Posted on 05/14/2011 9:23:12 AM PDT by OwenKellogg
The situation in the United States has deteriorated and will continue to do so unless drastic action on our federal, state and local government deficits is taken. We need to trace what happens during an economic collapse. In preparation for a collapse here is what you can do personally to avoid being swept away by the tidal wave of fear, anxiety and trepidation.
During the early stages of a nation collapsing economically, the debt of the nation swells almost uncontrollably. We, in the United States are already there.
From the burgeoning debt loads come the setting for collapse.
While the disaster can unfold in many ways, the course for the United States is already set in motion.
Inflation will increase. When inflation hits, citizens with limited financial resources become economic casualties first. These citizens are part of the beginnings of the downward spiral which ultimately leads to a depression.
In a misguided attempt to kick start the economy, our government will attempt another stimulus program which will fail. The parameters under which Fiscal Policy might work if you are so inclined to believe that it does have long been broken. Consequences of government actions are becoming unpredictable and are having unintended consequences.
The United States began the first phase of the stimulus program with the American Recovery and Reinvestment Act as well as the significant expansion of the unemployment compensation to pull us out of the recession. Both actions were the wrong actions at the wrong time.
When stimulus programs fail, our government will try to increase taxes or fees, often in deceptive ways such as fuel taxes, oil drilling taxes, user fees or increased regulatory burdens. This demand to increase taxes is to help support the citizens who were the first economic casualties of the recession as well as to pay for the deficit.
Next the bond rating agencies will downgrade our debt. At that point, our interest rates will increase and further prolong the recession. It is this downgrading of the debt and potential inability to sell our debt on the open markets that will be our undoing.
Our deficits will skyrocket because of the increased interest costs and creditor-forced reductions in spending will be enforced against us. The U. S. Congress will no longer establish our budget priorities. Our creditors will, as is done is Greece today.
The depression follows.
What then should the individual do?
Personally we have many options and they are extremely straightforward. The actions to be taken are exactly the same action that government needs to take but will not.
First, know where you are financially. Know your income and expenses and balance your own budget.
Second, you must start to build your funds if you are able. By establishing some cash reserves, you are reducing the risk of you becoming one of the first casualties of the collapse.
Third, you should consider paying off all short term credit card debt and minimize the use of credit cards unless you have the financial resources to pay for your spending.
Fourth, I would recommend refinancing your home with a 30 year long term mortgage considering how low rates look now. If your home is "underwater" with debt already that may not be possible.
Fifth, build up credit availability if you have the discipline not to use it. If you do not have that discipline, adding credit availability is one of the worst things you can do.
Sixth, make certain you are valuable to your employer. Stay current and productive. Many countries in Europe have 15% unemployment or more. Try not to become part of the "expendable" because you have let yourself stagnate.
Finally, help your family.
Surviving an economic collapse is possible. It will take 2 or more years for the U. S. to be in a full collapse. In interim get active politically, vote, and make government accountable, responsible and efficient to help prevent the disaster. I doubt Washington has gotten the message though! I hope you do. Your family is depending on it.
Frank Ryan, CPA specializes in corporate restructuring and lectures on ethics for the state CPA societies. Frank is a retired Colonel in the Marine Corps Reserve and served in Iraq and briefly in Afghanistan. He is on numerous boards of publicly traded and non-profit organizations.
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I’m wondering Kart....would nusimatics(sp?) make sense? ....not based on their gold or silver content, but very collectible.....something that in 20 yrs would double or triple in value...
property taxes is what is going to kill us....
see that is what is happening...the young people are slowly being boiled and as long as they have their sushi, and their American Idol...
but we'll be prepared to take them all in....
Another way to look at it: We have guns and money. They have guns and our money. Pull the plug and watch the sparks fly.
From what I’ve read gold and silver have been quite oversold. I’d be surprised if people who have purchased certificates even get their money back, forget about ever seeing the actual metals.
10 times more gold has been sold than they have.
I sure wish I was as smart as you two. I’m just one of those dumb Christians.
One thing that wasn't knowable back then, was how it was going to be dealt with. We are doing everything we told the Japanese not to do in the aftermath of their housing collapse..
Excellent post, Regulator. You bring up the matter of food growing problems in that area.
Soil, as you note, can be amended.
Now trying growing a radish in the northern tier of states in February or March. After you dig through the snow depth, pick off the bottom ice layer and get your drill out to make a seed hole into the soil freezeline, you might, if lucky, see a radish in mid-June.
In the meantime, people in the southeast will be eating blackeye peas and collards - not great but it is food - while their northern cousins are munching snowcones.
Survival in the southeast is much more probable than in the mid-west or northeast. And those areas are also infested with vast swamps. Both Milwaukee and Chicago were built on swamps.
I’ll tell someone who might be interested
Let’s see, what is the equation?
1 bear = 157 chickens
The novel, “Patriots-A novel of Survival in the Coming Collapse” by James Wesley Rawles is a real must read for what’s coming.
And now is the time to start networking, I think. Find out who you can ally with who won't freak out when the time comes, and to supply each other with goods and services, mutual protection (gotta sleep sometime), and to start the rebuild process.
I thought I had an "in" with the mayor of our town because he carpools with a good friend of mine. I was wanting to schedule discussions on the event of hyperinflation sealing the town, building up supplies, setting up distribution networks...but unfortunately I found out he is a typical Dem class warfarist type of leader. My town is hopeless it appears, I'll have to look elsewhere to network.
I’ve actually heard that farm land is going to become valuable. I dunno, but, it would seem with all the flooding of valuable farm land right now and the fact that we are growing food for fuel, it would become valuable again. By the way their is a corn shortage right because we are growing corn for fuel. I said when they first started doing this that there would be a shortage of food and it was immoral to grow food for fuel. My hubby laughed at me and said we grow tons of corn their won’t be a shortage. He’s not laughing now.
I wouldn’t know.
Haven’t followed your posts that closely.
I just know that there’s sooooooooooooooooooo much evidence
sooooooooooooooo brazenly everywhere in neon lights . . .
and still shocking numbers of FREEPERS run around posting as though life is going to go on more or less as usual.
That JUST AIN’T OUR LOT.
No.
That’s wrong.
The truth is
6 chickens X 12 igloos = 72 trillion gumdrops swallowed by 48 billion aardvarks.
I am flabbergasted that anybody could think a “full pantry” and stocking up on toiletries and sundries would be more than a drop in the bucket against high inflation.
How much inflation hedge can you shelter with a pantry?
Can you store long term $2,000 of food? $5,000? How about toiletries. Are you going to store $2,000 in toilet paper, razor blades and toothpaste? Do you have any clue how much room it takes to store even $500 in toilet paper? You would fill a small closet.
So lets say you buy $10,000 in food and sundries just to store as a hedge against inflation — avoiding the perishable — many foods are perishable, so we are talking all canned goods, rice, beans, crackers, salsa, cereal, maybe frozen meat and veggies if they keep but I doubt it - not during a 2 year collapse as stated above. That is a long time to store food in a pantry against inflation.
Anyway, you store $10,000 and lets say prices triple in 5 years. Congratulations, you just saved a cool $20,000. How long did the goods in that that pantry last? A year? Six months?
THIS IS GOING TO SAVE YOU AGAINST INFLATION???????? ARE YOU KIDDING ME?????
I personally have lost $20,000 in my home in the last 2 years and I was smart and bought waaaaay after the bubble popped. Do you think that $20,000 loss has ruined me?? NO it hasn’t. It is inconvenient but hasn’t left me broke. Now do you really think the $20,000 you save in that pantry is going to save you very long either? And please subtract all the food that spoiled or rotted or got contaminated by bugs or insects during long term storage.
If prices triple and you need a new car, that $15,000 Honda Civic today is going to cost you $45,000. And you thing a once-in-a-lifetime $20,000 savings will save you from inflation over the rest of your life?
You will be paying $10/gallon for gas. Your utility bill will triple from $150/month to $450/month. If you pay $10/day parking in a big city, that will triple. Don’t even get me started on the cost of your health care tripling in cost.
School fees triple. Entertainment costs triple, or maybe only double since people can’t afford them as they used to.
And people here think a full pantry is more than a drop in the bucket against a future life of post-inflation prices?
I’m sorry. This strikes me as patently absurd. Things like gold and real property will be a REAL inflation hedge to store your wealth, not a one time $10,000 stockpiling of the pantry.
I don’t know if people just don’t think this stuff through, or say the first thing on their minds, or if they just don’t realize how impractical a good theory can be when put into practice.
Stockpiling food and goods as a hedge against the impact of high inflation will save you a nice little bit and nothing more. I am 52 years old hoping to live to 80 or so. Say I only make it to 75. Having six months of bargain priced food and sundries to use for 6 months is going to do almost exactly NOTHING to protect me against the remaining 20 or 25 years of high inflated prices.
I realize you get what you get on the internet, but sometimes the inane things stated are just mind blowing. Truly mind-boggling.
And never mind the fact that you won’t save the $20,000.
If prices triple in 5 years, then the $10,000 of food and sundries you have that may last a year at most, would only save you 1/5th of $20,000 or about $4,000.
About the only good a stocked pantry will do you is you won’t run out of coffee or sugar or flour, etc. if there is a temporary shortage due to a run on those goods or a temporary disruption in distribution.
Stocking the pantry is always a good idea against very short term catastrophe where food & sundries are unavailable for a few days or a couple of weeks, but is worthless as a hedge against inflation.
I agree my first few posts on this thread were not loving but arrogant. I did provide the solution but people have to first know they need the solution. Therefore, I'll try again to all posters on this thread. Why did you post here? Are you fearful, angry, hurt, or joyful?
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