…before the comments start…yes I am armed but if I have the choice between losing a few hundred dollars or spending the next three years of my life in courtrooms defending myself for shooting someone who society would be better off without anyway…I’m glad to lose the money and make a police report.
How much cash to carry is a personal decision based on your financial resources, your spending habits, your responsibilities and your travel habits…just remember to do so and keep that emergency cash in a separate part of your wallet if you’re tempted to spend it on everyday items.
[At first you’ll want and need cash, then there will occur rapid inflation, during which you won’t want dollars and neither will anyone else. Mr. Larry]
B. When The Dollar Is No Longer A Reserve Currency
19 Aug 2013, ModernSurvivalBlog.com, by Ken Jorgustin
Pasted from: http://modernsurvivalblog.com/the-economy/when-the-dollar-is-no-longer-a-reserve-currency/#more-10929
I believe the U.S. is in the midst of a major currency collapse, and a huge change in our normal way of life.
The following is a list of startling notes that I wrote, as well as statements credited to Stansberry Research while I watched a video related to their newsletter back in 2011.
The scary thing is… nothing has changed since I wrote this, and it has actually gotten much worse!
Please take the time to read this and comprehend what will happen when the dollar is no longer the world’s reserve currency…
One MSB reader recently commented…
“There are a number of financial counselors predicting the demise of the dollar as the world’s basis of currency exchange. It seems that a number of people are aware that China, Japan, Russia, France are making definite moves in that direction. Brazil and Argentina as well a Cuba are all in the same camp. When will Washington and Wall Street wake up?”
He is absolutely correct. It is well known to those who follow what is happening, that the dollar is on the way out of world reserve status. To answer his question… Washington and Wall Street will not wake up. They will ride this horse until it drops dead…
The government has been borrowing so much money, that soon, we will not be able to afford even the interest on the loans.
Income tax receipts are roughly $900 billion a year.
Corporate taxes are roughly $200 billion annually.
Our current annual deficits are nearly $1.3 trillion, meaning we’re spending $900 billion + $200 billion + $1.3 trillion = $2.4 trillion.
Even if you doubled tax revenue, we would still be running a deficit!
Even if all U.S. citizens were taxed 100% of their income, it would still not be enough to balance the Federal budget! Tax increases will not even make the smallest dent on the true size of our debt.
There is not a single credible plan, by any political party, to merely end our annual deficits, never mind actually paying back our debts.
Here’s the kicker… the costs of maintaining our debts are about to skyrocket.
For years, the Federal Reserve has been keeping interest rates very low, to almost zero, and as a result, the interest rate at which the U.S. government borrows money from the Federal Reserve is an incredibly low level. This won’t last forever.
How much interest? Right now we’re paying about 15% of federal tax receipts (about $200 billion a year). If the government had to spend a ‘real’ market-based rate of interest, say 6%, it would cost $840 billion a year on interest (76% of tax receipts), just for what we owe right now, today.
We are trapped. The main-stream-media does not want you to know how precarious our government’s finances really are.
A debt default would be inevitable if not for one anomaly, the thing that has saved the U.S. so far, that is, the country’s ability to simply print more money. The U.S. is the only debtor in the world who can legally print U.S. dollars, and the dollar is the world’s reserve currency.
So, that sounds pretty good, just print more money, what is there to worry about?
The U.S. is the only country in the world that doesn’t have to pay for its imports or its debts in a foreign currency.
Example: A German wants to buy oil from Saudi Arabia – the German cannot pay for the oil in German marks (or Euro’s) because the oil is priced in dollars. You have to buy dollars first, then buy your oil.
The U.S. has been able to consume as much as we want without worrying about acquiring the money to pay for it, because U.S. dollars are accepted everywhere around the world.
As our creditors continue to figure out what’s happening (printing more and more dollars), we’re going to have very BIG problems. The creditors will either begin to refuse payment in dollars, or they will greatly discount the value of these new dollars. It’s already happening.
Most Americans have no clue what the repercussions are of losing the status of world currency.
Yes it can happen here. In fact, the exchange value of the U.S. dollar has fallen about 13% since June 2010. Its rate of decline is accelerating.
As the U.S. dollar continues to lose its position as the world’s currency, gas, oil, and other commodities will continue to skyrocket. Almost everything we consume will immediately get more expensive. It’s happening right now. Everything is getting more expensive.
The government says that there is no inflation. How is that even possible? They actually believe that the American public is going to believe them?
It’s only going to get worse, because we can NOT stop printing because we can’t actually afford our existing debts. No one wants you to know this. No one. That’s why, despite the obvious inflation going on all around the world, the Fed continues to say there’s no inflation at all. The government is radically devaluing the dollar and totally lying to everyone about what is really happening.
The Chinese are getting out of the dollar as fast as they can via strategic commodities.
With less demand for the dollar around the globe, interest rates will skyrocket.
Instead of getting a mortgage at today’s low rates of 5%, it may soon cost you 8% or 10% or 15%.
Stock prices will likely plummet by at least 40% in a matter of weeks as a result of this event in the currency markets.
When the U.S. dollar loses its spot as the world’s reserve currency, the brutal downturn will be about 10-times worse than the mortgage crisis of 2008.
When everyone is trying to get rid of their dollars, the government is printing more and more to pay debts, the crisis will reach epic proportions.
In the past 100 years this type of debt crisis has reared its ugly head in Germany, Russia, Austria, Poland, Argentina, Brazil, Chile, the Ukraine, Japan, and China.
Here’s the thing that most people don’t realize… The U.S. government can only continue printing dollars as long as the dollar remains the world’s reserve currency.
Reported by Robert Fisk (veteran Middle East reporter), last fall, China, Japan, Russia, and France got together for a secret meeting… without the U.S. being present or even knowing about the meeting. It was reported that Gulf Arabs are plotting to end dollar dealings for oil, moving instead to a basket of currencies including the Japanese Yen, Chinese Yuan, the euro, gold, and a new unified currency planned for nations in the Gulf including Saudi Arabia, Abu Dhabi, Kuwait, and Qatar.
In February (2011), the IMF has proposed replacing the U.S. dollar with something called ‘Special Drawing Rights’, or SDRs. SDRs will be able to be converted into any currency, based on a weighted basket of international currencies.
The IMF also proposed creating SDR-denominated bonds, which could reduce central banks’ dependence on U.S. Treasuries. They also suggested that certain assets, such as oil and gold, which are traded in U.S. dollars, could be priced using SDRs. (This is a HUGE step to replace the U.S. dollar as the world’s reserve currency)
Russian and China have made an agreement to settle all debts between them in each other’s currencies without first transferring to dollars.
The U.S. dollar has remained the world’s reserve currency for more than 50 years. It seems as though its days are numbered. Don’t remain in denial.
- Start to consider what will happen around you when this currency crisis unfolds.
- Plan to have six months of food, medical supplies, and access to water.
- Have a place you can go to if you need to get out due to rioting or unrest.
- Do not count on the government to save you if all he$$ breaks loose. The government will be too concerned about saving itself.
- Examine where your current assets or investments are.
- Consider investing or purchasing hard assets, or food , private land.
- Learn how to garden some of your own food.
- Examine your security and add where it needs adding.
- The more self sufficient that you can become, the better you will get through the crisis.
C. Top 10 Reasons to be a Stealth Prepper
15 July 2012, Prepography.com, by Andrew J. Jackson
Pasted from: http://prepography.com/top-10-reasons-to-be-a-stealth-prepper/
[You want to be “just another person in the crowd”. Live it, look it, be it; with readiness. Mr. Larry]
Being a ‘Stealth Prepper’ means keeping your preparations to yourself and practicing what we call OPSEC (Operational Security) in the military. The journey towards self-reliance and preparedness for life’s unexpected situations is exciting…you will want to celebrate your successes and discuss how to rectify your failures with like-minded people…don’t do it until you put a lot of thought into who you’re talking with, who they’ll tell and so on. Here are the Top 10 Reasons to be a Stealth Prepper:
- The words “I won’t tell anyone” are almost always a lie, even if said with proper intentions at the time. Keep your preparations to yourself.
- You can’t afford to buy enough for ‘everybody.’
- You don’t have enough space to store for ‘everybody.’
- You will be ridiculed in good times by those well meaning people in your life that think nothing bad can ever happen to them… or that the authorities will always protect them from danger…in other words the sheeple.
- You and your family could be in danger from thieves even in good times if it’s known that you keep cash, precious metals or other items of value including firearms… just in case.
- You might attract the tinfoil hat wearing crowd. If you want to broach the subject of preparedness with someone you want it to be on your terms with the people you chose.
- You could be inundated by requests for ‘assistance’ in hard times that will have you weighing the well being of your family against that of strangers, acquaintances and friends.
- You may find yourself having to take in more extended family than you planned… which could dramatically reduce the amount of time that your preparations will last.
- You and your family could be targeted in very hard times by desperate strangers, acquaintances, friends and even extended family members.
- You and your family could be targeted in very hard times by well meaning public servants enforcing ‘anti-hording’ ordinances for the ‘greater good.’
The best time to decide to become a Stealth Prepper is before you get started…the next best time now!
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