collapse could go for years- /my 2 cents

[Penn]

I know for about 5 years us stackers have been- oh any day now- 6 mos from now- the whole thing collapses.


Our idea while correct is flawed.

Nixon closed the gold window 8-15-1971. In 1973 oil embargo. Kissinger or whoever negotiated with OPEC- that for 30 years- oil would be traded in dollars and held in banks in New York. In 2003- this agreement expired- Iraq plotted to sell oil in Euros. So for 30 years- the dollar was backed by oil- the petro dollar if you will. Figure a few years to unravel- the petro tie- as China-Russia and maybe India will trade in their own currencies- not the dollar- so lets pick TARP as the day the dollar became fiat. TARP was the 850 bail out- and seg way to QE QE2, and the fed buying its own debt- so for our purposes the dollar has been fiat since 2008. The average life span of a fiat currency is 27 years. We are 5 years in- and thus have as an average 22 more years.

http://georgewashington2.blogspot.com/2011/08/average-life-expectancy-for-fiat.html

HOWEVER- as a measure of inflation- we will use federal spending. 2008 to now this debt has more then doubled to 17 tril. This means inflation for the 5 years is over 100%, or over 20% a year.
Since 1979 inflation formula has been changed 21 times. Lets use shadow stats-type of rate- and call inflation 8%.

Lets now take average SS COLA- call it 2%. This means those on SS lose 6% purchase power each year. Since TARP- that is 30%. Candle sticks and figurines are fine and dandy- but when I pull bills I pay to run a house- my costs have gone up- substantially higher then 2% a year.

One day- I scratched my head- Im like- why the heck am I so broke? Utilities are all paid. I fought and reduced property taxes, I reduced house and car insurance to the bone. I got rid of TV, and got rid of my cell phone. I do NOT want a room mate or to rent a room out.

In preparation- I bought a modest stack- one bit at a time. Now tho- due to manipulation- that price is low. So much for trading coins for gas and food.

People in my circle have cut back- but I noticed business does not get the message. People I know do not have cash for a $5 magazine- and endless "services" "service contracts".

This is death by a thousand cuts.

Why isnt business tuned in to this new reality?

Specifically tech- they want to sell everything. All I wanted was cheap DSL. Finally I told the gal this is exactly why I dont have a cell phone, tv, or mobile- I can not afford all the ways yous come up with for me to "save money", and I am too stupid to figure it out.

You thoughts?

 

[ancona]

Penn,
It is all by design man, all by design. As for the stack, don't sweat it too much, because like all things ponzi, the paper silver and silver derivatives scam is a time bomb, and like all time bombs it must eventually explode. It is but a matter of time until someone with deep enough pockets decides to break the backs of the LBMA and Comex with a stand and deliver demand. When that happens, and when they tell that deep pocket they don't have enough metal to settle the contract, all paper promises cease to exist. It will be force majeure on a biblical scale. Imagine if you will an entire market complex simply ceasing to exist overnight. The ramifications are huge. Silver and gold will be unleashed, since to suppress metals you need paper to sell it short. When no one has faith inn the market, no one will be willing to "lend" gold or silver to the speculators and the price will be discovered through a panic mechanism rather than a paper speculator market.

Just be patient brother, just be patient. when this thing unfolds, and it most certainly will, you will be glad you had a stack, no matter how large or small, because you will have provided yourself with insulation against fiat.

 

[Jay]

don't agree with the 22 years part. Keep stacking!

 

[Aubuy]

Don't just stack metals. You mentioned oil. Maybe try to own a piece of something in energy.

 

[dontdeBasemebro]

I think the slow-roll collapse is already going and our only options are a fast crash or continue on this path.

Convert resources from paper to things that are real and will be needed even when an economy tanks (food/water, energy, medice, shelter etc).

 

[tomswifty]

I hear that while certain current trends have happened in the past, as far as the whole picture is concerned, we're in uncharted territory. I'd be wary of judging today's situation too much from past data. I think 22 years is pretty optimistic judging by how quickly the bankers got to operating criminally out in the open, and how quickly the U.S. government is setting up martial law apparatuses.

TS

 

[ancona]

I am in the slow, deliberate collapse group. I think there will be some event that happens which causes a global sort of explosion in the financial world, and then over a period of a few years, it all unwinds. As leveraged and paper covered as the whole system is, when it starts to bleed there will be no stopping it. Chaos will rein, and as the others in this thread have elucidated, it will unwind rather quickly. The 22 years thing is prefaced upon .Gov having some way to control the collapse and stem the flow once it begins. I believe it will be impossible for the financial institutions to regain our faith because as of today, there has been no serious expiation among them and I think there will be none in the future.

We all need the system on some level because electronic banking has so completely taken over hard cash. Governments around the world dream of a cashless society, since total electronic transaction scenarios give them complete control over money, and the ability to simply seize assets they feel like taking. in addition, the power to tax that money becomes absolute. The system will collapse before that point, and we'll all experience something akin to what our grandparents experienced through the thirties. It will be Grapes of Wrath on a global scale, only this time the people will be heavily armed and extremely angry.

 

[DCFusor]

Paypal managed to create an electronic funds transfer bank without having to be regulated as a bank. As long as the electronics work, we'll probably have something - I could write that code from scratch in not very long if I had to.

The JIT system for almost everything is more worrisome. A couple days of no trucks to the major stores and it's over...or even a major hack on their scanner to warehouse JIT systems that sends all the TP to one store and all the meat to another far away one. In most stores right now, you can't even buy food if it doesn't have a bar code on it, no one knows what to charge for it. Had it happen.
Lowes - same deal. No one knows how to keep paper records and orders to the mother ship anymore, they can't just go back to manual overnight.

No one at the stores knows how to do it by hand anymore. If it took them a couple days to discover the foulup, the truck/road/warehouse capacity will take *months* to catch back up - even in the absence of panic buying and hoarding, which we know from the '73 oil crisis, creates problems worse than existed without it.

So there could be a "short" (months?) time of extreme badness. But a lot of what's wrong is structural, and until that changes in a major way - as if we could count on world governments to even see the problem, much less do something unpopular to the very wealthy to fix it - that's going on for a loooooonnnnng time. It's already been going on for at least 500 or so years. It's just gotten to a point now where it can't keep going...something's gotta bust, we just don't know the order in which it happens, or the exact results. So it's just plain smart to be ready for almost anything you can manage to be ready for.

 

[Penn]

DC- none of the stores here can do anything if the power goes out- say it goes down for 20 mins and you have less then 8 items in groceries. They are not capable of running a cash register. So even if you have cash- no deal.

 

[DCFusor]

Here, the little, low-volume stores will be fine till they need to restock, then they'll find out about "no trucks available, prioritized to the big boys". Since the power goes out all the time around here (except for my place) - they're all ready for that, with generators they test frequently and keep gassed up. Can't sell gas without the pump, which is the draw for a country store to get you to stop in and pay 10% more for everything else you forgot to buy in the "city" when you were there. They all figured this out a couple years ago - some almost went out of business and lost customers permanently because they couldn't operate during an extended outage - when people are freaked out the most.

 

[ancona]

Down here in Florida, store and gas station owners figured out the generator thing right after the triple whammy a few years back. That and legislation requiring stations along major roadways to have a back-up source that could be powered by whatever type of fuel they were selling means people can evacuate if needed. Regular stores however, are a different story. WalMart, Target, Publix, etc. don't necessarily have them, which seems a bit idiotic to me, since the loss of power there means the loss of hundreds of thousands of dollars of meat and frozen stuff.

 

[DCFusor]

And those are the only stores most people shop at or even know exist. About 6 mo's ago, we had a power loss in town, and the grocery store I go to most often gave away a ton of molten ice cream, rather than re-freeze it and sell defective product. Nice of them.

But that logistics thing - this is not a guess, it's standard teaching at West Point among other places.
There isn't overcapacity in transport to "make up" for a loss of a few days in less than a month or more - not enough trucks OR roads in the current system, even if the stuff is available, but merely in the wrong place. To coin a phrase "It's jus that simple".

This whole model of making stuff where it is cheapest, then shipping it to the demand, because shipping is (currently) cheaper than the other differentials, is going to come to an end. It's just a matter of the EROI of energy at some point if nothing else.

Some of the electronics parts I fool with have been partially made in 5 different countries before they finally get to me. That's nuts.

 

[Penn]

I am on a tight budget- despite that- I avoid stores that are too big. I dont want to spend all day at a store.

 

[dontdeBasemebro]

The system will collapse before that point, and we'll all experience something akin to what our grandparents experienced through the thirties. It will be Grapes of Wrath on a global scale, only this time the people will be heavily armed and extremely angry.

My great grand parents were lucky, even while suffering in Europe they could at least dream of coming to the US. Where are we to go?

And those are the only stores most people shop at or even know exist. About 6 mo's ago, we had a power loss in town, and the grocery store I go to most often gave away a ton of molten ice cream, rather than re-freeze it and sell defective product. Nice of them.

But that logistics thing - this is not a guess, it's standard teaching at West Point among other places.
There isn't overcapacity in transport to "make up" for a loss of a few days in less than a month or more - not enough trucks OR roads in the current system, even if the stuff is available, but merely in the wrong place. To coin a phrase "It's jus that simple".

This whole model of making stuff where it is cheapest, then shipping it to the demand, because shipping is (currently) cheaper than the other differentials, is going to come to an end. It's just a matter of the EROI of energy at some point if nothing else.

Some of the electronics parts I fool with have been partially made in 5 different countries before they finally get to me. That's nuts.

That is one of the downsides I see in moving to the small towns/country. Most people aren't self sufficient the way you are, and when infrastructure goes out the cities are going to get services back first (assuming a situation where things are coming back, like a natural disaster or fuel shortage).

I remember a few years back reading somewhere that due to the high fuel costs, slumping economy, and rising wages/living standards in Asia that the pace of shipping jobs overseas had slowed and even reversed in some cases (companies moving their stuff back here). Can't say what the situation is right now, but it makes sense that as the economy stutters and the Asia/South America rise (and who doesn't expect fuel costs to continute to rise) making things in other hemispheres and shipping them to the US becomes a loser.

 

[mike]

That is one of the downsides I see in moving to the small towns/country. Most people aren't self sufficient the way you are, and when infrastructure goes out the cities are going to get services back first (assuming a situation where things are coming back, like a natural disaster or fuel shortage).

In the cities, nobody is self-sufficient and everyone will be killing each other for a slice of bread.

 

[Aubuy]

In the cities, nobody is self-sufficient and everyone will be killing each other for a slice of bread.

Relax. People in North Korea don't kill each other over a slice of bread. The government doesn't allow it. If you complain about a lack of food you are sent to "camp" and taught new skills like crocheting with rags and rat catching. I think any economic collapse here will be far better managed than in North Korea and our "camps" would be built using union labor, solar panels, and recycled materials (Leed Certified for sure!) so they would be much more environmentally friendly. There is not a chance people are going to be allowed to shoot each other over a piece of bread, however if you are caught using carbon during an economic collapse it's probably off to the solar powered electric chair.

 

[DCFusor]

But the first part of what mike said is certainly true. No one is even close to self sufficient in cities. We ship them food, energy, and tax dollars created here, and take their garbage in return.

The assumption that service will return to cities first is flawed. It assumes the only way that happens is gov intervention. Here, when stuff breaks, the citizens themselves fix it.