Category Archives: Economics

How Much Interest Has Your Food “Bank” Earned This Year?

By: Tom Chatham

In these days of declining paychecks and rising prices, people are hard pressed to get the most for their money. With every new dollar that is printed the value of your hard earned savings decreases and much buying power is lost. The conventional way to offset this decrease is to invest your money where it can earn interest and increase your holdings in real terms or at least keep up with inflation.

If you put your savings in the bank you might get .25% these days if you are lucky. This is at a time when real inflation is running close to 9% annually. In order to earn a better return on your funds you must put them in increasingly risky investments that have counter party risk that many may not fully appreciate until something happens. Just ask those fleeced by the MF Global bankruptcy.

There are few things one can place their money in these days that will maintain value or even grow. The normal safe haven in times like this are usually precious metals or investment grade collectables but those things must be sold in the marketplace in order to utilize the value of those items. What the average person needs is a safe haven they can hold and use at will and still reap the full value of those items.

When you earn interest on investments, your Uncle Sam will be standing there with his hand out when you liquidate that item so he can get his share. This just adds insult to injury when you loose buying power through inflation. There must be a better way to store wealth on a small scale that average people need and can use. That way is through commodities that you use every day.

When you buy a can of soup for .50 cents and put it on the shelf for several months and finally use it after the price has increased to .65 cents, you have effectively earned 30% interest on that can of soup. Where can you earn 30% interest these days with no counter party risk?

What makes this even better is that you pay no tax on that 30% interest. Can it get any better than that? This type of investment plan will work for anyone because everyone buys food on a regular basis. Not only that but the other things you use at home such as hygiene supplies, paper products, cleaning products, and hardware supplies will likely go up in price as time goes on and offer you the opportunity to save on your future needs. This also applies to things such as ammo, clothing, auto parts and energy supplies.

Some may say this is a waste of time because many of these things will have to be used within some time limit, but you will need to buy these things anyway at some point so why not increase your buying power by making purchases in a different manner than you normally do.

If you store a years supply of food at home and the real inflation rate is 8% annually, when you replace those goods that you use you may pay more but you will essentially be eating at last years prices. If inflation gets even worse in the future you will have more available purchasing power than others because you will not have to buy necessities every week like everyone else. You can wait for specials, deals on bulk purchases or seasonal fluctuations.

In a serious situation you would be able to stop purchases for up to a year and use that money for other things such as equipment to grow and can your own food. In the event of unemployment, it is also one less expense you will need to worry about. While food is a natural for this type of savings plan other household products may work even better due to longer shelf life.

Just imagine if you had everything you would need for the next ten years stored in your basement. How much would you save in inflated prices over that time period? With a real inflation rate of 8% prices would almost double every ten years. It is unlikely that your paycheck would increase at a similar rate. This type of savings plan is better than putting money in the bank because a bank can go out of business or outright steal your funds because of new laws that are now in place. The amount of money you spend on everyday necessities over several years can run into the thousands of dollars and that is sufficient to preserve a lot of money.

It is important for each person to analyze their financial position at regular intervals and you must be aware of the real inflation rate in order to devise a plan to get the most from every dollar you spend. This will become ever more important as the economy becomes more unstable as time goes on. In the end it is up to you to protect your hard earned money from loss due to economic conditions that are controlled by those that wish to destroy it.

A Depression Era Economics Lesson

By: Tom Chatham

When the great depression hit in the 1930’s, many people had a difficult time surviving. When the system they depended on ceased to function properly, they no longer had the ability to earn a living wage and care for their families. Even at a time when you could get a meal for a nickel, many people struggled to feed themselves.

In many rural areas, farmers faced the difficulty of being able to even grow enough to feed themselves. The drought that accompanied the depression left many no choice but to move to more hospitable locations where jobs could be found.

Some people were in a much better position to weather the national problems than others. They were not rich in monetary terms but they had a stable living condition that enabled them to get by as always.

In the rural community that my family had called home for over 100 years, my family got by better than most. The fact that many of the people were watermen, that made their living on the Chesapeake Bay catching various types of seafood throughout the year, made the depression different for them. As my father related to me, they really didn’t know there was a depression going on most of the time.

The men went to work every morning catching what they could. Anything they couldn’t sell was taken home for dinner. Everyone had a garden and maybe some chickens and a hog out back providing meat for the winter. The area was also surrounded by many small farms producing many things they could trade for. Nobody had much money but the area teemed with the things that were needed to get by and barter was the norm.

Electricity was not seen in the community until the late 1940’s and few people had a car. These people really did live off the grid. That was the norm for them and they got by very well even with the national economy in a state of hard times. They could not buy many of the things they needed so those things had to be made out of whatever materials they had.

There are many stories like this that have been told and they are worth listening to once again. These stories provide the foundation people will need when the economy fails again in spectacular fashion leaving many in dire straits. When everything fails you have to go back to what works. That is a lesson that our ancestors have left for us to follow if we have the sense to learn from their hardships.

The current generation has known nothing but excess and prosperity. When the system turns down again they will be lost without all of the creature comforts and gadgets they are used to getting with great ease. They have been raised with the notion that everything is easy and when that paradigm fails they will not know how to cope with reality. This is the problem we face and must deal with in the months to come.

There are two lessons that can be taken from this story. When hard times come your location and creativity can make up for many shortfalls in life. Those things can make the difference between suffering and having a decent standard of living. Living in an area rich with resources allows you to produce many of the things you need locally with little money and can even provide you with a stream of income. The lack of resources in your area can make things very difficult over the long term.

The current generation has lost the ability to trouble shoot the problems they are faced with and come up with simple solutions. Creativity is something many people no longer possess and that is one of the things that will make life hard on them. The greatest generation knew how to devise creative solutions to their problems that allowed them to get by and even prosper. That is a lesson we need to take away from the last depression.

It is good for people to plan for hard times by stocking up, learning to produce food and storing real money for times of need but that will not be enough when the time comes. Your location and the ability to be creative and solve the many problems you will face will be necessary ingredients to surviving the coming hard times. Keeping your plans simple and learning the ways of our grandparents will help in ways we cannot even contemplate at this time but their wisdom will be as critical as your other supplies. One of the many slogans that came from that time is worth remembering.

Make do, do without, use it up, wear it out.

One Character Flaw You Must Overcome To Survive

By: Tom Chatham

There are many character flaws that humans suffer from. Some are just inconveniences while others can mean the difference between mere survival and prosperity. Many people go through life in a never ending series of failures and can never understand why. Rather than look at their actions and make an objective determination of what went wrong, they would rather go on thinking it was not their fault for the failure.

As a smart man once said, doing the same thing over and over again expecting a different result is the definition of insanity. But this is exactly what most people do on a daily basis. It can be obvious to someone looking at them from the outside but is not obvious to the person themselves.

One of the character flaws people suffer from can be described by many different names. You might call it normalcy bias or procrastination but it amounts to the same thing. You fail to do something you should do based on the current information available to you. This may simply mean you fail to take advantage of a job opportunity, make a good investment or it could be something that spirals out of control and affects your whole future.

Information is your reality check on life. Just like intelligence in a war zone, it can be acted on or dismissed. What you do with it will determine your outcome in the future. A piece of information that you find contrary to your prevailing feelings does not make it true any more than it makes it irrelevant. What it does mean is you should investigate it further and determine what effect it will have on your future plans.

Here is one example. You have a few thousand dollars saved up for emergencies. You have a family to care for and a mortgage and car loans to take care of. The payment of all your monthly bills require the combined income of you and your spouse. One or both of you lose your job and have difficulty finding another. You now have hard facts in front of you to process.

You cannot pay all of your monthly bills with the current income. Even if you reduce your expenses you still will not have enough money coming in to cover the basics. You have no choice but to dip into your emergency cash to make up the difference. The amount of cash reserves will keep your bills paid up for several months before you run out of cash. Here is the disconnect that most people have.

What will you do after the cash runs out? That is the question most people refuse to ask themselves and the reality they refuse to look at. Most people will run things out until they have no resources left to control their future. Only then will they face the reality they were faced with several months before. They just assume and hope something will happen that corrects their problems before they run out of money.

Rather than investigating the job market and accepting the reality that they may not find another job quickly and making plans to deal with that reality, they just continue life as normal until time and money runs out for them. Unfortunately this hypothetical situation has become reality for millions of Americans.

What could they have done? There are many things they should have considered before their financial resources ran out. They could have looked at selling their house and cars and downsizing to make their remaining income sufficient to live on. They could have looked at job opportunities in other cities. They may have determined that moving in with relatives for a short while would be the best solution.

In an extreme case of job loss they may have determined that buying a travel trailer or RV to live in and some basic supplies to live on for several months would be the best way to avoid possible homelessness. An objective evaluation of their circumstances would have provided a realistic look at what they were facing but many will forgo this approach to feel normal as long as possible and will then suffer terribly for that lack of foresight.

This is one character flaw in humans that allows them to dismiss possible danger and walk off a cliff with both eyes open. The lesson here is simple. We must constantly question and evaluate our situation and accept those things we want to dismiss just because they make us feel uncomfortable. Regardless of how you want the future to play out, you must always treat reality with the attention it deserves. You can ignore reality, but you cannot ignore the consequences of ignoring reality.

Is Silver Indicating The End Game Is Near?

By: Tom Chatham

Gold and silver have suffered a beating this past week. Silver has broken below support levels and at this time the bottom is uncertain. One thing that is certain is that the manipulation taking place behind the scenes is providing a prime buying opportunity. While investors are having another bad day, stackers are enjoying every minute.

It is common belief that the destruction of the currency by unfettered printing should cause a rise in PM’s but the manipulation taking place has made pricing PM’s a guessing game for the past ten years. Only the final destruction of the fiat empire will usher in the unrelenting rise of gold and silver to their natural free market levels. This takedown may be the final gasp of the currency manipulators before the printers lose control and gravity takes over.

John Embry recently stated that silver is one of the few lifeboats that will be available to people when this Ponzi scheme comes apart. He also stated that from the Austrian perspective there remains only two possible outcomes and the most likely one is that they will print as much money as necessary and that will lead to hyperinflation at some point.

Last year the DHS insider told Doug Hagmann that a prelude to the end game would be a massive takedown in the price of metals. With the price of silver breaking below the $18 resistance level, it is possible we are seeing that move now.

Jim Rickards, who has been providing financial threat and asymmetric warfare advice to the nations intelligence services, is now expecting a great depression that will last 25 years. He expects the losses of the next market collapse to be in excess of 100 trillion dollars. He also believes it will begin within the next six months. He has also stated that the government has already implemented what they call the day after plan for this collapse which involves evacuation of government leaders to areas called site A, site B and site R.

John Williams of Shadow Government Statistics is still calling for hyperinflation in the U.S. and he believes it will begin by the end of 2014 or early 2015.

Jonathan Cahn, author of The Harbinger, believes that based on biblical text and dates that another devastating market crash may happen by September 2015, with a high likelihood around Sept. 13, 2015.

In any event, people will have to judge the current world events and warnings of others and make their own decisions as to what will come and prepare accordingly.

The current cost of silver in fiat dollars is well below production cost and cannot last for any significant amount of time because physical shortages will develop at some point. That makes it a very good vehicle to store any excess funds you have for the future.

When you think about how to save for the future you must consider the actual value of assets and commodities and how they will be affected by a major disturbance in the normal state of commerce.

The value of something is relative. It depends on the one who has the item and the one who wants it. To complete a transaction, the two must come to some mutually agreed upon terms. These terms define the current value of the item.

Even if the world wakes up on the wrong side of the bed one morning and money as we know it no longer has any value due to the circumstances, at some point you will still need some way to save for the future.

One of the reasons we need a medium of exchange that will hold its value over time is so that you can save your excess production now so that it can be used later if you cannot produce enough later in life to live day to day. That is the whole point of saving for retirement. To pay for things you need when you can no longer physically produce enough.

There are many that will say it is a waste of time to save or plan for commerce in the future if everything collapses but it is a necessary action of humanity and will be necessary no matter how bad a collapse is. Those that do plan for some type of commerce in the future may decide that skills will be their savings to draw on in the future rather than physical assets such as precious metals. The reasoning behind saving at least some PM’s is the fact that they have a 5,000 year track record that transcends the past mistakes made by humans.

In the future if you are fortunate enough to still be productive after some world changing event and someone needs something you have, you will either have to give it to them for free or take something in exchange for it. If you take something in exchange for it, what would you prefer that something to be?

The Great Unwinding and The Aftermath

By: Tom Chatham

As global currencies wage a race to the bottom, citizens of the world are kept distracted by insignificant things to keep them calm right up to the end. The end will be the destruction of many world currencies and the savings of those invested in them. When that happens those who have lost everything will panic, and for good reason. The conspiracy theorists and sound money people will be proven to be prophets but none of that will matter by then.

All of the savings that people think they have was long ago looted by the bankers and now they must destroy those ledger entries that people think they have. Much like the phantom gold that no longer exists in vaults but only on paper, those ledger entries must be destroyed before the banks are required to give that money back to its rightful owners. It is not only the savings but the promised payments from government entities that must be eliminated. The government has made promises it cannot keep and now it must find a way out while maintaining “plausible deniability”.

That is the crux of the unwinding we will see in the near future. The people have been robbed of their wealth and their futures and now it is time to perpetrate the cover up so the guilty parties can sail off into the sunset with their ill gotten loot. It almost sounds like a movie plot but unfortunately the people will have to stick around after this show and deal with the aftermath. That is something most people do not see coming and are ill prepared to deal with emotionally, physically or financially.

There are many things that people will disagree on when it comes to the future but there are some things those following events will agree on.

There will likely be a catastrophic event in conjunction with a monetary crisis.

Most people will be completely unprepared for the events.

Only those that hold hard assets and the means to protect them will come through this with any wealth in tact.

The government will increase their control of the population.

Basic resources like food, water and energy will be expensive or difficult to get. This is especially true for imported goods.

People will lose the homes they cannot afford and their retirement savings.

Government payments will be cut off or severely cut back.

There will be armed resistance against the government as they reduce freedoms that people are accustomed to.

Roving gangs will likely be a problem at least in the short term following the crisis.

The country will look much different in ten years than it does now, and likely not for the better.

People will need a different strategy for retirement than they now hold.

Healthcare will become more expensive and less available to the average citizen.

The U.S. will likely become a third world nation as far as living standards are concerned.

These items point out the direction we are headed as a nation. Those that ignore the reality we now live in will suffer greatly and will be immobilized with fear and uncertainty as to what to do. The government they looked to in the past for guidance and safety will be at odds with their very existence in the future. Those things they took as a given will no longer exist.

This list defines what you as an individual must be prepared to deal with in the uncertain future ahead. Only by addressing these issues will you have any peace of mind in the coming days as events play out on a global scale. It has been said many times before but must be repeated because many still do not hear the message.

You must be prepared to provide basic necessities to your family for a prolonged period of time. This includes clean drinking water, nutritious food, shelter, sanitation, security, clothing, health care and any excess funds should be used to buy precious metals or some other wealth preservation tool. Any transportation and communication assets you have will greatly enhance your survival position.

Beyond these basic items you will also need to think about some way to produce income in the years ahead. Having special knowledge or capitol equipment to produce needed goods will insure you can continue to care for your family long term. The ability to produce food, water, clothing or energy and provide medical help or capitol goods will insure you have a product to sell that will be in demand.

In a dysfunctional world the business opportunities are many. Basic supplies that were once taken for granted will be sought after by everyone. Herbal remedies, meat production, paper goods, cleaning agents, tools, building supplies and such mundane things as blocks of ice and footwear will have to come from somewhere. Something as simple as an absorption freezer powered by a homemade power source like bio-gas can provide frozen meat and ice to sell the year round.

You must also be cognizant of many possible dangers that an uncertain world can present. These include natural disasters, the threat of war, disease, nuclear dangers such as fallout and contamination and chemical threats from malfunctioning plants and storage sites.

The ability to plan for the future is more imperative now than ever. It is a sad thing that people spend more time planning a summer vacation than they do for their future. That lack of planning will insure a difficult future for them and their children as the world unwinds at an ever faster pace taking their standard of living to ever lower levels until reaching the bottom of this unknown new world. You need to prepare now like your life depends on it, because it does.

The Pursuit of Money Over Personal Satisfaction

By: Tom Chatham

Have you ever asked a person why they work? If you have the answer will likely end with a statement that they need to pay for stuff. It’s a truism in the world we live in that you must pay for many of the things we need. Its this need to pay for more and more stuff that leads to the need for higher paying jobs.

This perceived need leads many to seek jobs they do not necessarily like but need to achieve this end result. The race for the almighty buck has many unintended consequences. It has been said that if you do not like your work, you will not like anything else about your life.

The pursuit of money leaves many people with a hollow void that is never filled and causes them to lash out at society in their discomfort. This is seen in the many cases of domestic abuse, road rage and general lack of politeness in society. In many cases the more the person makes, the more likely you are to see these traits.

What is missing in many peoples lives is the personal satisfaction they get from the feeling of accomplishment of something every day. The more personal satisfaction a person gets out of life, the more likely they are to be a happy person and in turn treat others with respect. This also helps to insure a healthy life that avoids many of the ailments that come with having a foul mood most of the day.

The feeling of accomplishment can come from very little things such as building or repairing something. Some of my most cherished accomplishments are things I did for free. Knowing I did something that had some value and served a purpose meant a lot to me personally. Doing that and making some money at the same time is just icing on the cake.

This is something many people in our fast moving world miss out on and it can cost them in the end. As society gets faster and money becomes the primary commodity in life, people can lose their self worth and determination. This is evident when something happens and they suddenly have no money to continue their current lifestyle. Money has replaced personal satisfaction as the cement that holds society together. When the money supply finally gives out, society will fall apart.

Having money is great because it allows you to do many things you could not do otherwise but it should not be the foundation of your existence. How many people have gotten divorced because of monetary problems? How many people have refused to get involved with someone else because they did not meet up to their monetary expectations?

Money has become all too important in society and when it goes away during economic crisis society cannot handle it. If you have a spouse that just says, don’t worry we can manage, after you have lost your job and have very little money to live on then they get it. They are saying their personal happiness does not depend on money to give them the personal satisfaction in life that they require.

This is the missing ingredient that the American society needs to get through the trying times ahead and we no longer have it. If we do not find it soon, the days ahead will be very miserable and very destructive as society tears itself apart searching to fill the void left by the destruction of money. When you can go day to day without money and feel happy about life, you are at a place that will allow you to get through most bad events in the right frame of mind. That frame of mind is what you need to solve the problems at hand and move on with your life. The lack of it will cause us to self destruct.

Prepare For Longterm Instability and Hardship

By: Tom Chatham

Unlike the normal business cycle that allows for a recession every few years to clear out the mal-investments and keep the system functioning properly, the current cycle has been artificially induced with money that has unseated the foundation of good financial practices and caused a series of bubbles that must pop at some point. When this happens the business cycle will be heavily damaged and will take many years to reestablish some type of normalcy.

If you think of a cycle as a pendulum swinging back and forth, you must realize that the further it swings to one side, the further it will swing to the other to balance itself. That is what we must realize with the current bubble boom in the financial sectors. The further out of balance they get, the further they will need to swing back to preserve equilibrium. When these bubbles finally pop, the offsetting swing will be monumental. A normal recession of a few years will be exaggerated to a multi-year disaster.

These are the type of conditions that usher in depressions of long duration. This bubble induced mania is far beyond anything experienced in human history and will result in an equally disastrous financial contraction destroying paper assets and making hard assets desirable and difficult to acquire in the aftermath.

In this type of situation, hard assets and a wide knowledge base are as good as it gets. The ownership of capital equipment that produces necessary consumer goods and the ability to finance yourself internally combined with sufficient knowledge to use these resources will provide a safe harbor to get through the difficulties that arise. Becoming your own bank requires the ability to store financial assets such as precious metals and diamonds that have universal value. This is one of the few ways to store wealth that can survive such market destruction.

Usually when market destruction such as we are about to see occurs, the government goes to war in a vain attempt to preserve itself. This causes even more destruction of hard assets and economic freedom that are required to repair the economy. The government often sees this as creative destruction where production is destroyed and must be replaced causing more work and resources to be expended. Destroying labor and hard commodities may spur the economy in the short term but you cannot get wealthy by destroying your limited assets. Unfortunately for the government the economic chaos that will follow the next economic crisis will insure the war economy will be insufficient to spur the economy and return the population to prosperity. The financial system will likely tear itself apart making any sudden recovery impossible.

The result of government and wall street actions will likely result in a multi decade era of depression and hardship that many will be lucky to survive. The government knows this and has increased its internal policing ability to control the population during this turbulent time. In many cases the government will pose more of a threat to the people than the economic conditions.

The only way to see this crisis through to the other side is to have the ability to care for yourself and your family with a minimum of outside help. The more self sufficient you are the better your standard of living will be during this time. The ability to store some wealth in hard assets that you can use such as equipment or weapons and ammo or in precious metals will enable you to get through the difficult times. It is important that you understand that this crisis will not end in a few years but will continue for a substantial amount of time and you must be prepared to act longterm.

This means having the resources to maintain your lifestyle longterm and having sufficient supplies such as food or food production capabilities, medical supplies and sufficient ammo to protect life and limb as the situation dictates. In regard to these things the average person is likely to underestimate the amount of resources they will need to get through a long crisis. When it comes to things such as ammo the average person does not realize how much ammo they can use if they are suddenly forced to defend themselves on a daily basis from hostile forces. A protracted gunfight can consume several hundred rounds of ammo in a single day.

It is with these things in mind that the average person needs to determine what their resources are and insure they are rationed to get through the crisis. This is especially important of non-replaceable resources. Planning for disruptions for two or three decades is not overkill at this point. Those that are best prepared for the future difficulties are most likely to get through it in tact and in the best physical and financial shape.

Create Value Added Products For Income

By: Tom Chatham

It is becoming harder every day to keep up with rising prices in a declining economy. This type of situation is often referred to as stagflation. Your income stagnates while prices rise making life ever more difficult. In the situation many Americans now find themselves in, they will need to develop a business of their own to replace the ones that are now disappearing at an alarming rate. The best businesses to be in in the future are those that provide a basic necessity to the population.

For those with a small plot of land that need to support themselves, it becomes necessary to maximize the income from that land. Many people make good money from produce which can be grown intensively in many cases but unless you live in southern latitudes you can only grow most things for part of the year. While produce is a sure money maker in most cases it cannot be stored for very long making it difficult to provide income on a regular basis throughout the year.

Growing things such as grain is one way to insure you can store a product for sale the year through but unprocessed grain does not provide very high profits on a small scale. An acre of corn will only provide you with several hundred dollars gross per acre so a large field is required to make any reasonable profit. But, what if you could make thousands of dollars per acre instead of hundreds? This would make the small plot you have more viable as an income source.

A bushel of corn sells for about $6 depending on the season and available stocks. That same bushel of corn when ground into cornmeal will generate around $36 on a retail level. The ability to grind your own grains for resale provides you with the opportunity to maximize profits on your small acreage. It is easy to find a produce stand in rural areas but how many sell value added products like cornmeal or flour? This can provide you with a product that few others have and if you have sufficient acreage, you can produce enough to sell throughout the year.

With small scale grain raising, you have the ability to grow heritage plants in an organic way. Many people now seek organic feeds for their livestock making organic grains a growing business. You will not make the maximum profit per bushel selling as feed but if you have sufficient land, it can increase your profits immensely. Another product you can provide at the same time are seeds. Having the ability to produce seeds for sale can reap huge profits if your selling base is large enough. A bushel of heritage corn can sell for as much as $1,200 when broken down into small packets for home gardens.

Value added products are not limited to grains. If you have a sizable woodlot, a small portable mill can provide you with lumber to sell. With a flock of chickens you can sell eggs for a few dollars a dozen or you can hatch them out and get a few dollars per chick. Those that can raise and process meat can increase their profits considerably over the sale of live animals. Making cheese or ice cream from excess milk adds a lot of value to dairy products. Making products such as sorghum syrup, rolled oats or honey are products that are not made by everyone that sells produce so you will have the ability to draw people to your business for these specialty items.

In the search for better profits from your small plot, it is necessary to develop a customer base that you can depend on for repeat sales. Repeat customers are the basis of any profitable business regardless of the product. Having a business location where your customers can come to view your products and fulfill their needs is the very best way to build a small business that can provide income during difficult times. Your ability to control your products from harvest to sale will allow you to remain competitive in the marketplace and reap the maximum profit from your products.

Using available resources to their maximum potential is the way Americans built this country up from the wilderness they found. Making a product to sell is the only way to produce real wealth. The act of producing value added goods requires knowledge and equipment. By analyzing your potential and that of your land you will be able to determine what you are capable of and what equipment you will need to build up your business. By making up a list of what you need to do you will be able to plan out a strategy that may take a few years to realize but can provide you with the ability to be productive and stay ahead of a declining business environment where basic necessities will always be in demand.

When The Buck Stops Here

By: Tom Chatham

The U.S. dollar is the world reserve currency, for now. That means everybody that trades in major commodities around the world needs dollars in hand to purchase what they want. In the 1970’s Saudi Arabia agreed to sell oil in dollars only and the petrodollar was born. As a major oil producer this forced everyone else to price their oil in dollars. Everyone needs energy to grow their economy so this created a huge demand for dollars around the world to pay for this oil.

As the economies of the world grew the demand on the dollar grew. The U.S. found itself in a position that allowed it to merely print money to pay for anything it needed around the world. America became wealthy by becoming the greatest manufacturing center in the world but as our manufacturing declined it was replaced with the ability to produce dollars for world consumption. This gave Americans the greatest prosperity the world has ever seen. That is beginning to change with the bilateral agreements now taking place around the world.

Many of the countries around the world have become disenchanted with the dollar over the last decade due to the Feds massive creation of dollars flooding the world. This creation of dollars has devalued the dollars already in circulation and the dollar is no longer seen as a good store of value.

The bilateral agreements being orchestrated now will eventually unseat the dollar as a needed mechanism of world trade and when that happens everyone will dump the dollars they are now holding. Every fiat dollar is a claim on real goods. When these dollars are liquidated from overseas vaults, they will be converted into hard assets. It is estimated that about 80% of all existing dollars are held outside the U.S. When this liquidation takes place all of these dollars will eventually go back to where they came from, meaning the U.S.

All of these dollars were created far in excess of any real goods to back them in the U.S. As these dollars are sent home they will be converted into hard assets from the U.S. This will turn the U.S into a giant garage sale as dollar holders attempt to get whatever assets they can before inflation eats up their purchasing power. The people in the U.S will find themselves bidding against foreigners with about four times as much money and the goods will go to the highest bidder.

When this happens the price of goods will skyrocket putting basic necessities out of reach for most Americans. This is the nightmare hyperinflation that many fear will come in the waning days of the dollar. If this happens America will be stripped of anything of value and many fear the government will simply turn over public lands for these fiat debt instruments created by the private Federal Reserve System.

A day of reckoning is coming for the citizens of the U.S. and it will be pandemonium as everyone tries to grab and hold on to anything they can to preserve their wealth and property. The day the buck finally stops in the U.S. will truly be the end of the line for most Americans.

How Will You Protect Your Private Property?

By: Tom Chatham

Private property rights are the cornerstone of a free republic. People are only free when everyone is equal under the law. When a small group of people subvert the laws that make everyone equal and place themselves above the law, it is only a matter of time before freedom becomes forced servitude.

The actions by the U.S. government are giving the tell tale signs of complete destruction of liberty and the institution of what can only be called slavery of the masses. Those at the top are engaged in the transformation of the nation into a feudal society where a few are very rich and the rest are subjected to poverty and earning a meager existence at best.

In a wealthy nation like the U.S., the transformation to a feudal society requires the government to destroy or take all wealth away from those that have it. They must impoverish everyone by taking their land, their money, their personal belongings and anything else that constitutes wealth that they can use. This is especially true of equipment that can provide basic goods required by the populace and the ability to produce income.

Much of the wealth will be destroyed due to economic reasons that cause property to be repossessed by creditors. This has been made possible by the credit schemes devised by banking institutions to create debts that cannot be paid back by borrowers. The underwater mortgage loans that many now have are evidence of this.

Some of the wealth will be lost as economic conditions deteriorate and individuals are forced to sell their belongings to continue their current lifestyle or simply survive. As their possessions are sold off and the money is spent on needed goods with ever increasing prices, these people will slowly become impoverished until they are forced to rely on government handouts for survival.

Those that have been conscious of the debt based system we live in have stayed out of debt by living within their means, own their possessions free and clear and likely have savings to fall back on during desperate times. These people will be the target of government policies to impoverish them by any means. This will include massive price inflation, civil forfeiture laws and new taxes meant to overwhelm property owners. Everything you own will be targeted for confiscation and destruction. The government must destroy the ability of people to be independent of the government and remain free.

These people are the greatest threat to a tyrannical government. That is why they will ultimately be targeted to take what they have by force. The executive orders now on the books give the government the authority to take everything you have under emergency decree. Once these few individuals are the only one’s left with any substantial wealth, the government will move to take their property and complete the transformation.

The government moves in small steps to further their agenda and prevent any mass outrage by the population. The moves by the EPA and FDA to reduce or limit your rights on your own property slowly train you to not question the government and prevent self sufficiency. The governments edicts that lay claim to everything you have including your food and labor are a clear indication of their end goal. The governments statements that they have the right to kill Americans is self evident. The moves to regulate and eventually deny private gun ownership is the prelude to their final solution. A defenseless and impoverished population is powerless to prevent government abuses.

When this happens it will be up to each person to decide how they will react and what they are prepared to do to protect their rightful property. Some may decide to convert some or all of their wealth into commodities such as precious metals for easy transport and concealment. Some may decide to move to another place, out of the reach of the government. Some may elect to fight the government in a direct confrontation to defend their property. Some may elect to hide in a remote area and stay clear of the government until things change for the better. Some may elect to literally bury their wealth or important equipment to prevent confiscation by government personnel.

Regardless what your plan is you must decide now what you are willing to do and what actions you need to take now to preserve your property under the circumstances we will likely face in the future when government operatives come for your wealth. Once the nation is relegated to poverty and defenseless, and the government controls all forms of wealth and natural resources, it will no longer be possible for the people to build a decent future for their family. It is for these reasons that wealth and property must be protected from government confiscation to insure the people have the ability to maintain a reasonable standard of living and a certain amount of freedom. In the end, the loss of private property rights will mean the loss of freedom and prosperity.

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