Tag Archives: depression

A guide to cushioning system collapse

(News & Editorial/A guide to cushioning system collapse)

 A. Crisis Reality: “Within An Hour the Stores Were Emptied”

guide shelves
22 January 2014, The Daily Sheeple, by Mac Slavo at SHTFPlan.com
Pasted from: http://www.thedailysheeple.com/crisis-reality-within-an-hour-the-stores-were-emptied_012014
When toxic chemicals spilled into the Elk River in Charleston, West Virginia a couple of weeks ago we got another glimpse into what the world might look like in the aftermath of a major, widespread disaster.

There were several lessons we can take from this regional emergency and all of them are pretty much exactly what you might expect would happen when the water supplies for 300,000 people become suddenly unavailable.

Lesson #1: There will be immediate panic

Studies have suggested that the average person has about three days worth of food in their pantry, after which they would be left with no choice but to scrounge for scraps once their food stores run out. We saw this scenario play out after Hurricane Sandy, when thousands of unprepared people lined up at National Guard operated FEMA tents and temporary camps. That’s what happens when there’s no food.

With water, however, it’s a whole different matter.

Food we can do without for weeks, but lack of water will kill us in a very short time. The events following the Charleston chemical spill highlight just how critical fresh water is to maintaining stability.

A reader at The Prepper Journal web site shared his firsthand account of the events as they played out. In a situation where water supplies are poisoned, whether by accident or on purpose, the anatomy of a breakdown accelerates significantly from three days to mere minutes:

Just yesterday that ban was lifted, but what if this had happened in your town? Would you be able to live comfortably with no water from the tap for 5 days? The news reports that I read stated that there was plenty of water and the stores never ran out. That is in direct contradiction to what Steve tells me:

Immediately after the announcement, the stores in the area were rushed for any bottled water products. Within an hour the stores were emptied.  Do not let anyone tell you that everything was nice, peaceful and everyone conducted themselves gracefully.  There were fist fights and scuffles for the last of the water.

After the order was issued no one could give any answers as to when drinkable water would be available.  Those with water were either hording it or selling it at enormous prices.

48 hours after the ban,  water began to be distributed to the everyday person.  Hospitals and nursing homes received the first shipments.  By the way the hospitals (except one) were not taking any new patients).  If you got hurt or injured you were on your own or had to travel an hour away for treatment.

What if the spill was more serious or the supply of water non-existent? Would you have enough water on hand and the means to disinfect new sources to take care of your family? It is news like this that illustrates for anyone paying attention the importance of storing water.

If you live an area affected by a water supply contamination and have no water reserves, this report suggests that you have less than an hour to stock up. And during that hour there will be panic with the potential for violence being highly probable.

Lesson #2: Security forces will be deployed to maintain order This is a no-brainer, but nonetheless worthy of mention.

We saw it after Hurricanes Sandy and Katrina – thousands of troops and militarized police deployed to prevent looting and rioting. The fact is that when the water and food run out people will be left with no choice but to rob and pillage. It becomes a matter of survival. Crowds will unwaveringly stampede to get to the resources they need. They’ll stomp over you if you happen to fall on the ground in a rush, because when the herd starts running nothing will stop it.

Imagine how these people will act when they are desperate for food food and water:

There is a reason the government has been preparing military contingency plans and simulations for events that include economic collapse or a massive natural disaster. They know what will happen if millions of people are left without critical supplies.

In Charleston, after water supplies started being delivered to grocery store chains, local government and the companies themselves brought on hired guards to keep the peace.

The Elk River event was limited in scope, affecting about 300,000 people in an isolated area, thus it was not that difficult of a situation to contain as FEMA and government could throw all of their resources and assets at the problem.

But imagine a scenario that involves multiple large metropolitan areas simultaneously in different regions of the country.

There are simply not enough personnel (or supplies) to respond to such a situation and maintain order.

Lesson #3: Despite hundreds of billions spent, the government is ill-prepared It took emergency responders five days to get water to the Super Dome in New Orleans following Hurricane Katrina.
Following Sandy, FEMA had enough food and water to provide the absolute basic necessities to about 50,000 people.
In Charleston it took at least two days to get water supplies moving.
If this were a massive catastrophe it could be weeks before help arrives.

The Federal Emergency Management Agency has itself warned that it is not equipped to handle large-scale emergencies. It’s for this reason that they strongly recommend a minimum two week supply of food and water.

guide fema
Considering that the majority of Americans have maybe three days worth of supplies, how many millions of mouths would need to be fed three square meals a day if we experienced a multi-city event?

It was recently reported that FEMA has in its possession about 140 million “meals ready to eat.”
In 2011 a FEMA/DHS organized National Level exercise simulated an earthquake on the New Madrid Fault in the Mid West. The simulation revealed that 100,000 people would be killed almost immediately, and another 7 million would be displaced from their homes.
They would only have one place to go – government managed FEMA camps. Those seven million people eating just two MRE’s per day would  consume FEMA’s entire emergency food reserve within 10 days.
Then what?
You probably already know the answer.
Prepare now, because the last place you want to be in is in the midst of crisis-driven panic.

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B.  Report: Supplier Survey & Trend Analysis of Preparedness and Resiliency Provisions
30 Sep 2012, learntoprepare.com, by Denis Korn
Pasted from: http://learntoprepare.com/2012/09/report-supplier-survey-trend-analysis-of-preparedness-and-resiliency-provisions/

Here is my perspective on current trends relating to food products for shelf stable food reserves and resiliency provisions in general.
In the 37 years I have been in the natural foods, outdoor recreation and emergency preparedness industries as a retailer and manufacturer, I have experienced a number of fluctuations and factors that have influenced the availability and pricing of foods and supplies for preparedness. A number of current factors and converging events are affecting the preparedness marketplace today and potentially in the near future.

In addition to my own present-day observations and experience as a retailer of food reserves and preparedness products, I have very recently surveyed a number of suppliers, processors and manufacturers for their assessment of current conditions in the marketplace.

Here are my appraisals, reports, and insights regarding the state of the industry:

  • The numerous and diverse potential scenarios associated with emergency and disaster preparedness is so pervasive in contemporary culture, that a broad spectrum of citizens have begun to take some form of action. Others are acutely aware of the probable dangers and are waiting for a significant triggering event to act.
  • BOB1 foodIf a serious event were to occur, fence sitters and those who have done nothing to prepare would overwhelm preparedness suppliers, manufacturers and normal outlets. Products will be sold out or long lead times will prevail. The nature of the triggering events will determine the availability of preparedness supplies for both the short and long terms.
  • Preparedness niche companies and their suppliers have a limited supply of goods on hand during normal business activity. At all levels of the supply chain there is a restricted amount of products available. Y2K, hurricanes, international disasters have all been testaments to disruptions in certain product availability. A wide spread and prolonged emergency will have a devastating effect on the availability of goods and services. This is especially true of specialty food processors.
  • The main stream media will not accurately depict the real state of affairs regarding the current conditions in our society. This relates to politics, the economy, financial issues, government action and inaction, weather effects and anything that would be valuable for citizens to know so that they can prepare in advance for shortages. Information is significantly manipulated, controlled and fabricated. This includes what you hear and what you don’t hear.
  • The current drought has had some effect on food prices and availability but not a catastrophic one. The increases in costs have already been factored in as it relates to commodity futures. Corn, soy beans and wheat were the crops most affected by the drought, as was potatoes and to a smaller extent other vegetables and fruits.Internet- food, FD #11 cans
  • A record corn crop was initially anticipated, so the effect of the drought could have been worse. NOTE: 40% of the corn crop goes for ethanol.
  • Currently the price of most beans has dropped some due to good yields in North Dakota where 2/3 of the nation’s beans are grown. Availability of beans and other grains is good.
  • Rice prices and availability is stable.
  • Freeze dried food processors are very busy and are experiencing an increasing demand for fruit and vegetables from non preparedness manufacturers. This is causing shortages in some products. The drought has not substantially affected fruit and vegetables.
  • There has been a shortage in some “ready” or “no cooking required” ingredients that are necessary for entrée and blended recipes. Many of these ingredients use non freeze drying technology to enable a no cooking requirement.
  • Quality domestic food ingredients are becoming more difficult to source. It is essential that consumers do diligent research to establish trust with reputable manufacturers. Many current preparedness food packers have succumbed to using lower quality imported and processed foods.
  • Currently, other vital preparedness provisions – electronics, medical, tools, water filters and such, are in adequate supply. Last year at this time there were shortages.
  • Prices have risen in many sectors due to a multitude of factors such as transportation, packaging (paper prices have seen a steep increase), cost of benefits to employees, fuel, raw materials, regulations unfavorable to small business and lack of credit. Prices are expected to continue to rise, and with any new detrimental financial event they will rise dramatically.
  • As shortages continue lead times for fulfillment will increase. I see this currently occurring.
  • The current debilitating state of our nation and the attitudes of despair of our citizens are unprecedented in my lifetime.
  • I and others see a substantial spike in demand for preparedness food and supplies from possibly right before to definitely after the November election. Negative reaction to the outcome of the election will be momentous – no matter who wins. We will soon know how serious the reaction will be, what form it will take and what governmental actions will be executed.

Conclusion:
Currently food products – with increasing lead times – and other supplies are available. However, there are a multitude of very volatile factors that could trigger a substantial increase in demand of preparedness supplies. A very difficult question to answer, although it discussed frequently is: How will a crisis effect fulfillment of essential goods and services?

During Y2K there were specific dates as to a potential problem, and specific remedies that could be addressed and possibly implemented. When citizens realized that problems had been addressed, demand for preparedness goods subsided. It was the unknown consequences of a potential computer calamity and the perceived resolution of those problems, which triggered the fluctuations in demand and supply.

The unknown consequences of the myriad of potentially devastating scenarios being discussed currently are not so easily resolved nor are the timing markers so easily recognized. There is so much uncertainty associated with current events that folks are either in denial or on edge waiting for a significant triggering event before they act. And when they do, preparedness suppliers, warehouse retailers and numerous provision dealers will be inundated.

I and numerous other observers of current events don’t ask if a catastrophe or serious events will happen – but when? Then we ask:

  • 1. How long will it last?
  • 2. How devastating will it be?
  • 3. How will the population cope with a dramatic lifestyle change if scenarios are dramatic?
  • 4. How many will be prepared?
  • 5. What will those who are not prepared do, and who will they rely upon?
  • 6. What repressive and draconian measures will the government implement?
  • The unknown consequences of the myriad of potentially devastating scenarios being discussed currently are not so easily resolved nor are the timing markers so easily recognized. There is so much uncertainty associated with current events that folks are either in denial or on edge waiting for a significant triggering event before they act. And when they do, preparedness suppliers, warehouse retailers and numerous provision dealers will be inundated.

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C.  The #1 Preparedness Question – What’s Your Scenario? (Why?)
13 Oct 2012, learntoprepare.com, by Denis Korn
Pasted from:  http://learntoprepare.com/2012/10/the-1-preparedness-question-whats-your-scenario-why/

This is such an important question to answer when engaging in preparedness planning that I felt it necessary to examine it more carefully. It is the first question in my 12 Crucial Questions of Preparedness Planning, listed under 12 Foundational Articles for Preparedness Planning (as you can see I like the number 12).

Before I proceed with this topic I want to share some insights on the current state of fears and concerns I hear people discussing.

guide disaster formsIt is no secret that the societal, financial and moral issues of our time are wreaking havoc on the lives of most Americans. While at each election, the parties proclaim their election to be the most important of the era, what we currently are experiencing is that this statement is finally true. Not that the outcome will necessarily change the fundamental problems underlying our society and its governance, but that the results will indicate how really difficult true transformation will be. I am very passionate about my concerns for our country and the future for my children and grandchildren. I have never seen such blatant in-your-face displays of revolt, rage and lying by those who are ignorant, self-serving and delusional (a strong word yet in my opinion accurate).

Our leadership, corporate ethics, cultural morality and attitude towards truth, human compassion and right action has been so corrupted and dishonored that it will take a Divine act to significantly transform us and set us on the right path. Earnest prayer is essential! Over the course of the next few months we will see how difficult it will be during the times that lie ahead, and as it relates to this blog site – how can we be prepared?

Steve Wynn, a very successful developer and casino operator, was asked for his assessment of the current business climate. His answer included this statement, “…And I have to tell you, Jon, that every business guy I know in the country is frightened of Barack Obama and the way he thinks.” This response mirrors my experience in talking with many small business owners, and is an exact duplication of the circumstances surrounding the 1980 election between Jimmy Carter, incumbent and Ronald Reagan, challenger. The business climate was terrible (I was in the outdoor recreation and preparedness industry as a business owner at that time), and whatever one’s political viewpoint, the perception of a pro-business and competent President was critical in turning the decline around. This is not a political blog, so I will not dwell on the politics. However, I cannot turn my back on the obvious – too much is at stake.

The perception of the capability and aptitude of our leadership to instigate real change will have a dramatic effect on the course of events in the short term. For the long term, the fundamentals must be transformed.

Let me be frank, I am a small business owner who has owned various businesses for 41 years, and if we don’t elect leadership who will instill confidence and trust and initiate real reform for We The People during these darkest of days – we’re screwed!

Here is the entire question #1 of the 12 Crucial Questions:
What are the circumstances or scenarios you have determined may exist that will require you to rely upon your preparedness supplies?
This is not only the most important and first question to answer, it is often the question most overlooked, or not considered critically enough. While many people find it difficult to honestly assess potential uncomfortable and “fearful” possibilities, wasting time and resources on inadequate and ineffectual provisions can be detrimental to your health or possibly your life. Don’t be caught up in slick advertisements, fraudulent claims or irrelevant personality endorsements. I have seen them all – do your due diligence!

  • What will be the severity and impact of those circumstances on your life?
    Now starts the process of being specific and increasingly focused. Honesty is essential – this is no time for wishful thinking and denial.
  • Given your potential scenarios, how thoroughly have you researched the available options for food, water, medical, shelter, hygiene, and other categories of critical supplies?
    An actual physical list is vital in answering this question. Here you will begin to determine specific provisions you will need. You will have a broader perspective of available items required for your scenarios.
  • Are you prepared for emergencies during all seasons of the year?
    Depending on where you live, temperatures, rain, snow and other weather conditions can vary significantly. Cold weather preparedness is especially important. The anticipated duration of your scenario might require preparing for multiple seasons and conditions.
  • Is your family more susceptible to certain emergencies?
    Depending on where you live or where you might need to relocate will determine unique potential issues. Possible hurricanes, earthquakes, tsunamis, storms, tornadoes, fire, riots, loss of electricity, lack of water, lack of essential medications are just some events that might affect your preparedness planning
  • How would your scenarios impact you or your family’s daily routine? Work or livelihood?
    If you scenarios are relatively minor and isolated, then of course there will be a minimum of inconvenience. If however, your scenarios are more impactful, severe, regional or nationwide and of longer duration, then you are looking at a significant disruption in routine and possibly a substantial lifestyle change.
  • How will you protect yourself and family against those who might do you harm?
    Many folks don’t welcome the notion that a significant emergency or disaster will create a dangerous environment with animals, gangs or groups of ill-intentioned people who can inflict injury. Where you live will determine the degree of concern. Those who are responsible for their own welfare and the protection of their family will need to reflect on this question with seriousness. Protection devices are numerous and diverse, consider the appropriate response for your anticipated scenarios.

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 D.  9 Survival Items You Should Always Have In Your Car
10 June 2013, OffTheGridNews.com, written by: Travis P- Extreme Survival
Pasted from: http://www.offthegridnews.com/2013/06/10/9-survival-items-you-should-always-have-in-your-car/

In my home I have over a dozen firearms, thousands of rounds of ammunition, shelves and shelves of food, enough water to drink for weeks, and a two rucksacks packed to last seventy-two hours should this all be compromised.

Now how useful is all this if I’m not home when things fall apart? It’s no good to me at all if I’m thirty miles away and traffic is halted… or if a hurricane hits and I’m stranded. In addition, if a bridge washes out or I crash in the middle of nowhere, I might need a survival kit. As I discussed in last week’s article, I almost always have either a shotgun or my concealed handgun on me or in my car or truck, but what about other supplies? A lot of things can happen, and my survival gear may not be at hand.

So is the easiest answer to simply throw one of those seventy-two-hour bug-out bags in my car or truck? Well that’s a good idea, but not very practical for riding around with every day. These rucks are pretty big, and they won’t work well with strollers, car seats, work stuff, and trying to fit myself and others in my vehicles, and I can’t toss it in the bed of my truck without worrying someone will swipe it.

So that’s where the “get home bag” comes into play. Some people may see it as a smaller bug out bag, but I much prefer calling it the “get home bag”. The main difference between the get home bag and my bug out bag is size. My two bug out bags will last my family 3 days comfortably and can be stretched to five days if we have a good water source. My get home bag is more customizable in terms of food and water, and how long they need to last.

I’ll address those two first.
Food and water are critical, and the situation will vary on how much you need. So first I put a 24 count case of 20 ounce bottled water in my trunk. It fits perfectly on the floor, under my son’s car seat. That room is wasted anyway since he is rear facing. It doesn’t leave room for the mentioned stroller or tools, but there is enough for the case of water.
I also have a Camelbak hydration system, and a Nalgene bottle. I can fill both up and carry as many additional water bottles as I believe I’ll need for the trip home. I have loved these hydration packs ever since the first time I was issued one in the military. It’s an excellent way to carry water, easy to carry, and leaves your pockets and pack free for other things.

For the food portion, I keep six civilian versions of the military MREs. I have plenty of access to military MREs, but the civilian MREs are much better tasting, last longer [5years as listed at Amazon-Mr Larry], and I know the date of production. They also pack more stomach-friendly foods than the military versions. I field strip the MREs and tape them tightly together with duct tape for compact packages. I also have quite a few bags of sealed beef jerky and high fat protein bars. This all fits in easily with the spare tire in the trunk of the car.

So now that my food and water are in place, I can take or leave whatever I need. Remember this isn’t to last you forever, just enough to get you home. I feel I’ve over-packed, but it fits well so there is no point in taking anything out.

Now, as I write this, I’m building the actual get home bag portion of this. I didn’t buy anything special to build this; I used what I had laying around. I will honestly probably buy a few things for this kit in the future (and drive my wife a little crazier). Most of the items are extras I hang on to, but quality items none the least.

First off, my personal number one rule of survival is to always have a knife, and a good knife at that. I packed a Spyderco Enuff Sheepfoot. The Enuff Sheepfoot is a small fixed blade with a sturdy Kydex holster. I like Spyderco knives, and this little one wasn’t much use in my tool box, so into the bag it went. Next I tossed an extra small, folding knife in the bag (it’s a small, cheap Smith and Wesson folding knife).

Next was twenty feet of paracord, braided to make it more compact. Also known as 550 cord  (for its resistance), 550 could also be the number of uses it has. A good strong cord can do anything from make snares to fashioning a lean-to.

Next up was a good strong, metal framed, LED flashlight, and a Gerber headlamp. Neither of these are expensive Surefires, but they’re dependable and water resistant. Along with these are, of course, extra batteries to keep them lasting a few days. I may add a cheap crank flashlight to this mix as well.

One of the most important series of items is the medical supplies. This is a basic individual first aid kit. I packed a compression bandage, two triangle bandages, a cinch tight, some band aids, Betadine solution, gauze, and a burn dressing. I also included a flask of liquor (high proof), for cleaning wounds and if necessary, for starting fires.

Speaking of fires, I packed a good outdoor lighter, water resistant matches, and a cheap fire starter. Three different ways to start a fire is a good place to start. Fire can cook and purify water, as well as act as a signaling device.  It’s just as important as water because it will purify water too. On this note I’m also packing a military metal canteen cup in which to boil water. I’m also packing a packet of a dozen Micropur tablets, each capable of purifying a liter of water.

I have a few miscellaneous items to toss in there as well. First are two rolls of tape, one electrical and one duct tape. Tape is another item that has a million uses. I also threw in a D ring, just because you never know. I also tossed in three glow sticks—blue, yellow, and red—that will each last 8 hours. These can be used for signaling as well as lights. {I’d add a few items the author of this article hasn’t mentioned, ie.: cheap thermal blanket, poncho, insect repellant, gloves and stocking cap or brimmed hat, depending on time of year and location. Also more apt to carry a 1/2 lb or larger canister of Bear grade pepper spray, than a gun, for this two hour to over night emergency. Mr. Larry).

Now the last piece of gear I’m bringing is probably the most important—the gun. I had a hard time choosing a weapon; I decided that the weapon needed to be concealable, adaptable, and powerful. I ended up choosing the Taurus Judge. I chose the Judge for a few reasons. First off, it is powerful enough to deal with any man or critter I will encounter. I can also load a variety of different shots for close range snake dispatching and small game hunting. I packed a box of Federal .410 handgun No. 4, a box of number 7, and 15 Winchester .45 colt Winchester PDX, and ten double-aught buck. I have a total of 75 rounds for this weapon. This weapon will compliment my everyday concealed handgun, a .45 acp 1911 Commander, with two eight-round magazines.

Of course I packed my favorite holster, a Blackhawk Serpa, with a paddle attachment. I love the Serpa for the Judge. It holds the weapon high, is easy to conceal, and it also holds the heavy weapon really well.

The actual pack I use is a military surplus “butt” pack. The butt pack was used on 782 gear as a patrol pack to carry food, tarp, or whatever a soldier needed on patrol that day. I rigged mine up with an old two-point sling to act as a messenger bag (aka “man purse”). The butt pack is tough and lightweight, just big enough to fit everything, and still stays small and convenient.

The small get home bag is a pretty handy little bag to keep in any vehicle. The bag is perfect for a short survival situation and cost me nearly nothing to build. It takes up only a small amount of room in my trunk, or behind the seat in my truck. Like my bug out bags, I’ll be changing and upgrading it constantly, and it will become a permanent addition in my vehicle.

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The amount of gold or silver savings you should have

(Survival Manual/7. Warehouse / The amount of gold or silver savings you should have)

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What to Do When – Not If – Inflation Gets Out of Hand.
4 Sept 2012, Financial Sense.com, by Jeff Clark
Pasted from <http://www.financialsense.com/contributors/jeff-clark/what-do-when-not-if-inflation-gets-out-hand&gt;

“The cheek of it! They raised the price of my favorite ice cream.

Actually, they didn’t increase the price; they reduced the container size.

I can now only get three servings for the same amount of money that used to give me four, so I’m buying ice cream more often.

Raising prices is one thing. I understand raw-ingredient price rises will be passed on.

But underhandedly reducing the amount they give you… that’s another thing entirely. It just doesn’t feel… honest.

You’ve noticed, I’m sure, how much gasoline is going up.

Food costs too are edging up.

My kids’ college expenses, up.

Car prices, insurance premiums, household items – a list of necessities I can’t go without. Regardless of one’s income level or how tough life might get at times, one has to keep spending money on the basics. (This includes ice cream for only some people.)

According to the government, we’re supposedly in a low-inflation environment. What happens if price inflation really takes off, reaching high levels – or worse, spirals out of control?

That’s not a rhetorical question. Have you considered how you’ll deal with rising costs? Are you sure your future income will even keep up with rising inflation?

Be honest: will you have enough savings to rely on? What’s your plan?
If price inflation someday takes off – an outcome we honestly see no way around – nobody’s current standard of living can be maintained without an extremely effective plan for keeping up with inflation.

It’s not that people won’t get raises or cost of living adjustments at work, nor that they will all neglect to accumulate savings.
It’s that the value of the dollars those things are in will be losing purchasing power at increasingly rapid rates. It will take more and more currency units to buy the same amount of gas and groceries and tuition. And ice cream.
I’m not talking science fiction here.
When the consequences of runaway debt, out-of-control deficit spending, and money-printing schemes come home to roost, it’s not exactly a stretch to believe that high inflation will result.

We need a way to diffuse the impact this will have on our purchasing power. We need a strategy to protect our standard of living.
How will we accomplish this?
I suspect you know my answer, but here’s a good example. You’ve undoubtedly heard about the drought in the Midwest and how it’s impacted the corn crop. The price of corn has surged 50% in the past two months alone.
Commodity analysts say the price could rise another 20% or more as the drought continues.

While the price of gold constantly fluctuates, you would have experienced, on average, no inflation over the last 30 years if you’d used gold to purchase corn. Actually, right now, it’d be on the cheap side.
When you extrapolate this to other food items – and virtually everything else you buy – it’s very liberating. Think about it: gold continues its safe-haven role as a reliable hedge against rising inflation.
I believe that those who save in gold will experience, on average, no cost increases in the things they buy and the services they use.
Their standard of living would not be impacted.

I think this kind of thinking is especially critical to adopt when you consider that supply and demand trends for gas and food dictate that prices will likely rise for a long time, and perhaps dramatically.
So how much will you need to make it through the upcoming inflation storm and come out unscathed?

Like all projections, assumptions abound. Here are mine for the following table. I’m assuming that:
•  The price of gold, on average and at a minimum, tracks the loss in purchasing power of whatever currency you use, and that it does so from current prices. Given gold’s history, this is an easy assumption to make.
•  Gold sales, over time, capture the gain in gold and silver so that your purchasing power is preserved. (This doesn’t mean I expect to sell at the top of the market; I expect we’ll be selling gold as needed – if gold has not itself become a widely accepted currency again.)
•  We pay taxes on the gain. This will decrease our net gain, but there should still be gains. In the famous Weimar Germany hyperinflation, gold rose faster than the rate of hyperinflation.

To calculate how much we’ll need, I looked at two components, the first being average monthly expenses. What would we use our gold and silver for? From corn to a house payment, it could be used for any good or service. After all, virtually nothing will escape rising inflation. Here are some of my items: groceries, gas, oil changes and other car maintenance, household items, eating out, pool service, pest service, groceries and gas again, eating out again, vitamins, movie tickets, doctor appointments, haircuts, pet grooming, kids who need some cash, gifts, and groceries and gas yet again. Groceries include ice cream, in my case. How many ounces of gold would cover these monthly expenses today?

And don’t forget the big expenses – broken air conditioner, new vehicle, vacation… and I really don’t think my daughter will want to get married at the county rec hall. How many ounces of gold would I need to cover such likely events in the future?
The point here is that you’re probably going to need more ounces than you think. Look at your bank statement and assess how much you spend each month – and do it honestly.

The other part of the equation is how long we’ll need to use gold and silver to cover those expenses. The potential duration of high inflation will dictate how much physical bullion we need stashed away. This is also probably longer than you think; in Weimar Germany, high inflation lasted two years – and then hyperinflation hit and lasted another two. Four years of high inflation. That’s not kindling – that’s a wildfire roaring through your back yard.

So here’s how much gold you’ll need, depending on your monthly expenses and how long high inflation lasts.

Every corn-based product on the grocery shelf will soon take a lot more dimes and dollars to buy. But wait – what if I used gold to buy corn?

If my monthly expenses are about $3,000/month, I need 45 ounces to cover two years of high inflation, and 90 if it lasts four years. Those already well off or who want to live like Doug Casey should use the bottom rows of the table. How much will you need?

Of course many of us own silver, too. Here’s how many ounces we’d need, if we saved in silver.

A $3,000 monthly budget needs 1,285 ounces to get through one year, or 3,857 ounces for three years.

I know these amounts probably sound like a lot. But here’s the thing: if you don’t save now in gold and silver, you’re going to spend a whole lot more later.
What I’ve outlined here is exactly what gold and silver are for: to protect your purchasing power, your standard of living.
It’s like having your own personal financial bomb shelter; the dollar will be blowing up all around you, but your finances are protected
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And the truth is, the amounts in the table are probably not enough. Unexpected expenses always come up. Or you may want a higher standard of living. And do you hope to leave some bullion to your heirs?
It’s sobering to realize, but it deserves emphasis: if we’re right about high inflation someday hitting our economy…

Most people don’t own enough gold and silver.
If you think the amount of precious metals you’ve accumulated might be lacking, I strongly encourage you to put a plan in motion to save enough to meet your family’s needs.

We have top recommended dealers in BIG GOLD, ones we’ve vetted that are trustworthy and have highly competitive prices. We also recommend a service that will deduct whatever amount you chose from your bank account and buy bullion for you automatically. And now, given how concerned we’ve been about the inflation that’s coming, we’ve actually started our own service. You can check it all out in the current issue of BIG GOLD, risk-free. I can tell you that purchase premiums are incredibly low, due to a proprietary system that bids your order out to a network of dealers that compete for your business. We’re already using it, and the response from other investors has been tremendous.

Whatever plan you adopt, my advice is to make sure you have a meaningful amount of bullion to withstand the firestorm that’s almost mathematically certain to occur at this point. And now you know exactly how much gold you’re going to need.

See this article at:

<http://www.financialsense.com/contributors/jeff-clark/what-do-when-not-if-inflation-gets-out-hand&gt;

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The Cloward-Priven strategy is working.

Remember these points:
1. “Nothing in politics happens by chance”. — President Franklin Roosevelt
2. “Strategy is something that happens to you while you are looking the other way”. — President Franklin Roosevelt.
3. The illegal we do immediately; the unconstitutional takes a little longer.” –Secretary of State Henry Kissinger

The Cloward–Piven strategy is a political strategy outlined in 1966 by American sociologists and political activists Richard Cloward and Frances Fox Piven that called for overloading the U.S. public welfare system in order to precipitate a crisis that would lead to a replacement of the welfare system with a national system of “a guaranteed annual income and thus an end to poverty”.

Cloward-Piven Paradise Now?

August 1, 2011, American Thinker, By Jeannie DeAngelis
<http://www.americanthinker.com/2011/08/cloward-piven_paradise_now.html>
“Combine class warfare, demonizing the rich, getting as many people onto the welfare rolls as possible, and pushing the economic system to collapse and you have a flawless formula for Cloward-Piven 2.0 — and a vehicle that ensures Obama remains in power. Cloward-Piven is a much talked-about strategy proposed in the mid-1960’s by two Columbia University sociology professors named Richard Andrew Cloward and Frances Fox Piven. The Cloward-Piven approach was sometimes referred to as the “crisis strategy,” which they believed were a means to “end poverty.” The premise of the Cloward-Piven collective/anti-capitalist gospel decried “individual mobility and achievement,” celebrated organized labor, fostered the principle that “if each finally found himself in the same relative economic relationship to his fellows … all were infinitely better off.” The duo taught that if you flooded the welfare rolls and bankrupted the cities and ultimately the nation, it would foster economic collapse, which would lead to political turmoil so severe that socialism would be accepted as a fix to an out-of-control set of circumstances. The idea was that if people were starving and the only way to eat was to accept government cheese, rather than starve, the masses would agree to what they would otherwise reject. In essence, for the socialist-minded, the Cloward-Piven strategy is a simple formula that makes perfect sense; the radical husband-and-wife team had Saul Alinsky as their muse, and they went on to teach his social action principles to a cadre of socialist-leaning community organizers, one of whom was Barack Obama. As the debt crisis continues to worsen, President Obama stands idly by an inferno with his arms crossed, shaking his head, and doing nothing other than kinking the fire hose and closing the spigot. Spectator Obama is complaining that the structure of the American economy is engulfed in flames while accusing the Congress, which is trying desperately to douse the fire, of doing nothing about the problem. Although speculative, if the Cloward-Piven strategy is the basis of the left’s game plan, spearheaded by Alinsky devotee Barack Obama, it certainly explains the President’s inaction and detached attitude.

The greatest nation in the history of the world is teetering on the brink of a catastrophic economic crisis. America was pushed to this point by a rapidly-expanding national debt and a stressed-out entitlement system; in the center of this crisis is the President, who insists on expanding it even further, all in the name “fairness” and “social justice.” As a default date nears and the President threatens seniors that there’s a chance they may not receive their Social Security checks, it has been revealed that the federal government disperses a stunning 80 million checks a month, which means that about a third of the US adult population could be receiving some sort of entitlement. Since the 1960’s when Cloward-Piven presented a socialistic guideline to usher in the type of evenhandedness Obama lauds, America’s entitlement rolls have swelled from eight million to 80 million. If the nation’s ability to disperse handouts were ever disrupted, it’s not hard to see how chaos would erupt should an angry army of millions demand what Cloward-Piven called “the right to income.” Couple the threat of dried-up funds for food stamps, Social Security, unemployment benefits and the like with the Obama administration’s vigorous campaign to turn a tiny upper class of big earners into the enemy, and you have the Cloward-Piven recipe for anarchy and complete collapse. If the worst happened, Saul Alinsky’s biggest fan, whose poll numbers continue to plummet, could use mayhem in the streets to remain firmly ensconced in the White House. Alinsky taught his students a basic principle that community organizer Barack Obama learned well: “Never let a good crisis go to waste.” Fiscal disintegration coupled with lawlessness would deliver the type of Cloward-Piven/Saul Alinsky trifecta that progressives have worked toward and waited decades for…”

The Cloward/Piven Strategy of Economic Recovery
February 7, 2009, American Thinker, By Nancy Coppock http://www.americanthinker.com/2009/02/the_clowardpiven_strategy_of_e.html
“Using borrowed money for a band-aid bailout of the economy should seem backwards to most people. However, it likely is a planned strategy to promote radical change. Those naively believing that President Obama is simply rewarding his far-left base, and will then move to the political center, must wise up.

The assumption that Obama will need the nation to prosper in order to protect the 2010 mid-term election incorrectly assumes that he esteems free market capitalism. He does not. Rather than win through superior ideas and policies, the Democrat plan for success in the mid-term elections is to win by destroying political opposition. Obama adheres to the Saul Alinksy Rules for Radicals method of politics, which teaches the dark art of destroying political adversaries. However, that text reveals only one front in the radical left’s war against America. The Cloward/Piven Strategy is another method employed by the radical Left to create and manage crisis. This strategy explains Rahm Emanuel’s ominous statement, “You never want a serious crisis to go to waste.” The Cloward/Piven Strategy is named after Columbia University sociologists Richard Andrew Cloward and Frances Fox Piven. Their goal is to overthrow capitalism by overwhelming the government bureaucracy with entitlement demands. The created crisis provides the impetus to bring about radical political change. According to Discover the Networks.org:  Rather than placating the poor with government hand-outs, wrote Cloward and Piven, activists should work to sabotage and destroy the welfare system; the collapse of the welfare state would ignite a political and financial crisis that would rock the nation…[ Making an already weak economy even worse is the intent of the Cloward/Piven Strategy. It is imperative that we view the American Recovery and Reinvestment Plan’s spending on items like food stamps, jobless benefits, and health care through this end goal. This strategy explains why the Democrat plan to “stimulate” the economy involves massive deficit spending projects. It includes billions for ACORN and its subgroups such as SHOP and the Neighborhood Stabilization Program. Expanding the S-Chip Program through deficit spending in a supposed effort to “save the children” only makes a faltering economy worse. If Congress were to allow a robust economy, parents would be able to provide for their children themselves by earning and keeping more of their own money. Democrats, quick to not waste a crisis, would consider that a lost opportunity…”

Can it be? When you’re in a hurry to get somewhere socio-economically and the combination of Welfare, Food stamps, Medicare, and Social Security aren’t getting you there fast enough, you must additionally provide  welfare subsidies for the automobile industry, for the some of the worlds largest Financial Banks and even guarantee the solvency of foreign countries.

The Debt Walkers Strike Back
The Automatic Earth, 2 Dec 2011, by Ilargi
http://theautomaticearth.blogspot.com/
“It’s very simple, but maybe that’s the problem. For all I know it’s just too simple for people to see.

There’s a group of people, and it’s tempting to call them the 1%, but they’re not really, since there’s politicians in there too who have no shot at even aspiring to be part of the 1%, and media pundits and economists and what have you, who all together try to save the existing financial system at all cost. A cost that they don’t bear: that cost is being paid for by the 99%.

Theirs is just one particular view, one particular idea, of what it takes to get out of the crisis we’re in. Nothing more, nothing less: just one idea. But one that prevails over any alternatives to such a radical extent that, from an objective point of view, it can’t but boggle the mind.

“If we don’t save the banks and the financial system at large, there’ll be Armageddon to pay”. That’s the endlessly repeated prevailing line.
However, if we keep on spending ever more trillions to prevent Armageddon from arriving, surely we must invite it, by the very act of doing exactly that, to at some point come knocking on the back door. After all, you can’t spend more and more, and then some, without ever being served with the bill for doing so.

So we’ve had all these rescue missions over the past 5 years. Behemoth-sized amounts of taxpayer money and future taxpayer money have been poured into our economies in this alleged attempt to try to save them.

Now, take a step back and tell me what you see. I’ll tell you what I see: a financial system that is in worse shape than ever before during those 5 years. At least half of Europe is flat broke, most banks have lost 50%-80% of their market value, Bank of America, a major bailout

recipient, is fast on its way to becoming a penny stock, China sees shrinkage wherever it looks and Japan is rumored to be awkwardly close to the chopping block.

Evidently, something’s not working the way it’s supposed to.
And here is why: it is becoming clearer by the day that saving the banks is not the same as saving the people, upon whom increasing austerity is unleashed to pay for … saving the banks.

We have a choice to make: either we save the banks, or we save our societies. Which are falling apart as we speak on account of the costs of saving an already deeply bankrupt financial system.

But we’re not even starting to discuss that choice. All choices and decisions are being made -for us- in a one-dimensional vacuum theater by a small group of people who, to a (wo)man, flatly deny that such a choice needs to be made or even exists. Because making that choice doesn’t fit their purposes and careers and fortunes and ego’s.

Merkel, Blankfein, Sarkozy, Jamie Dimon, Obama, David Cameron, Mario Draghi and Timothy Geithner, they are all servants of the existing financial system, of the existing banks, which are broke but try to hide that from us. At our debilitating expense.

Yes, they’ve been able to stave off the inevitable until now. But that has only been possible because they have virtually unlimited access to your money, to the wallets of the 99%.

We should grow up and make these decisions ourselves, instead of letting a group of morally severely challenged suits with very vested interests make them for us any longer.

They’re leading us straight into Dante’s Ninth Circle of Hell. And last I heard, that’s definitely not a place to raise your kids.”

We intuitively know what the executives of the bailed out Financial Institutuions must feel. After costing the American people 10s if not 100s of billion$ of dollars and trillion$ in derivitive guarantees,  they reward themselves with 100,000$ if not million$ in payday bonuses. While they did not share in their largess during times of plenty, yet we were forced to pay their debt.

How do the people toward the lower end of the economic spectrum feel?
As a ‘retired person’ living in a retirement community, I see a lot of elderly folks and have heard a lot of hardship stories.
At present, if you are looking toward retirement there is nowhere to put your savings. Money is not safe due to inflation. Banks are not safe. Funds, stocks, bonds…
If you buy gold & silver bullion or US Mint bullion coins, for protection from inflation, and safety from bank and debt collapse, you will be fined with a huge tax. The Federal Government does not want your money placed in bullion since they have no access to using those funds. They don’t want you to have freedom in your old age, they want you on welfare-where you are controlled by the threat of loss.

Everyone sees the national ‘news’ media and interprets the sound bites into the management of their own unique circumstance. What are people at the real grass-roots learning and what are their community social-economic expectations? Don’t laugh at what follows, it is the result of what was discussed in the article above.
Is the Cloward–Piven strategy working yet? Yes, and we’re far along on the road to what Ilargi refers to as ‘Dante’s Ninth Circle of Hell’. When the ‘system’ finally breaks, it won’t be paradise, but conditions may make our new minimalistic Socialistic Government subsistence checks  look like it.

Mother of 15 Kids: “Somebody Needs to Pay; Somebody Needs to Be Held Accountable”
A woman with 15 kids (and no spouse) complains that people around aren’t doing enough to help her – even though her rent, food and furniture have all been covered by good Samaritans and the government. You have to see this to believe it!
“Somebody needs to be held accountable, and they need to pay,” she said.
Um, maybe that someone should be you?

Paste the following YouTube link in your browser.

http://www.youtube.com/watch?v=bavou_SEj1E

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Professor Cornel West: Battle For Entitlements Will Be “Fought In the Streets”
December 5th, 2011, SHTFplan.com, by Mac Slavo  
With the economy on its last leg, poverty stricken Americans at record highs and mass movements against greed and interventionist government policies already organizing in major American cities, Princeton professor Cornel West predicts that the battle for entitlements will be fought in the streets.
[Image at right Professor Cornel West and President Barack Obama.]

“Some of this is going to be fought in the streets. Civil disobedience does make a difference. Because corporate greed now is an issue everybody’s got to talk about. Wealth equality – everybody’s must talk about because of the Occupy movement.” [What did we read in the articles above about the Coward-Priven startegy?- Mr Larry]

[Video link to Professor West’s interview. http://www.shtfplan.com/headline-news/professor-cornel-west-battle-for-entitlements-will-be-fought-in-the-streets_12052011  ]

Civil disobedience will only work until the people realize nothing has been done – and that nothing can or will be done. When they finally understand that politicians, bureaucrats and corporate interests have completely destroyed their way of life, then we can fully expect violent confrontations and mid-east style, potentially armed, riots in the streets of America.   This isn’t going away. In fact, the frustration, anger and desperation will continue to build pressure. Whether its the Tea Party movement, Occupy Wall Street, or other third-party protests, the momentum is gaining speed and strength.   When the powder keg finally blows all bets are off. We can only hope for civil disobedience. But considering what we saw happen in the mid-east, where many were protesting exactly the same circumstances – an out of control government, rising food prices and impoverishment of the working class, among other things – we should be preparing, as trend forecaster Gerald Celente has so oft predicted, for the people who have lost everything, and have nothing left to lose, to completely lose it.   The government is certainly preparing for this eventuality, because in many circles they know civil unrest is a foregone conclusion.

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The clock is ticking, time is running out

(News & Editorial/ The clock is ticking, time is running out.)

news-desk[1]A.  Will America make it to 2018 before the largest depression in history strikes?
July 2013, Answers.Yahoo.com, by Deusche
Pasted from: http://answers.yahoo.com/question/index?qid=20130626135336AACi7MV

Economic collapse is now a mathematical fact for the future of the western nations, the only question which remains is when. Every chart points to the 2018 period where we hit completely unsustainable figures in debt/income rations, 0% savings rate, and facing a deficit of 2X the taxable capacity. In other words, despite all the blind hope many people have, the US government can not raise taxes 100% and maintain a healthy economy, nor can people continue to spend 110% more than they make with $0 savings. It just simply isn’t possible. The trends will not reverse either, these trends have not changed since 1960, and would amount to a complete cultural shift of not spending anything and converting that money to debt and savings. This clearly is NOT going to happen before 2018.

So the question remains, will we slip into the depression prior to 2018, or will we do like everything else and wait until the last second and go off the cliff?

The days for disagreement and debate for whether the dollar will collapse are over. If you think there is a chance it will NOT then you lack the knowledge of our current economic system and I have no interest in your opinion because it is based on propaganda and complete ignorance. If you chose to ignore the blatantly obvious facts staring us in the face then you won’t matter soon anyway because you’ll lose all of your money on deposit and starve to death before 2020. (The FDIC currently only holds enough reserve for 40% of the nation’s current depositors, which is pointless anyway since the dollar will have no value)

Will enough people see the future and begin to withdrawal from the US dollar and cause the depression to begin early, or is this country too filled with the mindless and irresponsible that it will actually make it to 2018?

So out of curiosity,
How many here have at least 2 years worth of equity in non-dollar based wealth?
Who here has 3-6 months of access to food and water?
Who here has the ability to maintain these conditions > 100 miles from a major city?
Who here has NO debt, and a second trade which will be useful in a micro economy?

If you answer yes to all of these, congrats, you will survive to see 2020, if you answered NO to any of these, then your odds are incredibly small.

You have up to 1 year and 2 months remaining to make these things happen. You will not be warned by CNN, Bloomberg, newspapers, goofle, or any other media outlet, just like every other time in history when an economic crisis hits and they are blinded by normalcy bias. It puzzles me still why people think the news is going to warn them of a depression, they never have and never will. By the time you hear a Moody’s downgrade, the market dropping 1000 points in a single day, or the Fed doubling QE after an emergency session in DC it will be too late.

Many people tried to stop the great depression, dumping billions (trillions in todays inflated currency) into the systems hoping to stop it, but in the end the market and the collapse is not something anyone can stop.

This is the only Warning you will receive. It’s up to you whether you chose blind faith and financial data based on best case propaganda, or whether you do the research and realize the facts. Even common sense tells you a society completely based on financing there is something seriously wrong. Remember, the markets always surge before the crash. We’ve had the surge, so we know what comes next.

Additional Details
What you can do is stock up on basic living needs. Normalcy Bias tends to leave people with the false impression that we will always have access to cheap food at the grocery store. The average travel your food makes is 1500 miles, so it won’t take much to stop that flow. People need to remember, this past 50 years of success have been a FLUKE in human history. Starvation and suffering has been the normal for 99% of human history. We’re about to enter a NATURAL cycle of a major downturn. The reason is quite simple. The average person consumes more than they contribute. This adds up, and today our society is at its breaking point. Taxes can NOT rise and produce more, it will only shut down businesses and increase unemployment. Taxes lowered or remaining the same will definitely lead to US defaults. Either way it’s coming.

There is no “Which one” you idiot. The entire western civilization and their governments are completely broke. What part of this do you not understand? Which chart can’t you read? What part of 100% broke is so hard to figure out? These are not standing figures, these are ratios. Do you know what a ratio is? Probably not…

100% debt/gdp
110% consumer di debt/income
3:1 deficit increase

This means the entire western civilization is spending MORE than they bring in. So when people say there is nothing wrong, the economy can continue they are not only wrong, they are completely and utterly clueless.

1 – 2 does not equal + numbers. You can’t barrow out of debt, you can’t continue spending more than you make. At some point the lenders STOP, and what do you think interest rates will do?? We can barely afford the debt service now at practically 0%, so just how exactly are people and the governments going to afford 2X 4X 9X the payments???

B.  Celente Warns: “If You Don’t Have Your Money In Your Pocket It’s Not Yours”
22 Oct 2013, SHTFplan.com, by Mac Slavo
Pasted from: http://www.shtfplan.com/headline-news/celente-warns-the-collapse-of-2014-if-you-dont-have-your-money-in-your-pocket-its-not-yours_10222013

clock ticking

(Image courtesy Dees Illustration)

If there’s one thing that should be clear, it’s that nothing the government or their banking partners have done to solve the economic crisis has been for your benefit. They’ve enriched themselves, yet again, on the backs of the American people.

All the while, they’ve told us that everything is getting better. But anyone who’s paying attention know that nothing of the sort has happened.

We continue to shed jobs. Hundreds of thousands of people are still losing their homes. Personal debt is rapidly approaching 2007 levels. The U.S. government has borrowed more money than what we can ever hope to repay.

We are still in the middle of it and it’s only going to get worse.

If you think it’s over, that they saved us and we’re out of the woods, then you’ve got a lot of pain coming your way.

And if you think you still have plenty of time to prepare, that it’s decades or years away, you’d better think again.

Trend forecaster Gerald Celente predicted the collapse of 2008 in remarkable fashion. And now he’s warning of a similar crisis to come next year.

There’s fear and hysteria running through the entire global financial community, because as everybody knows all they did was postpone the inevitable.

[They’re going to] turn more of America into Slavelandia as well, where people can get those part-time jobs, have no insurance, no benefits, and not enough money to live on, and they’ll have to go on food stamps and other assistance…

I’m saying to everybody out there, If you don’t have your money in your pocket it’s not yours.

Any self-respecting adult that hears McConnel, Reid, Boehner, Ryan, one after another, and buys this baloney… they deserve what they get.
And as for the international scene… the whole thing is collapsing.
That’s our forecast.
We are saying that by the second quarter of 2014, 1) we expect the bottom to fall outor 2) something to divert our attention as it falls out.

It’s the militarization of the United States… because of the grand scheme. And that is, these people may be stupid – the people running government – but they’re very shrewd. And they know… that there’s no way to solve these economic problems.

The mayhem that went on at Walmart when people couldn’t cash in their food stamps.
Multiply that by tens of millions. Multiply that by a breakdown in society. 

Look what they did in Boston. To me that was a test. They closed down a hundred square miles… to hunt for a 19-year old kid.
Look at America’s most feared criminal of this last year. A 19-year old kids, Snowden, and Bradley Manning. Now there’s three faces of disaster you never want to meet in a dark alley.
So, you can see how this society is being controlled because they don’t want anyone to get out of line.

YouTube

Watch Gerald Celente and Alex Jones discuss the coming trends and our future at YouTube:
http://www.youtube.com/watch?feature=player_embedded&v=SEgd8t339gU

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Make no mistake. It’s coming.
And when it hits, it’ll make the crisis of 2008 look like a picnic.
We survived that one, barely, but it took trillions of dollars just to stabilize, not fix, the system.

This time around, our creditors and the people as a whole may well lose confidence. And once that is lost, look out, because as Gerald Celente notes, the happenings at Walmart when the EBT system crashed were just a prelude.

Imagine that next time around it happens to not just EBT cards, but ATM’s and bank accounts, or that the U.S. dollar itself crashes to such an extent that it is no longer feasible as a mechanism of exchange.
In such a scenario you can fully expect disruptions to food supplies and the normal flow of commerce.
The only saving grace you’ll have are the physical assets in your possession – your arable land, long-term food stores, gold and silver ( http://www.jmbullion.com/ ), and the post-collapse labor skills you’ve developed.

The time to prepare is now or you may well experience the horrific effects to come.

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C.  Shadow Stats Founder On Hyperinflation: Disruptions to Food Supplies, Normal Flow of Commerce
5 May 2010, SGTFplan.com, by Mac Slavo
pasted from: https://www.shtfplan.com/emergency-preparedness/shadow-stats-founder-on-hyperinflation-disruptions-to-food-supplies-normal-flow-of-commerce_05052010

Many of our readers are familiar with John Williams of Shadow Stats (http://www.shadowstats.com/ ). We often refer to his economic analysis to get the real story about GDP growth, unemployment and most matters of government accounting.

In previous articles, we’ve discussed the threat of Hyperinflationary Depression – No Way of Avoiding Financial Armageddon and What is Money When the System Collapses?

Mr. Williams was recently interviewed by The Gold Report and the discussion revolved around the real possibility of hyperinflationary collapse of the US Dollar and an economists view of what the effects of such a collapse would be. If you haven’t read our previous articles, we’d recommend reading those now as they may provide some ideas, tips and strategies to help you whether the storm in the event that it does happen as Mr. Williams suggests it may.

The following excerpts are just snippets from an excellent interview that is worth your while to read in its entirety.

There’s strong evidence that we’re going to see an intensified downturn ahead, but it won’t become a great depression until a hyper-inflation kicks in. That is because hyper-inflation will be very disruptive to the normal flow of commerce and will take you to really low levels of activity that we haven’t seen probably in the history of the Republic.

Again, if you start to see,  1) a great depreciation of the U.S. currency or, 2) a tremendous increase in lack of confidence in the soundness of the government’s fiscal condition, there is a problem. You mentioned Greece, for example. The sovereign solvency issues there are minuscule compared to what we have with the United States, which is the elephant in the bathtub. The markets know it’s there. The central bankers know it’s there. Again, with the downturn in the economy, all the issues are going to be brought to a head. 3) As they come to a head, there will be that effort to dump the dollar. I would expect that, indeed, it will be decoupled from its reserve status, although it could follow after the fact as opposed to before the fact.

Beyond income issues, the problem with the hyper-inflation is that very quickly the use of cash will cease. Let me contrast our circumstance here with a very popularly followed hyper-inflation case that’s now run its course in Zimbabwe. There you had probably the worst hyper-inflation that anyone’s ever seen. After devaluation upon devaluation, they successively lopped the zeros off the bills. If you took a $2 bill that they first issued back in the ’80s and then tried to come up with the equivalent of a $2 bill in the last form of the currency, it would be very difficult to do because it was so worthless. If you put a pile of those together to equal the original $2 bill, it would actually stretch from the earth to the Andromeda Galaxy. We’re talking light years. There are not enough trees on earth to print them. Yet the Zimbabwe economy survived and functioned. They had a lot of problems, but they operated. The reason they functioned was because they had a back-up system, which was a black market in U.S. dollars. People switched out of the Zimbabwe dollar to U.S. dollars. They could live with that. In the U.S., we don’t have a back-up system.

In terms of preserving the purchasing power of your assets, the best thing I can think of is physical gold. That’s worked over the millennia. I’m not per se a gold bug. It just happens to be a circumstance in which it’s the cleanest asset around for that. You don’t need to put all your assets into gold, but hold some. Hold some silver. I’d look to get some assets out of the U.S. dollar and look to get some assets out of the U.S. When I say outside of the U.S. dollar, again, I look at the Canadian dollar, Australian dollar, Swiss franc in particular. I think they will tend to do particularly well, whereas the U.S. dollar is going to become effectively worthless.

As the dollar breaks down, you’ll also likely see disruptions in supply chains, including shipments of food to grocery stores. People should consider maintaining stockpiles of basic goods needed for living, much as they would for a natural disaster. I sit on the Hayward fault in California. I have a supply of goods and basic necessities in case something terrible happens-natural or man-made-that will carry me for a couple of months. It may take that long for a barter system to evolve, which I think is what you’re going to end up with; at least until a new currency system is reorganized and you get a government that’s able to bring its fiscal house into order. No currency system in the U.S. is going to work unless the fiscal conditions that drove it into oblivion are also addressed.

I like physical gold and silver. I look to gold as a primary hedge. If you can come out of this holding gold, you’ll be in a position where you’ll be able to take advantage of some extraordinary investment opportunities that will follow.

It’s coming, and top (non-mainstream) economists are telling us to get ready.

Contrary to what we hear from Mr. Bernanke, Mr. Geithner, and Mr. Paul Krugman, the economy will not continue to grow indefinitely and we have not completely recovered yet. This is all part of a greater depressive trend in the economy and if Mr. Williams is right, the real numbers will show economic contraction in the latter part of 2010. What will the stock market and bond markets do once global investors and US debt buyers realize that the so-called recovery was nothing more than a mirage?

The Federal Reserve is printing trillions of dollars, and when it becomes apparent that the plans put forth by President Bush and President Obama have failed, we are going to be in serious trouble.

We are going to side with Mr. Williams on a coming hyperinflationary destruction of the US Dollar at some point in the near future (timeframe: +- 5 years), and we hope that Mr. Williams’ assessment of a brief period of disruption to commerce is accurate. Because if it is anything longer than that, then the shit will most certainly be hitting the fan in the style of The Day the Dollar Died or Patriots,, and that will not be in any way pleasant, even for those of us who are ready for it.

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Precious metals will become currency as the dollar goes bad

(News & Editorial/ Precious metals will become currency as the dollar goes bad)

bad dollar currency

A. Recent headlines:
1. China-Russia currency agreement further threatens U.S. dollar:
http://www.ibtimes.com/china-russia-currency-agreement-further-threatens-us-dollar-248338#

2. Brazil, China Sign Trade Deal to Bypass Dollars:
http://silverdoctors.com/brazil-china-sign-trade-deal-to-bypass-dollars/

3. China-Australia to Ditch US Dollar…
http://www.stormfront.org/forum/t957807/

4. BRICS Nations (Brazil, Russia, India, China and South Africa) signed Local Currency agreement at Summit. They will not trade in U.S. dollars anymore. Agreements around the world between Countries to Drop U.S. dollar for trade (including Australia http://sherriequestioningall.blogspot.com/2012/03/bric-nations-brazil-russia-india-china.html

5. The Germans Want Their Gold Reserves Back In Germany:
http://www.forbes.com/sites/robertlenzner/2013/01/19/the-germans-want-their-gold-reserves-back-in-germany/

6. “Germany wants its gold back, Fed says…eventually, maybe“:
http://www.examiner.com/article/germany-wants-its-gold-back-fed-says-eventually-maybe

7. Texas Wants Its Gold Back From The Fed:
http://www.zerohedge.com/news/2013-03-23/texas-wants-its-gold-back-fed

With the world human population being 7.0 billion, so 30% of the world has moved away from the dollar.
China (1.3 billion population), Russia (143 million), Brazil (194 million), Australia (23 million), India (1.2 billion), South Africa (51 million) = total 2.91 billion population of listed countries.

..

bad dollar historicB. Implications of the loss of the dollar’s reserve status
22 Mar 2009, MarketSkeptics.com, by Eric deCarbonnel
Excerpt pasted from: http://www.marketskeptics.com/2009/03/how-big-deal-is-loss-of-dollars-reserve.html

As the dollar loses its reserves status, at least half of the world’s $5,385 billion dollar reserves will be sold off and replaced with other currencies (yuan, euro, khaleeji, gold, rand, etc…). The US, with its $71 foreign reserves, will not be able to do anything to counteract this mass exodus from the dollar. With outflows of this magnitude, the dollar’s value will collapse to a fraction of where it is now. The process of foreign nations extracting themselves from the dollar is not going to be pretty. The likely impacts are:

1) The dollar’s value will plunge as investors see the writing on the wall and jump ship.

2) US credit markets will collapse. As the dollar fall, a mass exodus from credit market will begin. Investors sitting on toxic securities will sell at firesale prices to escape the currency depreciation.

3) The fed’s balance sheet will explode beyond all reason. In response to the mass exodus from credit markets, the fed will buy trillions worth debt in a desperate attempt to hold interest rates down. Unfortunately, the more debt the fed buys, the more quickly the dollar will fall, and the more panicked the credit selloff will become.

4) US interest rates will soar, despite (or because of) the fed’s efforts.

5) Countries around the world will be hurt badly by the dollar’s decline. These countries include:
_A)  Nations which are heavily dependent on US exports: Japan, Mexico, etc…
_B)  Nations with large dollar reserves: Japan, China, Gulf oil states, etc…
_C)  Nations which receive large amount of US foreign aid: Israel, Egypt, etc…
_D)  Nations which rely on remittances from citizens working in the US: Mexico, India, etc…
_E)  Nations which use dollars as their official currency: Liberia, Panama, etc…
_F)  Nations which have large amounts of dollars in circulation: Central and South America (especially Argentina), Eastern Europe, etc…

6) Some nations will see benefits from the dollar’s decline. These countries include:
_A)  Nations with large gold reserves: EU zone, Switzerland, etc…
_B)  Nations which owe dollar denominated debt will see that debt wiped out: Iceland, African nations, etc…
_C)  Nations who stable currencies: EU zone, Switzerland, China, etc…

7) World politics will be greatly altered. There will be considerable anger at the US from nations hurt by dollar’s fall. The US will lose influence to Asia (mainly China).

8) US retailers will get crushed. As the dollar falls, the cost of imports for retailers will increase, but the American consumer will be unable to afford to these higher prices. Competition between desperate retailers will force them the sell inventory at below cost, creating massive losses. Retailers most heavily dependent on imports (ie: Wal-Mart) will be the first to go under. Eventually as more and more retailers go bankrupt, the few survivors will be able to raise prices enough to cover costs, and the sector will stabilize at a fraction of its current size.

9) American lifestyles will change radically. The end of cheap oil, low interest rates, and deficit spending will mean a lower quality of life and higher taxes.

10) The price of gold and other precious metals will explode.

11) US will experience hyperinflation.

 .

C. WHAT IF?
29 May 2013, Gold-Eagle.com, an editorial by Larry LaBorde of http://www.silvertrading.net/ Pasted from: http://www.gold-eagle.com/editorials_12/laborde052913.html

What if the US lost its world reserve currency status?  What might it look like? I suppose the first question is; what does it mean that we have the “world’s reserve currency”?
At the end of WWII the allies met at Bretton Woods and decided to use the US dollar as the official world currency and that it would be backed by gold.  All worldwide trade would be priced in dollars and settled in dollars.  Food, energy (oil), etc from around the world would be priced and paid for in USD.  New York became the financial center for all world trade. Fast-forward to President Nixon in 1971 and the USD was cut loose from the gold standard due to OPEC oil imports and a growing imbalance of trade that was causing gold to flow out of the US in large amounts. Today goods from around the world flow to the US and newly created paper dollars flow out.  (Well not really paper dollars, just newly created electronic digits made up on a computer.)  In essence we create IOUs that everyone must accept due to the Bretton Woods agreement and they send us their stuff.
Once we completely figured this out we decided in the 1990’s that we would “think” and they would “work”.
The US was going to run as a clean “information society” and all that dirty industry would go somewhere else.  Our balance of trade kept getting worse and worse.  We imported way more than we exported.
We used to report our imbalance of trade numbers a couple of decades ago with great concern.  Now no one seems to care at all since it is so far out of balance that it can never be fixed.  (Sort of like an annoying knock in the engine that you fix by turning up the radio.)  Ocean going freight containers started to pile up over here because we didn’t have enough goods to send them back fully loaded.  For a while we sent hay overseas in freight containers because we had to send empties back to get them refilled so they greatly discounted the freight on the backhaul or return trip.
Many people have started to find creative uses for these freight containers that are building up over here.  They are the empty boxes on Christmas morning.  Who sends the empty boxes back to the store for more toys?  You just get new boxes.
Under the original Bretton Woods agreement if one country imported more goods than they exported the difference was settled up in gold.  After a while the lazy country sent so much gold overseas that its currency dropped in value and they could not import as many goods.  The lower priced currency made their exported goods more competitive so they began exporting more and the gold flowed back.
When the link to gold was cut this self-regulating mechanism was broken.  So now why should the US export anything?  Why not import everything and just pay for it all with USD made up from nothing?  Works great for the US but everyone else may have a problem with that system.  So why does the rest of the world still accept our USD electronic digits?

One reason is the rest of the world can still spend them at the Middle East gasoline station to tank up with oil.  In the late 1970’s and early 1980’s a deal was cut with the Saudis that so long as they priced their oil in USD and USD only, we would support their family rule with the full force of the US military.   So even though we did not export enough goods to soak up all of our exported USD, the Middle East did.  The OPEC countries then purchased our US bonds with their excess USD and earned a pretty good interest on their USDs – until now.  Whenever someone in North Africa or the Middle East failed to live up to the agreement they were “replaced” with someone who would. The whole system is now broken but still working somewhat.  The only reason the rest of the world has not thrown it out altogether is there is not anything else to easily take its place.  (Your thoroughbred now is old and swaybacked and stumbles along but it is still better than walking.)  The world thought the Euro might offer an alternative to the USD when it was first launched.  We all see where that is now leading.  Doug Casey famously said, “The dollar is an IOU nothing but the euro is a who owes you nothing.”  It seems that the euro is not going to offer the USD any serious competition.  The USD is still the prettiest horse at the glue factory. So what is next?

Well the BRICS (Brazil, Russia, India, China and South Africa) have started their own development bank.  This cuts the World Bank out of the picture in much of the world.  The G-20 is talking about alternative currencies to challenge the USD and perhaps replace it one day with something a bit more fair to everyone else.  China is cutting trade deals directly with Brazil and Australia outside of USDs.  India is cutting deals with Iran outside of USDs.  This is in direct violation of the Bretton Woods agreement.  However, these countries feel they are exchanging value for value in their trade with each other on a more fair and equitable arrangement.
What would make a new reserve currency attractive?  If the country that issued it had a trade surplus or at least balanced trade with the rest of the world a lot of the resentment would disappear.  If the new currency were backed by gold once again the self-regulating mechanism would be fixed causing no one country to benefit to the detriment of another.  If a basket of currencies were used from several strong countries with both of these attributes then even better. Rumor has it that Russia and China have both been working hard to build up their gold reserves and they are both about 5 times the US gold reserve at its peak.  Rumor also has it that the US gold reserve is maybe not as large as reported. What if instead of Greece (or another PIIGS country) pulling out of the European monetary union and reissuing its own currency that something more interesting happened?  What if the strong man with the 3rd largest gold reserves and a strong export economy pulled out and reissued its own currency – backed by gold!
What if Germany pulled out leaving the Euro to collapse?  Then what if Germany looked east and linked up with Russian and Chinese currencies that were also backed by gold?  A new reserve currency made up of a basket of these three currencies (all backed by gold) would be a Eurasian powerhouse. But where would this leave the USD?  So long as the Middle East Gasoline Station was still in business and accepting USD it would survive.  But what if the Muslim Brotherhood took over Saudi Arabia?  What if the house of Saud fell?  What if the Chinese would not loan us any more money to mount Gulf War III to save the house of Saud?
There are several “ifs” here but what might happen? If the rest of the world could not spend their USD reserves at the Middle East Gas Station and we are not able to ramp up our exports and sell them something they might want, then what exactly would they do with those USD?  Why would anyone else in the world want them?  And since 1971 we have been sending them all over the world and they have been piling up in every corner, there are a lot of them out there that suddenly find themselves unloved.  I believe that all at once there would be a race to spend them all at the only place where they must be accepted – to the only place where they are legal tender for all debts both public and private – right here within the US.  They would buy everything that was not nailed down.  Cranes, bulldozers, tractors, trucks, ships and entire factories all to be crated up and carted off.  The mad rush of so many dollars would cause these items to be bid up to very high prices in USD.  This of course would devalue the USD even further.
All of a sudden all those old ocean containers that have been piling up over here would be filled to capacity hauling assets off as fast as possible.  All of those IOUs would come home to roost at the same time.  Of course we could default or slap on export taxes of 1,000% or some sort of currency controls for repatriated USD.  They could even call all of those USD overseas illicit drug money and seize all of it!  But that might lead to a war or several wars.  Wars have been fought over issues far less trifling than that.  No one likes to get stiffed on an IOU.  Especially the largest pile of IOUs in the history of the world.

Assuming that we did the right thing and honored our debts.  What would the US look like after the smoke cleared?  What few factories remained would be largely owned by foreign interests.  With much of the means of production carted off we would have a hard time exporting more than we consumed.  Anything imported would be terribly expensive priced in USD.  A trip to Wal-Mart would be like going to Neiman Marcus.  Since we no longer grow enough food to feed ourselves our imported food would be very expensive.  If the welfare state continued the dollar would devalue even more and finally collapse.  Everyone would have to accept a much lower standard of living as we worked in factories owned by foreigners.  As our dollar finally devalued to a fraction of its former glory the US would become a cheap labor country.  Factories would move back to the US for the same reason many moved to Mexico in the 1980’s and 1990’s.
Slowly we would rebuild and in a few generations we could be a first world country again.
So what can you do now?  Where can you run?  When the War Between the States began and the first Battle of Bull Run was fought, Southern General P.T.G. Beauregard set up his headquarters in the home of Mr. Wilmer McLean.  Mr. McLean was too old to fight in the Southern army and sought to move his family to safety.  He glanced at the map and picked a nice safe place 120 miles further south  – in Appomattox.  You see the war started in his front yard and ended in his parlor as General Lee surrendered the Army of Virginia to General Grant several years later.  The first and last great battles of that war both found Mr. McLean.   Sometimes you can run from danger but in the wrong direction.  Take some time and carefully think things through for yourself.  Make sure you are not jumping out of the fire and into the frying pan.  A storm could be coming our way.  Build a good storm shelter just in case.  Years too early are better than seconds too late.

 ..

D. Arizona lawmakers back gold, silver as currency
18 Mar 2013, Yahoo! News, by Cristina Silva/ Associated Press
Pasted from: http://news.yahoo.com/arizona-lawmakers-back-gold-silver-233837866.html

Arizona Republicans want to allow gold, silver to be used as currency

PHOENIX (AP) — Arizona lawmakers say the global economy is on the precipice of financial ruin and the U.S. dollar could soon be worth less than the paper used to make it.

These doomsayers are pushing forward legislation that would declare privately minted gold and silver coins legal tender, no different under state law than the U.S. dollar printed by the federal Department of Treasury.

The measure is Arizona’s latest jab at the federal government, which prohibits states from minting their own money. It also reflects a growing distrust of government-backed money.

“The public sees the value in it,” said Republican Rep. Steve Smith, of Maricopa. “This is the type of currency we have had over the history of mankind.”

The bill, which advanced in a 4-2 vote by a House committee Monday, states that gold and silver should be legal currency not subject to tax or regulation as property. The Republican-led Senate gave the bill its blessing in February in a 17-11 partisan vote.

The bill would let people use the precious metals as money as long as businesses agree to take them. If made law, it would take effect in 2014.

Democrats oppose the measure. They say it would be a bureaucratic nightmare because businesses don’t have the equipment to determine the value of gold and silver.

“This should be addressed by the Federal Reserve and not by the state,” said Democratic Rep. Rosanna Gabaldon, of Green Valley.

Keith Weiner, president of the Gold Standard Institute, which supports gold-backed currencies, said he envisions a system where people can pay for goods and services with debit and credit cards backed by gold and silver.

Paper money is a “recipe for worldwide bankruptcy,” Weiner told Arizona lawmakers Monday. “Everybody is going bankrupt on this system so we need a sound and honest money system, such as gold and silver.”

In 2011, Utah became the first state in the country to legalize gold and silver coins as currency. Lawmakers in Minnesota, North Carolina, Idaho, South Carolina, Colorado and other states have debated similar laws in recent years.

Many investors have invested their money in precious metals in recent years as a hedge against the declining value of the dollar. When the value of the dollar declines, gold prices rise.

Gold rose $12, nearly 1 percent, to $1,604.60 per ounce on Monday with news of Europe’s bailout plan for cash-strapped Cyprus. Silver inched slightly higher, up 2.3 cents to $28.874 per ounce.

The dollar was up against the euro, the currency used by 17 European countries, as well as the Japanese yen and the Canadian dollar in February.

Proponents of the switch to gold and silver argue paper money is too vulnerable to government manipulations. When central banks boost the amount of currency in circulation to drive down interest rates, the value of that currency relative to others can decline.

“It’s actually strange to me that we don’t have this already,” said Republican Rep. David Livingston, of Peoria.

Gold-backed money fell out of favor during World War I because the U.S. and many other countries needed to print more cash to pay for the war. In 1971, President Richard Nixon formally abandoned the gold standard.

 .

 E. Arizona’s Hard Currency: How Much Gold Might It Need?
27 Apr 2013, Gold-Eagle.com commentary, contributed by Miguel Perez-Santalla
Pasted from: http://www.gold-eagle.com/editorials_12/perez-santalla042713.html

How much gold & silver might Arizona, Utah and the other states now involved in hard-currency laws come to need…?
ARIZONA is moving to allow gold and silver coin to be used to pay debts, and – effectively – go shopping. This has already been approved in the state of Utah, and there is an assortment of other states that are moving in this direction as well. However, Utah’s gold currency law has been on the books for more than a year. But it has not yet made any headway into how to manage gold and silver being used as currency. Nor will payees be obliged to accept bullion as payment. As a result, many pundits are pooh-poohing Arizona’s gold idea, acting as obstacles to its possible success.
Though I don’t personally believe that physical gold and silver carried around by persons is the future of our country, I do believe that there will be some structural change to come. The small yet actively progressing action in many states is an indicator of the demand for better controls and justification of the value of our money. Concern that the ability to print money without measure will destroy this country is not only just, but is also warranted.

The Federal Reserve – which is not part of the government – is actively in charge of our currency. By injecting capital to the markets to support the banking sector, which irresponsibly lost billions of Dollars in their management of customers’ funds, they have instituted an invisible tax on all citizens of the United States of America. It is no surprise that many people who pay close attention to these matters are up in arms. Especially, since they don’t participate in the windfall of free capital given by the Federal Reserve to the banks as a safety net.
In essence, every time the government issues money freely and gives it to others it is a promissory note on the ability of the populace to pay, it puts us all more in debt. The people of the United States of America are becoming fed up with the free-flowing funds the government regularly gives away as gifts of supposedly humanitarian aid to foreign countries that are not even considered allies. These gifts in the billions of Dollars are on top of expenses needed to support our infrastructure. This creates a mountain of debt that essentially devalues the US Dollar. Our ability to pay is what the citizens are concerned with.
To avoid this many are turning to silver and gold bullion as a reliable asset or marker of value. Of course when you tie up your money in an asset like gold and silver you want the most easily accessible manner to extract that value whenever needed. This is where the effort to make gold and silver accepted as currency is coming from.
So let’s take a look at what would happen if one state such as Arizona were to convert to a precious metal economy. Arizona’s GDP (Gross Domestic Product) was roughly $258 billion at last count. As a proportion of the United States’ entire economy, that’s about 1.7%. Which if we apply that number to the total of currency in circulation and bank deposits (known as M2 by the economists) gives Arizona a money supply of somewhere around $180bn. Using today’s market prices, in gold that would represent 126,000 ounces which is nearly 143% of the current annual world production, and it would represent over 945% of the world’s annual silver production. But of course silver is an extremely bulky and difficult metal to handle. No one thinks the entire state of Arizona would go to 100% metal-backed currency. People will of course remain free to use fiat (backed only by faith) money, and most would likely choose the same fiat Dollars and bank-account credits we already have.
But it’s important to understand that – in the proposals as they stand – people could choose to use metal-based currency for all their in-state transactions. So the potential ceiling on the gold or silver needed is much nearer to 100% of that $180bn than it would be under a formal “Gold Standard”. There, with Dollars redeemable for gold, full gold-backing wasn’t necessary.
The Gold Standard instead used precious metals as a standard of value. The last US gold standard was a 25% basis of gold in fact, before it was repealed in 1968. Applying a classical Gold Standard, and using a 25% basis for gold or silver, Arizona’s cash and bank-deposit holdings would occupy 235% of the world’s annual silver production at current prices, or 36% of the world’s annual gold production.
A more logical decision may be a combination of the two, with a 5% silver and 25% gold funding which would represent 30% annual gold production and 39% silver production. This of course would drive the value of the precious metals much higher, as the market adjusted to accommodate Arizona’s impact on global demand. But as we just saw, Arizona’s proposals go far beyond a Gold Standard, making 100% metal-backed banking and currency a possibility, if highly unlikely. Note, this is only for one state – and one where barely 2% of the US population now live. The numbers involved are already stupendous.

You can imagine what would happen to gold and silver prices if all 18 states currently working on similar “hard currency” laws saw only 10% of their citizens move to holding precious-metals. But that being said, I do not believe at this very moment it is the goal of this legislation. The new legislation deems to allow transactions to be negotiable and settled in full using gold or silver if the parties involved agree to it. Hence you can sell your car for 4 ounces of gold or buy a house for 10,000 ounces of silver. But to do so without an official government structure you would have to in effect be your own central banker and invest your currency into your own private gold and silver reserves. Hence when you go to enter into a transaction the value of your asset should have been protected from any central banking or government debt fiascos. Are currencies backed by gold and silver to be the future? This is possible in some form. Had this system not been tried before? The answer to this is yes. But the methods that were used in the 20th century were complicated by the entry of the Federal Reserve System and other Central Bankers. It was prior to central bank machinations that gold and silver brought stability to the financial markets and the economy in general.

With the entry of the central bank models, including the Federal Reserve, free spending of the people’s money became a possibility and is what eroded the gold standard and derailed a more functional system. Unfortunately most of the spending was used to fund wars. Maybe if wars had to be paid in hard assets they may have ended sooner than later with less loss of human life. However, there are arguments on both sides of the fence. As I read and study more and more about our modern-day banking system it is a miracle that it has not failed sooner. Of course this is my personal belief. This is also what is driving the current activity in the states to bring in some correlation of currency to gold and silver as hard assets. The history of the Federal Reserve, which is not a bank, has the US economy since its inception riddled with negative GDP growth. It is peppered with financial calamities. Its primary function was said to be the stabilization of the economy.
It has failed and has not performed better than any other prior system. I don’t have the answers but I know it doesn’t lie in the Federal Reserve System. This is a centralization of power away from capitalism to a form of modern day socialist tendencies of spending without limits within our system. This indicates to me in the event of a serious economic downturn, which seems to be forthcoming since we already did kick the can down the road as far as we can, we will have serious troubles in the union of these United States of America. But for the time being the general public who are able, are happy buying their gold and silver and keeping it in a safe and secure place for when this situation rears its ugly head. Those that do and are in the states where they have legalized its use as currency stand to have a much more secure environment moving forward as the government is not allowed to take away your money without cause. At least, not at the moment.

bad dollar charts

[Today, we have a price buying opportunity in gold and silver bullion coins. When the SHTF, prices on retail items will rise, inflation will surge, precious metal prices will have risen steadily ahead of events as the global situation deteriorated in ways not understood by the public. When everyone realizes that they need a stable source in which store the value of their rapidly eroding currency (dollars), those precious metal commodities will already be exceptionally expensive in dollar terms. You have to buy the dips while the opportunity exists, as the ancient adage says, “By low. Sell high”. Mr. Larry]

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Prepare with Cash and Equivalents

(Survival Manual/2. Social issues/Prepare with cash and equivalents)

Prepare with Cash and Equivalents

 Our financial system needs growth to sustain it, so that loans can be paid back with interest. Once  peak oil hits, growth will be gone. Economic growth may even be replaced with economic decline. It is not clear our financial system can handle this.


When it becomes serious, you have to lie”, Jean-Claude Juncker, Chairman of the Euro zone finance ministers and the currency union’s key spokesmen, May 2011.

Projection from early 2005
Today’s fiat money system is in joint peril with other paper assets during the upcoming worldwide depression. Unlike the last depression, our Federal Reserve paper money is backed by nothing but
air, hot government air, redeemable in like units. And nearly as cheap as air to give to the body economic, Rubin and Greenspan (Plunge Protection Team) will work like crazy to inflate the bursting economic bubble with huge quantities of this air.
•  I would expect the discount rate to drop to near 0% enticing us to borrow more, refinance again and to help them float the market and the world on the sinking U.S.S. Titanic. [Local bank interest rates 0.1% in 2009-2010, 0.05% during 2011.]
•  But eventually this ploy will become unworkable as we find ourselves mortgaged to the hilt and questioning our ability to repay. (July  2011]
•  Mass bankruptcy will follow and the good faith and credit of the U.S.A. will look to be in real trouble to the rest of the world. [First international bankruptcy 2010-2011]
•  There will be a flight to quality, dollars around the world will be sold at any price as they go through a confidence crisis. This is the reason that the next depression will eventually end up being inflationary
and not deflationary. [Gold started its long-term rapid rise in the summer of 2008. Silver ‘took off’ in April 2010]
•  Money then is a commodity (pretty printed paper, cheap metal slugs, barter items, and/or precious metal coins) that you can use in trade for other commodities you would like. You choose each day what you will trade your labor or stuff for, to use as money.  You are wealthy only if you own and control the means to sustain life for yourself and possess items that can be traded with others.
•  Paper assets are about to be destroyed in the upcoming years during a stock market crash. These overvalued pieces of colorful paper, with the engraved images of our national forefathers, will not feed or take care of you because nobody will be willing to trade anything worthwhile for them. These include Stocks, Bonds and any other debt based paper asset like Federal Reserve Notes and your bank account valued in Federal Reserve Notes.
Additionally copper-clad coins will eventually be viewed for what they are –  Slugs – imitations of the real thing. What then will be used as money?

Four Characteristics of Money
1)  It must be divisible.
2)  It must have high value in relation to its volume and  weight.
3)  There must be widespread recognizability.
4)  It must have transportability.
Gold and silver coins satisfy all these requirements.

A.  How much and what kind of money should I own?
To prepare for the  coming depression please consider the following:

1)  Newer Coins
You will want to have on hand a significant amount of pennies, nickels and copper-clad dimes and quarters.  This is for when limits on bank withdraws begin and cash is scarce. You do not want to use your gold and silver coins then, they are to be used when things start leveling out and the economy restarts. Most people will not initially know the value of gold and silver. Therefore, use the copper-clads until the populace gets educated. If you are on a budget, start by collecting a few hundred dollars face value. A wealthy individual could have thousands of dollars face value of copper-clad coins
tucked away.

2)  Paper Money
You will want to start by having enough paper cash money on hand to cover at least one month’s
personal expenses: mortgage payments, car and truck, taxes, utilities, household supplies, etc. If you are well enough off I would recommend that you have much more. According to the experts you must have cash on hand, not in the bank, to satisfy your obligations or you may be forced to forfeit your assets. Also, as the stock market crashes and banks suspend withdraws, you will be able for a  short time to buy pennies on the dollar. Additionally, banking services will be non-existent and checks, credit cards, etc. will be useless. An assortment of $1, $5, $10 and $20 bills is recommended (it may be difficult to get change for larger bills). The amount you feel comfortable storing is up to you. Keep the cash where you can easily get your hands on it.
You may not have access to your safe deposit box because of an extended bank holiday.

3)  The Transition Period Between Fiat Money To Real Money
Eventually, the liquidity crises, during and after the bank limits will pass, and paper dollars will be devalued (they become worthless), the federal government will begin taking over the failed banks, they will make good on the FDIC and FSLIC government bank guaranty and other government commitments by printing new larger denomination paper money.
$500, $1,000, $5,000 and then $10,000 bills will be reissued by the federal reserve in huge quantities, and/or they will circulate a new type of currency. Copper-clad coins, and small bills will become worthless, unless you have wheel-barrels full of them. Run-away Inflation. This will be a hyper-inflationary period for people holding paper assets, paper money and copper-clad coins. When you get wind of the coming currency devaluation dump your paper and copper-clad money for anything of real value. This is the time to already have your silver, gold and any other items you will want and to barter with.
Look for a new National Value Added Tax (V.A.T.) on all purchases and services. Government-controlled rationing will be setup and the Black Market will be in operation.

4)  Silver Coin
Now the importance of having gold and silver coin is evident after seeing the stock market crash scenario and the destruction of paper assets. The only money that is real is that which has intrinsic value. Currency like gold and silver money will be the only real store of money value. The wealthy individuals to emerge from the coming stock market crash and depression that follows, will be the ones who have preserved their wealth during the destruction of paper assets. Face it, after having a roof over your head, food to eat and clothes to wear, you will be wealthy only if you have things of real value to others and if you can turn that into opportunity for yourself. Barter any commodity that you can but the two commodities historically that always become real money and a reserve of value are gold and silver.

You will want now to buy as much silver as you can, before the VAT becomes law, and while the rest of the world is chasing after paper assets. Today, silver is a good value compared to how it will appreciate. Although you will want to acquire gold, silver is better suited for small exchanges and will be used more for the day-to-day purchases. Get plenty of junk silver, pre-1964 dimes, quarters and half dollars by the bag ($1000. face value), 1/2 bag or smaller amounts. You are basically getting old U.S. silver coins that have been picked through to remove the rare pieces. The price is currently about 5 times the face value. Old silver dollars are much more expensive costing about 30.88per dollar (based on 39.90 spot price of silver, 29 July 2011). Your best value for silver dollars is to get newly-minted US American Eagle silver dollars, the US mint has been minting the new silver coin since 1986 and they are about $44.60 each (29 July 2011) and contain 1 troy ounce of 99.9% silver, this is about a 0.3 ounce more silver than carried by the old silver dollars (0 .714 troy oz.).
All these coins contain a specific amount of silver and are recognized by the whole world as to their size and weight. U.S. coins are better than other coins or bullion because of their recognizability, so don’t hold anything, but U.S. gold and silver coins.

5)  Gold Coin
The best value in U.S. gold coins are the ones minted by the U.S. Government. US American Gold Eagle coins are currently minted, ranging from about $180, May 2011, for the 1/10 oz. coins to about $1,627, July 2011, for the 1 oz. coins. There are also 1/4 oz. and 1/2 oz. coins, but I prefer either the 1/10 oz. or the 1 oz. coins.
•  1/10 oz. gold coins should be used to barter on small items; items that are larger than what you can buy with your 1 ounce silver coins.  The 1/10 oz. coin is ‘valued/stamped’ at $5.00 and would be an easy way to buy something worth a fraction of  the 1 oz. of gold.
•  The 1/4 oz. gold coins are improperly valued at $428, May 2011 because of their weight;  the 1/2 coin is not a good value because of its increased commission.
•  The 1 oz. coin is the best way to store large quantities of gold and is the most cost-effective method.
Each coin contains 1 oz of 91.6 pure gold in troy ounces plus a small amount of hardening metal to strengthen the coin, each coin weighs slightly more than its stated value.

After socking away new copper-clad coins, paper money and silver coin, you will want to buy as much gold coin as possible. You will preserve your wealth through the coming paper asset destruction and will emerge as a rich individual.

My advice
(Note: Do your own research and come to decisions that fit your personal circumstance. I’m not a qualified financial advisor. Mr. Larry)
If you are financially capable of storing (your long-term ‘savings account’) gold  and silver, you should have different types of gold and silver holdings. I would suggest starting your bullion holdings with cash and junk silver, then progressing to American Eagle silver and gold bullion coins.
Besides being  the historical standard for money, silver and gold are also barter commodities.
You will want to have the right denominations/weights of silver and gold coin to transact business. Which silver or gold coin you will use, depends on the cost, situation and who you are working with. People familiar  with the old ‘junk silver’ coins would rather trade with them than with bullion coins. Some people will see your US gold or silver Eagles and feel secure that they can count on that coin to be what it  says it is and will be more willing to make a trade with you.

During shortages and government controlled rationing, a store keeper may have a limited supply of a desperately needed item like medicine that he can only sell at the government set price. Who will get
this item? The person next to you with a 50 dollar bill of questionable value, or  you with 50 dollars in silver or gold coin – the store keeper or trader will recognize that your coin has a much higher intrinsic value. Of course you will get the medicine; however, if you only had an unrecognized bullion coin or a ‘junk silver’ coin from another country you may not.

Buy as much junk silver and American eagles as you have the means for. The bullion coins will preserve your wealth through to the other side of the collapse of paper assets and you will have the means to get going financially.
Old junk silver coins are meant for dealing with local stores for small transactions during and after the upcoming paper asset collapse. Deciding what and how much to store all depends on your situation, will you have the desired money medium for the opportunity/life style you are pursuing?

You only want enough cash on hand to sustain yourself in the event of bank withdraw limitations, and until worldwide dollar confidence crashes and the world dumps dollars on the market in a race
to get any value they can from it. Other than a pile of small bills to see you through a crisis, cash is a bad thing to hold because of possible hyper-inflation and the fact that it is backed by practically nothing.
Obviously the bulk of your investment money placed in a good fund tied to the performance of the stock market is the best place to be right now; long if you see the market rising and a ‘short’ ETF (DXD and others) if you see a decline coming.

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B.  Forces which cause gold and silver to rise in value.
•  Bank Failures
•  Rising inflation or the expectation of rising inflation
•  Devaluation of the dollar
•  Other currency-related crises
•  Increased Industrial and Investment demand for gold
•  Price increase in other commodities
•  Stock and bond market collapse
•  A New World War
•  International tensions

Gold serves as an increased hedge, though volatile in the short-term, against the erosion of the purchasing power of paper money. This is why you want to hold your portable gold coins for 3 – 7
years on the average. However, if a deal or situation presents itself that is extremely advantageous such as gold appreciating in value to quadruple or more what you paid for it–consider selling– you can always buy property with the proceeds.

Just before the peak of another depression, gold, is estimated to possibly rise to $3000 – $6000 an ounce. And if the President bans gold altogether; then places the U.S. back on the Gold Standard—as it is felt in many of the bearish financial newsletters, gold could a lot higher!
Spot silver prices are closely  connected to the same factors as those driving gold; however, because of  the low supply of available silver, it may become nearly as valuable as Gold.

You have five things working to drive the price of gold up:
1.  Increasing Gold Lease Contracts
2.  Increasing Consumer Demand- in China and India, as well as Europe.
3.  Gold Investors Needing Gold- international banks
4.  IMF: “By the IMF’s [International Monetary Fund] own documentation, the international banking community is trying to create a new global currency that will be backed by gold valued at between $3,000 to $5,000 per ounce.” –The Economic Outlook; Vol. 7. #1. January 1998.
5. Deflation: “To avoid outright economic collapse-Asian governments are devaluing currencies. Currency devaluation is a hidden form of hyper-inflation–the last desperate act before outright economic collapse. How do you protect yourself from currency devaluation? Gold &  silver.”
–The Economic Outlook; Vol. 7. #1. January 1998.

The following table provides my personal thoughts on the way to split up assets in order to cover most contingencies. I recommend you set aside the cash mentioned in the top half of the table first, and when this is done, do what you can to develop the funds to buy some combination of the bullion listed below.

Denomination(to
hold)
Number to have on hand(minimum) Item cost
(each)
Investment
in each denomination
$50 bills none
$20 bills 200 $20 $4,000
$10 bills 50 $10 $500
$5 bills 50 $5 $250
$1 bills 300 $1 $300
$1 coin $1 none
Quarter (25¢)
coin
10 rolls $10 $100
Dime (10¢) coin 10 rolls $5 $50
Nickel (5¢) coin 10 rolls $2 $20
Penny (1¢) coin 10 rolls $.50 $5
Currency   & coin• $5,150
Pre 1965 ‘junk -90% silver coins $200 face
value
$2844 $2844
Silver Eagle 1 oz 500 ea $19.87 $9,935
Bullion bar, 100 oz none
Gold Eagle 1/10 oz 20 ea $138 $2,760
Gold Eagle 1 oz 8 ea $1295 $10,360
Bullion $25,899
Currency, Coin and Bullion ‘On Hand’ $31,049

Table above updated on 16 Oct 2014

When faced with hyperinflation or other major calamities, you should have a pre determined  list of items to purchase ‘at the last-minute’ and/or items to invest your  cash in, things that will survive the
currency collapse or become more valuable in the post disaster period. When the window of opportunity is seen about to close, you must immediately transfer the bulk of your extra cash into some combination of ‘commodities’, such as; food, land, housing, other real estate, and barter items.

The totals shown in the table above are approximately the current annual gross wage of a mid level
US worker. With slightly reduced circumstances, this sum will provide 1) Four to five years of  supplemental income, or 2) in a severe depression it would provide about two years worth of 50% pre-crisis  income, or 3)  in a catastrophe, provide one full years income.

Coupled with your food  and water storage plan, as discussed in, 1) Survival Guide/ Food&Water /Develop a Survival Food List, and in 2) Survival Guide/Warehouse/Food, you should have the capacity to weather a serious dislocation.
With the adoption of other support systems, discussed and enumerated in Warehouse/… your resilience and survivability  should see you through most of the abrupt physical catastrophes that may impact a region or a national or global economic collapse.

While watching the short term, keep in mind that there are very long term cycles of human conduct and behavior toward one another, in our exploitive relationship with  the natural environment, our  modern civilizations energy use and resultant population numbers, as well as environmental ‘black swans’. The interplay of flux and flow between these relationships, trends and surprise events show themselves in the changing levels of human prosperity.

During the late 20th Century the world was very prosperous, we all poured our wealth into entertaining material goods, desiring ‘thing’s more than the traditional stores of value, gold and silver, hence the price of silver was the cheapest it has been in almost 700 years (Google ‘650  Years of Silver Prices’ or see http://goldinfo.net/silver600.html)

On 19 April 2011, the spot price of silver reached $43.07 and began an overdue correction. As technology developed the steam engine and later, our petroleum-based civilization with electricity, mining technology brought about an easier extraction of minerals. Now, as we moving through the brief peak oil plateau period, our open-pit mines have grown huge and underground mines extend for miles.
There are no more easy surface ‘finds’ of most of our civilizations industrial mining needs. When our oil supply declines there will be a diminished amount of minerals extracted from mines and at higher real prices (above what ever inflation will be). There will be less because the huge quantity of almost free labor provided by oil driven machinery will be declining, but also because we will have already extracted the bulk of the available resources.
The coming extended rise in silver prices will reflect not only scarcity, but difficulty and cost of extraction. The same shadow will fall across
all mined minerals, lumber, paper products, aluminum, rare earths and uranium. Costs will rise rapidly during the coming few years irrespective of whether there is inflation or deflation. The things we have grown accustomed to around the turn of the 21st Century will become increasingly difficult to obtain at ‘reasonable’ prices, the cost of ‘things’ will go up in real terms.
The decade from 2011 to 2021 will be wild.

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Filed under __2. Social Issues

Why you should prep

A.  Your personal obligation,
May 2014 by Mr. Larry
“Two hundred years ago (1812) the majority of the human race lived an agricultural life, their tools, assets and  knowledge were fitted to extracting most of their livelihood from the land, their land.
Fast forward to 1937 (75 years ago) , agriculture had become mechanized, allowing a great many families to migrate to the cities. These new urban residents learned skills that replaced the previous agricultural knowledge on how to provide for their families sustenance.

Meanwhile, back in the countryside, as had been the practice for 8,000-10,000 years, the remaining farm families continued to use the excess from their crop yield to sustain themselves during the winter, they maintained a quantity of their produce as seed for the following spring planting, some of the crop yield fed their livestock, some grains was sold for trade currency,  and if  the harvest had been really good, they added a couple more head of live stock.

The farm family stored food supplies, seed for future crops, and maintained a supportive ecology based on agricultural foods, wood from the forest, and water from the well or stream. They maintained a supply capacity to cover the eventuality that: a rainstorm might damage an early planting,  a drought could reduce summer production,  or an early frost might kill crops before they’d fully ripened. There could also occur: a crop disease in the field, insect and pest infestations in storage, robbery, heavy taxation,  a wild-fire, or a number of family members (work force) could be ill and removed from the seasons production labor effort. There were and are a lot of potential threats, fortunately none have a high probability of severe occurence on any given year.

The new landless,that is,  the migrants from the farm to the city-town, like their country kin, needed to maintain a savings from the slight excess generated by their labor. Life,  in some ways, may have become easier in the city, but there was/is still the chance of losing one’s job; a business bankruptcy; severe, long term illness in the family; theft by robbery and taxation; currency devaluation (more governmental theft), fire, war, calamity, personal needs and eventual retirement.

There remained a need for everyone to set some of their income aside to cover an eventual, “rainy day,” and not just a literal day or a week, but to cover the individual or family in case they missed a significant part of their harvest or a seasons labor for wages.

During recent decades (roughly the last 75 years), the exploitation of essentially free energy (free lunch) from fossil fuels has made the world’s lifestyle wealthy compared to  that of ancient kings. The largess of Western social economic structures have grown to provide an economic safety net for both farmers and unemployed urban residents. These public welfare programs have become so prevalent, that people now expect someone else to look after their deficiencies.
Diligent industry and personal responsibility have given way to public welfare, there is no longer a need for diligent industry or personal responsibility; quite the contrary, both the rural and urban worker can at times maneuver their situation in conjunction with the letter of the law to profit from sloth. Once enrolled in the public welfare, enough people find ways to stay in the program that they become a burden to society. [See also my post, “Tragedy of the Commons”]

The point here is: While governments has set up well-meaning, social welfare programs, these programs can only be expected to function as long as government structures operate within  some nebulous limit we might call, “Normal Conditions”. It’s great that a new layer of protection has been added as insurance for our personal sustenance, but each individual adult, each family, still has to provide diligent industry and accept personal responsibility to protect themselves.

When you  fulfill your obligation to look after your own survival, like any other larger animal on this planet, then you can accept public welfare on a temporary basis.  Relying on and expecting public assistance in times of regional-national-global hardship is like an irrational farmer who thinks: there will never be a crop loss, who doesn’t maintaining supplies, who does not maintain a flock or herd, and who eats the seed set aside for next year’s crop. This is a line of thinking that is bound for disaster, this is “our modern way” in the West and it has been for the last decade.
All it takes is one crop failure; or, in modern terms: massive unemployment, an extended period of high inflation,  the government declaring bankruptcy, a couple of nuclear missiles entering our skies, a deadly pandemic, any form of economic collapse…
…In 3 days you could be dying of thirst, followed by several weeks of social disorder that escalates by maybe two orders of magnitude (100 times worse than what “bad” means in “normal” times), starvation begins in 4 weeks…” (Mr. Larry)
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B.  Aesop knew how it worked — 2500 years ago
If anyone doesn’t understand the obligation of families to one another during a serious economic national crisis, I recommend you read Aesop’s fable,  The Grasshopper and The Ant, as follows:

“Once there lived an ant and a grasshopper in a grassy meadow. All day long the ant would work hard, collecting grains of wheat from the farmer’s field far away. She would hurry to the field every morning, as soon as it was light enough to see by, and toil back with a heavy grain of wheat balanced on her head. She would put the grain of wheat carefully away in her larder, and then hurry back to the field for another one. All day long she would work, without stop or rest, scurrying back and forth from the field, collecting the grains of wheat and storing them carefully in her larder.

The grasshopper would look at her and laugh. ‘Why do you work so hard, dear ant?’ he would say. ‘Come, rest awhile, listen to my song. Summer is here, the days are long and bright. Why waste the sunshine in labour and toil?’

The ant would ignore him, and head bent, would just hurry to the field a little faster. This would make the grasshopper laugh even louder. ‘What a silly little ant you are!’ he would call after her. ‘Come, come and dance with me! Forget about work! Enjoy the summer! Live a little!’ And the grasshopper would hop away across the meadow, singing and dancing merrily.

Summer faded into autumn, and autumn turned into winter.
The sun was hardly seen, and the days were short and grey, the nights long and dark.
It became freezing cold, and snow began to fall.

The grasshopper didn’t feel like singing any more. He was cold and hungry. He had nowhere to shelter from the snow, and nothing to eat. The meadow and the farmer’s field were covered in snow, and there was no food to be had. ‘Oh what shall I do? Where shall I go?’ wailed the grasshopper. Suddenly he remembered the ant. ‘Ah – I shall go to the ant and ask her for food and shelter!’ declared the grasshopper, perking up. So off he went to the ant’s house and knocked at her door. ‘Hello ant!’ he cried cheerfully. ‘Here I am, to sing for you, as I warm myself by your fire, while you get me some food from that larder of yours!’

The ant looked at the grasshopper and said, ‘All summer long I worked hard while you made fun of me, and sang and danced. You should have thought of winter then! Find somewhere else to sing, grasshopper! There is no warmth or food for you here!’ And the ant shut the door in the grasshopper’s face.

It is wise to worry about tomorrow today.” (That was human thinking 2500 years ago. lfp)
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C.  Remember the addage , “It wasn’t raining when Noah built the Ark.”  (about 5000 BC)
One thing about the future is that no one can be too sure how it’s going to turn out. Most of us are realists and understand that in regards to the future, it’s better to prepare for the likelihood of falling on hard times than be stuck in the middle of it without any preparations or plans.

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Definitions use in the following article
SHTF – Shit hit the fan (event). Think: Temporary, local or regional disaster that disrupt some services, business and-or social structures for days to months. Hurricanes, earthquakes, tornado damage, flooding, riots, local volcanic activity, major snowstorms, hyperinflation…Black Swan SHTF events that trigger a chain of cascading disasters can lead to TEOTWAKI.
TEOTWAWKI – The End Of The World As We Know It. (event). Think: long term wide spread disruption, systemic failures, extreme hardship, trying to survive within a collapsed social structure, crime violence escallates, seeing dead human bodies becomes somewhat common. Nuclear War, solar and terrorist EMP, deadly pandemic, major volcanic activity…
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D.  SHTF vs. TEOTWAWKI?
SurvivalCache.com, by  Captain Bart
http://survivalcache.com/shtf-vs-teotwawki/
“This past President’s Day, all the satellite channels on my cable went out. Annoying. About an hour later all power in the house went out! This is about how it would play out if a big CME (Coronal Mass Ejection) were to hit the earth.

Prepared?
First the satellites and then some time delay later (depending on CME speed) the power goes down. Since I hadn’t followed my usual practice of daily checking on the Sun, I didn’t know and it was too late to find out. Then I noticed the cell phones still worked, my Blackberry allowed me internet access (NOT a Carrington Event). Turns out a line fuse had blown and about 40 houses were without power for 20 minutes or so. Not even much of a SHTF event but for a few minutes, a whole lot of things I wish I had already done went through my mind.

We often use SHTF and TEOTWAWKI almost interchangeably, but they are not the same thing. For the first week or two, they may be almost identical. Law enforcement may still be in place well into the TEOTWAWKI event. In many scenarios we won’t know if it is TEOTWAWKI for weeks or months. This causes difficulty in preparations. Get it wrong and you could be in trouble.

My SHTF moment may be your TEOTWAWKI event. When Hurricane Ike hit Houston, I shared food, firearms and ammo with neighbors. It was a SHTF and not even a ‘Black Swan” event. The problem with this, of course, is that now my neighbors know I’m prepared. If you lived on Bolivar Penninsula near Galveston, Texas, Hurricane Ike was a TEOTWAWKI event. This Cat II hurricane had a storm surge like a Cat IV storm and in parts of Bolivar not even the foundations are left.

The point of this is that not only is one man’s SHTF another man’s TEOTWAWKI, one event can morph into the other. How you prepare for one event effects how you deal with the other type event. If you have only prepared for TEOTWAWKI and that plan is basically taking your fully tricked out assault rifle and scrounging what you need from your neighbor’s deserted homes, then you may find yourself in real trouble when the SHTF but it isn’t TEOTWAWKI. SHTF and even ‘Black Swan’ events happen to all of us to varying degrees with surprising regularity although we often don’t recognize it. If you worked for Bernie Madoff and his ponzi scheme, the SHTF big time when your job, your investments and your savings all went away at the same time! Everything changed overnight.

I think the most likely TEOTWAWKI event will be some type of pandemic that will start slowly and grow in isolated locations until some critical mass is reached. You may have a different “favorite” TEOTWAWKI event but this one serves for discussion. At the point critical mass is reached everything shuts down, martial law is declared and the TEOTWAWKI spiral begins.

Plan For The Mostly Likely Events
What does this mean for us? I would argue that most of our preparations should be for SHTF events. A TEOTWAWKI pandemic and a normal flu outbreak will be identical on the local level for the first days to weeks. So my first preparations will be to survive a one-week ‘shelter in place’ – grid up and utilities working. My next step is to survive a 2-week, shelter in place, grid down scenario followed by a possible 4-week bug out stint. I am ready and flexible if things change but I feel that this is the most likely scenario and what I base my planning around.

The moral is to prepare for the most likely events first since they are the ones that will surely happen. I KNOW Houston will get hit by another hurricane. If I’m ready for Ike, then I’m set for a different 2 to 4 week grid down Black Swan. If I stretch my preparations to 3 months then I’m ready for a massive commerce interruption and so on. Baby steps will carry you far if you are consistently improving. Giant steps can lead to major, perhaps catastrophic mistakes in planning and execution. Take care of the smaller, high probability events and the low probability events and Black Swans can be successfully handled.”

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E.  How Horrific Will It Be For The Non-Prepper?
May 12th, 2012, for  SHTFPlan.com, by  author, Be Informed
http://www.shtfplan.com/emergency-preparedness/how-horrific-will-it-be-for-the-non-prepper_05122012

This article has been made available by regular SHTFplan contributor, Be Informed.
Editor’s Note: You have no doubt had your own set of issues dealing with friends and family members that simply don’t see the writing on the wall. The following article may serve to assist you in convincing those who simply don’t know, don’t want to know, don’t care, or have never even thought to contemplate. Some of the scenarios outlined below may be frightening, as they should be, because when it hits the fan millions of people will be thrown into desperation with no hope of a solution. Be Informed provides a variety of point-by-point details that may (and hopefully will) convince the non-prepared individual to at least insulate themselves with the basic necessities. The consequences for not doing so, as you’ll see, are severe and often deadly.

I have become personally so disenchanted with the way people fail to prep. People still don’t understand how important it is to put away. I have gotten into arguments over this and had cretins call me a fool because I put away food, water, and supplies. I thought about this and the frustration that other preppers have with this laid back idiotic attitude that there is no need for preparation. There are good people that just can’t/won’t start preparing. They have the money to do so, but just don’t want to. Many have only seen what happens to non-preppers on TV, but it still doesn’t make an impact.

In this article I detail some hard core realities to show just how awful it will be for those that don’t prep. Every one of these scenarios is something that has occurred to the non-prepper throughout history. While strong images come to mind, the purpose is to jar some people out of their inaction and into action before it is too late.

Preppers are good people and care much about those around them, and unless something does jar those around them that choose not to prep, their own survival chances could be reduced. For every bit of food, water, ammunition, or supplies you sacrifice to the non-prepper, the fewer irreplaceable supplies are left for you and your family in a crisis situation. It is hoped that the following can help certain people put into TRUE perspective just how horrific it will be for those that don’t prepare.

Here are the awful consequences for those refusing to prep.
As the world continues to decay at multiple facets, the common person has and continues to be lulled into a sense that everything is improving and will continue to for the distant future. After all, to them unemployment has peaked out and will drop until everyone that wants to work will easily be able to find good paying work, North Korea is no threat because all their long range “bottle rockets” fizz out, sanctions will eventually make Iran give up their nuclear program, oil prices will start going down after June or so, Europe will bail out Greece and Spain and everyone else, and U.S. debt will eventually come under control.

After 2012 everyone that has prepared themselves will go back to more “sensible” lives. “Good times are coming”, baseball season is here, let’s get back to watching some more crackerjack news.

It is amazing how people become good conversationalists with most others discussing all the gossip related news, while becoming mentally tranquilized into a totally deceptive state of denial of truly dangerous issues of the times. It’s the blind leading the blind… right off the cliff.

Rather than dealing with harsh reality, people surround themsleves with easy to digest material that can be talked about without directly influencing anyone’s lives. Meaningless chatter. Even for those unwilling to even think to prepare for a societal catastrophic event, there is also no desire to even face the extreme possibility of a sudden loss of one’s employment. A personal SHTF.

Look at some of the terrible personal pain experienced in America right now – and it hasn’t even hit the fan on a grand scale. Those people who have lived it up on credit, who failed to put much of anything away for a rainy day, who’ve lost their job, and who eventually lost their unemployment benefits are experiencing the first level of collapse. This is happening to millions of people in our own country, all around us, as we speak.

These Americans, who once enjoyed the luxuries that modern living had to offer, are now at their wits end, with very little hope for a return to their previous lives. They are no longer able to pay most or any of their bills. Many have to humiliatingly turn to others for help to pay for food, or worse, to obtain old, unhealthy and poor tasting food from locally funded food banks. Their credit cards are totally worthless. Many have been evicted from their homes and have uprooted their families to live either on the street, in tent cities, with relatives, or have been forced to live at homeless shelters, They’ve have had their vehicles repossessed, or simply can’t afford the gasoline anymore. Their living conditions often make it difficult, if not impossible, to look presentable for job interviews. For many, the life of stability they knew just a short while ago is gone, replaced with fear and a constant stress to the point of nervous breakdown.

A personal economic meltdown is confined to the individual or family, or at worst a few families. The human civilization remains intact and so do society’s safety nets.

With food assistance, rental assistance, homeless shelters, and family to turn to, even the most destitute are almost always able to find some sort of help – however menial.

It is no wonder with these known assistance programs, then, that people have forgotten or never thought to consider what happens IF and WHEN human civilization goes through a strong enough SHTF event. If that happens on a mass scale what happens to everyone that needs help that has not prepared ahead of time? What happens when governments are in such total disarray or destroyed altogether that they can’t help even if they wanted to?

The media and others have portrayed the good people that sacrifice much if not all “luxuries” of life to prepare themselves and their family and friends for extreme times, as chicken littles. Those who have made the choice to store up emergency food, water, and other necessities to avoid extreme life threatening risks, including suffering horribly during and after a widespread SHTF event, are laughed at and ridiculed often for “wasting” their lives on delusional paranoia.

But who is delusional? Those who see the signs around them and understand how vulnerable the system is, or those who believe that things never change, that politicians have their best interests at heart, and that if the worst happens the government will be there to provide everything they may need?

How many have considered the dire consequences of their failure to prepare in the event that the infrastructure and everything a country’s people depend on totally collapses?

The misery from long term unemployment and lack of money is like a walk in the park compared to the severe anguish and dangerous conditions that await those who have failed to prepare for the aftermath of a large scale cataclysm. The “minor” problems of unemployment that seem extremely major and painful to most today should serve as a wake up call to what life will be like when something much, much worse happens – when those proverbial safety nets are no longer there to catch us.

Many preppers have become deeply frustrated at those around them, especially those that truly mean something to them, because they simply refuse to put away anything at all for emergencies. The prepper is usually a person that cares a lot and it is often difficult for them to take a tough stance towards the people that they care about. However, unless someone changes the habits of those people that fail to get ready, decisions will need to be made, and they won’t be easy.

The choice of what the prepared prepper should do will boil down to either either adding these people to their own circle or survival group and reduce the group’s safety, supplies and self sufficiency, OR, they will have to let the non-prepper fend for themselves. This is a very personal choice, and each of us will need to decide based on our own morals, ethics and personal relationships.

As a last ditch effort, discussing the following scenarios with the non-prepper may help them understand what life will be like without what has sustained them so comfortably for so long.

This is the hard reality the non prepper needs to understand:

•  Without power the water company cannot get water to their faucets. Without water dehydration occurs within 24 hours. Dehydration causes much suffering before death.
•  Toilets in homes, unless they have an incineration toilet that still need power to work, don’t flush without water. Where will they go to the bathroom and then where will they dispose of human waste?
•  There will be no clean water available anywhere, especially in major cities, and they cannot live more than about three days without it.
•  Drinking dirty and polluted water will make them incredibly sick and accelerate the dehydration process.
•  Polluted water must be purified and that means having a good filter, bleach or other disinfectant, or fuel and something to boil water with.
•  Understand just how fragile the power and the infrastructure is that pumps water to the public. A breakdown in our power infrastructure or a cyber attack against utility systems will render them useless.
•  A single event can rapidly lead to a cascade of other events that would certainly collapse almost, if not, everything. This is why major snow storms, hurricanes or solar events  in the past have affected millions of people in an entire region all at once.
•  A single, seemingly unimportant event may become quite terrible as its repercussions spread; this can include a far and away disaster.
•  Understand that the economies of the world are so interwoven that when one major economy falls it affects everyone.
•  Not having any food in the house means that if the stores are emptied suddenly in a bad enough situation that there will be no food available for a long period of time afterward. Recent history during disasters around the world has shown that stores can literally be emptied in minutes.
•  Think about how totally horrible the feeling of being very hungry is and what circumstances would cause one to be desperate enough to eat anything.
•  ALL stores can be closed instantly under martial law.
•  Understand that you may not be able to purchase anything after it starts, especially with any credit cards.
•  Understand the complexity of food and water distribution; breaks in these chains can stop anything from getting to the people.
•  What life will be like if no toilet paper is stored?
•  Understand that without light sources, the night will be pitch black, often with zero visibility.
•  There will be no communications, other than probably martial law type of instructions over the radio, that is if they have batteries for the radio.
•  Other than ham and shortwave radio, any information that is available will be sent out by the government as filtered propaganda that “they” want everyone to hear.
•  Without power consider what it will be like to not have any heat to stay warm, or air conditioned air to stay cooler – with no way of alleviating the situation.
•  Travelling will likely be by  foot or bicycle, as their will be no fuel and roadways may be blocked.
•  Realize that ANY travel outside of the home or neighborhood will be extremely dangerous as ANYONE  who moves becomes a target
•  Non preppers will be pushed way beyond their limit because of lack of supplies.
•  The non prepper must realize their government does not really care about them individually, that they are a mere number and help will likely not come from them.
•  They have to figure out somewhere to get food. This can mean wild plants which they must know how to identify as safe, or risk poisoning themselves.
•  They have to understand that when we refer to “having no food” it doesn’t mean not having the food they are used to enjoying, it means no food to eat at all.
•  They have to understand that if they are fortunate enough to have any running water, they will probably have to bathe in cold water for lack of stored fuel to heat water.
•  They have to realize that the very strange and totally unexpected is going to be all around them, made that much worse because of lack of any reliable self defense stores or skills.
•  They might have to remain on the run constantly because of looking for water and food.
•  They must understand that bad will be magnified magnitudes to living misery because of lack of food, water, and other necessary items that they took for granted for so long.

Okay, now comes the “truly ugly and unthinkable” life that most, if not all, people that have failed and refused to prepare themselves will deal with. Clear vivid visualization is key here for anyone that ho hums the idea of prepping.
What horrors they will likely face after a cave-in of their nation’s economy, war, geophysical upheaval, or whatever crisis is bad enough to disturb or stop their nation from working and functioning? There are plenty of very potential SHTF events that are simply awaiting a catalyst to trigger them.

•  The Non-Prepper (NP) has to realize right off the bat that 911 and other emergency calls in will be met with silence or some recording telling the caller not to panic.
•  The (NP) that has no reliable self defense that can stop an attacker, will not get help from public services, and will become a victim of rape, assault, torture, or murder.
•  The (NP) that has no reliable self defense and will not only be at the mercy of criminal elements, but also have to contend with many desperate animals, some with rabies.
•  The (NP) that has no food will either have to find food or be ready to beg for food or worse, like sacrificing their bodies or other horrible acts or things to get a bite of food.
•  The (NP) will have to go through the worst, most rancid conditions of garbage to just maybe find what they should have stored up.
•  The (NP) will go through panic and near if not total psychosis looking for any water source right before their bodies begin shutting down during advanced stages of dehydration.
•  The (NP) will go through unbearable trauma when their children and other people around them are crying, screaming, and suffering with intense hunger pains in their stomachs.
•  The (NP) will have to deal with the awful stench of rotting wastes from many sources because they have not taken the effort to even store up waste disposal plastic bags.
•  The (NP) will have disease and pathogens everywhere, not only because they have no trash disposal means, but because they haven’t prepared how to deal with trash and waste.
•  The (NP) will have to live in very primitive conditions after things around them deteriorate rapidly, because they have neglected putting away anything to make life more bearable.
•  The (NP) and those around them will likely develop all sorts of infective skin rashes from the lack of insight of storing up toilet paper. Imagine the smell for a moment.
•  The (NP) will have to handle biting insects and other vermin that will collect amoungst the filth that will pile up. No pest control stored up along with no other supplies
•  The (NP) will have no way of treating sickness certain to follow a SHTF event, no first aid and likely no training or knowledge about how to treat the ill on top of this.
•  The (NP) will have sick and dying people around them because of not being able to treat minor injuries. Didn’t even stock up on disinfectives. Unsanitary conditions lead to infection.
•  The (NP) and others around them will experience much grief as they watch helplessly as their family members literally die of starvation right in front of their eyes.
•  The (NP) won’t believe how desperate hunger drives them and those that mean everything to them to “trying” to eat food that taste so bad it gags them and comes back up.
•  The (NP) will likely have  family and friends around them that have also not prepared committing suicide because they can’t take it any longer.
•  The (NP) will witness some of those people around them lose any sense of civilized humanity in them and behave like wild animals after some time from lack of necessities.
•  The (NP) and family members, maybe friends also, will at some point end up barbecuing or eating raw the family dog, cat, bird, any pet dear to everyone for food.
•  The (NP) will likely get into  physical fights with other family members over any scrap of food available as rational thoughts are lost to wanton hunger.
•  The (NP) as many other (NP’s) will eventually go out of any safety of their home looking for food and or water, become disorientated and lost, and die a hard death somewhere.
•  The (NP) that is “lucky” enough to find some government help will likely have to almost sell their  soul, probably all their freedom, to get tiny rations – just enough to keep them alive.
•  The (NP) will see widespread violence and barbarism that will shock them to the core and will wish that they had purchased some form of firearm and stocked up on ammunition.
•  The (NP) better get used to attempting to explain the children and other adults why they wasted all that money on junk, and didn’t buy any emergency food and other supplies.
•  The (NP), no matter how positive they are will drop quickly into depression and lose willpower as  having nothing to hold on to does this, along with lack of any nutrition.
•  The (NP) will feel the worst guilt imaginable as they hear their family moaning in anguish from lack of anything to eat, knowing they could have done something to prepare.
•  The (NP) will most likely not see the rebuilding and recovery after A SHTF event. They will, like almost all NP’s, be statistics. Some will die hours or a day before help arrives.
•  The (NP) from lack of food, drinking bad water, no light at night, the horrid smells, no good self defense, the overall horror, will often be paralyzed with fear and despair, blank stare.
•  The (NP) is totally helpless after SHTF, will have to rely totally on charity of those prepared to live. They will take all sorts of desperate measures likely to get them shot. They’ll attempt to eat hazardous foods like an animal trapped in a house will do, and get sick and suffer much before dying. The (NP) will      likely die (ugly and hard) as they lived, unprepared for anything.

If we were to use one single word to describe the torments that someone who “chooses” not to prepare will go through after a true you know what hits the fan it would be “PREVENTABLE”.

Almost every single person, even a very poor person, has the capacity to put away emergency food and supplies. Even homeless people have stashes of something just in case things become so bad that the normal hand outs and thrown-away items dry up. Many people with good sources of income don’t even have an extra can of food or any water put away at all. This is stupidity beyond words.

Every day lightweight disasters happen in all parts of the world that disturb services enough that people are confined to their homes for a certain amount of time. While recovery is short, people are still uncomfortable during these times. Look what happens after a power outage at night and you will be mystified at how many homes are completely dark for hours. People have not even bought an extra couple of candles or any battery operated light sources. Even in well-to-do neighborhoods you may hear only a lone generator going after a blackout. This lack of preparedness is truly frightening and plays itself out again, again, and again every time services are disrupted for minor to major reasons. It’s as if there is something wrong with storing extra food, water, and supplies.

Even after “lessons” played out to what happens to those non-prepared, most people still feel that it just cannot happen to them, or won’t ever happen to them again. It should be proof enough to people what happens to those unprepared after disasters simply by looking at those that have gone through it firsthand. The difference, though, comes in that these disasters have had recovery periods and help from others. Even Haiti received some help and conditions remain putrid over there.

After a TRUE SHTF, it is presumable that government help and others coming to the aid of those in need WON’T happen for long periods of time. During that time those that have chosen to not put food, water, and necessities away are going to be in life threatening positions. Most people just don’t get that when the supermarket shelves are empty they will stay that way for an extended period. When the utilities go down, especially water, it may be weeks, months, or longer before they come back, if ever. Without what someone needs to survive each day, it is not going to magically appear, and depending on the goodwill of others to feed them and sacrifice their own family’s survival chances is a terrible choice.

People MUST know what life will be like after SHTF in mega fashion if they refuse to prepare. This is NOT new. Terrible events have plunged people into the deepest levels of desperation and hopelessness, and they will happen again and again.

While the above consequences to the non-prepper are extremely abysmal for anyone to read, the simple fact of the matter is they have already happened time and time again to those that have nothing put away. People have resorted to cannibalism and gone to levels of primitive savage behavior out of shear desperation and out of literally losing their minds to the physical depletion of food and water that keeps the physical body operating. Sometimes showing the extreme severity and results of a person’s lack of action, such as failure of the simple act of putting away extra food, water, and supplies, can be the kick in the complacency that they need.

It’s really easy to put away food and supplies. All one has to do is add a little bit of extra food to the grocery cart for long-term storage. Over time this adds up to a well stocked pantry of supplies.

There is something that is in a can of food that everyone can eat and enjoy the taste of, so talk to family members about their nutritional preferences and start stocking up. Toilet paper and other supplies that really don’t have any expiration date can be put away and forgotten about ’til needed.

There MUST be common sense and intelligence to see what happens IF they don’t stock up for the future. There has to be the DESIRE to get started, and this is the real problem with so many.

Once started, however, prepping becomes a type of life saving routine or positive lifestyle habit. It is easy and can and will save one from misery. It may save their life and the lives of their family from ruin when SHTF, which is almost inevitably going to happen someday. Every month and year that goes by without a true SHTF event, makes it more likely that it will happen. Basic statistical chance shows this to be the case, but people continue the same pattern of behavior that has led them to the same devastation countless time before.

For those preppers that have people around them that refuse to prepare, you can at least have some degree of solace knowing that you tried to show the non-prepping person(s) what not having anything will mean to them and their families.

All we can do is try. Once we’ve given it our best shot, all we can do is let those who have been warned about the direness of the possibilities live their lives the way that want to. They will, unfortunately, live in a world of regret and suffering if the nation and the world falls apart around them.

To every action there is an opposite equal reaction. Preppers will see their efforts have been more than worth it. Objects that are motionless tend to remain motionless and non-preppers will find there are horrific consequences for their lack of effort and motion to put away “life insurance” preps for themselves and their families.”

End of article

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