Category Archives: Economics
By: Tom Chatham
Many people today know there is danger on the horizon and want to do something to prepare for it but lack substantial money to buy what they think they will need. They have scanned many good lists online and know what others are stocking up on. There are many good ideas out there but most of them take a conventional stance in preparing. When everything goes wrong with the economy and you can no longer depend on a regular income you must have a plan to maintain a decent standard of living.
If the day ever comes that you suddenly have no job, your savings and retirement are gone and you have no source of income, what will you do? If you can no longer make your monthly rent or mortgage payment, do you think you will be able to continue living there and for how long? This is a serious question that many people have not contemplated and refuse to even think about. When the greater depression picks up speed, your whole world can be turned upside down overnight.
Those that have made the decision to store emergency supplies may not have contemplated losing their dwelling when it hit’s the fan. Even if you have supplies for your family where will you take them if you lose your home? Have you planned for that eventuality? Even if it is remote you need to think about it.
The first three things people need to satisfy are shelter, food and clothing. Regardless of the situation, these are the first things people will try to get before moving on to other needs such as transportation, security and sanitation to name a few.
As a minimum your 72 hour kit should be upgraded to a two week kit with a good four season tent and cold weather sleeping bags for each person. This will provide you with the minimal level of food and shelter that you should be prepared to provide for your family. Adding to this, you should increase your food reserves to the amount you could transport if you had to move. This should be the minimum resources you have to take care of your family if it all falls apart.
In the event you lose your home and have no place to go you should plan on a more permanent type of shelter that you can feasibly pay for on a limited budget. The following are the six items you should try to acquire to care for your family in a worst case scenario. Even if you declare bankruptcy, in many cases the homestead act will allow you to keep up to $5,000 worth of property. The following list will fall far below that threshold with a little shopping around.
Older pickup truck- You should have a vehicle that is fully owned so there is no chance of losing it if all of your financial assets are lost. You want an older vehicle so you can maintain it yourself to a large degree. Newer vehicles since the mid 1980’s have fuel injection, computers and many electronic sensors that make diagnosis and repair difficult for anyone without the proper equipment. You also want a vehicle that can pull a trailer which leads us to the next item.
Camper trailer- Living in a tent is better than nothing but is still miserable in very cold weather. Having a hard shelter is far more comfortable especially if you have children. You can maintain a good deal of normalcy with a camper and you still maintain your mobility. Trailers can be found very cheaply today and the longer you have to look for one the more likely you will find a good deal.
Food supply- With a hard shelter that is mobile you maintain the ability to store several months of food and move it quickly if needed. You should acquire at least a years food supply even before you have a trailer to carry it all. If you plan to set up for long periods of time at a stationary location you would also benefit from having some basic garden tools and a supply of seeds to extend your food supply.
Energy systems- In a long term depression you will still need a certain amount of energy for certain systems. A wood gasifier will allow you to power your vehicle when fuel is hard to find or too expensive to buy. Your vehicle will also provide you with a power source for electrical power. Solar panels will also prove useful for electrical power over the long term crisis. For heating and cooking, wood stoves are good to have since wood is available in most locations and relatively cheap.
Security- Having a means to protect your family will become necessary if the social conditions deteriorate to the point that large numbers of people seek out resources for survival. A good pump shotgun and at least 500 rounds of ammo will give you a basic level of protection in most circumstances. It will also provide you with the means to hunt for food should it become necessary. A shotgun is a good entry level weapon for someone with little or no experience handling weapons. If finances permit a good pistol and a rifle with a good supply of ammo would be a good investment as well.
Silver-Some wealth preserved in the form of precious metals will give you the ability to buy items in the future that are truly needed. Paper money can lose it’s value in a national crisis but gold and silver will maintain their purchasing power over the long term and provide you with options you would not have otherwise. Having at least $20 face value in junk silver coins is a good start but more is better based on some of the economic signs we are now seeing.
These six things are only one type of plan but they provide you with the means to provide the basics no matter how disruptive things get. If you are unable to service your debts in the future you may end up with only those things you fully own and have physical control over. Regardless of your plans you need to analyze your current situation very carefully to insure you will have the means to provide the basics to your family.
It may be thought as premature by some to make such drastic plans at this time but once crisis strikes it will be too late to get the things you will need to ride out the social disruptions. If the government continues to print money we will eventually lose our reserve currency status and the petrodollar will be destroyed. When that happens inflation will run rampant until the dollar that we know disintegrates into nothing. Before that happens you need to ask yourself some important questions and have good answers now.
What will I do if I lose my job and cannot find another?
How will I continue to pay for food, rent, energy, clothing or medications if my income is cut off?
What will I do if inflation destroys my wages, savings and retirement accounts leaving me with nothing?
Will I be able to stay at my current home if I no longer have any money?
Where will I go if I am forced to leave my home?
What assets do I have that are fully owned?
How can I preserve my wealth if the dollar hyper inflates to nothing?
How will I take care of my family if the banks are closed?
What can I do to earn money if we have another great depression?
This is just a sample of some of the things you will need to know if the worst happens and judging from the current economic numbers we are getting very close to a terminal situation that will destroy most of the wealth that exists in paper and digital form. Continued money printing will only make the situation worse but that is the path of least resistance and the one we are likely to take as a nation of economically illiterate stooges.
If you do not have your economic survival strategy operational at this time you are playing with an economic fire that will burn everything you have in short order. You should not complain about your preps if it does not happen next week or next month. The longer it takes to happen gives you that much more time to make the necessary preparations so use this time wisely.
By: Tom Chatham
If we follow the premise that all things on Earth are finite such as the physical resources we use then we must assume that at some point we will begin to run out of these resources as they are more heavily utilized. Our use of energy is one such item that should be addressed by the average person before we hit the wall of limited and then lack of these resources.
There are those that think solar and wind will be the salvation of our energy problems but these people fail to take into account the limitations of these energy sources. It still requires energy to extract the raw materials needed to build solar panels and these must be replaced at some point. Wind turbines require steel, concrete, fiberglass and copper just to name a few of the resources needed to make these things work and they too must be replaced every few decades as they wear out.
One problem with solar that I have talked about to people is the fact that massive amounts of energy must be stored in order for it to power the grid continuously. One person recently calculated that batteries to store enough energy to power the U.S for one day would require batteries covering 923 sq. miles and costing 41 trillion dollars. While I am an advocate of wind and solar I do not believe they are capable of powering our grid reliably. I think their benefits can only be utilized as stand alone systems on individual buildings.
Those that think solar and wind can replace oil do not understand our energy requirements at the present time and certainly do not understand the power requirements of things such as ships, trains and semi trucks that move the bulk of our commodities around the world. Cheap oil has made the current world trade system possible and the lack of cheap energy will cause a collapse of the status quo. The collapse of our current energy system will cause widespread chaos and depressed living standards if we do not address this issue now. It is for this reason that we need to look forward to the energy we will use in the future.
Hydrogen is more akin to a storage battery as it takes energy to separate the hydrogen from other elements to utilize in most cases. Fusion is still a promising energy source that we still do not know how to produce and maybe in the future if we figure it out it will change things but that is some time off. Things such as oil, natural gas and coal are heavily used today but they will only last so long and a growing population is using them at a faster rate as time goes on insuring their demise at some point. Nuclear power plants are filled with controversy and their future is uncertain unless something changes.
If our fossil fuel system begins to erode we will have to fall back on what we know. In this case the most available source of energy available to the population is that age old element, wood. As archaic as it sounds if our energy grid begins to shut down wood may be the go to system for individuals at the local level. A mature wood lot can produce about ¾ of a chord of wood per acre per year. When utilized within these limits it becomes sustainable for the long term.
A small homestead with a good woodlot and some solar and wind power may be the future we are forced to embrace until some new energy source becomes available in large enough quantities to fulfill our needs on a large scale. Now is the time to begin this conversion before we are forced to do so when the materials we need are no longer available to the masses. There are many people that have made this change and live off the grid today and are very happy about it.
Wood is also a viable source of energy for vehicles utilized in the local area. Wood gas can provide the energy to power much of the agricultural equipment we need to maintain the food supply. While this is a step back it will likely become a necessity at some point if we wait too long. With wood gas a conservative estimate of wood power indicates about 20 pounds of wood equals a gallon of gasoline when utilized in a motor vehicle. There is some power loss with wood and production efficiencies vary from system to system.
Much of the population growth of the world has been made possible by the availability of cheap energy and the loss of this cheap energy will cause a drastic adjustment to the population on this planet as we run into resource scarcity. The abundance of food we now produce depends on vast quantities of cheap, available energy. Nature has a way of balancing things out if we refuse to do so on our own. People need to understand this.
While a small homestead with solar and wind power and equipment powered by wood may not be the ideal plan, it is one you can be working towards while you can do so with minimal disruption to your lifestyle. In the near future if energy prices and availability should become more of an issue than it is now, having alternative energy systems will minimize the effect on your quality of life. I suggest you have a plan that works for you and your family before you are forced into one by events.
A plan to deal with an energy shortage will not only protect you from a shortage but also from manmade and natural disasters that would curtail or eliminate the timely delivery of energy to the masses. The ability to provide the majority of your own energy needs makes you less vulnerable to shocks that can send society into panic and disrupt many lives. Over time things change. This can be beneficial or detrimental to our well being and your ability to adapt to those changes will determine your quality of life in the years to follow.
Our energy resources may be stable for many years to come. Then again they could change drastically in a matter of weeks. Walking into the future with your eyes closed knowing full well you could fall off a cliff is a dangerous way to live, especially when you could take steps to minimize the dangers and insure your quality of life if something does happen.
By: Tom Chatham
The prosperity we once knew as a nation was made possible because of cheap oil. When the EROI, Energy Returned On Invested, was at 30/1 we had unprecedented prosperity. The EROI is now falling below 10/1 and is taking prosperity with it. The EROI is the amount of energy we expend to get energy, in this case oil, out of the ground. We are getting 10 units of energy for every unit we expend to get it. Shale oil production results in 5 units of energy for every unit we expend.
This matters because everything we use depends on cheap energy to maintain the status quo. An EROI of 10/1 is necessary to maintain our current standard of living. The Hills Group project oil will drop to $11.76 by 2020. This may sound good on the surface but cheap oil will not mean much if you have no job and no money to buy it. As the next depression sets in many more people will lose their job and as a result prices will collapse. They project by 2020 we will have 75% fewer gas stations as a result of collapsing oil.
Today most of our population lives in the city. When jobs see their final collapse those people will have no way to survive. Living in the city requires stuff being brought in from other places. Those living in the city must pay for this stuff with the pay they earn. No jobs mean no pay and no goods.
During the last great depression many city dwellers had family in the country to move back in with to stay fed but most city dwellers today are several generations removed from the country life and no longer have living family members in the country to move in with.
Many of the farms that were left to city dwelling children after the parents died were sold and the money either spent or put into paper assets for retirement. When those paper assets evaporate those people will have nothing to fall back on.
I have said before that when this next depression hits it will devastate everyone and the only way people will be able to get by is if they produce most of their basic goods themselves. This will require a small farm and a family to help run it.
The U.S labor department has reported that productivity has declined for the third straight quarter. The real hourly wage increase reported in the first quarter at 4.2% has been revised to a decrease of .4%. GDP growth annualized for the first two quarters is 1%. S&P 500 companies are reporting declining earnings for the fifth quarter in a row. Economic growth is at its weakest rate since 1949. Gold is up 25% this year so far. All of these metrics are indicative of a stagnant or declining economy at a time when we are told everything is doing great.
The massive amount of money being printed is the only thing holding the economy in place right now but we are now moving beyond the point where that is even effective. From here on out more money will only cause more damage and it will compound the effects when the economy finally fails in earnest. Those that do not see this train wreck coming will still be sitting calmly as everything falls apart around them. They will be lucky to survive the impact and will be totally helpless in the days following. Those that see the danger will have gotten off a long way back and will be in a better position to help themselves and their family.
It is good to help others but you can only do so after you have taken steps to help yourself. The carnage we are about to see in world markets will affect everyone in some way. The best way to help is to understand what is coming and be prepared to deal with the realities that will follow. Global markets will revert back to local markets and those prepared for these changes will survive the initial collapse and thrive in the aftermath.
You can read more about EROI at https://srsroccoreport.com/the-coming-breakdown-of-u-s-global-markets-explained-what-most-analysts-missed/
By: Tom Chatham
It has been a long wait for the silver bugs but the future may indeed see them richly rewarded for all of their patience. Those that have held on are now about to see the end game unfold.
There have been many projections on the highs that silver could hit in the future ranging from a low of $100 to highs of $1,000.
It should be noted that much of the above ground silver has been used in the past few decades for industrial purposes that leave most of that silver not reclaimed due to the small amounts used in individual products. The plans of China to increase solar production will take a great deal of future silver production to power their energy grid.
The current production has silver at about a 10 to 1 ratio of gold. On the surface this means that silver should be valued at least at the 10/1 ratio. The current disproportionate ratio of 78/1 will insure silver rises at a higher percentage than gold during the current bull market.
If current projections of $10,000 gold are anywhere near correct that would put silver in the $1,000 range. Regardless of the ultimate price, gold and silver will rise substantially as chaos enters the markets. It is this chaos that will also require people to store the necessary resources to care for their families until the chaos subsides. Gold and silver holdings do not insure access to resources during chaos but will be valuable afterward to take advantage of good deals due to revaluations in the economy.
In times like this when most people are at risk of losing much of their wealth, the current low price of silver can help the average person not only preserve what little wealth they have but even increase it many fold to offset the failure of incomes to keep up with real inflation over the past few decades.
This is a once in a lifetime opportunity to beat the bankers at their own game. When the economic leverage shifts back from the paper wealth to real money those holding real money will reap the benefits. Even small holdings of silver will help individuals to insure their wealth will remain in tact after this economic cycle comes to an end.
Gold and silver are a form of escape hatch in the banker controlled economic system we are forced to play in. When they pull the plug on the current paper wealth, those that know no better will cling to those worthless paper assets to the very end never dreaming they will someday be totally worthless. The very few that understand what is taking place will use that escape hatch to save what they have so they can continue to prosper in the future.
The bankers know of this escape hatch but they have few ways to close it without alerting the people so they use their position and trust to convince the population this doorway is dangerous. They call it a barbarous relic that has no place in a modern society. They do this because they know the truth. If they can convince the people long enough, by the time people know the truth it will be too late to exit this door.
Those that have already taken this door out of the system are now looking in at the fire that is about to burn the house down. When the rush to the exits happen, many will not make it out. There is still time to get out ahead of the crowd but time is now very short. Any more procrastination on your part will likely be lethal to your economic health. On this Independence day free yourself from the banker controlled system by purchasing some real money and renew your declaration of freedom.
By: Tom Chatham
With the economic conditions becoming ever worse around the world every day it is becoming harder for the average person to build or buy large homes that make their owners feel successful. In recent decades it has become the norm to keep up with the neighbors in consumer spending. Nobody wants to be the neighbor that has the smaller home, the older car or an older phone. Competition has gone to extreme limits and now those limits are becoming unsustainable as people find themselves working lower wage jobs part time.
A home used to be a shelter for your family and nothing more but now they are seen as a savings vessel and a trophy to hold up to society as a whole. This mantra is coming to a catastrophic end very soon as those that still have a good job will soon find they can no longer keep up with the payments as society becomes mired in massive inflation and later deflation destroying everything not fully owned that can be protected from theft by politicians and bandits alike.
The more you have and the bigger it is the harder it will be to protect it in the future. You cannot simply pick up your 2,000sq.ft. home and move it when necessary in a turbulent environment. That elephant becomes a ball and chain. That’s even if you own it outright which most people do not. All of the years of payments you put into it could easily be lost through no fault of your own even though you did everything right.
When everything goes wrong in the economy you will still need a place to call home to provide shelter for your family. Being comfortable does not mean being big. A small home can provide everything a family needs to get by whether times are good or bad. It will be less costly to build, to maintain and cost less in taxes every year.
Most people can not fathom having to live in the small homes that many of our grandparents called home. That mentality will have to change and will be for the better as it will allow people to relearn the difference between needs and wants.
A small cottage or cabin can provide everything a family needs to have a good life. When times are good and they have extra money they will be able to save it rather than pour it into an asset that can go down faster than it goes up. Having actual savings is very important especially if credit is difficult to obtain.
A small home of only a few hundred square feet can be used as a vacation spot, a primary residence or an opportunity to rent it out for additional income. It can also provide a struggling millennial with a low wage job the ability to actually own a home now. This last fact will become more important as time goes on. Not only that but the ability for you to own a home free and clear will alleviate the anxiety if you come on hard times and risk losing your primary home. Knowing you still have a place to go that you can afford to maintain will be worth a great deal to you and your family.
Most people do not realize how cheap a small home can be built for. A great deal of the expense of a home comes from the size, the zoning regulations and the cost of labor to build it. Not to mention the cost of land in certain markets. A small home that can be built by you from kit form is a poor persons dream. It only requires a person to think in terms of function rather than size and looks.
A small home is a way for people that are marginally getting by to survive until they can improve their situation. Small cabin kits can be found for as little as $7,000 that two people can assemble in a few days. Imagine being able to buy a small piece of rural land, put in a well and septic system and build a livable home on it all for less than the cost of a modern luxury car. It’s possible in many areas.
Here is just one place where you can find prefab cabin kits for very little. Getaway Prefab Wooden Cabin Kit bzbcabinsandoutdoors.net
Even if you decide to build from scratch yourself these kits can give you some good ideas to start from.
In the coming months having a fully owned shelter you can depend on will become harder as the economy gets worse and people lose much of the money they think they have. It only takes a second for all of those digits in your banks computer to disappear forever.
Even if you have a good shelter now a cabin can provide you with an income producing opportunity that should not be overlooked. Also for those that have collage aged kids that are probably having a hard time in today’s economy, you can help them get a good start by helping to provide them with a small paid for home like a cabin that they can call their own. Having a paid for home starting out in life can open up many opportunities for a young adult. The money they can save even over a few years can be very helpful.
A small home provides a stepping stone to better things in the future but if things go terribly wrong in the economy you will have a place to go no matter what. Starting out small and working up is the way people have lived for centuries. It is only recently that people have been exposed to easy credit that has allowed them to live beyond their means and the future collapse of this credit will force people to return to a saner, more reality based existence. Start small, live within your means and follow your dreams and you may someday have the mansion on the hill to show for all of your effort.
By: Tom Chatham
The forces are mounting that will eventually overwhelm most Americans and send their standard of living to unknown depths. Americans that have only known the post WWII prosperity are ill equipped and educated to deal with depression level living. Easy credit and instant gratification have created a nation of whining, self absorbed, entitlement minded people with no moral or mental toughness.
Doug Casey believes we are headed for what he calls a super depression created by the ending of a debt super cycle. The bigger the debt cycle the bigger the depression that follows. That’s how reality works and most people are not prepared for reality.
When this depression, which has already started, gets momentum, it will overwhelm the plans of a society that is expecting to get things like social security, pensions and payouts from retirement plans they have paid into for many years. All of those things will disappear almost overnight and leave society gasping and stupefied over what to do. Their reactions will be to yell and scream and try to identify who to blame but the only person they should blame is the one in the mirror.
Many very smart people have raised the alarm and done their best to warn the sleeping public, but those slumbering masses have ignored the warnings and hit the snooze button one more time. The masses do not understand economics, do not want to understand economics and they will pay dearly for that ignorance in the coming days.
When the real unemployment rate becomes common knowledge as it increases substantially, people will be left to survive on what resources they have saved up outside the banking system that cannot be stolen by the politicians and bankers. That is a key point here. The assets you have outside the system that cannot be stolen from you with a few key strokes on some computer.
Those hoping for some miraculous event that will send the U.S. back to the days of manufacturing might and jobs for all will never see it happen. Those days are gone. The west line theory tells us our economy will slow down and become more modest as the shipping center of the world moves west to the next powerhouse region which is Asia. This is what history teaches us.
When people suddenly wake up one morning and they have no job, their retirement is gone and they need to care for their family, what will they do? When government services have collapsed and they suddenly realize they are now living in a third world country with few government services, what will they do? When the banks are closed and only a select few connected people have any type of money or access to goods, what will they do?
This is the reality that many people will face in the future and they have no idea how bad it can get. They refuse to contemplate the harsh reality they will be living in and take steps to mitigate the effects. To do so would be to acknowledge it could happen and they are taking personal responsibility. Personal responsibility is a dirty phrase in today’s entitlement society. To see some of the effects one only has to look at the collapse of society in Venezuela today to see what awaits.
When it happens it will all fall back to you to take responsibility for your family and take care of them for the duration. To do that you need to plan now for that eventuality and build up the resources you will need to provide food, shelter, clothing and security when the system fails to do it for you. You need to be Noah on his ark not the people watching as he floated away.
Having resources stored up is a must but it may not get you all the way through if the situation lasts for many years. That is why you need some type of plan to replace those resources as time goes by and have some way to generate some type of income or at least items to trade. Usable goods are for the short term and things like gold ,silver and production equipment are for the long term to help you get through the crisis with the least amount of pain.
Even with proper planning the days ahead will not be easy as the standard of living of society will fall substantially to levels only seen in failed third world countries or old pictures. The assets actually owned by people today is very small compared to how they live. They will default on their home loan, their car loan, and their credit card debt leaving them with very few real possessions and few ways to move what they have left even if they have some place to go. Ultimately these people will become the new serfs to the wealthy class that will take possession of anything of value. Feudalism will once again rule.
The lack of planning by society will make this a reality if it is allowed. What will you do when everything you have worked a lifetime for is suddenly taken away? Do you have a plan to keep what you have? Do you have a plan to make money when you cannot find a job? Do you have a way to take care of your family until things stabilize? Do you have a home you will not lose if the whole system breaks down? What will you do if electricity or fuel is too expensive to buy or not available to the general population? These are the questions you should be asking yourself now and you better have a good answer because your family will be asking them when the greater depression sets in.
By: Tom Chatham
With more and more people raising the alarm about a coming recession, and possible depression to end all depressions, it is only natural for people to think about where they should put the wealth they have been able to hold onto. If you still have any wealth to speak of after the past several years, congratulations. If any of that wealth is in paper assets that can disappear overnight, you really need to think about a safer place to store it in the coming months and years.
As they say, if you can’t hold it, you don’t own it. If the banking system shuts down due to hackers, enemy attack or government edict, any money you think you have could disappear quickly never to be seen again. At that point all you have to prove it ever existed is a piece of paper that no longer means anything.
We are heading into a rapidly changing future where nothing can be taken for granted. When the current social and monetary system ceases to function, you will need wealth in the form of physical items to get by from day to day. Wealth is the excess production you have to save for the future. It does not matter what form that wealth takes as long as it preserves value for future use.
In a serious crisis, wealth in the form of physical goods can mean the difference between suffering and getting by. In a crisis, physical goods are as good as cash when the time comes to trade for items you need. In today’s crumbling system there are some notable goods that not only hold their value but can increase in value when times get tough and people scramble for limited resources.
These not only provide security and can put food on the table but they hold their value over time better than many items. They can be worth many times their original cost when they can no longer be bought due to the lack of a functional financial system or decaying social condition.
Like guns, ammo can be stored for many years and current social conditions seem likely to make ammo costs stay relatively high for many years to come. Like food, when you need it you will be willing to pay many multiples of it’s original cost to get it making suppliers very important people.
Any disruption of the food distribution system for prolonged periods will force people to return to home canning to insure a food supply for their family. Most people no longer have canning supplies at home and when the time comes that they realize they need them, the cost will be very high if you can even find them. Anyone stocking extra canning supplies beyond their own needs will find them a good trade item when the time comes. Canning supplies like everything else will continue to rise in price in the coming years.
Gold and silver-
As the ultimate time tested wealth storage mediums, gold and silver will allow those that store them the ability to make good deals in the future when paper assets have lost all value. It does not matter if the price goes up or down, they always maintain their value through good times and bad. Today, price manipulation has made these metals available to the public at a major discount to their actual value but that will only last as long as there is confidence in paper. Those stocking up now will reap the rewards for their forward thinking .
Alternate energy systems-
When the grid goes down or energy prices spike at a time when many people no longer have meaningful employment, the ability to maintain energy in your home will mean a great deal to impoverished families. Generators are great but during a long term crisis, the ability to maintain power with a generator is limited. Even if you have a large supply of fuel your generator will likely fail at some point due to extended use. Solar and wind power systems offer the advantage of a one time expense and after that offer years of low or no maintenance to maintain power for critical systems such as lights and refrigeration. They are also much quieter than generators to avoid undue attention from the community.
Tools can come in many types and forms. Tools allow you to fix or build items you need. They also provide you with the means to provide services you can charge for giving you a business to fall back on if it is ever necessary. Good quality tools can last a lifetime and maintain their value over time.
Knowledge is power. When you have the proper knowledge you can write your own destiny. Knowing what to do and how to do it when everyone else is running in circles gives you a major advantage in life. Knowledge also provides you with the ability to use that knowledge for trade or business purposes that can earn you income for items you need. It is difficult to put a price on a good library.
In a crisis food is the ultimate currency. Regardless of what the social conditions are, people will need food. Since most of the population lives in urban environments today, they are dependent on food deliveries to stay fed. When that system fails those with excess food supplies or an ability to produce more will have a form of wealth they can use. Your money will actually be growing on trees.
There are many resources that you can store depending on your abilities and needs but these offer some of the best returns for the investment over time. The need to store wealth is for future consumption when you may not be able to earn the money due to age or economic conditions. The ability to invest some of your wealth now in items that will reduce consumption and supply your future needs is a winning proposition for most people. Only you can know what you expect from the future so you must plan accordingly now to avoid the worries later.
By: Tom Chatham
The road to recovery from any type of societal collapse is largely dependent on the mechanism that caused the collapse. For this reason we need to determine what the likely cause of the collapse will be and have the appropriate equipment to fix the malfunction after it happens. This requires society to take a realistic look at the situation as it is and not how we want it to be.
Most people do not even realize that we are heading for an economic collapse of epic proportions so talking about recovery may seem like we are getting too far ahead of ourselves. What you need to understand is that what we do now, before the collapse will determine how well we are able to recover from it and how fast. When you leave on a trip you pack the appropriate clothing and make sure the car is running well and you have emergency equipment like a spare tire with you just in case. When the economy collapses if we do not have the proper emergency equipment on hand to fix the problems, we will find ourselves stranded and unable to move anywhere.
From a societal standpoint, being unable to move means we will not be able to resolve any of our problems quickly and will out of necessity begin to prey on one another to fulfill our needs. This is what will cause loss of life on a monumental scale as the crisis is drawn out over time. Having the proper emergency equipment and a plan to use it will greatly reduce the suffering that is endured by society. This does not mean there will be no pain, only that we can keep it manageable.
A nations wealth is derived from having a product to sell. A service economy is dependent on having a wealthy society that has sufficient disposable income to support service jobs that consumers pay for rather than doing the jobs themselves. A society cannot get wealthy by washing each others clothes. There must be some type of real production to generate true wealth.
For this reason, the type of collapse many western nations now face will require them to have the ability to actually produce real goods following any collapse to begin the generation of wealth that is required to lift society out of any depression. This means society will need those with insight to have the necessary emergency equipment standing by after the collapse to begin the production of real goods and provide people with real jobs. The lack of jobs and resources following any collapse will mean poverty and predatory actions by society when things finally bottom out.
Most of the manufacturing ability of America has been shipped overseas. This means when a collapse occurs here we will once again need the ability to produce those things we need because we will lack the ability to buy them from others. The lack of a functional manufacturing sector means we will suffer in the future if we do not set aside the necessary emergency equipment we will need in the future to restart our manufacturing ability. As with many things we will need equipment to produce other equipment to build up that ability. The lack of this basic equipment to rebuild that manufacturing ability will doom this nation to poverty and third world status for decades to come.
This does not necessarily mean we will need to build large factories with thousands of employees. We will likely need to focus on smaller mini manufacturing sites employing a few dozen people in each. This is a first step to building larger more productive factories in the future. .
China has embarked on a building spree over the past decade and the result is the existence of many ghost cities and new infrastructure all over China. They possess all of the manufacturing technology of the west and the factories to produce the goods. They have also sought to secure raw materials all over the world for future use. They have built up a huge stockpile of gold. All of this means that China has positioned itself to have the necessary infrastructure to recover from any collapse that the world may face in the future. They have the equipment to build their own wealthy middleclass to fuel their rise in the future. They will do what the U.S. did in the 20th century and build up a wealthy middleclass and become a world leader economically, militarily and politically.
Americans need to realize that China now owns vital ports and businesses in the U.S. Following an economic collapse China will be in the position to increase its manufacturing ability in the U.S. and smother any American attempt to rebuild its own manufacturing ability making it independent of foreign influence. This is the threat to America recovering any future collapse if we do not have a large number of independent operators that can rebuild manufacturing ability at the local level quickly following any serious event.
If America wishes to remain free, we need people with vision to prepare for this eventuality and be able to respond with a new program of production to counter the many dangers we will face in the future. There are two areas that should be concentrated on as far as production is concerned. The first is the extraction or harvesting of resources and raw materials. The second is the conversion of those raw materials into finished goods.
Once you lose the ability to work and earn a living you become a government serf that is forced to bend to their will as you ask for handouts to survive. In an economic collapse the medium of exchange is destroyed along with the savings of the masses. When this happens people can no longer buy the goods they need to survive. Two of the things that survive collapse are individual labor and raw materials. When you can combine these with a third item, production equipment, you have the means to provide the basics of survival for the people and a means to produce their way through the difficulties they are facing. Absent a medium of exchange people will still be able to work for the things they need. This is the key to overcoming a serious crisis that can fracture the population and destroy societies.
Small localized production can make all of the difference when goods are needed to sustain families at the most basic level. The basis of any society is the ability to produce agricultural products. Food is a basic necessity and is the basis of any prosperous society. It is the first level in any production scheme to provide basic goods. Food provides the means to support industrial production. Industrial workers earn pay so they can buy food for their families. Food becomes the primary trade item to support other types of production that eventually provides a higher standard of living for society.
In a collapse, a food producer with a small industrial facility can trade food for the labor to produce factory goods that provide value added goods for society he can trade for other items. With this type of production, a community can overcome economic obstacles even in the absence of a medium of exchange. The industrial equipment could be as simple as a portable saw mill, a grain mill, fiber processing machines such as a spinning wheel and floor loom or a shop filled with wood working or metal working machines. The size and scope of production will be dependent on the abilities of these forward looking individuals to procure these machines prior to any crisis.
This may seem like pie in the sky dreaming to some but the fact remains. The future will only be as difficult as we make it. If we fail to prepare then we are preparing to fail and that will cause suffering on an unimaginable scale yet to be seen. Even a small amount of preparing can yield huge dividends when the time comes so anything you can do to prepare for the changes to come will be worthwhile. I am a big believer in infrastructure and the benefits it brings with it. A farm with specialized equipment can produce more products and create more wealth than one with typical farm equipment. Someone raising livestock that sets up their own small processing facility can process their meat for increased worth and has the means to hire persons to do the work for payment in food products. A dairy that has the ability to produce cheese can increase their product line and produce a product that will keep longer.
When crisis strikes in the future the amount of infrastructure available at the local level will determine what hardships we will face. The production of real goods is the only way we will get through a future crisis and keep society in tact for the duration. The wealth of local communities will depend on what products they have to offer in the future. A lack of local production will end with poverty and societal breakdown that may not be recoverable for many years to come.