WE ARE IN DEEP, DEEP ECONOMIC S**T

[Randall Flagg]

Mr flagg,

I agree 100% with what you are saying. I know that what is being said is true.... my gut say's the Generally Dumb Public (GDP) will ignore the issue until it is too late. Here is the latest comparison laid out:

when you put a frog in a pot of boiling water, it will try to get out ... if you put the frog in water that is warn and turn the heat up, it will stay in the pot and die quietly. My point is these steps have been laid out very carefully and quietly. In order for the faith in the US dollar to be destroyed and our government to collapse, it would take the governments outside the US to lose faith in our currency. that could be in 6 months (I doubt it) or it could be in 6 years (more believable, but still i doubt it). I think these foreign gorvernments want to try to heat up the water on the GDP over time and the majority of the people of the US will willingly follow those in power to their (or my/our) demise. I know ... pretty dark outlook, but... there are those that ignore all the evidence for their own comfort.

M

Good post matt, i do however disagree with the timeline though, i feel 2 years if we are lucky. Most governments have lost faith in the us, which is why last year the fed bought most of our debt via "household" buying, china has been dumping dollars into things like gold mines,oil wells,etc for the last year, at twice what the going rate was. Which had people confused, untill you realize they understand in a couple of years those dollars will be worthless but the mines will not.

With the amount of money needed to run the country in the next few years, along with falling tax collectins,consumer spending, and maybe higher interest rates, imho we are in the last stages TODAY.

This coming year will be very telling, so keep your eyes open on leading economic figures and reports.

 

[Cpt Caveman]

HAPPY, HAPPY, JOY, JOY, JOY!!!!
Don't know when it'll happen but I bet the craps gonna fly and it won't be a slow slide. It'll be ugly. I'd buy food for a year before I bought any precious metals. Gold's real high and silver was over $26 last time I checked. Price of food is going up as well but everything is bad when your kids are hungry.
When they keep emphatically telling us everything is ok and its getting better then you'll know its getting bad... hey wait a minute....

Catastrophic Consequences for Our Nation are 100% Guaranteed

President Signs Executive Order Focused on "Lifestyle Behavior Modification"

 

[thompbarn]

But what is the result?

It seems some people dont grasp the basic doo doo we are in.

They print the principal but never the interest, meaning there is no way to ever repay the debt, not the national debt, not all of our personal debt. We are slaves to the system, forever, there is no way out except for a total collapse.

No amount of taxes, or government cutting services can fix this problem, ever.

Stop blowing sunshine up each others behind about hanging around successful people and do some basic research.

What was our Interest payment last year on the debt? 3-4 HUNDRED billion dollars?

With interest rates at 0%? Care to do the math on what our payments would be if interest rates went up to 7-10%, even if we balanced our budget or even ran a surplus(lol, yeah right).

It would be in the trillions.


Some of you need to grasp just how serious this situation is. The C.R.E. market has to roll over close to 1 trillion dollars in loans in the next 2 years(2011-2013).

The residential market is going to fall even harder in the next year or two as there is over 2 million homeowners late on their mortgage, with the avearage being over 300 days late, with mortgage cure rates for 60 days late(or later) being 5%.

The only reason banks stopped the foreclosures(no matter what the msm tells you) is because as long as a mortgage is still on the banks books, it is counted as an asset, otherwise if everyone that was 90-120 days late on their mortgage was in foreclosure, you would see a huge tide of bank failures, and the fdic is already running in the red.

Meanwhile the banks are also trying to keep housing prices inflated by not allowing the bulk of the house they did foreclose on going to market as the market is already flooded with millions of empty homes.

If these successful people have their success in dollars or dollar denominated assets, and not tangible items like food/ammo/pm's/etc, i would not be hanging around with them.

Good luck brothers and sisters!

So, I understand the math. I understand that there will be a default on US debt (foreign, definitely; domestic, maybe) and/or massive devaluation. Either way, the economics don't look at all good. But what will the US look like after this happens?

A lot of real wealth still resides in the US in the form of natural resources. We still grow food. We used to, and can again, make things we need. Unemployment will skyrocket, and soup and bread lines will be long. Crime will rise. Does this necessarily mean we will be subsistence farming and huddling in small groups defending ourselves from marauders?

My opinion is an opinion only, and I recognize that I could be wrong. That is why I'm preparing for any SHTF scenario I can think of. To me, though, it won't all collapse (ala' Mad Max) absent an EMP or nuclear event. An economic collapse will SUCK, and we should prepare for this also.

After you stock food and other SHTF necessities, how do you prepare for an economic collapse? Where do you put your money? I, too think there is a lot of profiteering going on in precious metals. Farm land is through the roof. Not sure owning rental properties is a good idea, since rent will be paid in near worthless dollars. Holding cash makes no sense. If the US goes, the rest of the world will go, too, so foreign stocks and currency aren't a good bet. Where do you park your money?

Certainly adjustable rate debt should be paid off ASAP. No reason to pay off fixed rate debt as you can wait and pay it off with devalued dollars as it comes due.

Right now, I'm improving what I have. Planting trees, getting equipment and supplies to farm on a small scale. Setting up to run during power outages. Perhaps I should invest in means of production for barter goods. I'm certainly investing in skills in myself and family (canning, hunting, gardening, etc.) It is all very unclear how to preserve assets and wealth that I have built up over time.

Anyone else have ideas?

 

[longbow]

Rush says if he is off the air for two weeks, we are in deep trouble, I heard he is going to be off the air starting Thurs?

Do we need to panic?

 

[88E30M50]

I think it's anyone's guess as to what things will look like in the US in 20 years. I'm predicting a less materialistic lifestyle that values work and skill over possessions. Between now and then, it may be tough. I'm guessing there will be a major die-off in the world. Not necessarily in the US, but other countries that cannot produce their own food or that have depleted their aquafer. China has become a net importer of food and Saudi Arabia has run through most of it's aquafer. Even in the US, there will be places that are well populated today that may not be in 10 years. Areas of the Southwest that have little water will have little to keep people there. There's a reason that much of that area was sparsely populated until the advent of electricity and other abundent forms of energy that made life there not only possible, but comfortable.

The problems we are facing are not only economic or peak oil, but it's pretty much peak everything. Copper mines are mining ore now that they would not waste their time on 50 years ago. Other resources are in a similar situation. It's not that they are going to disappear, but that the easy, cheap stuff has been collected and the stuff that remains takes more money and effort to gather. What to do now? It's hard to say, but if you think that oil is running out, then try to figure out how to succeed in a world that does not run on it. Maybe now is the time to open a shop that specializes in cargo bikes or mopeds. If you think that resources are going to be in short supply, maybe come up with some idea to capitalize on thousands of useless autos that all contain valuable resources. If people are not going to be able to buy stuff as easily tomorrow as they can today, they'll need to fix today's stuff when it breaks tomorrow. Become the guy that knows how to fix stuff that was never intended to be fixed, but was supposed to be discarded when it breaks.

In some ways, the future will suck, but if you spend an evening watching the utter crap that's on TV now, you may decide that a world without that might not be all bad. Just some thoughts...

 

[Randall Flagg]

But what will the US look like after this happens?

Like mad max brother, first as you stated, when the us economy collapses so goes the world's.

Total system shut down, without currency, you have no fuel, without fuel you have no food, without food you have no hope.

Riots will break out, the government will not be able to contain them, nor do they really want too, they not only expect a massive die off, they are planning on it.

After some times goes by, the government(read nwo/un type elites) will come to save those left with promises of a grand new way of doing things so that this never happens again.....problem,reaction,solution.


The way to survive the economic collapse is to not need the economy in the first place, produce what you need to live, prepare to defend what you have.

Remember it took DAYS for the structure in new orleans to break down, when there is no currency, who is going to work in the power plants for free? When the power goes out, is it any different if it was an emp that caused it or due to not having any workers cause a days pay can not even buy a loaf of bread?

It is all very unclear how to preserve assets and wealth that I have built up over time.

Very few people are self sustainable, even on the major survival boards i am on, i would sugest that first, followed by a bug out location, followed by many cache's, then i would invest in barter items that will rise even if the economy starts booming like it did in the 90's(lol yeah right).

I would rather have 20 years worth of food, then dollars Any day of the week, even if the economy does better then it ever has, nothing is a better hedge against inflation then something bought today that you will use tomarrow that is certain to rise in price.

Skills are also a great way to invest, as well as to pass along that wealth to your future offspring.

This however is imho and ymmv.

 

[MattYagPD01]

longbow-

Brothu ... humor will help all of us... i love you man.

88E...-
Man.. i hope you are right...

Flagg..
realism with no humility will result in the shelving of every word. Brothu... you need to realize the following:

'Diplomacy is the art of saying good doggy when you are looking for a rock'
'Being political is the art of calling somone an A--Hole and they say thank you.'

please sir... your message is true.. but let someone else be the anvil. you just be the hammer.

M

 

[longbow]

Craigslist prices are dropping.....is that bad?

 

[Aggar]

Buy land. You need 2 acres to subsistence farm. Also make sure you leave enough room for the Alligator moat.

I think 160 acres is good.

 

[88GT]

Every fiat currency ever used has collapsed, as bad policy goes hand and hand with a currency you can just make up out of thin air.

That's a ridiculous conclusion because you fail to make the distinction between correlation and causation. You assume the former necessarily indicates the latter.

In the absence of poor monetary policy, what other attributes of fiat currency would contribute to its massive devaluation and corresponding economic decline/collapse? What inherent trait of fiat currency makes it unsuitable for use as a currency?

 

[88GT]

longbow-


88E...-
Man.. i hope you are right...

Just so we're clear, I don't dispute the claim that every fiat currency has failed. I just don't place the blame on the currency itself but the PEOPLE in charge of maintaining its integrity. In the absence of manipulation by people with vested interests in particular outcomes, there's no reason fiat currencies can't operate just as successfully as gold-backed (what is the term for non-fiat currencies besides non-fiat currencies?) currencies. Ultimately, even gold is a fiat currency because we place an arbitrary value on it. Sure, all the metals will have some inherent value from an industrial standpoint, but anything be that is just as artificial as the paper dollar, ****, or conch shell.

Where Mr. Flagg and I part ways on this discussion is the root of the problem. He ignores the manipulation and I say the currency is inherently neutral. Kinda like the firearm argument, it's a tool to be wielded for good or for bad. But by itself it has no purpose and no value.

It's an academic argument though. I just intensely dislike intellectually dishonest claims to back opinions.

 

[Randall Flagg]

That's a ridiculous conclusion because you fail to make the distinction between correlation and causation. You assume the former necessarily indicates the latter.

In the absence of poor monetary policy, what other attributes of fiat currency would contribute to its massive devaluation and corresponding economic decline/collapse? What inherent trait of fiat currency makes it unsuitable for use as a currency?

A simply economic saying will deliver your answer.....


Money is a matter of function four

Where Mr. Flagg and I part ways on this discussion is the root of the problem. He ignores the manipulation and I say the currency is inherently neutral. Kinda like the firearm argument, it's a tool to be wielded for good or for bad. But by itself it has no purpose and no value.

I most certainly do not ignore the manipulation, i also do not ignore human nature, i.e. greed,lust,envy.

If robots were in charge of our economic policy, fiat currency MIGHT have a chance, as long as humans control policy, every fiat currency will collapse.

Also fiat currency can not act as money in a usury system, as it can never act as a store of value.

what is the term for non-fiat currencies besides non-fiat currencies?)

Commodity money/specie money

 

[machete]

Think back- our parents could have done the same thing during hard times. Early eighties. Fuel shortages. Cold War. the Great Depression... etc etc. The good people did not give up. Know what they did? They kept on keeping on. And that's what I'm going to do.

back then,,,we didnt have a police state with a really bad attitude who will shoot you for holding a garden hose,,,a government with lots of armed employees who need to keep getting fed and a generation of kids who glorify war and play call of duty every day hoping to get to red mist civilians...

this aint what it used to be...if this goes bad,,,this is going to go really bad...

 

[machete]

I would say self sustainability is the only true hedge against inflation, if you produce your own energy(wind/solar/etc) then it dont matter how much it costs to power your house on the grid.

Along those lines i would advise for long term foods, or anything that you can buy today and know that you will use in the future. All these items even in the best of times have gone up in price and not down.

As an example, i have 2 years worth of toothpaste, 3 years worth of soap, 2 years worth of razors,etc.

If your looking to make a profit on items in the future, why not a class 3 permit and collect automatic weapons/ammo and such?

I would only advise gold if someone had 100k or more they wanted to protect.

I would suggest land,livestock,and items you use daily to start off with. I invested in heirloom seeds, talk about an investment that keeps on growing and will long into the future, those are it.

The burger king have it your way lifestyle is over, the quicker people realize it, the better off they will be.

A system that was set up to create the principal but never the interest, is a system set up to drain the wealth and then collapse. Thats just the way it is, the system wont care if anyone believes it or not, it will happen.

wow,,,best post of the year on INGO!!!!!!!!!!!!!

 

[Randall Flagg]

Thanks Machete, i think it is great some people can grasp this stuff, while i realize most never will.

 

[SemperFiUSMC]

Currency based on gold, silver, or any other commodity ignore the fact that value can be generated that in the aggregate exceed the value of the totality of the commodity.

For example, take an acre of real land. That land has value. Its value is greater if it is next to water. Moreso if there are a stand of trees. Greater still if it can be tilled, planted, and crops grown. Even in the absence of gold, that land has value.

Take that same land. Trees can be reduced to logs using rocks formed from the land. Logs become a cabin, and the cabin a home. The owner has turned his natural resource into a valuable asset exceeding the value of the gold (0) used to create the asset.

Now expand that to 100 acres with 100 cabins. For the sake of discussion let's say an acre of land is valued at $1 ($ being a monetary unit, not necessarily a US dollar) and an acre of land with a cabin worth $5. There is an aggregate value of $500 even though you have no gold.

Now you may have purchased that land for $1 worth of gold. You may have bartered $1 worth of a product or service. You may have borrowed $1 from a lending source to pay the owner. Or you could have stole the land from the Indians. But the $4 in value created by building a cabin must be factored into the total value of the economy. Any currency backed in a commodity ignores that added value and there fore does not reflect the true value of the assets.

I'm not an expert on currency or derivatives, except that derivatives make a lot of sense from the perspective that you can generate and maintain value from both your raw material and improvements to that raw material. Whatever the monetary system used should take into account those raw resources and improvements. Fiat currency does not necesarily do this, but neither does a currency based upon a single commodity.

 

[Randall Flagg]

Currency based on gold, silver, or any other commodity ignore the fact that value can be generated that in the aggregate exceed the value of the totality of the commodity.

For example, take an acre of real land. That land has value. Its value is greater if it is next to water. Moreso if there are a stand of trees. Greater still if it can be tilled, planted, and crops grown. Even in the absence of gold, that land has value.

Take that same land. Trees can be reduced to logs using rocks formed from the land. Logs become a cabin, and the cabin a home. The owner has turned his natural resource into a valuable asset exceeding the value of the gold (0) used to create the asset.

Now expand that to 100 acres with 100 cabins. For the sake of discussion let's say an acre of land is valued at $1 ($ being a monetary unit, not necessarily a US dollar) and an acre of land with a cabin worth $5. There is an aggregate value of $500 even though you have no gold.

Now you may have purchased that land for $1 worth of gold. You may have bartered $1 worth of a product or service. You may have borrowed $1 from a lending source to pay the owner. Or you could have stole the land from the Indians. But the $4 in value created by building a cabin must be factored into the total value of the economy. Any currency backed in a commodity ignores that added value and there fore does not reflect the true value of the assets.

I'm not an expert on currency or derivatives, except that derivatives make a lot of sense from the perspective that you can generate and maintain value from both your raw material and improvements to that raw material. Whatever the monetary system used should take into account those raw resources and improvements. Fiat currency does not necesarily do this, but neither does a currency based upon a single commodity.

Land only has value if someone wants it, and fake value created, does not add to the value of the economy, which is why you see housing prices dropping like a stone.

Land becomes worth more, the more people that need it, if 2 people lived in the whole us, land would not be worth anything.

Your 100 acres with 100 cabins are only worth 500 bucks if you have 100 people that want them. And then what do they pay you in?

You can not use land as money, and to my knowledge, no one ever has.

 

[nate1865]

I wonder how many people pushing financial advice have their personal finances in order?

I've had many "financial advisers" desire to meet with me to "assess my financial situation".

They are actually salesmen, most of them. Their personal finances are a mess. One went bankrupt. More are in debt then they could admit.

One guy tried to give me advice and tell me he was debt free. Of course, he didn't count his mortgage, car payments, or HELOC as debt because they were "good".

What America lacks is fiscal discipline. Most people, and I'd dare say most on this board too - can't manage their own spending because they love stuff too much and want to look like they have money. To "do well" in America is to have a lot of stuff (or look like it). Yet we are paper tigers financially. We slowly enslave our lives bit by bit financially until we are owned, enslaved to our desire for stuff. We justify it with "hey I get a tax break for this" - "I NEED this" - "if I made a decent living I wouldn't have to <insert bad financial decision here>"

 

[ATOMonkey]

All we have is the mortgage.

 

[SemperFiUSMC]

Land only has value if someone wants it, and fake value created, does not add to the value of the economy, which is why you see housing prices dropping like a stone.

Land becomes worth more, the more people that need it, if 2 people lived in the whole us, land would not be worth anything.

Your 100 acres with 100 cabins are only worth 500 bucks if you have 100 people that want them. And then what do they pay you in?

You can not use land as money, and to my knowledge, no one ever has.

I don't disagree with your specifics. In fact you said exactly the same thing I did. The same can be said for gold, silver, or platinum, or for that matter everything else that exists. Nothing have value unless someone wants it.As far as what they will pay me in, they will pay me in whatever I determine to be of value. Maybe we trade a motorcycle. Half a tootsie roll. What does it matter?

Again, I'm not an expert in monetary policy but it seems to me that the purpose of currency is to normalize values of desparate items and establish a common exchange formula for transacting in goods and services. Fletch knows a lot more about it then me. Where is Fletch?