Tag Archives: economy

Article – These Doomsday Preppers Are Starting to Switch From Gold to Bitcoin

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Wendy McElroy is ready for most doomsday scenarios: a one-year supply of nonperishable food is stacked in a cellar at her farm in rural Ontario. Her blueprint for survival also depends upon working internet: part of her money, assuming she needs some after civilization collapses, is in bitcoin.

Across the North American countryside, preppers like McElroy are storing more and more of their wealth in invisible wallets in cyberspace instead of stockpiling gold bars and coins in their bunkers and basement safes.

They won’t be able to access their virtual cash the moment a catastrophe knocks out the power grid or the web, but that hasn’t dissuaded them. Even staunch survivalists are convinced bitcoin will endure economic collapse, global pandemic, climate change catastrophes and nuclear war.

I’m not some dinosaur that refuses to embrace technology Because. But what I most definitely am is someone who tries to objectively evaluate the utility of something against what I envision my future needs will be.

I would think the people who froth at the mouth about “If you cant eat it, shoot it, or set fire to it, it’ll be useless after the apocalypse!” will lump bitcoin in there with gold as having no post-collapse utility.

As I see it, gold and silver (and perhaps bitcoin) have utility in the descent from “Times of Plenty” to “Thunderdome”.

Bitcoin does have an interesting use though…as long as there is internet you have a portable, secure, anonymous way to move your wealth. While getting on a plane from Dubai to London with a couple kilos of gold may cause some problems at customs, you can, I suppose, transport that same amount of wealth with nothing but a few passwords in your head.

Do I see a need for bitcoin in my preparations against an uncertain future? I dont think so. But Im also the first to admit that I am probably terribly underinformed on the subject. However, would I divert resources from other preparations I make towards getting bitcoin into those preparations? I would not. I’m just more comfortable with a mix of cash, metals, and, honestly, paperless handguns, as a method of doing commerce…pre- and post-collapse. (And, really,  most of my ideas about a sustained collapse are based on economic issues rather than comets/Xenu/rapture/bird flu/nuclear holocaust.)

However, and this is a big however, it might be prudent to dump a hundred bucks into it and just let it sit there in case it blows up again. Much like how penny stocks are fun to play.

Direction

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I was having a little exchange in email with someone and was describing how the direction of my own prepping (and I really hate that word..it sounds so cutesy and trendy) has changed as of late and why. Maybe it’s worth a post or two.

I’m fairly satisfied with where I’m sitting in terms of food, fuel, materiel, etc, etc. It’s not necessarily gilding the lily to continue on the current path, but this current economic clime is one that makes me think now is the optimal time to shift directions for me.

As I mentioned earlier, we’re in a somewhat better-than-usual economic period. Jobs and markets are at record numbers. I’m not going to say that money is out there falling from the sky, but for someone with a brain, work ethic, and ambition, now might be a good time to work on getting the financial side of preparedness buffed up…take the extra job, invest the extra cash, sell the unused items, etc.

What does the financial side of preparedness look like?  For the ‘casuals’ that may look like the classic six-month-emergency fund in the bank, pay off the credit cards, and beef up the Roth. For us lifestylers it may look like that plus cash in the safe, cash equivalents like gold and silver, trade goods, and other assets (like land).

I’m pretty sure I will be just fine if I don’t buy another gun, freezedried, or backpack for the next five years. And, as I’ve said over and over, the times in my life where I urgently needed money far outnumber the times in my life where I urgently needed a Barrett 82A1. Doesn’t mean that moment won’t happen, just saying that so far I’ve need $50 bills more than I’ve need .50 API.

Trying to avoid this

So, for the last few months I’ve cut back on my spending on things like storage food, ammo, guns (sorta), and the like, and have instead been moving more resources into savings, investments, cash, hard currency, and that sort of thing.

The economy is doing well at the moment but nothing lasts forever. If this good economy affords me the opportunity to get my ducks in a row for when it inevitably starts to decline…well, wouldn’t that be the smart thing to do?

So..for now, my focus is mostly on getting the money stuff squared away. If the zombies/war/Depression/invasion/flu/volcano/collapse occurs tomorrow I think I’ll be just fine with what I have on hand…but I don’t share that same level of confidence if some of the more mundane life disasters (transmission, broken leg, water heater, job loss, unexpected critical expense, etc.) occur. This change in direction will hopefully change that.

As I read that last paragraph it seem that could be interpreted as the direction of the blog changing, rather than personal direction. Nope…the blog will continue to strive to mediocrity with no change in its usual aimless topical wanderings. But personally, yeah, I think I’m going to be working on the really, really unsexy parts of preparedness. But…it’s gotta be done.

Piggy Goals.

Prepology 101: You prepare for bad times during the good times

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Unemployment is a tad under 4%…according to the graphs I was looking at, it’s only been that low twice in the last almost-50 years. What’s that mean? Broadly, if there’s anyone out there who wants a job, there’s one to be had.

Unemployment is down, the markets are doing well, confidence in the economy seems high. This is exactly the time you should be nailing down the acquisition of preparedness items and getting things taken care of.

It’s a lot easier to prepare when you have a good job, the economy is strong, and all seems rosy than it is to prepare when the market is tanking, you’ve been unemployed for two months, and you’re down to your last twenty bucks. Sure, that bonus you’re going to collect in two weeks will buy you that jet ski or 60″HDTV… but when we hit the other side of this moment of prosperity (which we always do) you’re gonna wish you’d used that bonus to pay down your debt, put away food, fund your HSA, or just tucked away in the bank. I’m not saying you can’t enjoy the current situation, just that you might want to use it to your advantage for later down the line.

So, just a reminder: this is the ‘fat’ season that you should take advantage of to put away for the ‘lean’ times. Could be guns, could be food, could be gold, could be cash in savings, could be paying off the house, could be getting those nagging dental issues fixed, could be paying off the truck……but now is the time to get ready for what may be coming next.

Still one of my favorite prints. An artistic representation of the Ant & Grasshopper fable. The grasshopper, the girl with the mandolin who spent all summer playing music and not working, faces the harsh winter and must beg to the ant, the industrious woman with the well-fed household, for help. Note the looks on the two women’s faces…the scorn, the humility.

Article – What Venezuelan savers can teach everyone else

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ASK the chief investment officer of a fund-management firm how to spread your investments and you will be told to put so much in stocks, so much in bonds and something in hedge funds or private equity. Chances are that white-elephant buildings, eggs and long-life milk will not feature. But in Venezuela, where the inflation rate is in the tens of thousands, things that people elsewhere would shun for fear they will lose value have become stores of real wealth.

The old standard for guarding against hyperinflation has always been gold and, to a lesser degree, silver. But, as seen in many wartime economies, certain goods hold their value across board… most notably cigarettes, booze, and …ahem…’personal services’. There’s a handful of occupations that are, basically, recession- and depression-proof: food, medical, weapons, entertainment, and sex. Doesn’t matter if it’s a war or a depression – everyone wants to eat, everyone wants to live, everyone wants to protect themselves, everyone wants to forget, and everyone wants to get some action.

Of course it’s kinda hard to transport some of those goods in a convenient manner which is why we have a medium of exchange – gold.

About this point in the conversation the shortsighted jump in and say that if you can’t eat it or shoot it, it’s worthless. After all, they argue, if you were dropped in the middle of the Andes with a suitcase full of gold you’d starve/freeze/etc.

This is, of course, quite true. But it fails to take into account that economic disasters rarely happen overnight. They are usually a gradual-but-increasingly-steep slope. The gold gets you the things you need to survive that drop into the Andes. Somewhere between “normal” and “Mad Max” is where the gold come into play. When the local backpacking supply shop won’t accept currency, the gas stations won’t take plastic, and the gun stores won’t take a check….that’s where the metals come in handy.

But…thats my opinion. I hedge my bets….metals, ammo, fuel, food, etc.

Article – Greek banks reopen but cash limits remain; taxes soar

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An article about how things in Greece are nowadays since they signed up for another austerity plan. Here’s an interesting paragraph:

Ready cash is something Greeks will need as new taxes also came into effect on a wide array of goods and services Monday.

Sales taxes have risen from 13 percent to 23 percent on many basic goods — including some meats, cooking oils, coffee, tea, cocoa, vinegar, salt, flowers, firewood, fertilizer, insecticides, sanitary towels and condoms.

Most European countries already have a VAT on things, but a haircut of 23 percent on something as essential as meat….well, thats a tough pill to swallow. How do you adjust your budget to suddenly accommodate this sudden redirection of your spending power?

Well, if you’re smart, you either have connections or networks to allow you to buy things without paying the tax. (Which, really, has been part of Greece’s problem all along…tax-evasion and avoidance is something of a national pastime there.) This is why cash is awesome….so you restrict cash and limit people to the use of debit cards or other instruments that leave a trail of paper. That trail of paper means that you can’t really evade those pesky taxes. So the winners here will be the folks that have lotsa cash (or cash-like instruments such as gold or silver), folks with heavy stockpiles of goods, and folks who can get those two groups together for a little piece of the action.

Look at that list of things that these new taxes affect….mostly things that are pretty easy to store for the long term. interesting, that.

Prices

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After a little bit of a spike, silver has dropped back into the low $16 range. While I think the odds of things ever hitting the stage of bartering for your life with a couple Silver Eagles is pretty slim, I still like having a little box full of tubes of them on hand. It’s some sort of primitive lizard-brain thing, but I just like the feeling of having them even if, from a pencil-and-calculator standpoint, it doesn’t make sense.

Speaking of prices going down, it’s been a long time since I saw gasoline for less than $2. I’m no economic expert but, to my uneducated eye, it appears this is a simple price manipulation by the oil producing nations to make domestic oil production economically unfeasible. If they make oil cheap enough, folks will just by it from them rather than dig up North Dakota and Canada. Simple business economics….undercut the other guy. An unfortunate side effect is that all those guys that were making bank out there in NoDak are now fearing for their jobs. A good reason to always tuck a little something aside when youre doing well…you never know how and when the fat times are gonna come to a screeching halt.

One thing prices have not been going down on is food. Meats are pretty high these days. Even buying in bulk it can add up quickly. We’re buying half a beef from a somewhat-local ranch next month and thats been, in our experience, the way to go. It’s the same price per pound regardless of cut…ground beef or t-bone…its all the same. It’s been a good way for us to buy meat but, obviously, you have to have the freezer space to pull it off. My experience, which you can read about if you search through the blog, has been that you can stuff a properly packaged piece of meat into a deep freeze and have it be just fine five years later.

On paper, its tough being a survivalist…you sink a lot of money into things that, arguably, you might never need. I’ve seen guys die with thousands of dollars tied up in things they owned ‘just in case’. The outside observer might think its a waste of money or ‘misallocation of resources’ but there’s a non-tangible benefit. It’s very much the same benefit you achieve from that other ‘waste of money’ – insurance. It buys me peace of mind and a general feeling of security which, in my opinion, does have a financial value. Still, it’s a hard thing, sometimes, to spend money on ‘just in case’ stuff when what you really want is a WarCraft subscription or a new iPad.

Of course, once the zombies rise it’ll be a whole different story and that money will look like a brilliant allocation.

Article – Panic in Greek pharmacies as hundreds of medicines run short

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Originally published at Notes From The Bunker. You can comment here or there.

Greece is facing a serious shortage of medicines amid claims that pharmaceutical multinationals have halted shipments to the country because of the economic crisis and concerns that the drugs will be exported by middlemen because prices are higher in other European countries.

Hundreds of drugs are in short supply and the situation is getting worse, according to the Greek drug regulator. The government has drawn up a list of more than 50 pharmaceutical companies it accuses of halting or planning to halt supplies because of low prices in the country.

More than 200 medicinal products are affected, including treatments for arthritis, hepatitis C and hypertension, cholesterol-lowering agents, antipsychotics, antibiotics, anaesthetics and immunomodulators used to treat bowel disease.

Why would a drug company ship millions of dollars of product to a customer who apparently has no ability to pay?  Simple math…no one stays in business long when they give away the product instead of selling it.

The lesson here is that when an economy collapses (or comes close to it) those convenient modern miracles may not keep coming. Of course, anyone with hard currency (cough*gold*cough) shouldnt have any trouble getting their drugs since there’s always someone somewhere who can deliver for the right price.

Oh yeah, silver is down…….

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Originally published at Notes From The Bunker. You can comment here or there.

I’ve been so wrapped up with the gun stuff going on (and rightly so, I believe) that I completely overlooked the fact that silver has dropped below $30 and is, at this moment, right around $28.75…time to buy!

IMG_0625

I’m fortunate that I have a buddy in the gold/silver biz (and, wow, has he been busy lately or what!) so he only gives me the mildest of dirty looks when I ask him to drop by the shop with just one or two silver rounds or Eagles for me. (Honestly, I prefer the rounds for the better value but the Eagles are probably more ‘recognized’.) It sucks that between the sputtering economy (and how are those job numbers these days, anyway?) and the gun control shenanigans it’s mighty hard to decide which direction to point my disposable dollars at. (Although, after typing the term ‘disposable dollars’, I think I’ve figured out where to point that wallet.)

Really, the ‘investment’ plan is really the same as it’s always been: gun stuff, metals, food. (Not necessarily in that order.)

I realize that there’s a certain demographic (a short-sighted one, in my opinion) that says “If you cant eat it or shoot it whats the point of it? When we’re all living in caves and eating our children no one will want your Eagles!” and thinks buying this sort of thing is a waste of time. That’s cool, I can respect that..I disagree with it, but I respect that you have an opinion. So take your money and buy more mags, ammo, land, guns, food, fuel, clothes, meds, household supplies, tires, and tools…because while we can disagree about the metals thing, I think we can agree that there’s virtually no point in holding onto anything more than a small amount of cash when it’s looking more and more like the only economic courses available to this country involve bank runs and inflation.

Article – Why your toilet paper is shrinking

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Originally published at Notes From The Bunker. You can comment here or there.

Everything shrinks in a recession: GDP, investment portfolios, even the products on store shelves. Consumer  goods companies know that customers won’t go for price increases during a downturn. Instead they often use a different tactic to offset things such as new competition or the rising cost of raw materials: cutting quantity while maintaining price. Yet it may not be obvious that your ice cream or OJ containers have shrunk. Manufacturers must note new specs on packaging, but the changes don’t have to be advertised (ever seen a now smaller! label?). Here’s a look at one of the most recent examples:

This still comes as news to some people. Apparently, there are still folks out there that don’t actually read the labels on the containers of food they purchase. I’ve been noticing this for a while now. Most notably my 1/2 gal. of Breyers has been melting faster and faster as the packaging continues to shrink and the price remains the same. Same for the spaghetti sauce I buy. The price stays the same, the quantity shrinks and the net result is you pay more for what youre buy but you don’t really notice.

This is kind of a ‘soft inflation’…it’s happening, but it’s being quietly slipped in under cover of careful labelling and packaging. One of the reasons I notice is because a) I almost always evaluate prices by comparing price/oz. and b) I have items purchased last year that I can compare against. This has been going on for a while and if more folks were aware of it more folks might realize how their purchasing power is slipping away.

This is another reason we stock up on things when we can. That can of vegetables that cost $1 per 15 oz. this year may wind up buying an identical sized can next year that only holds 13 oz. at the same price. When you see those sales, stock up.

We’re planning on hitting the local grocery stores Friday and seeing what kinda discounts we can get on turkeys. ‘Cause, let’s face it, prices ain’t going down.

Car rental, Walking Dead, economic recovery

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Originally published at Notes From The Bunker. You can comment here or there.

Buddy of mine in NY is learning a few things about post-disaster mopping-up that I never considered. For instance, think about this: the insurance guy comes to your house, takes one look at your car, and doesn’t even say anything other than “Yeah, that things toast. We’ll cut a check for you in the morning.” Now you have no car, but a nice check coming to go pick out another. What do you drive in the meantime? Well, your insurance also covers rental, right? So you call the rental agencies and thats when you discover that every car within fifty miles has been rented and the waiting list reads like a phone book.

So…next time you might want to rent a car in advance of things. If your car doesnt get washed out to sea, you can always cancel the reservation.

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Latest episode of Walking Dead: not gonna miss her at all.

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Since the nation douled-down on four more years of Carter II, I’m pessimistic about an economic recovery in the near future. (Or, an economic recovery that doesn’t require something drastic to jumpstart it.)

Really, I anticipate no major changes in anything we do around here in regards to the election results. About the only thing different will be a bit of an emphasis on securing more gun-related items and countering further economic malaise. Otherwise, business as usual.

As I expected, calling most of the major magazine and AR manufacturers and vendors was an exercise in futility. Most simply had their phones go straight to voicemail. Most of the answering messages started off with “Due to higher than normal call volume…” and ended with “..delays of six to eight weeks.”

Theres a few dissenting voices I hear from, from time to time, saying I have nothing to worry about…between the administrations lack of movement on gun control (cough*fastnfurious*cough), the Heller decision, and whatnot theres no signs that new regulation is in the works. Well, if that’s true (which I dont thin it is), then wheres the harm in putting two, three or seven more Glocks and AR’s in the safe, hmm?