What keeps me awake at night is the prospect of a financial collapse. Unless something dramatically changes in the world economies, I believe the next great economic depression is coming soon. If you life in Argentina, Greece or Spain, the depression has already arrived and millions are suffering from it. With 50% youth unemployment in Spain, cancer patients in Greece with no access to chemo drugs, or the malnutrition of Argentina’s underclass children, economic depression is real, painful, and reduces life expectancy.
Portugal and Italy, these beautiful countries, are on the edge of entering their next economic depression. How far behind is Great Britain and the USA from their great depression? Give the creativity of their leaders to delay, but not solve, their debt problems, my sense is we are 3 to 5 years away from our great depression. And when Great Britain and USA enters their next great depressions, the entire world, including China, will be dragged down. Some believe the China will ride out and become strong in the next great depression, but I do not hold that opinion. The capacity of China’s manufacturing sector is provisioned as an export economy. When Europe and North America enters their great depression, trade with China will fall off a cliff to minimal levels. Will China be able to make the difference with internal demand? I’m doubtful.
The political and economic leaders in USA and Euro feel that the solution to a debt problem is more debt. A some point in time, the national credit cards bills come due, no new credit cards can be opened, and sources for funding for new national debt will dry up. To delay the inevitability, USA and Euro zone are expanding the supply of money, through indirect mechanisms. The reason inflation is not readily recognized is that we are in a current period of deflation, where the value of real estate, businesses, and national assets are decreasing in value. Inflating and expanding the supply of currency hides the real deflation of many assets. But what is not deflating is the cost of day-to-day living expenses. My family’s groceries bills are going up, up, up every month. I’ve been closely monitoring the cost of long-term storable food, where the costs have dramatically increased the past two years. Clothing, automobiles, electricity and medical costs going up, up, up.
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Inflation is a major contributor to the lessening of the quality of life and increase in the rate of poverty.
Since likely our deflationary period will evolve to an inflationary period as money is expanded to service the growing and unsustainable national debts, the preceptor towards the next great depression will be a hyperinflation. Thus, the key economic indicator for families to monitor is the rate of inflation.
My concern with the US Consumer Price index is its heavy weight upon real estate (housing) costs. With real estate deflating and food/energy inflating, looks like we are not in a true period of inflation. But for my family, which has a fixed housing costs, inflation is only going up for our family. (Recommendation: if you have the opportunity to refinance your mortgage at historic low-interest rates, do so now!!!)
If you asked the people of Argentina and Greece what they would have done, and they knew ahead of time of the forthcoming collapse? I suspect if they had discretionary funds, they would have bought gold and silver. And if they had opportunities to do so, they might have moved out of the country, but that’s not a viable solution when the entire world’s economy has crashed.
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If you reside in Canada, I believe you’ll be in the best country to ride out the future economic collapse. First, Canada is a beneficiary of global warming. Previous inaccessible land is accessible for mining and farming. The longer growing period and having its own sources of oil will result in Canada continuing to be a net exporter of food. And Canadians are generally nice, law-abiding, and civil people. Rather in USA, when the welfare checks, social security checks, and food stamps stop arriving, there will be blood in the streets of most major USA cities.
So perhaps seeing that an economic collapse is ahead for Great Britain and USA, what should you do? Here are my recommendations:
1# Get out of debt and stay out of debt — In the early stages of economic collapse, your car and home can be repossessed. During the great depression of the 1930′s many people, especially farmers, were kick out of their homes and made homeless for inability to service their debts.
2# Relocate to a small town with abundant sources of water and produce agriculture — Civil unrest and crime will dominate the cities, making normal commerce an impossibility.
3# Start your own garden — Food will be the key indicator of wealth in the future. Having a full belly of food will be considered the new wealthy class. I highly recommend, if you are able, to have a greenhouse attached to your home or on your property. A greenhouse will give you a longer growing period, perhaps providing year round sources of fresh food. A greenhouse is more easily hideable and defendable from poachers and thieves.
4# Build up a long-term food storage plan — When the economic collapse arrives, you will want to stay close to your home and family. The ability to conduct business will be interrupted by crime, looting, riots, and martial law. Spending hours in your garden or hunting for game will make you a likely and easy target for bad people. You will need to act like a castle about to be sieged. You will need to be self-sufficient to provide your own food for at least 6 months. I recommend that your food storage plan be provision for an entire 12 months for your entire family. If you can afford 2 years, that will give you the ability to absorb additional family members into your homestead and provide to charity. The ultimate barter item during the economic collapse will be excess food. While the world is burning, no one will sell you food in exchange for gold or silver.
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5# You must have the ability to defend your family and homestead. If you do not like guns, get over it. Each family member from age 13 and up should have their own rifle. Each home should have at least one shotgun. Each person from age 16 and above should have their own handgun. You will need plenty of ammo. You will need plenty of practice and training. You will need spare parts, cleaning materials and lubrication for your weapons. And most importantly, you will need to partner with your extended family, neighbors, and local law enforcement. Whatever your financial situation, whatever your local gun laws, and whatever your feelings about guns and violence, you can not escape the need for defensive weapons. If you have enough food, medicines, gold and silver coins, bad people will eventually try to take it away from you. After the economic collapse in Argentina, nearly every family in Argentina can claim to have been a victim of crime. Starving, desperate people lose their morals. People will seek to avoid reality and bad emotions by taking drugs and alcohol. Looking healthy and feed will immediately identify you as a source of food. And bad people will having nothing better to do with their time, than to come looking for you. You MUST ally yourself with your neighbors and form a local security arrangement. Bad people will eventually form bigger groups of bad people. Existing gangs and drug organizations will become more violent and more organized, as civil order breaks down. We will go back to the days in the 1700′s and 1800′s where every good citizen carried his rifle throughout their daily activities.
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6# Gold and silver — Only after you have your long-term food storage plan in place and you are properly provision with defensive weapons and ammo, your discretionary assets will be best served in gold and silver coins. An important concept with gold and silver, gold and silver do not increase in value. Rather the value of currency decreases. Gold and silver preserves your purchasing power. As inflation evolves into hyperinflation, the value of currency will go down rapidly and painfully. At the start of the great depression, equity securities and bonds will lose their value painfully. Currency will buy less and less food. But gold and silver will continue to allow you to buy the same amount of good and services as before the currency collapse. You will not be rich in the traditional sense, if you are holding gold and silver after the economic collapse. But if as the status of being wealthy will be redefined as being able to feed your family, having gold and silver will allow you become part of the new class of wealthy. But recognize, that you’ll likely not be able to use your gold and silver until 6 months to a year after the economic collapse occurs. Because during the confusion and uncertainty in the early period of the economic collapse, no one will want to exchange food for your silver and gold. You must have your food storage plan in place first.
7# Consider learning new skills that will help you survive the economic collapse. Office jobs will be rare and difficult to obtain during an economic collapse. There will be a resurgence of physical trades, such as farming, plumbing, carpentry, animal husbandry, lumberjack, security, food preservation, knitting and sewing, medical services, repairs, electrician, well drilling, automotive and engine repair, gunsmith, ammo reloading, and such. Being able to teach any of these skills will be a new career option. Being able to work from your home now and in the future will give your family a distinct advantage. And if your family can contribute to the home business, then you will have more products and services to sell. But you need to gain those skills now. And you will need to gain the tools, manuals, and reference materials now.
8# Mentally prepare your family and yourself — Many people will not be able to adjust to the new normal. Teenagers will lose the ability to do text messages and play video games. Family vacations will be rare. Entertainment will regress 50 years. The work day will start at dawn and continue to dusk. Discretionary leisure time will become rare. Many people will enter mental depressions and level of suicides will dramatically increase. Families will break up. Marriages will fail. Children will join criminal gangs. Ahead of all this unpleasantness, now is the time to strengthen your family, your faith, and your community. And relearn the value and integrity of hard physical labor. Teach your children to have the skills and mental strength to confront the new normal. Gather your family closer to you. Grandma and grandpa are unlikely to be live separately from you. Your adult children might come back to live with you. Siblings will want to double up their families with you. All these activities require you to gain mental and emotional strength. You will need to be strong for your family. If you are not strong, who will be? The key indicator of who will survive the economic collapse are skills and mental attitude.
You have 1, 2, perhaps 3 years to get ready. Whether you and your family has enough to eat will be dependent on what actions you take in 2015.
I hope and pray our economies start to grow and our national debts start to decrease. I hope your family enjoys prosperity now and long into the future.(source)
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