Economic Shockwaves

Great work Adam. Charles and John are two of my favorites. Having them together made for a great discussion and I can’t wait for a second round.
Question for John and Charles in the next podcast, and here in the comments for anyone tracking: I am starting to see in more and more places where people who are “experts” in finance, banking, investing and associated fields beginning to talk more freely about how untenable much of our current system is. It’s as if the Pandemic has given them cover to talk about what we on this site have been discussing and have known for over a decade. Many are starting to talk about how this might end the dollar dominant system in the next few years. While interesting commentary, it still seems that most who opine on this topic still think that the system continues on for some time (usually years, sometimes a decade). However, with all of the insults the system is sustaining on a near daily basis, failures, bailouts, the current oil production/storage debacle, the repo disaster, outrageous unemployment, an economy filled with “bullshit jobs” and services that are likely going to go away at breakneck speed… (and the list goes on), does anyone think that there is a possibility that we could reach a point of cataclysmic failure abruptly that doesn’t just wind down over the months and years to come while something else emerges? If so, I would love to hear what folks think could happen next?

Talking about the inflationary impacts of “printing to bail” and how citizens can protect themselves against loss of value of their fiat currencies. I heard several abstract recommendations. I need a bunch of concrete examples and possibilities.
Paraphrasing:

CHS: When Spain discovered silver in South America and flooded the global markets with silver (which was real money at the time) the value of silver fell by 2/3. This is what happens when "money" is created and flows into the markets. Adam: Get inflation immune assets. Things outside of currency. Thinks that can’t be manufactured overnight. Assets held in dollars will be diminished and the holders of those dollars will be impoverished. And the majority of American hold near ALL of their assets in dollars. CHS: Must get $$ into something that is outside of fiat currency. What that is depends on who you are, where you live Something that is REAL collateral. What you do depends on who you are and where you are what your skill set is and how much capital you have.  
My request here is to have Charles (and John, Adam and Chris) brainstorm a long list of examples of ways that this might be done. Please leave the level of abstract principles and brainstorm with us on specific ideas. Help us make this real.
  • Starting with buy physical gold and silver and store it in a secure place.
  • Create some independence in food production with backyard garden and chickens. (This is food that does not need to be purchased with fiat currency.)
  • Please continue......
 

the Cuba transition is very instructive, especially how field traction and fertilization needs were addressed. no wonder that cuba is a leader in home made bio tech. the book on my desk is ‘sustainable agriculture and resistance’- transforming food production in cuba. Has a lot of data- tho its dated- published in 2002. Also ‘the theory of peasant economy’ by a. v. Chayanov, if you can find it, on how farmers can organize and the life cycle of a farm family regarding number and age of children etc. Fascinating.

Backyard garden, food store, hard assets. You will be noticeable, because you’re not starving. And the hungry masses will start to gravitate towards your island. Can you defend it? Would you defend it (willing to take lives)?
Maybe that list must include fortifying your island. Either with armaments, or a reliable social network.

Start with anything to produce food: animals for meat and milk. Rabbits can be housed in very small space and aren’t picky eaters. Chickens are also great for converting table scraps to meat and eggs. Plant fruit trees. Buy tools and equipment needed to do the things above. Go for quality, not low price.
For the household, we have been buying maintenance items like crazy. What critical systems do you have, and what might fail? Light switches and outlets, light bulbs, extra co-ax cable and fittings, maybe an extra router or modem for internet, sump pump switch. Canning jars and lids. Food dehydrator. Nails, screws, bolts, etc. Hose clamps. chains and bars for the chain saw, materials for vehicle oil change and maintenance.
Good, durable clothing for the family. Especially shoes and socks. Safety gear, including goggles, gloves, chain saw chaps.
On a bit larger scale, can you find neighbors who share your mindset and trade goods or services? Or work together to produce food? This would build social capital as well as the economic advantages. Those of us with currency can buy things that will be assets to the neighborhood. I bought a EMT style first aid kit and don’t know how to use much of the equipment. But my neighbor’s daughter is a nurse, and when I mentioned the kit in case local hospital is overwhelmed, she said “Kathy would know how to use that stuff.” So we can be a help to others. My cash, her skills.
These things might seem small to someone who has a lot of financial/currency assets, but they will all be used eventually, and probably more expensive and less available in the near future. Additionally, being a lead-by-example person lately has been the catalyst for great conversations with like-minded friends and neighbors.
If you want to spend more cash, there will come a time when farmland is cheap vs. gold or silver. Start building relationships with sustainable farmers in your area, so that you are prepared to work together to buy land and make it productive.
Julie

I do know that he works for a very well known, very solid Fortune 500 insurance company that is going to have billions of dollars riding on their decisions so I would surmise that the data he has access to which led to his statement is going to be more extensive, more heavily curated, and more thoroughly analyzed than yours.

Yet despite a 100% failure rate in this area, humankind’s hubris will lead it to try once again. Given past history, present trends, and future prophecies, I expect that the next attempt will be the most spectacularly catastrophic one yet. And it may very well be the last one for a long, long time. God help us.

  • My request here is to have Charles (and John, Adam and Chris) brainstorm a long list of examples of ways that this might be done. Please leave the level of abstract principles and brainstorm with us on specific ideas. Help us make this real.
  • Starting with buy physical gold and silverand store it in a secure place.
  • Create some independence in food production with backyard garden and chickens. (This is food that does not need to be purchased with fiat currency.)
Please continue……
how citizens can protect themselves against loss of value of their fiat currencies. I heard several abstract recommendations. I need a bunch of concrete examples and possibilities.
Why not ask your fellow subscribers also? I will start. I have created the ability to have a small cottage business by slowly acquiring the following.
  • sewing machine
  • serger
  • embellisher
  • fabric
  • stabilizers
  • fabric accessories (buttons, zippers, hardware, trims, etc.)
  • Crocodile (punch machine for fabric, leather, cardboard etc)
  • Dress form
  • Misc crafting supplies
  • Wish list -embroidery machine
All of these items put together along with the sewing lessons I have been taking now make for a cottage business. I am also mentoring for my kids and grandkids, that they can take an item and change it by, painting, altering the size, embellishing and creating something new. A fancy degree can create income but so can creativity and skills. A good carpenter, plumber, excavator, house painter, handyman, tree trimmer is no different. A good handyman, worth their weight in gold! Their equipment = assets. AKGrannyWGrit  

Our neighbor bought a wood mill. I think thats the right name. Anyway it cuts trees into lumber. He let it be known bring over your downed treed and he will split the milled lumber with you 50/50.
We have substantial beetle kill trees which have become a fire hazard.

  • friend = asset
  • his saw mill = asset
  • lumber = asset
A win-win arrangement.

Yes, invest in “things” that are inflation proof. But also: Learn a skill that will be in demand. Yes, if you can garden, some hungry person may want to take your food. But if you can teach your neighbors to garden, then they will not be starving (and they will value you for the knowledge you have and share). We are conditioned to think in terms of “assets”, and that this is a zero-sum game. But knowledge is not like that. Teaching someone else to garden does not reduce the value of the food you produce for yourself. (Unless you’re going to compete with your neighbor to sell your food at a market… which is not what I’m talking about.)
Or learn to sew. Or adopt an appropriate technology (how about manual typewriters – can you learn to fix those?).
I first learned this idea by reading John Michael Greer’s “The Long Descent” – a decade old now, but still relevant (perhaps moreso).

Dear PP Friends:
With a bit of trepidation, since we don’t “do religion” at PP, I offer the following resources to help you in your own preparedness efforts. Just a bit of background. My church, The Church of Jesus Christ of Latter-day Saints, has for a very long time been teaching its members to be prepared, to have reserves for times of trouble. To be clear, the idea is not “self-sufficiency” for its own sake, but to have enough to take care of ourselves, and then something to share…voluntarily.
My wife and I try to practice what we preach. Last week our local hospital requested emergency donations of masks, gloves, bleach and a dozen other things, to help cope with the pandemic. Since we had prepared enough for ourselves, and to share, I was able to take about half of what we had set aside, and donate it to the hospital.
The church has a lot of free materials that are available to help guide your own preparedness effort. I think the most important thing to start with is a reserve of food, what Chris calls a “deep pantry”. But each person/family will be different.
Here is a link to get you started. Explore the other links at the bottom of the first page. Since over half of the church’s current membership resides outside the US, you will find lots of useful suggestions for people who are less affluent. I hope this helps.
Bruce
https://www.churchofjesuschrist.org/study/manual/gospel-topics/food-storage?lang=eng
 

I recall we went down this discussion road about 10 years ago. The most pragmatic came to the conclusion that during a collapse scenario, the assets that hold the most value, are in the most demand, and are the most tradeable are … are you ready? …
cigarettes and booze
I just read a story from WW2 recently where a soldier who wasn’t a smoker traded his cigarettes for more C-rations because other soldiers preferred their cigarettes to their rations. Crazy, yeah, but that’s how an addict behaves.

Every source I go to has different information. Taxed/not taxed. SS recepients auto deposit to account/ must file a simple 2019 tax form,etc. Similar to the mask debate. Nothing but confusion.
By the way, did anyone who’s information was compromised, ever get the $125 from the Equifax settlement? I was promised it and have a claim number, but never received anything. Fallen through the cracks and forgotten.

Hey DrbruceDale,
The Church of Jesus Christ of Latter-Day Saints does a great job of helping anyone be prepared for emergencies or long term financial or social turmoil. I Found with about $1200 and a pickup truck by going to the LDS Home Storage Center, you can pickup a years worth of staples for 2 people. Rice, beans, wheat, spaghetti, macaroni, dry milk, everything in #10 cans that stores for up to 30 years. ANyone is welcome, not just members of their church. Best price for long term food storage. For $1200, even if I never use it, it’s well worth piece of mind.
Good stuff.

So many people requested the money. I was sent several rounds of, do you really want this, it may be diluted, we want you to take a credit monitoring service. Sign up again type emails.
 
Then nothing more over the past 6 months or so.
 
 

cigarettes and booze

I just read a story from WW2 recently where a soldier who wasn’t a smoker traded his cigarettes for more C-rations because other soldiers preferred their cigarettes to their rations. Crazy, yeah, but that’s how an addict behaves.
Pot is legal here so I would substitute pot for cigarettes. And growing a few plants might be a good idea. Edibles are now a huge business. And dog treats with CBD. ?

Per James Howard Kuntsler

One thing will be pretty clear: That the folks in charge of things gave trillions of dollars to Wall Street while tens or perhaps hundreds of thousands of Covid-19 survivors got wiped out financially with gargantuan medical bills. Do you think the Chargemaster part of the hospital routine will just stop doing its thing during this emergency? The billings will continue – just as the proverbial beatings will continue until morale improves! In the aftermath, I can’t even imagine the ‘splainin’ that will entail. The rage may be too intense to even get to that. For some, it may be time to lubricate the guillotines?
I thought I heard that patients would not be charged? Important to know. Anyone know?

Hi AKGrannyGrit,
I just found this online indicating that many carriers are covering Covid testing and treatment costs.
–Suzie

Adam,
Sure, I would like to see that discussion. What I would really like are transcripts of the conversations. It is so much quicker to read.
 

I am a believer in Murphy’s Law. There was a 6.5 earthquake in Yellowstone yesterday. Will it blow? I have no idea, but it is something to follow.
The more people say there is nothing to worry about, the more I worry.