3 Ways To Prepare For The Impending Economic Crash – Social security is welfare

Jon enjoys helping others evolve into their best selves on his blog: Masculine Development and recently launched his eBook on How to to Develop Your Masculinity.

While the media is hyping up the stock market, the real insiders know the truth: we are destined for an incredible economic collapse, the likes of which we’ve never seen before. Our debt has surpassed $20 trillion dollars, our nation is in a state of incredible polarization thanks to Marxist identity politics, and our culture is a complete cesspool of degeneracy and sexual confusion.

Some have regained their hope after President Trump was elected, and while he’s certainly doing his best to circumnavigate the globalists and their plans to destroy America from within, it’s far better to be safe than sorry. I propose that every man must prepare for the worst possible scenario, which in all likelihood, could easily happen within the next 1-2 years. Here’s four ways that you can prepare for this upcoming catastrophe.

1. Invest In Alternative Assets


Very few people know this, but I assume that most red pill men are aware that the US dollar is backed by absolutely nothing—it’s literally just a cotton-paper composite. It’s not backed by silver, it’s not backed by grain or corn, and it hasn’t been backed by gold for decades. In other words, once people realize that the jig is up, they’ll scramble to get rid of their US dollars in favor of more valuable assets.

This will be a time of massive wealth transfer, but those who prepare will make out like bandits. The two assets which I urge you to invest in are physical metals and cryptocurrencies—predominantly silver and Bitcoin. Precious metals have historically grown 10x, 20x, even 100x in value when a country’s economy collapses, so investing in silver and gold now could end up making you a very wealthy man in the next few years to come.

The demand for silver has also steadily been increasing, while the production of silver has been decreasing. It’s a precious metal needed for all sorts of computer-related purposes, and when the economy crashes, not only will it be in extremely high demand due to its intrinsic value, but tech companies will be forking over money left and right to get their hands on the stuff while they still can.

As for cryptocurrencies, I advocate the purchasing of Bitcoin. While some men have expressed concerns over the “cashless society,” I’m not too worried. I advocate using silver and cash for in-person transactions, but when it comes to the internet, bitcoin is far superior to credit card—it’s anonymous, self-regulating, and can’t be taxed or controlled by a government.

We’ve already seen bitcoin grow from less than a penny to its all time high of nearly $5,000 in just a few short years—a $13 investment in Bitcoin when it first came out would now be worth over $7 million. While some have expressed concerns over its volatility, rest assured, it will change the world. Investing in Bitcoin in 2017 is essentially like investing in Google in 2004. Men, make no mistake: this will be the single greatest investment opportunity for the next 20 years, at least.

2. Prepare Yourself Physically


If Hillary had been elected, this would have been priority number one—but thanks to the efforts of the manosphere, and various alternative media outlets, President Trump was put into office. I have great confidence that he will be able to face the threats of antifa and other Soros-funded organizations, but it’s still absolutely necessary that you prepare yourself physically in the event of a crisis.

Start with the basics like Starting Strength or Stronglifts in order to build a good foundation. Beyond this, you can upgrade to my Body of an Alpha program for a discount (since you read ROK), or maybe try a variation of the PHUL workout. Dr. Layne Norton’s PHAT is also a phenomenal advanced workout routine, although it’s very rigorous and is not recommended for beginners. Another free program that you can try is the Daniel Craig Workout, which is great for beginners to intermediate level gym goers.

If you’re trying to lose weight, consider counting your calories or going into on ketosis by following the steak and eggs diet. If you’re trying to bulk up, utilize mass gainers, complex carbohydrates, and bodybuilding supplements. It’s really not that complicated, and has already been written about before.

In addition to this, consider taking Brazilian Jiu Jitsu in addition to a striking art such as Muai Thai or boxing. Purchase some basic “bug out bag” materials, such as a tent, canned food, and a gun. While I do not believe that you will need to resort to physical combat, it could still easily happen. So far President Trump has been doing a good job of dealing with antifa and other far left terrorist organizations, but things could change in a heartbeat if our good old pals in the Bilderberg group decide to up their funding.

3. Network, Network, Network

There’s a reason why SJW’s and leftists tried so damn hard to shut down Roosh’s The State of Men tour—they understand that if men like us begin to network and organize, their anti-American agenda is toast. Liberals thrive by keeping conservatives apart from one another, and alienating us from other like-minded people. They understand that when they control the media, and make traditional men believe that they’re the only ones who think the way they do, it’s very difficult for them to take action.

As I’ve already discussed, however, there are far more men on our side than we believe—President Trump’s victory is evidence of this. Every single day I get emails from men all across the world, thanking me for writing what I write, and proclaiming their support for our traditionalist, masculine movement. Start going to activist organizations and expanding your social circle from there. Pro-Trump rallies, freedom of speech events, and the gym are great places to find men who you can side with.

The ROK and manosphere network is also a great one to surf through, and while it may be dangerous due to the number of SJW thought police lurking around every corner, it’ll be pretty damn hard to track you down if you use a fake name and a burner cell phone. Being a lone alpha some twenty years ago could work, but now the time has come for men to re-create their dominance hierarchies and reclaim the west.

Summary

In short, the chances of a massive economic collapse that renders our society destroyed is not extremely likely, although it’s quite plausible that it could happen within the next few years. Even if our society isn’t decimated like Venezuela or Zimbabwe, we will at least experience a massive economic crash over the next year or two. While President Trump has certainly tried his best to circumnavigate this impending doom, the globalist elites and the (((federal reserve))) are intent on destroying this country from within.

It’s incredibly important, for both you and your family’s sake, that you prepare yourself accordingly. Allocate a large portion of your investments into silver, gold, Bitcoin, and Ethereum—when the shit hits the fan, these assets will explode in value. Spend some time training, which you should already be doing. Take up classes at a local boxing gym, because even having a rudimentary knowledge of fighting will prepare you fairly well for a fight.

Lastly, start networking with other like-minded men, because they’re the ones who will truly help you out if things go south. Reach out to old friends, connect with new ones, and become active within pro-Trump circles in order to weather this upcoming storm. If you play your cards right, you could be a hell of a lot better off after it passes than before.

Suddenly, “De-Dollarization” Is A Thing

Tyler Durden's picture

Authored by John Rubino via DollarCollapse.com,

For what seems like decades, other countries have been tiptoeing away from their dependence on the US dollar.

China, Russia, and India have cut deals in which they agree to accept each others’ currencies for bi-lateral trade while Europe, obviously, designed the euro to be a reserve asset and international medium of exchange.

These were challenges to the dollar’s dominance, but they weren’t mortal threats.

What’s happening lately, however, is a lot more serious.

It even has an ominous-sounding name: de-dollarization. Here’s an excerpt from a much longer article by “strategic risk consultant” F. William Engdahl:

Gold, Oil and De-Dollarization? Russia and China’s Extensive Gold Reserves, China Yuan Oil Market

(Global Research) – China, increasingly backed by Russia—the two great Eurasian nations—are taking decisive steps to create a very viable alternative to the tyranny of the US dollar over world trade and finance. Wall Street and Washington are not amused, but they are powerless to stop it.

 

So long as Washington dirty tricks and Wall Street machinations were able to create a crisis such as they did in the Eurozone in 2010 through Greece, world trading surplus countries like China, Japan and then Russia, had no practical alternative but to buy more US Government debt—Treasury securities—with the bulk of their surplus trade dollars. Washington and Wall Street could print endless volumes of dollars backed by nothing more valuable than F-16s and Abrams tanks. China, Russia and other dollar bond holders in truth financed the US wars that were aimed at them, by buying US debt. Then they had few viable alternative options.

 

Viable Alternative Emerges

 

Now, ironically, two of the foreign economies that allowed the dollar an artificial life extension beyond 1989—Russia and China—are carefully unveiling that most feared alternative, a viable, gold-backed international currency and potentially, several similar currencies that can displace the unjust hegemonic role of the dollar today.

 

For several years both the Russian Federation and the Peoples’ Republic of China have been buying huge volumes of gold, largely to add to their central bank currency reserves which otherwise are typically in dollars or euro currencies. Until recently it was not clear quite why.

 

For several years it’s been known in gold markets that the largest buyers of physical gold were the central banks of China and of Russia. What was not so clear was how deep a strategy they had beyond simply creating trust in the currencies amid increasing economic sanctions and bellicose words of trade war out of Washington.

 

Now it’s clear why.

 

China and Russia, joined most likely by their major trading partner countries in the BRICS (Brazil, Russia, India, China, South Africa), as well as by their Eurasian partner countries of the Shanghai Cooperation Organization (SCO) are about to complete the working architecture of a new monetary alternative to a dollar world.

 

Currently, in addition to founding members China and Russia, the SCO full members include Kazakhstan, Kyrgyzstan, Tajikistan, Uzbekistan, and most recently India and Pakistan. This is a population of well over 3 billion people, some 42% of the entire world population, coming together in a coherent, planned, peaceful economic and political cooperation.

 

Gold-Backed Silk Road

 

It’s clear that the economic diplomacy of China, as of Russia and her Eurasian Economic Union group of countries, is very much about realization of advanced high-speed rail, ports, energy infrastructure weaving together a vast new market that, within less than a decade at present pace, will overshadow any economic potentials in the debt-bloated economically stagnant OECD countries of the EU and North America.

 

What until now was vitally needed, but not clear, was a strategy to get the nations of Eurasia free from the dollar and from their vulnerability to further US Treasury sanctions and financial warfare based on their dollar dependence. This is now about to happen.

 

At the September 5 annual BRICS Summit in Xiamen, China, Russian President Putin made a simple and very clear statement of the Russian view of the present economic world. He stated, “Russia shares the BRICS countries’ concerns over the unfairness of the global financial and economic architecture, which does not give due regard to the growing weight of the emerging economies. We are ready to work together with our partners to promote international financial regulation reforms and to overcome the excessive domination of the limited number of reserve currencies.”

 

To my knowledge he has never been so explicit about currencies. Put this in context of the latest financial architecture unveiled by Beijing, and it becomes clear the world is about to enjoy new degrees of economic freedom.

 

China Yuan Oil Futures

 

According to a report in the Japan Nikkei Asian Review, China is about to launch a crude oil futures contract denominated in Chinese yuan that will be convertible into gold. This, when coupled with other moves over the past two years by China to become a viable alternative to London and New York to Shanghai, becomes really interesting.

 

China is the world’s largest importer of oil, the vast majority of it still paid in US dollars. If the new Yuan oil futures contract gains wide acceptance, it could become the most important Asia-based crude oil benchmark, given that China is the world’s biggest oil importer. That would challenge the two Wall Street-dominated oil benchmark contracts in North Sea Brent and West Texas Intermediate oil futures that until now has given Wall Street huge hidden advantages.

 

That would be one more huge manipulation lever eliminated by China and its oil partners, including very specially Russia. Introduction of an oil futures contract traded in Shanghai in Yuan, which recently gained membership in the select IMF SDR group of currencies, oil futures especially when convertible into gold, could change the geopolitical balance of power dramatically away from the Atlantic world to Eurasia.

 

In April 2016 China made a major move to become the new center for gold exchange and the world center of gold trade, physical gold. China today is the world’s largest gold producer, far ahead of fellow BRICS member South Africa, with Russia number two.

 

Now to add the new oil futures contract traded in China in Yuan with the gold backing will lead to a dramatic shift by key OPEC members, even in the Middle East, to prefer gold-backed Yuan for their oil over inflated US dollars that carry a geopolitical risk as Qatar experienced following the Trump visit to Riyadh some months ago. Notably, Russian state oil giant, Rosneft just announced that Chinese state oil company, CEFC China Energy Company Ltd. Just bought a 14% share of Rosneft from Qatar. It’s all beginning to fit together into a very coherent strategy.

Meanwhile, in Latin America:

De-Dollarization Spikes – Venezuela Stops Accepting Dollars For Oil Payments

(Zero Hedge) – Did the doomsday clock on the petrodollar (and implicitly US hegemony) just tick one more minute closer to midnight?

 

Apparently confirming what President Maduro had warned following the recent US sanctions, The Wall Street Journal reports that Venezuela has officially stopped accepting US Dollars as payment for its crude oil exports.

 

As we previously noted, Venezuelan President Nicolas Maduro said last Thursday that Venezuela will be looking to “free” itself from the U.S. dollar next week. According to Reuters, “Venezuela is going to implement a new system of international payments and will create a basket of currencies to free us from the dollar,” Maduro said in a multi-hour address to a new legislative “superbody.” He reportedly did not provide details of this new proposal.

 

Maduro hinted further that the South American country would look to using the yuan instead, among other currencies.

 

“If they pursue us with the dollar, we’ll use the Russian ruble, the yuan, yen, the Indian rupee, the euro,” Maduro also said.

 

The state oil company Petróleos de Venezuela SA, known as PdVSA, has told its private joint venture partners to open accounts in euros and to convert existing cash holdings into Europe’s main currency, said one project partner.

This first step towards one or more gold-backed Eurasian currencies certainly looks like a viable and — for a lot of big players out there — welcome addition to the global money stock.

Venezuela, meanwhile illustrates the growing perception of US weakness. It used to be that a small country refusing to take dollars could expect regime change in short order. Now, maybe not so much.

Combine the above with the emergence of bitcoin and its kin as the preferred monetary asset of techies and libertarians, and the monetary world suddenly looks downright multi-polar.

$20 Trillion: U.S. Debt Crisis | Peter Schiff and Stefan Molyneux

The Government Parasite- For Us To Survive, The West Must Die!

The Hard Working American vs.

The Government Parasite

http://theeconomiccollapseblog.com

Which lifestyle choice produces better results – being a hard working American or being a government parasite?  Actually, when you look at the cold, hard numbers they may just surprise you.  In America today, we deeply penalize hard work and we greatly reward government dependence.  If you live in a very liberal area of the country and you know how to game the system, it is entirely possible to live a comfortable existence without ever working too much at all.  In fact, there are some Americans that have been living off of “government benefits” for decades.  Many of these people actually plan their lives around doing exactly what they need to do to qualify for as many benefits as possible.  America is rapidly turning into a European-style socialist welfare state and it is destroying our nation socially and financially.  Ever since the “war on poverty” began our debt has absolutely exploded and yet now there are more poor people in this country than ever before.  Obviously something is not working.

Now don’t get me wrong.  I deeply believe in having compassion for those that are going through tough times and having a safety net for those that cannot take care of themselves.  We should not have a single person in this nation going without food or sleeping in the streets.

But in America today it is absolutely ridiculous how many people are climbing aboard the “safety net”.  At this point, an astounding 49 percent of all Americans live in a home that receives some form of government benefits.

So who pays for all of this?

The people that drag themselves out of bed and go to work each day pay for it all.

For a few moments, let’s examine how the lifestyle of a typical hard working American compares to the lifestyle of a government parasite.

In America today, the median yearly household income is somewhere around $50,000.  About half of all American households make more than that and about half of all American households make less than that.  When you break it down, it comes to about $4000 a month.

So how far does $4000 go in America today?

Unfortunately, it doesn’t go very far at all.

First of all, a hard working American family will need some place to live.  Unfortunately, the vast majority of the decent jobs are near the big cities, and it is more expensive to live near the big cities.  Let’s assume that an average family of four will spend about $1000 a month on rent or on a mortgage payment.

The government parasite, on the other hand, has a whole host of federal, state and local housing programs to take advantage of.  During the recent economic downturn, more Americans than ever have been turning to the government for help with housing costs.  For example, federal housing assistance outlays increased by a whopping 42 percent between 2006 and 2010.

Once you have a place to live, you have to provide power and heat for it.  For the average hard working American, this is going to probably average about $300 a month, although this can vary greatly depending on where you live.

For the government parasite, there are once again a whole host of government programs to help with this.  For example, LIHEAP (Low Income Home Energy Assistance Program) assists low income households in paying their home heating bills.

Most average hard working Americans are also going to need phone and Internet service.  Let’s assume that the hard working family of four in our example is extremely thrifty and only spends $100 a month for these services.

For the government parasite, cell phone service is not a problem.  As I have written about previously, those that “qualify” can receive a free cell phone and free cell phone minutes every single month from the federal government.  In addition, in some areas of the nation low income families can qualify for deeply subsidized home Internet service.

In order to earn money, our hard working family is going to need to get to work.  In most households, both parents have decided to work these days so both of them will need cars.  Let’s assume that the family is very thrifty and that both cars were purchased used and that the car payments only total about $400 a month.

The hard working family will also need auto insurance for the two vehicles.  Let’s assume that both parents have a great driving record and that they only pay a total of about $100 a month for car insurance.

The cars will also need to be filled up with gasoline.  The average U. S. household spent $4155 on gasoline during 2011, but let’s assume that our family is very, very careful and that they only spend about $300 on gas each month.

So what about the government parasite?  Well, the government parasite does not need to go to work, so this expense can potentially be eliminated entirely.  But since most other things are paid for by the government or are deeply subsidized, in many instances government parasites are actually able to afford very nice vehicles.

In addition, a new bill (The Low-Income Gasoline Assistance Program Act) has been introduced in Congress that would give “qualifying” households money to help pay for gasoline….

Low-Income Gasoline Assistance Program Act – Directs the Secretary of Health and Human Services to make grants to states to establish emergency assistance programs to pay eligible households for the purchase of gasoline.

A hard working American family is also going to need health insurance.  Well, we all know how expensive health insurance has become.  In fact, health insurance costs have risen by 23 percent since Barack Obama became president.  But let’s assume that our hard working family has somehow been able to find an amazing deal where they only pay $500 a month for health insurance for a family of four.

For the government parasite, health insurance is not needed.  If there is an emergency, the government parasite can just go get free medical care at any emergency room.

And of course there is always Medicaid.  Back in 1965, only one out of every 50 Americans was on Medicaid.  Today, one out of every 6 Americans is on Medicaid, and things are about to get a whole lot worse.  It is being projected that Obamacare will add 16 million more Americans to the Medicaid rolls.

So what about food?

Everyone has to eat, right?

Well, the hard working family in our example is faced with an environment where food prices are constantly rising but paychecks are not keeping up.  Let’s assume that the hard working family in our example clips coupons and cuts corners any way that it can and only spends about $50 for each member of the family on food and supplies each week.  That comes to a total of $800 a month for the entire family.

So what about the government parasite?

Government parasites need to eat too.

Well, that is where food stamps come in.  Right now, there are more than 46 million Americans on food stamps.  Since Barack Obama became president, the number of Americans on food stamps has increased by 14 million.  Food stamps have become so popular that rappers are even making rap videos about using food stamp cards.

Okay, so after all of this where do we stand?

Well, the average hard working family so far has spent $3500 out of the $4000 that they have to spend for the month.

We still need to find money for clothing, for paying off credit card debt, for paying off student loan debt, for dining out, for entertainment, for medications, for pets, for hobbies, for life insurance, for vacations, for car repairs and maintenance, for child care, for gifts and for retirement savings.

But wait.

There is actually no money left at all because we have forgotten one of the biggest expenses of all.

Taxes.

When you total up all federal, state and property taxes, our average hard working family is going to pay at least $1000 a month in taxes.

So that puts our average hard working family in the hole every single month.

Meanwhile, the government parasite does not pay any taxes because he or she does not earn enough money to be taxed.

Are you starting to get the picture?

In many ways, life can be so much easier when you are constantly taking from the government instead of constantly giving to the government.

New Jersey Governor Chris Christie recently put it this way….

“We’ll have a bunch of people sitting on a couch waiting for their next government check”

Once again, I am not dumping on those that have been through all kinds of nightmares because of this economy.  As I have written about so frequently, the U.S. economy is simply not producing enough jobs for everyone anymore, and this is creating major problems.

Just about everyone needs a helping hand at some point, and we should always be compassionate to those that are in need.

However, there is also a growing number of Americans that are content to simply give up and live off of the government, and that is fundamentally wrong.

It is not the job of the U.S. government to take care of you from the cradle to the grave.  What the U.S. government is supposed to do is to make sure that we have a well functioning economy that operates in an environment where hard working individuals and small businesses can thrive, and sadly the U.S. government has failed miserably in that regard.

We desperately need the U.S. economy to be fixed, but I wouldn’t hold my breath waiting for that to happen.

As economic conditions get even worse in this country, millions more Americans are going to turn to the government for assistance and at some point the safety net is going to break.

What is our country going to look like when that happens?

19 Signs Of Very Serious

Economic Trouble On The Horizon

Most Americans have no idea how much economic trouble is heading our way.  Most of them just assume that everything will eventually “return to normal” just like it always has before and that those running our economy “know what they are doing” and that we should trust them to do their jobs.  Unfortunately, these beliefs are being reinforced by the bubble of false hope that we are experiencing right now.  For example, it is being reported that weekly unemployment claims in the United States have fallen to a four-year low.  That is a very good thing.  Let us hope that unemployment claims go even lower and that the current period of stability lasts for as long as possible.  We should enjoy these last fleeing moments of tremendous prosperity for as long as we can, because when they are gone they won’t be coming back.  As I noted the other day, all of this false prosperity in the United States has been financed by the 15 trillion dollar party that we have been enjoying.  We are adding about 150 million dollars to our debt every single hour so that we can continue to enjoy an inflated standard of living.  Unfortunately, nobody in the history of the world has ever been able to keep a debt spiral going indefinitely, and our debt bubble will burst eventually as well.

Sadly, when you attempt to end (or even slow down) a debt spiral the consequences can be extremely painful.  Just look at what is happening in Greece.  Several waves of austerity measures have been implemented, the Greek economy has been plunged into a full-blown depression and Greek debt is still going up.

The rest of the nations of the eurozone are also now implementing austerity measures, and most of them are also starting to fall into recession.  The economic pain in Europe is just beginning and it will go on for quite a long time.

And eventually the United States is going to join the pain.  Right now the U.S. government can still borrow trillions of dollars at super low interest rates thanks to games being played by the Federal Reserve.  But it is simply not possible for this Ponzi scheme to last too much longer.  When it ends, the pain will be extremely great.

And even in the short-term there are some extremely troubling signs for the U.S. economy.

The following are 19 signs of very serious economic trouble on the horizon….

#1 According to one new survey, approximately one-third of all Americans are not paying their bills on time at this point.

#2 The U.S. housing industry is bracing for another huge wave of foreclosures in 2012.  The following is from a recent Reuters article….

“We are right back where we were two years ago. I would put money on 2012 being a bigger year for foreclosures than 2010,” said Mark Seifert, executive director of Empowering & Strengthening Ohio’s People (ESOP), a counseling group with 10 offices in Ohio.

#3 The Citigroup Economic Surprise Index, a key indicator watched by many economists, is on the verge of heading into negative territory.

#4 We are supposed to be in the middle of an economic recovery in the United States, but bad news just keeps pouring in from major companies.  For example, Yahoo is firing thousands of workers and Best Buy is closing dozens of stores.

#5 Richard Russell says that the “big money” is starting to quietly exit from the financial markets….

“My guess is that this is the big money that has been holding off as long as it decently can — and then dumping their goods just before the close. I don’t think the big money likes this market, and I think they have been slowly exiting this market, as quietly as they can.”

#6 Goldman Sachs is projecting that the S&P 500 will fall by about 11 percent by the end of 2012.

#7 All over the country, local governments are going into default and we have not even entered the next recession yet.

#8 The U.S. government will add more to the national debt in 2012 than it did from the time that George Washington became president to the time that Ronald Reagan became president.

#9 The Federal Reserve is desperately trying to control interest rates.  The Fed purchased approximately 61 percent of all government debt issued by the U.S. Treasury Department in 2011.  This is the only thing that is keeping interest rates in the United States from soaring dramatically.

#10 German industrial production is falling at a pace that is far faster then expected.

#11 Italy’s debt-to-GDP ratio is now up to 120 percent.

#12 The Spanish government admitted on Tuesday that Spain’s debt-to-GDP ratio will rise by more than 11 percent this year alone.

#13 Yields on Spanish bonds are rising to dangerous levels.

#14 The Spanish government is projecting that the unemployment rate in Spain will exceed 24 percent by the end of the year.

#15 Unemployment in the eurozone as a whole has risen for 10 months in a row and is now at a 15 year high.

#16 In the aftermath of a 77-year-old retiree killing himself in front of the Greek parliament in protest over pension cuts, the economic rioting in Greece has flared back up dramatically.

#17 At this point, Greece is experiencing an economic depression with no end in sight.  Some of the statistics coming out of Greece are really hard to believe.  For example, one port town in Greece now has an unemployment rate of approximately 60 percent.

#18 The IMF is asking the United States to contribute more money for European bailouts.

#19 At this point, even some of our top scientists are projecting economic trouble.  For example, researchers at MIT are projecting a “global economic collapse” by the year 2030 if current trends continue.

But the truth is that we will experience a “global economic collapse” long before 2030 comes rolling around.

Let us hope that we still have at least several more months of economic prosperity in the United States before things really fall apart.

The truth is that the vast majority of Americans need more time to prepare for what is coming.

Sadly, most Americans are not preparing.  Most Americans have blind faith that those in positions of power are going to fix everything and set us on the path to even greater prosperity than ever before.

Unfortunately, all Federal Reserve Chairman Ben Bernanke and Barack Obama have been doing is kicking the can down the road and making our eventual collapse much worse.

As many of us have painfully learned, you can run from debt for a while, but you can’t hide from it forever.  Eventually debt catches up with you, and when it does it can be very cruel.

The 15 trillion dollar party is coming to an end, and the consequences of decades of very foolish decisions are going to fall on this generation.

Read This First Before You Decide That Preppers Are Crazy

Do you believe that preppers are a few cards short of a full deck?  Do you assume that anyone that is “preparing for doomsday” does not have their elevator going all the way to the top floor?  Well, you might want to read this first before you make a final decision that all preppers are crazy.  The information that you are about to read shook me up a bit when I first looked it over.  To be honest, I had no idea how incredibly vulnerable our economic system is to a transportation disruption.  I am continually getting emails and comments on my websites asking “how to prepare” for what is coming, so when I came across this information I knew that I had to share it with all of you.  Hopefully what you are about to read will motivate you to prepare like never before, and hopefully you will share this information with others.

Originally, I was going to write an article about the rising unemployment in Europe today.  Did you know that unemployment in the eurozone is now at a 15 year high?  It has risen for 10 months in a row with no end in sight.

But I have written dozens of articles about the economic crisis in Europe already.  So before starting on that article I started thinking of all the “preparation” questions I have been getting lately and I went over and checked out one of my favorite preparation websites: shtfplan.com.

Well, an article had just been posted over there about a report put out by the American Trucker Associations entitled “When Trucks Stop, America Stops“.

I went and found that original report and I was stunned as I read it.

The truth is that our “just in time” inventory and delivery systems leave us incredibly vulnerable to a nationwide disaster.

You see, it is very expensive to hold and store inventory, so most manufacturers and retailers rely on a continual flow of deliveries that are scheduled to arrive “just in time”, and this significantly reduces their operating expenses.

This is considered to be good business practice for manufacturers and retailers, but it also means that if there was a major nationwide transportation disruption that our economic system would grind to a halt almost immediately.

Once store shelves are picked clean, they would not be able to be replenished until trucks could get back on the road.  In the event of a major nationwide disaster, that could be quite a while.

So what could potentially cause a nationwide transportation shutdown?

Well, it is easy to imagine a lot of potential scenarios – a volcanic eruption, a historic earthquake, an EMP attack, a solar megastorm, a war, a major terror attack, an asteroid strike, a killer pandemic, mass rioting in U.S. cities, or even martial law.

If something caused the trucks to stop running, life in America would immediately start changing.

So exactly what would that look like?

The following is an excerpt from the report mentioned above put out by the American Trucker Associations entitled “When Trucks Stop, America Stops“….

*****

A Timeline Showing the Deterioration of Major Industries Following a Truck Stoppage

The first 24 hours

• Delivery of medical supplies to the affected area will cease.
• Hospitals will run out of basic supplies such as syringes and catheters within hours. Radiopharmaceuticals will deteriorate and become unusable.
• Service stations will begin to run out of fuel.
• Manufacturers using just-in-time manufacturing will develop component shortages.
• U.S. mail and other package delivery will cease.

Within one day

• Food shortages will begin to develop.
• Automobile fuel availability and delivery will dwindle, leading to skyrocketing prices and long lines at the gas pumps.
• Without manufacturing components and trucks for product delivery,
assembly lines will shut down, putting thousands out of work.

Within two to three days

• Food shortages will escalate, especially in the face of hoarding and consumer panic.
• Supplies of essentials—such as bottled water, powdered milk, and
canned meat—at major retailers will disappear.
• ATMs will run out of cash and banks will be unable to process
transactions.
• Service stations will completely run out of fuel for autos and trucks.
• Garbage will start piling up in urban and suburban areas.
• Container ships will sit idle in ports and rail transport will be disrupted, eventually coming to a standstill.

Within a week

• Automobile travel will cease due to the lack of fuel. Without autos and busses, many people will not be able to get to work, shop for groceries, or access medical care.
• Hospitals will begin to exhaust oxygen supplies.

Within two weeks

• The nation’s clean water supply will begin to run dry.

Within four weeks

• The nation will exhaust its clean water supply and water will be safe for drinking only after boiling. As a result gastrointestinal illnesses will increase, further taxing an already weakened health care system.

This timeline presents only the primary effects of a freeze on truck travel. Secondary effects must be considered as well, such as inability to maintain telecommunications service, reduced law enforcement, increased crime, increased illness and injury, higher death rates, and likely, civil unrest.

*****

Earlier in the report, the reasons why America’s water supply would be in such jeopardy are described in greater detail….

According to the American Water Works Association, Americans drink more than one billion glasses of tap water per day. For safety and security reasons, most water supply plants maintain a larger inventory of supplies than the typical business. However, the amount of chemical storage varies significantly and is site specific. According to the Chlorine Institute, most water treatment facilities receive chlorine in cylinders (150 pounds and one ton cylinders) that are delivered by motor carriers. On average, trucks deliver purification chemicals to water supply plants every seven to 14 days. Without these chemicals, water cannot be purified and made safe for drinking. Without truck deliveries of purification chemicals, water supply plants will run out of drinkable water in 14 to 28 days. Once the water supply is drained, water will be deemed safe for drinking only when boiled. Lack of clean drinking water will lead to increased gastrointestinal and other illnesses, further taxing an already weakened healthcare system.

Can you see why I always recommend that you make sure that you and your family have access to fresh water and a way to purify it?

This report should be very sobering for all of us.

What would you and your family do if you had no food, no clean water and the stores were shut down because their supplies were gone?

An article by Tess Pennington entitled “Emergency Items: What Will Disappear First” contains a list of 100 things that are likely to disappear from store shelves first.  The following are the first 10 things on her list….

1. Generators (Good ones cost dearly. Gas storage, risky. Noisy…target of
thieves; maintenance etc.)
2. Water Filters/Purifiers
3. Portable Toilets
4. Seasoned Firewood. Wood takes about 6 – 12 months to become dried, for home
uses.
5. Lamp Oil, Wicks, Lamps (First Choice: Buy CLEAR oil. If scarce, stockpile
ANY!)
6. Coleman Fuel. Impossible to stockpile too much.
7. Guns, Ammunition, Pepper Spray, Knives, Clubs, Bats & Slingshots.
8. Hand-can openers, & hand egg beaters, whisks.
9. Honey/Syrups/white, brown sugar
10. Rice – Beans – Wheat

You can find the rest of the list right here.

Most Americans just assume that they will always be able to run out to the supermarket or to Wal-Mart and buy anything that they need.

But if the trucks stop running that will change almost overnight.

After reading the information above, does anyone out there still believe that preppers are crazy?

The truth is that there are good, solid reasons why millions of Americans have been storing up food, water filters and other supplies.

Our world is becoming increasingly unstable, and all of us need to get educated about how to prepare for the difficult years that are coming.

One nightmarish event can change everything that we take for granted in a single moment.

Just remember what happened after Hurricane Katrina.  Even though that was only a regional disaster, millions of people had their lives completely turned upside down by that tragedy.

Don’t make the mistake of assuming that just because the U.S. has always known tremendous peace and prosperity since World War II that things will always be that way.

Our lives will only continue to be “normal” as long as the trucks continue running.

When the trucks stop running in America, there will be mass chaos.

Are you prepared for that?

 

The Next Great Depression? Its Coming, if your not ready, your dead.

The Economic Collapse

Are You Prepared For The Coming Economic Collapse And The Next Great Depression?

http://theeconomiccollapseblog.com

Not So Fast On That Whole Economic Recovery Thing

 

Not so fast.  Those that are publicly declaring that an economic recovery has arrived are ignoring a whole host of numbers that indicate that the U.S. economy is in absolutely horrendous shape.  The truth is that the health of an economy should not be measured by how well the stock market is doing.  Rather, the truth health of an economy should be evaluated by looking at numbers for things like jobs, housing, poverty and debt.  Some of the latest economic statistics indicate that unemployment is getting a little bit worse, that the housing market continues to deteriorate, that poverty in America continues to soar and that our debt problem is worse than ever.  If we were truly experiencing the kind of economic recovery that the United States has experienced after every other post-World War II recession we would see a sharp improvement across the board in most of our economic statistics.  But that simply is not happening.  Sadly, this is about as much of an “economic recovery” as we are going to get because soon the economy will be getting much worse.  So enjoy this period of relative stability while you can.

The Obama administration would have us believe that unemployment in the United States has declined, but the truth is that the percentage of working age Americans that are employed has stayed very, very flat for more than two years and now there are some measures of unemployment that are actually getting worse.

For example, according to Gallup the unemployment rate in the United States has risen from 8.5% in December to 8.6% in January to 9.1% in February.  The Obama administration would have us believe that it is actually going the other direction.

Initial unemployment claims are rising again.  For the week ending March 3rd, they increased by 8,000 over the previous week to 362,000.  This is not the kind of good news that people were hoping for.

What the U.S. economy could really use are millions of good jobs.  But those are being shipped out of the country at a staggering pace.

Right now there are millions of Americans in their prime working years that are sitting at home wondering what to do with their lives.  The average duration of unemployment in the United States continues to hover near a record high, and if we were truly experiencing an economic recovery it should have been falling by now.

But a lot of Americans have bought into the propaganda about an economic recovery and they are out running up huge amounts of debt once again.  In January, consumer credit increased by much more than expected.  The following is from a recent Reuters report….

Nonrevolving credit, which includes auto loans as well as student loans made by the government, rose $20.723 billion during the month. That was the biggest increase in dollar terms since November 2001, when credit was surging in the wake of the September 11 attacks in New York and Washington.

Don’t fall into the trap of debt slavery.  During the last recession millions of Americans lost their homes and most of what they owned because they got overextended.

Don’t do it.

The U.S. housing market continues to deeply struggle as well.  If we were really in an economic recovery housing would be bouncing back.  But that is not happening.  Just consider the following facts….

*The number of new homes sold in the United States continues to hover near a record low.

*U.S. home prices in the 4th quarter of 2011 were four percent lower than they were during the 4th quarter of 2010.

*According to CoreLogic, 22.8 percent of all homes with a mortgage in the United States were in negative equity as of the end of the 4th quarter of 2011.  That was an increase from 22.1 percent in the third quarter.

Why are things still getting worse for the U.S housing market?

That is a really good question.

We should have seen some improvement by now.

But it isn’t happening.

Also, poverty in America continues to explode.

For example, the number of Americans on food stamps has increased to 46.5 million – a brand new all-time record.

If we really were in an economic recovery, wouldn’t that number be going down?

We should be thankful that the U.S. economy is not declining as rapidly as it was during 2008 and 2009.  But what we are experiencing right now is not an economic recovery.  It is simply just a bubble of false hope.

The big problem is that our nation is covered in an ocean of constantly expanding debt.

U.S. consumers are drowning in debt, U.S. businesses have pushed debt levels to the red line, and the U.S. financial system is massively overleveraged.

Of course government debt is our biggest debt problem of all.

All over the nation, state and local governments are on the verge of financial ruin.

If we were in the middle of an economic recovery, so many states would not be in crisis mode.  A recent article in the Los Angeles Times declared that “California could run out of cash in March“.  As the economy continues to crumble we are going to hear a lot more of this kind of thing.

A lot of local governments around the nation are on the verge of total financial collapse.  Stockton, California has announced that they will be defaulting on some debt payments, and Suffolk County in New York recently declared a fiscal emergency after discovering that it would rack up more than 500 million dollars of debt between 2011 and 2013.

Keep your eyes open for more news items like this in the months ahead.

Of course the biggest problem of all is the U.S. national debt and it continues to rapidly get worse.

According to the Congressional Budget Office, the U.S. government had a budget deficit of 229 billion dollars in the month of February.  That is the worst one month budget deficit in the history of the United States.

The Congressional Budget Office also says that the U.S. government is now borrowing 42 cents of every single dollar that it spends.

Ouch.

The U.S. national debt has gotten more than 59 times larger since 1950.

The U.S. national debt is now more than 22 times larger than it was when Jimmy Carter became president.

Are there any words in the English language that are strong enough to describe how foolish we have been?

Of course we won’t be able to accumulate so much debt indefinitely.  At some point the trillion dollar deficits will stop and our false prosperity will disappear.

If you want to get an idea of what happens then, just take a look at Greece.

But Barack Obama and most members of the U.S. Congress don’t really care about what they are doing to our future.

What they care about is winning the next election so that they can continue living their fabulous lives.

Barack Obama is supposed to be taking care of the American people, but instead he has been very busy taking care of the people who helped him get elected.  Politics in America is all about money.  Just check out the following very short excerpt from a recent article in the Washington Post….

More than half of Obama’s 47 biggest fundraisers, those who collected at least $500,000 for his campaign, have been given administration jobs. Nine more have been appointed to presidential boards and committees.

At least 24 Obama bundlers were given posts as foreign ambassadors, including in Finland, Australia, Portugal and Luxembourg. Among them is Don Beyer, a former Virginia lieutenant governor who serves as ambassador to Switzerland and Liechtenstein.

Washington D.C. is deeply corrupt and if you are waiting for our politicians to fix our problems you are going to be deeply disappointed.

The federal government is not going to save you.

Our politicians are not going to save you.

You better figure out how you are going to take care of yourself and your family in the years ahead because this is about as good as things are going to get.

This “economic recovery” is about to end and more pain is about to begin.

Greece Has Defaulted – Which Country In Europe Is Next?

Well, it is official.  The restructuring deal between Greece and private investors has been pushed through and the International Swaps and Derivatives Association has ruled that this is a credit event which will trigger credit-default swap contracts.  The ISDA is saying that there are approximately $3.2 billion in credit-default swap contracts on Greek debt outstanding, and most analysts expect that the global financial system will be able to absorb these losses.  But still, 3.2 billion dollars is nothing to scoff at, and some of these financial institutions that wrote a lot of these contracts on Greek debt are going to be hurting.  This deal with private investors may have “rescued” Greece for the moment, but the consequences of this deal are going to be felt for years to come.  For example, now that Greece has gotten a sweet “haircut” from private investors, politicians in Portugal, Italy, Spain and other European nations are going to wonder why they shouldn’t get some “debt forgiveness” too.  Also, private investors are almost certainly going to be less likely to want to loan money to European nations from now on.  If they will be required to take a massive haircuts at some point, then why in the world would they want to lend huge amounts of money to European governments at super low interest rates?  It simply does not make sense.  Now that Greece has defaulted, the whole game is going to change.  This is just the beginning.

The “restructuring deal” was approved by approximately 84 percent of all Greek bondholders, but the key to triggering the payouts on the credit-default swaps was the fact that Greece decided to activate the “collective action clauses” which had been retroactively inserted into these bonds.  These collective action clauses force most of the rest of the bondholders to go along with this restructuring deal.

A recent article by Ambrose Evans-Pritchard explained why so many people were upset about these “collective action clauses”….

The Greek parliament’s retroactive law last month to insert collective action clauses (CACs) into its bonds to coerce creditor hold-outs has added a fresh twist. These CAC’s are likely to be activated over coming days. Use of retroactive laws to change contracts is anathema in credit markets.

If a government can go in and retroactively change the terms of a bond just before it is ready to default, then why should private investors invest in them?

That is a very good question.

But for now the buck has been passed on to those that issued the credit-default swaps.  As mentioned above, the ISDA says that there are approximately $3.2 billion in Greek credit-default swaps that will need to be paid out.

However, that number assumes that a lot of hedges and offsetting swaps cancel each other out.  When you just look at the raw total of swaps outstanding, the number is much, much higher.  The following is from a recent article in The Huffington Post….

If you remove all hedges and offsetting swaps, there’s about $70 billion in default-insurance exposure to Greece out there, which is a little bit bigger pill for the banking system to swallow. Is it possible that some banks won’t be able to pay on their default policies? We’ll find out.

Yes, indeed.  We will find out very soon.

If some counterparties are unable to pay we could soon see some big problems cascade through the financial system.

But even with this new restructuring deal with private investors, Greece is still in really bad shape.

German Finance Minister Wolfgang Schaeuble told reporters recently that it “would be a big mistake to think we are out of the woods”.

Even with this new deal, Greek debt is still projected to be only reduced to 120 percent of GDP by the year 2020.  And that number relies on projections that are almost unbelievably optimistic.

In addition, there are still a whole host of very strict conditions that the Greek government must meet in order to continue getting bailout money.

Also, the upcoming Greek elections in just a few weeks could bring this entire process to an end in just a single day.

So the crisis in Greece is a long way from over.

The Greek economy has been in recession for five years in a row and it continues to shrink at a frightening pace.  Greek GDP was 7.5 percent smaller during the 4th quarter of 2011 than it was during the 4th quarter of 2010.

Unemployment in Greece also continues to get worse.

The average unemployment rate in Greece in 2010 was 12.5 percent.  During 2011, the average unemployment rate was 17.3 percent, and in December the unemployment rate in Greece was 21.0 percent.

Young people are getting hit the hardest.  The youth unemployment rate in Greece is up to an all-time record of 51.1 percent.

The suicide rate in Greece is also at an all-time record high.

Unfortunately, there is no light at the end of the tunnel for Greece at this point.  The latest round of austerity measures that are now being implemented will slow the economy down even more.

Sadly, several other countries in Europe are going down the exact same road that Greece has gone.

Investors all over the globe are wondering which one will be the “next Greece”.

Some believe that it will be Portugal.  The following is from a recent article in The Telegraph….

“The rule of law has been treated with contempt,” said Marc Ostwald from Monument Securities. “This will lead to litigation for the next ten years. It has become a massive impediment for long-term investors, and people will now be very wary about Portugal.”

Right now, the combination of all public and private debt in Portugal comes to a grand total of 360 percent of GDP.

In Greece, the combined total of all public and private debt is about 100 percentage points less than that.

So yes, Portugal is heading for a world of hurt.  The following is more about Portugal from the recent Telegraph article mentioned above….

Citigroup expects the economy to contract by 5.7pc this year, warning that bondholders may face a 50pc haircut by the end of the year. Portugal’s €78bn loan package from the EU-IMF Troika is already large enough to crowd out private creditors, reducing them to ever more junior status.

So why should anyone invest in Portuguese debt at this point?

Or Italian debt?

Or Spanish debt?

Or any European debt at all?

The truth is that the European financial system is a house of cards that could come crashing down at any time.

German economist Hans-Werner Sinn is even convinced that the European Central Bank itself could collapse.

There is a Der Spiegel article that everyone out there should read.  It is entitled “Euro-Zone Central Bank System Massively Imbalanced“. It is quite technical, but if this German economist is correct, the implications are staggering.

The following is from the first paragraph of the article….

More than a year ago, German economist Hans-Werner Sinn discovered a gigantic risk on the balance sheets of Germany’s central bank. Were the euro zone to collapse, Bundesbank losses could be half a trillion euros — more than one-and-a-half times the size of the country’s annual budget.

So no, the European debt crisis is not over.

It is just getting warmed up.

Get ready for a wild ride.

15 Potentially Massive Threats To The U.S. Economy Over The Next 12 Months

We live in a world that is becoming increasingly unstable, and the potential for an event that could cause “sudden change” to the U.S. economy is greater than ever.  There are dozens of potentially massive threats that could easily push the U.S. economy over the edge during the next 12 months.  A war in the Middle East, a financial collapse in Europe, a major derivatives crisis or a horrific natural disaster could all change our economic situation very rapidly.  Most of the time I write about the long-term economic trends that are slowly but surely ripping the U.S. economy to pieces, but the truth is that just a single really bad “black swan event” over the next 12 months could accelerate our economic problems dramatically.  If oil was cut off from the Middle East or a really bad natural disaster suddenly destroyed a major U.S. city, the U.S. economy would be thrown into a state of chaos.  Considering how bad the U.S. economy is currently performing, it would be easy to see how a major “shock to the system” could push us into the “next Great Depression” very easily.  Let us hope that none of these things actually happen over the next 12 months, but let us also understand that we live in a world that has become extremely chaotic and extremely unstable.

In the list below, you will find some “sudden change” events that are somewhat likely and some that are quite unlikely.  I have tried to include a broad range of potential “black swan events”, but there are certainly dozens more massive threats that could potentially be listed.

The following are 15 potentially massive threats to the U.S. economy over the next 12 months….

#1 War With Syria – U.S. Senator John McCain is now publicly calling for U.S. airstrikes against Syria.  A military conflict with Syria becomes more likely with each passing day.

#2 War With Iran – A war in the Middle East involving Iran could literally erupt at any time.  The following is from a Reuters news report that was issued on Monday….

President Barack Obama appealed to Benjamin Netanyahu on Monday to give sanctions time to curb Iran’s nuclear ambitions, but the Israeli prime minister offered no sign of backing away from possible military action, saying his country must be the “master of its fate.”

#3 A Disorderly Greek Debt Default – Many reporters in Europe seem to think that this is becoming increasingly likely.  So what would a disorderly Greek debt default mean for the global financial system?  A leaked report that was authored by the Institute of International Finance says that a disorderly Greek debt default would have some very serious consequences.  You can read the full text of that leaked report right here.

#4 An Economic Collapse In Spain – Spain has one of the largest economies in Europe and it is rapidly becoming a basket case.  As I have written about previously, the unemployment rate in Spain has hit 19.9 percent, and the unemployment rate for workers under the age of 25 is up to 49.9 percent.  Unfortunately, the situation in Spain continues to deteriorate.  The following is from a recent article by Marc Chandler….

However, the devolution in Spain is particularly troubling. The new fiscal compact had just been signed last week, which includes somewhat more rigorous fiscal rule and enforcement, when Spain’s PM Rajoy revealed that this year’s deficit would come in around 5.8 percent of GDP rather the 4.4 percent target. This of course follows last year’s 8.5 percent overshoot of the 6 percent target.

The problem that for Spain is that the 4.4 percent target was based on forecasts for more than 2 percent growth this year. However, in late February, the EU cuts its forecast to a 1 percent contraction. This still seems optimistic. The IMF forecasts a 1.7 percent contraction, which the Spanish government now accepts.

#5 The Price Of Gasoline – The average price of a gallon of gasoline in the United States has risen for 27 days in a row and is now up to $3.77.  Virtually all forms of economic activity are affected by the price of gasoline, and if the price of gas keeps going up it is eventually going to have dramatic consequences for the U.S. economy.

#6 The Student Loan Debt Bubble – Just like we saw with the housing bubble, the student loan debt bubble just continues to grow and grow and grow.  At some point the nearly 1 trillion dollar bubble is going to burst.  What effect will it have on our financial system when that finally happens?

#7 State And Local Government Debt Crisis – It is being reported that California is running out of cash again and there are cities all over the country that are on the verge of bankruptcy.  Could we see a significant municipal bond crisis in the next 12 months?

#8 The Collapse Of A Major U.S. Bank – A number of top U.S. banks are looking increasingly shaky.  In a recent article, David Trainer explained why he has such serious concerns about Bank of America right now….

In my opinion, there are four actions taken by financial services that signal the company is headed to serious trouble.

1. Management shake-up and major layoffs – lots of layoffs over the past year

2. Exploiting accounting rules to boost earnings – SFAS 159

3. Drawing down reserves to boost earnings: to the tune of $13.3 billion in 2011 and 2012

4. Bilking customers with new fees: tried it before and trying it again

Bank of America has taken all four steps.

#9 A Derivatives Crisis – The International Swaps and Derivatives Association recently ruled that the Greek debt deal will not trigger payouts on credit default swaps.  This is seriously shaking confidence in the global market for derivatives.  But the global financial system simply cannot afford a major derivatives crisis.

Estimates of the notional value of the worldwide derivatives market range from $600 trillion all the way up to $1.5 quadrillion.  The notional value of all derivatives held by Bank of America is approximately $75 trillion.  JPMorgan Chase is holding derivatives with a notional value of approximately $79 trillion.

When the derivatives bubble finally bursts it is going to be a financial horror show unlike anything we have ever seen.

#10 The Fall Of The Japanese Economy – The Japanese economy shrank at a 2.3 percent rate during the fourth quarter of 2011.  Japan has a debt to GDP ratio of over 200 percent and a major debt crisis involving Japan could erupt at any time.

#11 A “Solar Megastorm” – Scientists tell us that there is a “1 in 8 chance” that a “solar megastorm” will hit the earth by 2014.  A recent Daily Mail article detailed what some of the consequences of such an event would be….

‘We live in a cyber cocoon enveloping the Earth. Imagine what the consequences might be,’ Daniel Baker, of the University of Colorado’s Laboratory for Atmospheric and Space Physics told National Geographic when asked about a potential ‘megastorm’.

‘Every time you purchase a gallon of gas with your credit card, that’s a satellite transaction.

‘Imagine large cities without power for a week, a month, or a year. The losses could be $1 to $2 trillion, and the effects could be felt for years.

#12 A Major West Coast Earthquake Or Volcanic Eruption – On Monday, there was a 4.0 earthquake in San Francisco and a 6.1 earthquake in Argentina.  Is the “Ring of Fire” waking up again?

#13 Tornado Damage To Major U.S. Cities – Last year, the U.S. experienced one of the worst tornado seasons of all time.  This year, we have already seen the worst tornado outbreak ever recorded in the United States in the month of March.  A couple of towns in Indiana were completely wiped out by that outbreak.  So what should we expect when we get to the heart of tornado season this year?

#14 Severe Drought In The United States – Last summer was one of the driest summers on record in the United States, and in many areas there is simply not enough water available for farmers this year.  Some are even projecting that we could see “dust bowl conditions” return to some areas of the country eventually.

#15 An Asteroid Strike In 2013 – Although scientists tell us that the probability is extremely low, the truth is that there is a slight chance that a sizeable asteroid could hit the earth in February 2013.  The asteroid is estimated to be between 60 and 100 meters wide, and it is projected to pass by our planet “at a distance of under 27,000 km“.  If it did hit us (and scientists say that the odds of that happening are very low) it would potentially be as serious an event as the Tunguska Event in Siberia in 1908.  Mac Slavo of shtfplan.com recently described how awesome the Tunguska Event really was….

On June 30, 1908 an incoming meteor exploded approximately 5 miles above Siberia. The force of the air burst explosion, estimated at between 15 and 30 megatons, or about 1000 times bigger than the atomic bomb that destroyed Hiroshima, was so powerful that it annihilated everything in an 830 square mile area, and reports suggest that that explosion was heard up to 1000 miles away. Because of the remoteness of the impact zone, the Tunguska Event over Siberia had very little effect on the human population in the region, but the destruction of some 80 million trees in the area shows just how powerful a blast was created.

Of course there are so many other “sudden change” events that could potentially happen – a terror event in a major U.S. city, a deadly pandemic, an EMP attack, cyberterrorism or a major political scandal could all possibly cause a stock market crash and an economic collapse in the United States.

In the world that we are living in today, you just never know what is going to happen.

So what are all of you concerned about over the next 12 months?

Do you see the potential for some “black swan events” to happen?

Please feel free to post a comment with your thoughts below….

 

Barnhardt: On Money, Banking, And Men

Barnhardt: On Money, Banking, And Men


From Ann Barnhardt:

ON MONEY, BANKING AND MEN (1 OF 3)
POSTED BY ANN BARNHARDT – FEBRUARY 29, AD 2012 11:22 PM MST

If you know how bad the situation is and don’t feel the need to subject yourself to any more of my patented Barnhardt Phillipic and Funeral Dirge for Civilization, take your leave now, because I honestly think that this is the the saddest, most profoundly depressing post I have yet written.

And I’ve written a few.

A few thousand.

The topic is the US Dollar, and currency in general. The Federal Reserve has been willfully and systematically debasing the US dollar for a century by claiming that 2% inflation is the benchmark of a healthy economy. Since the universities and media have been overrun by Marxists, there is hardly anyone alive who A.) is in possession of the capacity to independently think and reason their way through such a question and B.) anyone who cares in the first place.

In addition to the slow grinding debasement by the Fed, the Marxists have finally fully usurped and overthrown the government of the United States, and thus have now executed the coup de grace: wild, flagrant money “printing”, and by “printing”, please understand that we are not talking about the fabrication of paper bills. We are talking about computerized entries into the Federal Reserve’s ledger. The Fed literally types in an addition of x billion or y trillion dollars into its balance sheet – creating dollars out of thin air that exist as zeroes and ones on a computer server – and then use those new dollars to purchase US Treasury bonds. In this way, the Obama regime and its puppetmasters have debased the US dollar by roughly one half the total GDP in less than four years. This iteration of both the United States and the US Dollar are over. There is no way to walk back the damage that the Obama regime has done. They have accomplished their mission, no matter what happens from this day forward.

After reading and reviewing my texts on monetary theory from Mises, Hayek, Friedman and contemporary economists including Denninger, I have come to a profound realization about money and the fiat vs commodity money (i.e. gold-backed currency) debate – and it bodes very, very poorly for us.

First, a few preliminary points.

1. Going to a gold standard will solve nothing. This is not to say that I don’t think that gold and silver are good wealth storage vehicles in this situation. To the contrary, I think they are excellent for these times. BUT, simply reverting to the gold standard, in and of itself, will not turn us around. We will, at some point, be FORCED to revert to the primordial commodity currency paradigm simply because our government and society will collapse, and thus our currency with it. If and when our culture rebuilds itself, if we remain as we are, the exact same problems that have arisen under the fiat money system will emerge again, even under a gold-backed currency.

So why has civilization, up until just within the last few decades, operated on commodity money systems, and why is it plausible to think that any fiat currency could ever have any legitimacy? The reason why civilization has used commodity money, namely gold and silver, up until just recently is because up until just recently, there was no way to instantly verify money held on deposit, or the existence of a line of credit. With computers and the internet, such instant checks are as common as breathing, blinking and walking. We don’t even think about it anymore. We go to the sandwich shop, get our sandwich, and in less than three seconds, the vendor has confirmed that we have funds, and then transferred those funds into his account. In the centuries and millennia past, people would load chests filled with gold coinage and jewels onto sailing ships and set out for distant lands. Why did they take their gold and jewels with them and risk losing that money to shipwreck or piracy? Because they had to take it with them. The only way to confirm your wealth to others was to physically possess it. Physical possession and spot exchange was also the only way to execute mercantile transactions. If we lose telecommunications and computing ability due to the successful detonation of an Electromagnetic Pulse weapon, or simply due to the total breakdown of society and the ability to maintain and power such systems, then indeed, this argument will become moot. BUT, so long as there is near-instant data transmission, commodity money will be theoretically optional (*with a qualifier to be addressed later in Part 3).

While we are looking at history, it bears mentioning that metals-backed currencies have not prevented other economic calamities. Just in the United States, the Great Depression of the 1930’s and the post-Civil War depression of 1873-1879, now called the Long Depression, which was actually caused by the manipulation of silver demand by the German Empire, were not magically prevented by metals-backed currency. Returning to a gold standard would not prevent recessions from happening. In fact, recessions are a necessary fact of economies, and serve to deflate bubbles and restore equilibrium. The only people who promise to eliminate economic recessions are Marxists, and that is because Marxists are liars. Just as all respiring beings on earth must both inhale and exhale, so too must economies. A person who perpetually inhaled would eventually burst their lungs and die. Conversely, a person who could only exhale would asphyxiate and die. But both actions, in a balanced, moderate cycle, are the definition of health. It is the same with economies: periods of expansion followed by a healthy, normal contraction that deflated any bubbles and restored equilibrium, thus setting up the next expansion phase.

2. Metals-backed currencies can be corrupted, too. There are two ways to corrupt a metals-backed currency, and it has happened many, many times throughout history. The first means pertains to coinage, and is to corrupt the metal itself with cheaper metals, such as zinc. The Roman denarius was debased from 4.5 grams of pure silver to less than one tenth of a gram of silver. Hyperinflation was the inevitable result, and the currency had to eventually be totally replaced.

The second means, which pertains to paper and electronic currency, is for the government to lie about the reserve quantity. This could either be done by explicitly lying about the number of ounces in storage, OR could be done by clandestinely issuing dollars to cronies of the oligarchy, which were NOT actually backed by any metal, and thus would be a de facto lie as to the supply. Since the people would be unable to demand a daily audit and reconciliation, the ability to police and reconcile the supply of metal and dollars would be impossible, and exactly the same things that are going on today, namely government looting of the Treasury and debasement of the currency, would continue apace.

ON MONEY, BANKING AND MEN (2 OF 3)
POSTED BY ANN BARNHARDT – FEBRUARY 29, AD 2012 11:20 PM MST

The problem lies in our overtly criminal government, obviously, but also in the banking paradigm itself. Fractional reserve banking with unsecured lending has got to go. In the current banking paradigm, banks are required to keep from zero percent to ten percent (yes, that’s right, ZERO PERCENT) of customer deposits on hand as reserves, and loan the rest of the money out. If a customer deposits $100 in Bank A, $90 is lent out and $10 remains as reserve (and this is the CONSERVATIVE version). Whoever borrowed the $90 then deposits it in Bank B. Bank B then lends out $81 and keeps $9 in reserve. And so on, and so on. If you go through ten cycles this way, you end up with the original $100 being leveraged into $686.19 of deposits backed by only the original $100. This is what they call “money creation.” For you math buffs, this is a limit function. With a 10% reserve requirement on a $100 initial deposit sum, the limit terminates at $1000. With a 5% reserve requirement on $100, the limit terminates at $2000. With a zero percent reserve requirement, the limit is obviously infinite.
A reasonable, non-zero reserve ratio is workable, but only so long as banks are required to carry one dollar of reserves for every one dollar they lend out. These reserves can be either in the form of the bank’s own capital, OR in the form of FAIRLY VALUED booking of the assets purchased with the loan. All unsecured lending must stop. This means that all home mortgages must be marked-to-market every single day, and if the home is worth less than the loan outstanding, the bank must post its own capital against the shortfall. This also means that credit cards, which are totally unsecured because they are used to purchase mostly non-assets, such as meals, gasoline, vacations and pure service commodities, must be backed by bank capital dollar-for-dollar. The bank could sell bonds to raise capital if it wants to make unsecured loans and then would be arbitraging the spread between the interest rate it must pay on the bonds and the interest rate plus default risk on the credit cards. In this way, the worst that could possibly happen, namely every unsecured credit line totally defaulting, would result in the bank owners and investors losing their money – but the customer deposits would be safe because all of the loans against hard assets, which would be properly valued and marked-to-market, could be sold to other banks in the market, and that revenue would fully cover all customer deposits.

In not posting capital against unsecured loans, the banks are indeed naked short selling our currency – and it matters not whether that currency is gold-backed or not. The credit card customer is promising to pay back (deliver) a loan with money that they do not have and does not exist, and they won’t be able to borrow. So, the bank and the customer together are colluding in the naked short sale. The long on the other side is the citizen and taxpayer who will subsidize the inevitable “need” to print more dollars to “bail out” both the bank and the customer. Taxes will be raised and the currency will be further debased, causing price inflation – a one-two punch to the citizen. This is EXACTLY what is happening to us today.

Well, the reality today is that banks are both writing massive quantities of unsecured loans and doing nothing on their side to balance the ledger, AND they are failing to honestly and realistically book the values of their hard-asset loans. The big banks are still booking home values at their original purchase price – not the fair market value today. Given the housing bubble, most mortgages today are underwater and are worth far, far less than the principal balance to say nothing of interest. This is why I say, echoing others, that the major banks in this country are not just totally insolvent, they are insolvent multiple times over. If the government wasn’t criminal and the favored banks of the oligarchs actually had to comply with Sarbanes-Oxley, the entire system would implode into a singularity tomorrow.

For more info and a much better explanation of the concepts covered to this point, do purchase “Leverage” by Karl Denninger – a very easy-to-grasp, detailed explanation of the whole, stinking mess.

CLICK HERE TO BUY “LEVERAGE”.

ON MONEY, BANKING AND MEN (3 OF 3)
POSTED BY ANN BARNHARDT – FEBRUARY 29, AD 2012 11:14 PM MST

And that brings us to the conclusion and actual point.

All of the stuff outlined above is all well and good to talk about, but as I was reading, including opposing thoughts from other schools, including the Austrian School which advocates full-reserve banking in some instances, namely demand deposits – a possibility to which I am not entirely opposed – I kept running into the 400 pound gorilla, which is silently acknowledged, but never really discussed, because the discussion would inevitably lead to talk of morality and thus . . . religion.
At the end of the day, any currency is backed not by physical commodities or a collective abstraction called “a government”. No. A currency is backed by the character and integrity of men that constitute the issuing nation or body. In short, WE ARE THE GOLD. We are the bearers of the “full faith and credit” which backs our Federal Reserve notes today. And that, dear readers, is why this country is not going to turn itself around anytime soon, and is almost certainly doomed in the short-run.

Every text I read over the last few days always included a very brief caveat that all of the preceding theory was, of course, contingent on a moral society with a functioning rule of law, honest regulation and a populace that was mostly honorable and trustworthy. This caveat was phrased differently in each instance, but it was always there, hanging over everything else like a fine mist. If you have a nation of moral degenerates, all bets are off. If the people are more dishonest than honest, and the government is nothing more than a mafia, then all economic systems and all postulations fly apart at the seams. If there is no rule of law, and if theft, graft and looting are the prevalent systems of economic activity, then no matter what your banking system, no matter what your currency – fiat or commodity-backed, your system and your economy will absolutely, positively fail eventually.

Sadly, that is where we are in this country. Sure, there are still good people, but as a percentage it isn’t even remotely enough to bear the burden of the massive moral degeneracy of the others. Even among those people who would never steal or loot, there is a decided lack of courage to stand up to those who do steal and loot. The MF Global confiscation proves this. People have mostly rolled over and taken having their money stolen, shrugging their shoulders and telling themselves that there is nothing they can do – and then going back for more, continuing to patronize the very exchange that facilitated the theft and fraud. To my knowledge, only one broker has exited the field on purely moral grounds in a pre-emptive action to protect clients, and as a protest to the injustice of the system itself.

Our government is saturated with corruption, looting and outright treason and criminality, and yet most people simply cannot be bothered to care, much less to act, and are thus passively complicit. A non-trivial percentage of the population are planning and maneuvering to best “benefit” or profiteer from the criminality and fundamental dishonesty of the paradigm. Others are attempting to enter the oligarch class themselves under the guise of running for political office – and make no mistake, this encompasses both the so-called left and the so-called right on the political spectrum. The degeneracy is everywhere.

The fall of a society can happen very quickly. Our society has taken roughly 50 years to topple. If the previous example of the Russian culture is any example, we can expect it to take many multiples of 50 years to undo this damage, if and only if the pendulum has reached its maximum amplitude and now begins to swing back, which I fear has not yet happened. Morality cannot be legislated. Cultures cannot be purged of evil, selfishness and sloth overnight – even with a war. I cannot lie to you and tell you that short of Divine Intervention, this situation will resolve itself in any of our lifetimes. We had “it.” We had “it”, and we squandered “it”, and now “it” is gone, and no governmental, economic or monetary policy will get “it” back. “It” can only come from God, dwelling in the hearts of men, and God only comes to men if they specifically ask Him.

We, the people, always have been and always will be the ultimate backing commodity of our currency, because at its core, money is merely the representative device for a man’s capacity to produce and create. Dishonest men do not create or produce. They steal. Thus, the currency of a morally degenerated society is by definition degenerate itself. The currency of a degenerate society is the proxy not for a man’s ability to work and think, but rather a proxy for a man’s capacity to steal and evade work.

We used to be like gold – beautiful and warm. Now we are like pig iron – cold, brittle and good-for-nothing. And THAT is what constitutes the “full faith and credit” that backs the U.S. Dollar. So long as our culture remains degenerate, our currency can never be anything but spiraling, worthless trash.

Even More Debt And Even More Store Closings

The Obama Nation: Even More Debt And Even More Store Closings

http://theeconomiccollapseblog.com/archives/the-obama-nation-even-more-debt-and-even-more-store-closings

Well, it is time to raise the debt ceiling again.  Right now we are about to hit the current limit of $15.194 trillion and the Obama administration is going to ask that it be raised by another 1.2 trillion dollars.  Unfortunately, Congress has already promised not to stand in the way, and so soon the debt limit will be raised to a staggering $16.394 trillion.  Considering how much debt we have already placed on the backs of future generations, what is another 1.2 trillion dollars?  After all, if we are going to sell our children and our grandchildren into debt slavery, we might as well go all the way, right?  Such is the thinking in “the Obama Nation”.  During “the Obama Nation”, the federal government has already accumulated more debt than it did from the time that George Washington took office to the time that Bill Clinton took office.  Of course the Bush administration was nearly as bad at piling up government debt.  Between Bush and Obama (with a big helping hand from the Federal Reserve), they have done a pretty good job of wiping out the financial future of the United States.  If there are future generations of Americans, they will look back and curse those that did this to them.  It is absolutely immoral to steal trillions of dollars from future generations.  Unfortunately, there are very, very few members of Congress that are even objecting to this madness.

Today, more debt just seems to be the answer to everything.  The truth is that debt is not just a government problem.  We are a nation that is addicted to debt.

As of October, total consumer credit in the United States had increased for 12 of the past 13 months.  We simply have not learned the lessons of the past and we are making the same mistakes all over again.

We are living in the greatest debt bubble in the history of the world, and this false prosperity that we are enjoying is simply not sustainable.

But even in the midst of this false prosperity we are seeing a huge number of store closings.

For example, it was just announced that Sears has decided to close between 100 and 120 Sears and Kmart stores.

Once upon a time, Sears was the dominant force in the retail industry, but those days are long gone.  Sears stock has declined more than 45 percent so far this year, and many are wondering how long the company is going to be able to survive.

And there have been other high profile store closings announced during this holiday season as well.  A while back it was announced that all Syms stores and all Filene’s Basement stores will be closing.

Will we all eventually be relegated to shopping only at Wal-Mart?

In the middle of this “economic recovery” that Obama keeps talking about a staggering number of retail stores are closing up shop.  The following is a list of store closings in 2011 that I recently found.  The first number represents the total number of stores being closed for each chain….

405 Blockbuster

633 Borders

200 GameStop

189 Gap

160 f.y.e.

117 Anchor Blue

117 Foot Locker

100 Talbot’s

71 A.J. Wright

69 Metropark

63 Friendly’s

60 Rite Aid

52 Destination Maternity

50 Abercrombie & Fitch

50 Hot Topic

45 Big Lots

45 Family Dollar

43 Select Comfort

43 Sonic Drive-In

35 Denny’s

32 Great Atlantic and Pacific Tea Company, Inc. (SuperFresh, Pathmark Super Market)

30 Ultimate Electronics

28 Dominos

25 Superfresh (Great Atlantic & Pacific Tea Company)

20 Lowe’s

Sadly, it looks like things are going to get even worse next year.  One consulting firm is projecting that there will be more than 5,000 store closings in 2012.

The United States is piling up unprecedented amounts of new debt at a time when our economy is dying and our ability to produce wealth is diminishing.

All over America right now, poverty is absolutely exploding.  Millions of people that never dreamed that they would have to reach out for help now find that they have no other options.  The following comes from a recent article in the Fiscal Times….

For years, the food pantry in Crystal Lake, Ill., a bedroom community 50 miles west of Chicago, has catered to the suburban areas’ poor, homeless and unemployed. But Cate Williams, the head of the pantry, has noticed a striking change in the makeup of the needy in the past year or two. Some families that once pulled down six-figure incomes and drove flashy cars are now turning to the pantry for help. A few of them donated food and money to the pantry before their luck soured, according to Williams.

“People will shyly say to me, ‘You know, I used to give money and food to you guys. Now I need your help,’” Williams told The Fiscal Times last week. “Most of the folks we see now are people who never took a handout before. They were comfortable, able to feed themselves, to keep gas in the car, and keep a nice roof over their head.”

But not everyone will ask for help nicely.  As the economic numbers continue to get worse, desperate Americans will lash out in wild and unpredictable ways.

The following is from a local NBC station down in Texas.  In the days to come, this type of report will become quite common….

A 19-year-old Houston-area man says he was beaten and a friend was slashed in the face as a group of men robbed him of his new pair of expensive Air Jordan shoes.

We will also see more mass protests and more mass riots as the months and years roll along.  This country is going to become increasingly unstable.

Check out this video of a massive brawl that erupted inside Mall of America the other day.  Soon scenes such as this will become so common that they will not even be newsworthy anymore.

In response, many Americans will get sick and tired of waiting for the police to protect them and will take matters into their own hands.

In fact, we are already starting to see this.  For example, just the other day a store clerk down in North Carolina knocked a would-be robber out cold and then forced him to clean up his own blood after he woke up.

There are millions of Americans out there that are not going to put up with a whole lot of nonsense.  When desperate criminals try to rob from their homes or businesses it might not end well for the criminals.

Of course it would be much nicer if the federal government would do some things to actually fix the economy and avoid some the problems that are looming on the horizon.

Ah, but that would interrupt their vacations.  Right now, the U.S. House of Representatives is on vacation until mid-January.

If you can believe it, Congress does not work for most of the year.  Normally they are scheduled to be in session for about a third of all the days on the calendar.

And Obama is certainly taking it easy.  He is enjoying yet another vacation.  As I wrote about yesterday, it has been estimated that the Obama Hawaiian vacation this year will cost somewhere in the neighborhood of 4 million dollars.

Yes, it is tough being the head of the Obama Nation.

Sadly, a lot of Americans still have faith in these jokers.

According to a Gallup poll that was just released, Barack Obama is the most admired man in America by far and Hillary Clinton is the most admired woman in America by far.  If you can believe it, Barack Obama has held the top spot for men for four years in a row, and Hillary Clinton has held the top spot for women for ten years in a row.

When are we going to learn?

Someone once said that insanity is doing the same thing over and over again and expecting different results.

Well, the American people keep sending corrupt politicians such as Bush and Obama to the White House and they keep expecting things to get better.

It just isn’t going to happen.

If we stay on the current path that we are on, there will be a lot more store closings, the economy will continue to crumble and government debt will continue to skyrocket.

Minor changes are not going to cut it.  We need massive changes on a fundamental level.

Unfortunately, neither political party is offering massive changes.  The Republicans and the Democrats just keep offering the same tired solutions and they keep promising that they can “fix things” if we will just send more of them to Washington.

Hopefully the American people will wake up and see through these lies because time is running out.