Totally agree with this comment, its what I am aiming towards. I think if you are mostly self sufficient and can produce some excess produce with which to barter with than you will be fine in any financial crisis. Food and water after all are the most precious resources for mankind and if you have this met than you can work on the other things. Physical Security is right up there also after the first two and its something that I think can best be achieved through a stable community. If you look at all the 3rd world countries they all have physical security issues and their wealthy elite always have their own private security / militia. Australia's elite will be no different in any Global melt down they will be easily able to afford their own private security force.
It only takes a few Dollars somewhere.... The Tipping Point : Which will it be, inflation or deflation? Maybe neither, maybe a run. Fed Chief Ben Bernanke is know as 'helicopter Ben' for having observed that you can fix any deflation problem by dropping a sufficient amount of freshly printed currency from a helicopter. So clearly, those at the Fed would prefer ramping up a new inflationary bubble to having to suffer through a long, boring, deflationary bust, like Japan. If you look at bubbles popping in fiat money economies, you see very few case where the central bank didn't try to inflate a new bubble. So I'd say that inflation is more likely than deflation, but there's another possibility that could be even more likely still. The fate of the dollar could be decided by a few cabbies in Jakarta. Because currencies that aren't backed by anything solid, as the dollar once was, before the last of its traditional silver/gold backing was stripped away in 1971, are vulnerable. They are very much like deposits in a bank with no deposit insurance. Back in the days before deposit insurance, bankers had to seriously worry about depositor confidence. If it dropped too low, like in that old Jimmy Stewart movie, "It's a Wonderful Life," a ruinous run on one or more banks could result. Could falling confidence in the dollar among foreign investors trigger a run on the dollar? We'd all like to believe that's impossible, but let's think about this for a second. Never before in human history have so many businesses, so many central banks, so many ordinary banks, so many cab drivers and other hard working folks, in every other country in the world. Held a part of their wealth in a single foreign currency. Dollars are stuffed in cookie jars and mattress in every city on the planet for only one reason. Because the people holding all those trillions of dollars have confidence in the dollar's ability to protect their wealth by retaining its value. As that confidence erodes, the dollar becomes more and more vulnerable to a loss of confidence run. This is exactly what happened to banks that weren't frugal enough with people's money, back in the days before deposit insurance. Ironically, the deposit insurance the government offers on most America bank deposits, is one more enormous potential liability that serves to cause foreigners to have less confidence in the dollar itself. Runs tend to be sudden and devastating. Why did it happen that day, and not the day before or the day after or a week before. Who knows? Confidence is a very odd, easily lost, state of mind, which no one fully understands. Put just a slight little hint of a smokey smell in the air, and have a few people stand up and run for an exit in a giant sports arena. And the next thing you know you can have hundreds of people getting crushed underfoot as everyone in the arena stampedes for the exits. It doesn't take much to shake confidence. I have a habit of randomly checking a few newspaper web sites each day from a list of the world's press. And there certainly seems to be a smokey smell around the dollar lately in the foreign press. Is it enough to have primed foreign dollar holders to stampede for the exits? We can't really know, until it happens. A few too many cabbies line up one day at a currency exchange in Jakarta to dump the dollars they'd long kept stuffed in their mattresses. They get to talking, a few text messages go out to friends. And thanks to today's highly connected world, the next thing you know, the grocery store down the road from you has empty shelves. Some sort of confidence tipping point was crossed in the night, which allowed a few cabbies in Jakarta to trigger a worldwide dump the dollar run. So next time you hear someone debating if it will be inflation or deflation. You'll have a third option to put on the table. http://www.humods.com/2011/02/can-fed-inflate-new-bubble-or-will-we.html I have a single dollar in my diary - to remind me what it's all about, and every time I spend money on my credit card I have to go past that dollar to get at the card. It's a good reminder.
If that writer was smart, they'd cut up the credit card and never own one again. A debit card that only draws on their savings is all you need - full CC functionality with no debt attached. I personally have a Zimbabwe 50 million dollar note as my bookmark... a REAL reminder of the 'value' of paper fiat currency. Nothing really surprises me about TheBenBernank's decisions anymore. If you look at it from the puppet angle, it's pretty obvious what he's doing there. He's a front man and there to cop the critique for those who really run the show, nothing more. Same with the presidential chair in that case. A bunch of empty suits who smile and placate the masses and are paid off by the real owners so they can run their operations behind the scenes in relative peace.
In my wallet i have both an american 1 dollar note and a Zibabweean (is that even spelt right?) 100 trillion dolar note
I have one Mark. Will cost you a hundred trillion Zimbabwe. lol Actually most travel agents will have a US dollar to sell you.
Great tip JulieW, I assume money exchangers would also have that option? There's lots of them in Sydney...
Anyone that has a Travelex sign will help you out and most shopping centres have foreign monies as well. If you look carefully you can change AUD to USD and vice versa without paying commission too.
Auspm is quite correct; we are absolutely soon going to experience the biggest financial crash the world has ever seen - and yes gold and silver prices will be hit hard for a time. It would be unwise however, to 'wait for the crash' before purchasing, because the crash will actually proceed in three stages - and each stage will affect PM prices in different ways. The main PM sell off will be caused by investors scrambling for liquidity to cover margin calls and redeploy assets. It will not be a 'crash' for PMs. A short term equities 'rebound' will lure many (unbelievably - but watch it happen!) back into stocks at what will be perceived to be bargain basement prices. Don't be one of them - keep stacking if you can! The PM pullback will be severe, with higher Fibonacci numbers likely; stay physical unless you have VERY deep margins. Remember, between now and the crash we stand a good chance of a similar large move Upward - so the crash prices might only come back to today's prices anyway - assuming there are any ounces left. The pullback will not last a long time perhaps 3 to 6 months but metal prices will soar as investors switch from 'investing' to 'preserving' wealth. Auspm's figures are spot on - in fact hyperinflation has already begun although it's not generally labeled 'hyperinflation' until prices rise by 50% in one month. For reference, in Jan 2011 we saw the following commodity price rises: Corn 7.8%, wheat 5.6%, Rice 10.1%, Sugar 5.6%, and cotton 17%. These increases will only get faster but as you can see, the train is moving. However Auspm is slightly 'inaccurate' on one count - hyperinflation is not 'exponential' it is actually 'exponentially exponential' - something which is never seen in 'natural' systems. For the nerds out there, this means that plotting the hyper inflated prices on "LOG-linear" paper yields an exponential curve! If you understand that I'll pause while you readjust your jaw! A few more points - the coming crash will not be a 'second' crisis - the 'first' GFC was a minor planned dress rehearsal. (Those 'great minds' that are "working on the future" aren't necessarily on 'our' side) For your own sake, please understand that what is coming will change the world forever. People will never 'trust' their money again. (Germans already understand this just ask them what is in their safety deposit boxes right now!) The crash will bring unbelievable suffering (including death) to millions of people worldwide - though famine, poverty and eventually disease too. The US dollar, of course, will collapse - and pension funds will be wiped out. Property prices will plunge; there will be many sellers but few buyers. Anyone with savings in the bank or on a fixed income will suffer greatly. The crisis will eventually be 'solved' when a unified global currency is introduced and people are desperate enough to accept it. The currency will NOT be based on any sort of gold standard however, so make sure you are RIGHT OUT of gold when you see this appear - because gold will (naturally) still be a competitor to the new system but the new system (being fiat but global) will 'win' as it will have the power to assign any price to any commodity. You have been warned! Before this happens though, the price of gold will rise astronomically and the silver price will go absolutely wild. Those of you patiently waiting for the 'big move up' will have your patience rewarded! Silver WILL break out of it's cage - literally overnight! Don't spill your cornflakes when you see the chart on that day! You will NOT believe your eyes! In summary, yes silver and gold will certainly help preserve your buying power, but they will not be enough! A global famine is underway right now, and food prices will be going up steadily from now on. This famine will strike Australia, but India and Pakistan and the poorer countries will suffer greatly. Some of you will be selling your silver early to buy food for your families. Be thankful for your stack! When it arrives, the crash make the famine worse because the financial confusion will affect all the inputs to agriculture (fuel, fertilizer, transport, labor etc.) The only real remedy to the famine will be to purchase arable land with a good water supply and start to learn about self-sufficient farming as JulieW very correctly points out above. THIS will be the best use of your silver profits - apart from food. Wheat prices will eventually beat silver - just as cotton did last year.
Quality reply mate. Ive been looking at property out west of Brisbane for sometime now. I once saw some youtube clip about all of this and they said head for the hills and become as self sufficient as possible. My plan is to sell PM at the peak and by a few nice big blocks of land somewhere west and try and build a sustainable house off the main grid. I'm not to sure are locations or lot sizes, but i'm sure i will have a better idea as the years go by. Bellinvest
Turk very interesting stuff and good to read alternative opinions on stackers. What kind time frame do you put all of this happening? I disagree that we will see "famine" here in Australia, even during the depression of the 30s and both great wars we had food rationing in Australia. We produce a lot of commodities for export markets, in the event of any kind of worldwide depression you would think the powers that be would look after the people? I do think that Australia will be isolated from any major SHTF scenario unless we have major natural disasters happening simultaneously across the nation.
Silverfunk. Yes you are right about the food rationing of the 1930 but what was required was it wasn't like the dole today. You reported to the police station and received a voucher which enabled you to buy certain supplies from the local store. Eg Your voucher would entitle you to say Half pound of tea, 2lbs of flour, 2lbs of sugar,1 small tin jam or treagle and some salt. However you couldn't stay in the same place and wait for next fortnights allowance, you would have to hit the road jack and be at least 30miles away to get your next supplies. The guberment of the day didn't want large groups of young fit men congregating in major cities causing trouble and unrest. Thats why there was so many swagmen on the move. Country folk were kind to them in many cases and they often did a few hours work on the farm in return for a meal. People of all professions were on the road including doctors and lawyers as well as so many working class people. I hope I'm wrong but I don't think that todays generation would put up with such terrible conditions while the rich live like kings. I can only see big trouble ahead unless there is a different distribution of the financial pie. Regards Errol43 My mum and Dad told me this story many times and that is why I always save silver for a rainy day.
I've been thinking about food shortages a lot lately, and I feel like it won't take much for the average person to tear up the back yard and turn it in to productive land should things truly head south. I'm not sure, a friend of mine who is quite smart yet not all tuned in to what is going on said something interesting to me recently when he remarked that he sees a future when the family unit consists of one person working and one staying home to farm the available land. If seeds are available, I don't see it as much of a stretch to see droves of people take to urban farming. Provided we don't see serious currency collapse, we'll still have division of labour. Thoughts? I should say though, I'm in Hobart so the average rental may have more of a backyard than most..
Nice insight Turk. I have started to stack rice, well bought 50kg earlier in the week because it was cheap. Next day, each kg has gone up 50 cents in spot. Thinking about hoarding more, somehow I think its going to get progressively more expensive, we won't be immune completely even if we produce the food here. Slam
Right, NOW I'm scared. WTF is going on? Is it all going to end up in an apocalyptic scenario? Should I convert my semi-bush 1.5 acres into a self-sufficient farm now? What should I do with my 3000oz Ag? Where should i hold it? For how long? Should I train my kids in how to slaughter a cow or use a gun instead of soccer practice? Have my last 17 years of uni/specialty training/work been for nothing other than a few nice certificates on the wall as I traipse door-to-door offering my labour for a meal? Help.
Silverfunk "We produce a lot of commodities for export markets, in the event of any kind of worldwide depression you would think the powers that be would look after the people?" In a world wide Economic depression why import billions of tons of Iron ore,or any commodity.Even meat would be too expensive. Villagegate Takes lots of land to feed a family.
There are alot of survivalist forums that can either help or increase your paranoia further. If you watch videos of societies in chaos, or places of disorder, you'll see one thing carried by men that helps to keep things orderly. This is a universal truth. A bald fact. Humans are flawed. We dont live in utopias. Whatever your world view is, the truth that peace comes at the threat of violence is inviolable in human societies.
