Monthly Archives: October 2013

Growing Your Investments for the Future

By: Tom Chatham

When you speak of growing an investment most people automatically think of investing their money in some sort of financial scheme that increases the amount of financial units they trade in. In our case this is the dollar denominated world of crony capitalism and ponzi schemes. Anyone who gambles knows the house always wins. The house in this case is the banking system and its’ offshoot, the federal government.

People have been led to believe that they can magically get 6, 8 or 10% annual interest into perpetuity making them rich in the end. This means the amount of money in existence must increase at that rate. Some have done it but they are the exception to the rule. As with any ponzi scheme, the first in wins and everyone else loses. Money is only as good as the assets it can buy. If assets cannot expand as fast as money creation, the magical accumulation of it will ultimately buy less and less if everyone is allowed to accumulate it. In order for you to win the interest game, someone must lose.

As Chris Martenson has stated, there are limits to growth. Everything has a limit and debt creation is no different. If something grows without limits, it eventually outstrips the available resources that feed it. We are now seeing the limits of that growth evidenced by the stalled economy we have now inherited. This means the easy accumulation of money and debt that we are accustomed to will have to change. This will mean a redefining of the standard of living we will enjoy in the future. When the current ponzi scheme ends, some will win but most will lose. So, where does this leave those that are just now entering the economy and seek to build a nest egg to retire on.

The best way to build up assets is to literally grow them. The money printers can print to infinity and as they do so the value of that money will change. As I have said before, a can of ham will always be a can of ham. That means a pound of ham will always perform the same function in society regardless of the price or the amount of paper currency in circulation. That pound of ham represents a real asset. It may have a limited shelf life but it has real value.

It takes time and energy to produce that pound of ham just as it takes time and energy to produce beef, dairy products, wood, grain and any other commodity. Those commodities are limited by natural forces. It may be water, soil condition, growing area or pestilence. You can only produce so much of any commodity before you reach the upper limit of growth. The world can only produce so much grain every year so the available amount produces a cap on available supplies. This is similar to limiting the amount of currency in circulation. That means that a commodity will hold its value over time unlike a devaluing currency. In Argentina the recent currency devaluations have caused farmers to hoard their grain as a way to store their wealth until they can spend it.

For an individual that has a few acres of land, growing a commodity is a good way to build up their assets until they are needed. With a small pasture you can buy a bull calf from a dairy for as little as $35 and raise it on pasture until it is full grown. That full grown steer will now be worth $800 or more dollars if sold on the hoof. For a small investment in money and time, you will have increased your net assets by a huge amount. It is not that much more difficult to care for 5 calves than one which allows you to leverage your resources and compound your gains.

If you are someone that likes to grow things, you could start with a handful of heritage grain seeds and compound that small holding into a whole field of grain in a few years. If you have limited room for growing grains you may be able to grow just a few heritage seeds that thrive in your area and break the harvest into small packets of seeds to sell. Doing so can yield hundreds of dollars per bushel in some cases.

By growing your own seed and increasing the plantings, you will ultimately increase your net worth just as if you were earning interest in a bank only you will have complete control over the asset. For someone that uses sustainable growing techniques and maintains their own seed stocks and breeder stocks, which is the way our great grandparents accumulated wealth, it will be one of the few ways to accumulate wealth in the future outside of the manipulated systems we now have. A good woodlot with some selected woods can produce an impressive amount of wealth when sold. For someone with the ability to mill their own wood, they can get the maximum amount of wealth from their woodlot.

When you grow your assets in a financial institution, you are at the mercy of a host of unscrupulous persons that work for the house. The house will always win by eating away at your assets through taxes, fees, devaluation and outright theft as we have seen recently. When you literally grow your assets in the back yard, you are at the mercy of nature and the free market and they are much more forgiving than bankers and politicians. By doing so you carry no counterparty risk and give yourself every opportunity to prosper.

In the end you must decide what is more secure, a bunch of digits in a computer or a herd of cattle in the pasture. In the future those digits may be in limited supply and hard to come by if you do not work for the house so another more equitable way to accumulate wealth must be used by the population. By producing farm commodities that will always be in demand and storing some of that production in livestock, seeds or other elements like gold and silver, you can accumulate and preserve the wealth you need for the future.

Farm OPSEC for Ms. Piggy and Friends

By: Tom Chatham

I have seen quite a few articles on OPSEC concerning supplies and distribution to the needy during a collapse but not very many concerning farms. Here are just a few things for you to think about between now and then.

Many preppers have made their list and checked it twice and feel better for the effort. They have developed plans for most contingencies that may arise and have their stores well secured for the duration. One of the situations that many have talked about is the prospect of providing excess to those in need when the time comes. Some will share and some will not according to those that talk about it.

There are good points to be made for each side of this argument. It ultimately comes down to your particular circumstances. Some people will be ok sharing within their communities due to the cohesiveness there and the willingness to look out for one another. In these places a certain moral code will prevail.

In other places it would literally be suicide to advertise your ability to help others. In this situation if you felt the need to help others it should be done anonymously through third parties to protect yourself and your family. In either case it would be beneficial to have a third party system such as a church group to provide for unprepared neighbors, drifters and “outsiders” to help protect the whole community from foragers on the move. Those that have supplies stocked in depth may be able to keep them out of public view but what about those with livestock?

One of the goals of many is to become self sufficient so they can provide for their families in perpetuity. This means being able to grow crops and raise livestock. Due to the nature of this activity it is almost impossible to hide these things from full view. If you are a farmer and someone comes to your door asking for food, it is difficult to say you have none when you have a pasture full of beef walking around and roosters crowing in the backyard. This puts you in the unpleasant position of turning away desperate people, some of which may due you harm.

This is why a third party clearing house for excess foods is preferable in many cases. It is much easier for a farmer to say that all his excess food is sent to the local church for dispersal to the needy and give them directions there. This can defuse many possible encounters and ill will from others and those in need will soon learn that this distribution center is the only place to get any food. This will prevent many from continuously coming around seeking food. Once it is known where to go any individuals that show up on your farm will likely be trouble makers and you will know as soon as you see them.

When trouble makers show up, how you handle them depends on the situation but if they leave at gun point with an attitude, you will likely have more trouble from them later. These are the people to fear during a crisis. When it comes to this type of environment, you will have to take measures to prevent this situation from developing to begin with. There are several ways to handle it.

– Get rid of all livestock until things stabilize.
– Conceal livestock so animals are not visible
– Have the ability to guard animals 24/7 with deadly force
– Have a secluded location with no through traffic
– Have sacrifice animals positioned that will prevent a larger intrusion

Getting rid of all livestock is a desperation move because you do not know if you will be able to replace those animals when things stabilize. It may be possible to conceal animals to some extent by using structures, hedges, trees, solid fences or dirt berms to avoid detection by passersby but a rooster can be heard ¼ mile away and a cow over ½ mile so visual concealment alone may not be enough.

Having the manpower to guard a herd of livestock may be a viable option for some but it will not prevent some attempts. If someone is coming to steal a pig or cow they will not be alone and will probably have a vehicle. This means the more livestock you have the bigger the target you will make.

It is good if you have a secluded location a good distance from a travel route and one that is surrounded by forest. This will make it easier to block the entrance and prevent accidental discovery by outsiders. It will also necessitate vigilance on the farmers part because being secluded will make you a target if discovered unless you have the means to protect your farm. If your farm is assaulted by individuals, having animals outside your defensive perimeter will allow assailants to get what they came for without putting the rest of your farm in jeopardy. The only problem with this solution is that appeasement never works. Eventually they will be back for more so it is best to deal with this the first time and end the threat.

A solution that many will likely have to employ will involve all of the above solutions. Having a breeding stock that is well protected and concealed, good security, keeping only the minimum amount of livestock necessary, having a secluded location and if assaulted, having livestock exposed that will lead aggressors into an ambush where they can be dealt with.

No plan is perfect for everyone which is why each individual must analyze their own unique situation and determine what will work best for them. The more time you spend on planning and execution of your plan the fewer bugs you will have in it when the time comes to use it.

As for crops, it would be difficult to completely protect them from foragers. In that event it might be useful to have some disposable plantings around the perimeter of the field to prevent damage to the main crop. Most people have little understanding of what to do with small grain crops straight out of the field such as wheat, oats or barley so they would be less vulnerable than crops like corn and beans. Also, large plantings of crops like potatoes, kale and carrots may be best hidden in the middle of a crop of wheat or corn to prevent detection. To many these would look like nothing but weeds in the field. Hiding crops in plain sight should be employed when possible.

Protecting a working farm during a collapse when food is scarce is a daunting task. With the size of the perimeter it is unlikely most farmers will be able to guard it all so some sacrifices may have to be made. The core of the breeding stock and garden should be close and readily defendable at the very least. Seed stocks should be hidden and protected to ensure a crop can be planted when it is necessary. Farm equipment, liquid fuels, energy production equipment and transportation are all areas that need to be considered in the overall plan.

Farming is a complex business and doing so during a collapse will make it even more difficult. This article only touches on a few of the items you may need to consider. The every day needs of the farm must be planned in detail for long term viability due to possible lack of resources outside the farm during the events duration. Planning pays and lack of planning will cost dearly.

The U.S. Debt Ceiling Has Been Suspended

By: Tom Chatham

When is a debt ceiling not a ceiling? When it has been removed. That is the solution that was enacted on Wednesday night to fund the government for the next 90 days. This will last from Oct. 17, 2013 until Feb. 7, 2014. This has some very dangerous implications for Americans. It means as of right now there is no debt ceiling and the federals can spend as much as they like. With all of the previous spending by DHS, and the impending economic crash that we face in the near future, it is terrifying to think what the federals might buy in the next 90 days that they can use against American citizens.

With this scenario in place the writing is on the wall and foreigners can read it well even if Americans cannot. The dumping of treasuries will likely increase substantially over the next few months as the collapse becomes evident to everyone but Americans. This is the end game and most people don’t even know they are in it.

With the debt ceiling removed even temporarily, the government has the ability to overspend and when the ceiling is reinstated in 90 days any new debt over the current limit will not be debatable. The limit will automatically have to be raised to that amount. That is why President Obama answered “no” when asked if there would be a renewed debt debate next year. He knows he can bypass it. When the time comes for the House to raise the debt limit they will either have to raise it to encompass the additional spending or not raise it and possibly trigger a default. Either way the Democrats can blame the Republicans for the additional debt increase or a default.

It could go something like this. The government decides how much extra money they will need until after the elections next year and borrow it now. The money is dispersed into the usual slush funds until needed to avoid any new debt debates before the election. The Republicans will lose the ability to stop uncontrolled government growth next year and the Democrats will deprive them of any debt debates before Nov. This will give the Democrats a big edge in the elections and could allow them to take some seats in the house. Not that changing from one party to the other will change anything, it will just determine how fast we collapse.

By this time next year I suspect the Petrodollar will be on life support if not completely dead and high inflation will be rearing its’ ugly head. The governments answer to this will be price controls which will lead to shortages. Then things go downhill fast from there. That’s if we actually make it to next fall without a serious incident in the U.S. before then.

These are truly perilous times for the U.S. and everyone should prepare as they deem appropriate. The west line has shifted and we are now on the trailing edge of history. If we are to survive as a nation and prosper again we must learn to operate with a smaller more efficient economy as others before us have done. This will entail a smaller more localized economy with more small producers and a stable medium of exchange. The only alternative is to become a failed third world nation with no future.

The Preppers Mt. Everest

By: Tom Chatham

When you ask someone why they climbed the mountain some will say, because it’s there. I wanted to know if I could do it. It is the same drive that makes people want to win at sports.

Why do preppers prep? What is the point? If something so catastrophic happens that the world is drastically changed or destroyed, why would we want to survive to live anymore?

Dieing is easy. All you have to do is give up and quit. It’s living that is so hard. One of the hardest things a person can do is to wake up in the morning and get out of bed when they know the world is stacked against them. So why do it?

There are three types of people in the world. Those that can do, those that are afraid to do, and those that don’t know what they should do.

I’m the kind of person that will take the time to hammer out a bent piece of metal even if I don’t need it and could easily go buy another one. I like a challenge and I like the feeling of accomplishment when I succeed.

Last year I was working on one of my vehicles when it bent some of the pushrods almost into an S. I could have run down to the parts store and bought new ones but being the cheapskate that I am and loving a challenge, I decided to try to straighten them out. I managed to straighten out 3 but had to buy one new one that was too far gone. They were not expensive but I saw it as a challenge.

About 20 years ago we had a bad winter storm that left several inches of ice on the road. I had to drive 15 miles on these icy roads to get home. About 2 miles from home I rounded a turn and the truck began to slide. My small Chevy 4×4 slid sideways and the front end dropped into a deep ditch until the chassis was touching the ground. I could push up the opposite side of the ditchbank a few inches but could not get enough traction to back out.

A short time later a neighbor came by and a couple of guys tried to help push it out with no success. They said I would need to call a tow truck and offered me a ride. I declined and said I would keep trying. A few minutes after they left I finally stopped and analyzed my situation a little more. I knew I needed to get the front end up and get some traction, but how. I then went into the woods and found a few small logs and threw them behind the wheels. I pushed up the opposite bank a few inches allowing the logs to roll into the bottom of the ditch. When I rolled back the truck pulled itself out of the ditch with little effort.

The point of this story is that I decided I would get it out and would not stop until I had exhausted every possible idea. You don’t know what you are capable of unless you try.

I think preppers are willing to go to extremes and prepare not because they fear death or hardship but because they are willing to explore their absolute limits. They want to know if they are capable of overcoming the obstacle just because it’s there and they have more fear of walking away not knowing than of trying and failing. Some in business might call it the drive to succeed and others might call it the drive to win.

Everyone has their limits and some will prevail when others fail but in the end, the act of trying and not giving up is what’s important. That is what prepping is about to me. If I see a potential obstacle in my future I will try to prepare to overcome it then move on but if I fail and the worst happens I will have a clear conscience. That is what prepping is. Being prepared to face a challenge and giving yourself every chance to overcome it.

When people ridicule those that see potential danger and prepare to overcome it, it is like someone looking at Mt. Everest and saying, oh it’s just a little hill no different than all the others we have crossed, and then they proceed to walk up it with no supplies or equipment. Experience is a virtue that preppers relish and others simply scoff at, at their own peril. To a prepper, the future is a Mt. Everest with no visible top that they are prepared to climb.

Why do people prep for catastrophic situations? Because it’s there.

The Default of Civilized Government

By: Tom Chatham

The government shutdown has been anything but a shutdown. It has morphed into an exercise in police state tactics. The events taking place in the U.S. today are unprecedented and are more commonly seen in failed African nations than modern industrialized countries. The temper tantrum being acted out by the current president is anything but what one would expect from an American president. This is what happens when you elect a 50 year old man with a 10 year old brain to run a nation.

The president has made it his job to punish the American people until he gets what he wants. He has barricaded open air war memorials, closed parts of the ocean, closed privately owned businesses, closed highway viewing areas, closed parking lots and shut down commissaries on military bases while approving an immigration rally to take place on the closed national mall and keeping the golf course open at Andrews AFB so he can play golf. Some animals are more equal than others.

What is mind boggling are the things being closed down during this government shutdown.

– Biscayne National Park is shut down and no fishing is allowed. Charter boats in the area are prohibited from taking anglers into the 1,100 sq. miles of ocean in the bay due to the government shutdown.
– Lake Meade is closed and all of the people who live on houseboats on the lake have been evicted until the government shutdown is over. It is even rumored that NPS has torn up docks to prevent owners from getting to their boats.
– War memorials in open air locations have been barricaded at multiple locations across the nation to prevent viewing.
– Privately owned businesses along the highways in the Great Smoky Mountains National Park have been closed by NPS because the buildings sit on rented federal property. The highways through the federal lands are open but the businesses next to the highways are closed depriving people of their livelihood.
– Mount Rushmore National Monument is closed but so too are the highway viewing areas that allow people to see the monument from a distance.
– The government could not close Mount Vernon because it is owned by the Mt. Vernon Ladies Association but they have blocked off the parking lots next to the historic site which the ladies association jointly own with the federal government. The organization has forced the reopening of some parking.

These are but a few of the childish reactions to the current impass in Washington. The fascinating thing about all of these closings is that the National Park Service (NPS) is on furlough with many other federal employees but they are still working and harassing people to cause as much suffering as possible as ordered by the president according to some NPS employees.

All of this is to protect Obamacare which has nothing to do with health care and everything to do with raising taxes. Over the next 10 years this bill will raise 1.9 trillion dollars of additional revenue for the government and that is probably a low figure once it gets momentum. The figure heads in government keep harping on the potential default if we do not raise the debt limit so they can spend more. Here are some figures you should know.

U.S. Treasury data on tax receipts indicate that through July of 2013 the government has taken in an average of 238 billion/month. It has spent an average of 283 billion/month giving us a deficit of 45 billion/month. To take care of basic necessities would cost the following.

52.8 B/Mo. Interest payments on debt
73.5 B/Mo. Social security payments
7.17 B/Mo. Veterans pensions
78.3 B/Mo. This would cover the entire HHS budget including Medicare/Medicaid, Childrens health insurance program.

211.7 B/Mo. Total to cover these payments leaving 26.3 B/Mo.

Military funding amounting to 39 B/Mo. was appropriated by a bill passed by Congress and signed by the president before the government shutdown so it is not included here but even if it had to be included it would only leave a gap of 12.7 B/Mo. which likely could be cut from non essential spending at HHS and/or military cuts to fuel and spare parts acquisition.

As this list shows, all of our basic necessities could be covered with the current tax revenues coming into the treasury so talk of a default is fear mongering at its’ worst. The fear in Washington is that the people will realize we don’t need a lot of the spending we now have and loss of that money would mean loss of government control of a segment of the population. There will not be a default unless the President chooses to default on the debt to initiate a bigger crisis. In this case expect creditors to get large chunks of U.S. territory as payment for their loans.

The thing we have to fear is not a potential default in finances but a current default in civilized behavior from our elected representatives in Washington. This deficit in moral behavior will almost certainly grow and end with blood in the streets. It is rumored that President Putin said negotiating with Obama is like playing chess with a pigeon, the bird knocks over all the pieces, shits on the board then struts around like he won. This is a good analogy of the episode now playing out in D.C. One thing is for certain, no matter what solution we get, the suffering will increase as time goes on and the people will pay the price for the dysfunctional government they have created.

Never Let a Good Crisis Go to Waste

By: Tom Chatham

The government shutdown may be a good time for states to reestablish the authority they have slowly lost over the years. With the federal government in a dysfunctional stupor, the states have the opportunity to step up and take a leadership role that can undermine the federal authority in a number of areas where states should have complete authority. Not only can they regain their constitutional power but it may be a good time to take it one step further.

With all of the misinformation and shenanigans coming out of D.C. this may be the ideal time for states to look seriously at secession. When the federal government finally runs out of money, it will act like a dieing animal and strike out at anything that it can in a desperate act to keep alive. It will become despotic toward the people and the state
governments in an effort to stay in control.

When the federals cease to send out the checks that everyone depends on, the state and local governments will have to deal with the fallout of all of the unsustainable policies embraced at the federal level. For that reason it would benefit the state governments to ready a plan now for taking charge after the federals collapse.

– Establish a state bank in each state

– Convert all state money to gold and silver coinage

– Prepare to assume control of all federal property in the state

– Prepare to assume control of all federal programs the state wants to keep

– Prepare to declare all federal laws null and void

– Coordinate gold and silver valuations with other states

– Prepare national guard units for any federal pushback

– Insure critical infrastructure will continue to operate

The act of storing coinage now will give the state the ability to continue payments to individuals keeping commerce flowing. By stockpiling gold and silver now and doing a revaluation of goods to 1940 levels after a federal failure, the state should have sufficient funds for operations. That means that all prices will need to be revalued to 1940 levels including gold and silver. Someone making $1,000 a year will be making a living wage and gold and silver will be traded at their constitutionally set values. The undervalued PM prices at this time will enable state governments to leverage their funds and actually have more money in a revaluation allowing them to operate until the new economy stabilizes and tax revenues are reestablished at reasonable levels.

The best tax scheme at this juncture would be a sales tax to provide all revenues for the state. A large percentage would go to the county where collected and a smaller portion would go to the state for operations. The county would be responsible for all of its operating costs and government programs and would be limited to its tax receipts. All other taxes would be repealed. This is the most equitable way to finance government.

With state governments in control, the federal government could eventually be reestablished under state supervision and would only have authority over federal military units and ICE agents to insure a protected border and the authority to mint national coinage for circulation. The federal authority would only have funding through tariffs and customs duties as a source of operating revenue.

This idea is a long shot but is possible if sold to the American people in the proper manner. A great deal of education would have to occur to properly inform the populace but nothing is impossible. If the state governments preempt the federals before they declare an emergency, the states would be in a controlling position. It’s nice to dream but we should not let this crisis go to waste. Any power that can be wrestled from the federals at this time is worth the effort.

Government Is a Virus

By: Tom Chatham

Virus – 1) venom, as of a snake. 2) Any of a group of ultramicroscopic infective agents that cause various diseases, as smallpox; specif., a filterable virus. 3) An evil or harmful influence.

There are many things that a government can be called but a virus is the most accurate. It invades a host. It multiplies uncontrollably and degrades the host as it does so. It weakens the host until eventually the host dies. Then it finds a new host to infect. In the end only one can survive.

If people learn only one thing this year, that should be it. When a virus invades your body you must fight it with everything you have or else succumb to the inevitable. The human race is now in an epic battle with the most destructive virus ever created. A mutation that has occurred and is destructive to the whole. A harmful influence that wants to assume complete control. A destructive force that seeks nothing more than to multiply and destroy. That is the essence of government today.

There is a choice. We have a choice. We can lay down and die a horrible death or destroy the virus that seeks to destroy us. Every virus has a cure. An element that it can not overcome. All we need to do is to identify what that elusive cure is and take a good storng dose and we will be on the road to recovery.

Many have become lethargic and succumbed to the idea that the virus is now a permanent part of their lives. They embrace it and try to adapt to its many mutations and uncomfortable symptoms. They fear the powerful medicine that will destroy it. Some have become so consumed with the virus that they fear destroying it will destroy them as well.

There is some truth to that. Once a virus has surpassed a certain point, there can be no recovery for some people even with the proper medicine. These are the ones that resist the need of the society to apply the medicine and save what can be saved. The infected are content to take the rest of society down with them. As the infection sucks the life out of the host, it becomes less able to defend itself from its’ ultimate demise.

The epidemic we now face is at a tipping point. It will either destroy everyone or some will be strong enough to apply the needed element and destroy the infection. The window for using a cure is rapidly closing. As time goes on, the chance of fewer survivors increases.

Many realize they have been invaded by an invasive and destructive species and seek to correct the problem but are unsure what to do. They want relief from this monster that seeks to destroy them and are willing to take a chance on strong medicine without knowing what effect it will have on them. They are becoming sicker and more desperate as time goes on. The virus is becoming stronger and more destructive.

As of lately, I know of only three things that have any effect on this infection. A good prayer, silver and lead, all applied in appropriate doses at the appropriate times. The only thing people must be careful of is that they do not over medicate and make the situation worse. But at this point, that does not seem possible.