I do not see SHTF scenarios as Apocalyptic, others do. This is one of those broad, nebulas terms, no unified meaning that I have seen. I would be interested in what it means to you. I do not see myself in a barb wire enclosure, armed guards at the doors, scavenging at night, bartering food for fuel, giving PM for winter coats. I can see myself behind locked doors, ammo safely secured, personal protection at the ready, all family members well trained in their use, municipal services rationed, or not available, government employees paid by barter, as they refuse to accept IOUs. That would be the extreme. not quite mob rule, but close - strong neighbor hood watch groups, etc. In the U.S. governments are all going broke. Little community governments - fire departments closing, police departments consolidating, city officials leaving office a decade early, small communities having no one run for prestigious political offices, water companies needing big money to comply with EPA, state governments the same, and the Feds bring up the rear. I am retired from state service, had over 12 years in the last state. I listed my net wages, after medical insurance, all taxes and mandatory deductions from my pay, and compared that to a 23 year old, mentally disable (so not required to work) mother of three on welfare, and her net - what the government was giving her directly, or directly paying vendors who gave her services (not things like administrative costs) - was greater than mine. In virtually all states, every welfare caseworker has families on their caseload making more than the college educated, trained and experienced worker administering their benefits. Six years with no pay increase for the ones working, eroded benefits due to increased health care costs, while benefits increase for the ones who choose to not work. Not sustainable, IMO. For damage control, ALL states are going to a new eligibility and welfare disbursement system, which has all of the signs of call centers in some developing country. The governments of this country are running out of money, and the FED can run the printing press overtime and that will not change. I suspect it is similar in other countries. The masses are clueless. I look around and see a house of card, and trees in the distance are blowing in the wind. I want to be prepared. I am one who says we will probably survive another 100 years, but maybe not. What I am guessing - speculation - is some nations will start to lose faith in their currency. Sellers will lose faith in the paper currency, and take offers of PM for purchases, at some mutually agreed rate. This could occur even with government bans on such things. Once this starts, I speculate a snowball effect. This would spread globally. Those in power would try to normalize things, and have an established exchange rate fiat>PM. There is currently a one world - faith based -fiat system. The currency changes, the system remains. Many things might cause people to lose faith, and if they do, SHTF follows. What is new this time around is social media, and how interdependent all nations are, even those who do not care for the other's political beliefs. This fiat system, with the banking system, and the international stocks, has all nations tied together. I can't say if this is a bad thing, or not, but it changes the dynamics of anything we have experienced before. One large government could do things that seem reasonable to them, but starts an avalanche that can't be stopped.
What I mean is as follows: There are people who (appear to) think the global financial system will collapse and silver will go to four million dollars an ounce the minute this happens. My problem is ... who the kcuf is going to pay me for the gnikcuf silver if they don't have fiat, for skcuf sake. And if they don't have fiat, what pray tell will they pay me with? Silver? And the other scenario ... apocalyptic war ... the "opposition" invades Australia turning us all into Swiss Cheese and / or fluorescent bowls of jelly. And out from the blood stained glowing green slime we all spring, waving our 1/10 th ounce Libertads screaming "here you bastards, you want my silver ... give me your money, your guns, your Marlboro cigarettes and your Swiss Army Knives and kcus my kcoc". Really ? That's what I'm trying to say
Four million dollar per ounce silver just means that people ceased to accept dollars as payment/money. There is really nothing more behind it!
Swapping silver to King Cash $9 is selling silver for $9. Quite simple I thought, but you talk about not buying?
If Silver ever becomes 4million bucks then in all likelyhood it's going to cost you about 4 million bucks to eat for a day. So you won't be trying to sell your silver, rather you will buy food with it.
Guys and Gals, If Stock Market collapses and SHTF (opening post)........ my opinion is to keep it simple. What do you have to offer, if such situations came to be, to stay alive? We all need to eat, drink, have clothing and protection from the environment. Precious metals may not be the total answer for people who want to trade something for food, drink or clothing. In the Great Depression and in wartime, it was the black market.....unfortunately only the fittest survived. I don't get involved in long conversations about what would I do if such and such happened. We can't predict the future, but we can try and be prepared with whatever means are available to us according to our means/ability to cope. So I invest 1/3rd in cash, 1/3rd in precious metals, 1/3rd in stock market. I lose out if the stock market crashes completely. I lose out if no-one wants to barter with precious metals. But cash may do the trick so long as the banks don't fall over! Is there an easy answer? Not really. But precious metals have stood the test of time, haven't they?
The question is why should the stock market crash..... To understand this you have to understand why it is booming when all about is chaos and uncertainty. The next step once you understand why it has boomed and where the capital came from for the boom to occur you can then ask the next part.. If it is to crash, where would the capital shift to? Of course the easy guide is risk...where is the greater risk? If you come to the conclusion that the stock market is currently one of the lowest risk investments capable of absorbing enormous amounts of capital then you will then understand that the stock market is not going to crash. Of course it will have a correction now and again...say twenty percent.... Then the ..."I told you so mob" will be washed out and off it moves upwards again defying all newspaper and television analysts that don't know shit from clay.
you say a crash, but i see it simply a plane running out of fuel needing to land. everyone thinks, omg what if we become a 3rd world country. no one i have ever encountered ever asks what it is that europeans do to make themselves worthy of first world status. secondly, there was a post about third world country call centres. what if that is fair and your just used to being over paid and underworked. the world is balancing, and the people that are used to working hard will be able to survive. the lazy self entitled will not.
I think stocks are the best place to invest but you are living a fantasy if you think the stock market cannot drop 50% or more from current valuations - especially the US markets Just think of how the world will look when interest rates have gone back up to double digits again
You need to appreciate where the capital is coming from....and more importantly the amount. It is very difficult for an average wage earner to come to grips with world capital flows and the decisions behind them. It is not the small investor driving the stock market. We are talking billions upon billions of dollars moving in and out of investments. Not your normal investments but investments capable of absorbing the capital and are most importantly.....fluid. They are easy to trade in and out of and have depth......the key word is depth. Forget about gold and silver in this...not fluid and not deep. Out of stocks and into?????? Sovereign bonds?......super risky Euro?......dead currency walking Yuan or rouble?......not today. U.S. Bonds?......only if there is a war in Europe. U.S. Dollar?........watch this baby roar soon. What's left.....stock market.....oh yeah baby.
yeah, if you're that weak minded that you panic sell at the very bottom then what are you doing investing in something? That has to be the definition of complete stupidity surely? And on that, I know a few people who seriously hurt themselves financially in 2008 (6 digit losses) and all of them, upon reflection, blame themselves. This idea that your money needs to work for you 100% of the time is ludicrous, but you'd be surprised how many investors cannot grasp the concept of going 100% in cash. It makes sense more times than any of them care to admit.
Agree. IMHO investors that can't swallow the concept of sitting on the sidelines, can't comprehend the idea because they cease to be investors, and suddenly become savers. This is often frowned upon as being embarrassingly socially unsophisticated, especially at trendy inner city lunches within a circle of metro-mates. I've often done very well by sitting in cash and waiting for the right opportunity to pounce.
There is no out of stocks and into anything. The capital just disappears - up in a puff of smoke. Then the place the capital came from asks for it's money back - oops
I haven't searched other threads, but what about the material in Michael Lewis' book: ? He contends the stock market is overly complicated, and is being gamed regularly by high speed traders. Any attempts to correct the system would probably be gamed all over again with the new rules. They are making billions a year, skimmed off the many trades, where they have millisecond advantages. Admittedly this is only a few dollars for most long term investors, but his concern is that it shows many of the weaknesses of the stock market, and if not corrected, will make for an even more unstable system. The system is broken, there are no discussions to fix it, let alone action, so the future is very uncertain. Hucksters are using technology to make billions a year, and produce nothing. The do so at the expense of smaller investors. That's what I have gotten so far, without reading the book. ~ ~ Here is a lifted quote: In his just-released book "Flash Boys: A Wall Street Revolt," Lewis claims the high-frequency trading industry within the nation's stock market is divided into two worlds of "haves and have nots" based on trading speeds they can afford. That system leads the privileged to get access to trades faster, before most others even have a chance to make a transaction. "The haves paid for nanoseconds; the have-nots had no idea that nanoseconds had value. The haves enjoyed a perfect view of the market; the have-nots never saw the market at all," he writes in the book. The system has created a "whole ecosystem on Wall Street around themselves" involving banks and exchanges that cater to people who have the inside track, Lewis said on TODAY. "It's an unfair playing field," he said. "It's crazy for investors to be trading against people who have, essentially, have knowledge of the prices before they do."
Panic sell? Heh, those 'weak minded', as you name them, sold in the idea to buy back in at $5, an idea given to them by the money for nothing club that fills its pockets with other peoples money, along fear, and greed, and as BeHereNow just said: due to lack of knowledge, data, and sufficient trading speed. Look at those black pool markets, where governments institutionals buy/sell outside the market awareness and the price mechanism scope, using privileges granted by governments. And that's just one example. The entire financial system, from central banks to privileged Joe, is based on such a frontrunning in data acquisition and trading speed, under a government force-based umbrella.
Capital never disappears. During crises / stock market crashes you often read in newspapers that X billion dollars were destroyed/vaporized on the stock market. In reality, those X billion dollars were used to buy stuff in the economy, and that 'vaporizing' is just the official erasing of the obligation to pay them back. Or in other words: the purchasing power you produced/earnt, was spent by others, for nothing in return. Of course, they don't like to describe it like it is, and thus we them using terms like destroyed / vaporized / etc.
Exactly.. Capital was not created on the rise in prices and does not vapourish on the fall. It simply changes form or is removed from one point to be placed in another........to pay a higher price on a stock you must either borrow money, use savings or sell something to obtain the capital. Either way there is a balance to the trade.
