Are we heading towards an Economic Collapse? Preparing for Financial Armageddon
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Lead Story, Preparedness, Threats Posted by:
Rob Richardson
Our county sits at over 16 trillion dollars in debt, with unfunded obligations that make the actual debt number about $120 trillion. The reality of the situation is there’s really no way out of the situation. Our government, thanks to both political parties, has spent us into a hole that we cannot dig ourselves out of. The facts, that nobody seems to want to talk about, indicate our country is still heading towards a complete meltdown of the financial system.
You can choose to believe the lies that are being spoon feed to you by the mainstream media, or you can look at the reality of the situation; our Economy is still facing some enormous challenges, and the prospects for a full economic recovery don’t look very good. The financial problems that lead to the housing / financial market crash of 2008 have not been fixed; in fact, many of these problems are even worse today than they were in 2008.
Preparing for an economic collapse
Twenty years ago, most people would have said you were crazy for thinking our system could collapse. Even today, most of our country is either unaware, or has forgotten how closely we came to a complete collapse of the financial system during the banking crisis of 2008.
Here we sit five years after our government spent $700+ billion to bailout a system they told us would never fail, and our system is still in just as much danger of collapse as it was in 2008, maybe more. If you’re not prepared, you need to start taking steps to protect yourself and your family from future troubles.
Keep an eye on the markets, and keep an eye on the banks.
Before depositing any kind of money in the bank, you need to research the financial soundness of that bank. Since the so called end of the financial crisis, when the government spent over $700 billion dollars to “fix the system”, over 440 banks have failed.
That means almost every week since 2008, the FDIC has had to shut down at least one troubled bank. It’s estimated that they have already had to pay out over $65 billion to cover these FDIC insured deposits.
With so many banks still going under, you really have to wonder how long the FDIC can continue to pay out on these insured deposits. With banking industry assets sitting at somewhere around $13.6 trillion, there is little reason to believe the FDIC can actually cover these insured deposits during a full scale collapse.
While many people believe they’re money is protected by the FDIC, the simple truth is, there’s not enough money to protect everyone. If the system collapses, your FDIC insured account is anything but certain.
Realize your dollars may become worthless.
You must seriously look at the possibility of an all-out collapse of the system. If this were to happen, your dollars would quickly become worthless.
You must start to take a balanced approach to being financially prepared for the future. While investing in your financial future is important, the same can most definitely be said for investing in your ability to survive future disasters. If you haven’t started preparing for the possibility of economic troubles, now is the time to seriously consider stocking up to survive future problems, financial or otherwise.
To do this I recommend investing in long-term consumable goods.
This means stocking up on items that you will need and use in the future, or stocking items that you can barter with in case the system fails. By stocking up on food, water, survival gear & supplies, and bartering goods; you will have a nice stockpile of supplies that will help see you through almost any disaster situation.
Another upside to investing in consumable goods is these goods are completely secure from financial market volatility, and will continue to hold their value after the collapse. In fact, most consumables will probably skyrocket in value in a post collapse world.
Always have cash on hand.
If you’re wondering why I recommend keeping cash, especially after telling you your dollars may become worthless, you need to realize that during the initial stages of a collapse, most people are going to be doing anything they can to get their hands on money.
People do what they know; during an economic collapse, 99% of the population will still perceive paper currency as something that has value. Most will be in denial, making your paper money useful for buying goods for at least a couple weeks after the collapse, maybe months. If you’re 100% certain the system has collapsed, you should immediately use this money to stock up on any last minute supplies or bartering items.
Remember, you can’t count on any of the money you have in the bank; most banks simply don’t have enough cash to deal with a run on the bank. During a collapse situation, your money is probably as good as gone. To prepare for the possibility of collapse, you need to have some cash on hand at all times.
It’s time to take action.
While I would never advise anyone to completely give up on our financial system, I do advise preparing for a worst case scenario.
There are some very real problems that have yet to be addressed by our politicians in Washington. When it comes to protecting your wealth, and ensuring you will be able to live a comfortable life in the future, you are the only person that can guarantee your long term financial security. You must decide what that means for yourself and your family, and then take the necessary steps to ensure your future security.
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I have recently been becoming acclimated to the ideas that our government provided systems are not forever. My simple question is How much should a person like myself; A young adult with a GF and no kids keep around in my safe?
you’ll have to do the mathe on that question. do you hunt,fish,garden? do you live in a area that has food available. so how much do you and the gf need to eat each day to stay healthy x your stock x your ability to gather.everything has a shelf life as well and the other concern is water supply and purification
wise food has a decent shelf life and can be portable/easy to store
Do you have any special skills? are you a college student. I’d recommend getting some type of First responder training (Firefighter, MFR, EMT)there usually offered through Community colleges with assistance of Fin Aid. Even if thats not what you want to do with your life its ok (Many dept.s are Volunteer anyway and they just respond from home whenever they can). I went through the Fire academy and thats what they told us. But since I passed everything the training and skills we acquired just made us more valuable in severe incidents like a collapse. Just something to think about (cant save all of your money so why not spend it on something that makes you more valuable)
Agreed… As a scout leader of over 12 years I took it upon myself to take the two week Wilderness First Responder course put on by Outward Bound… one of the best classes / courses I have ever participated in.
anyone one who is stockpiling food should buy with CASH ONLY and at nonmembership stores when we have a food shortage the gov is going to rol in and take peoples food stocks to hand out in their bread lines and they wont take all of it but they will only leave you with 3 days worth dont belaeve me look it up for your self are wonderful president fairly recentally passed it in to law stay off the grid buy in cash
I completely agree with Dave! Buy everything in cash. The more you are off the grid, the better. Then again, are we staying off the grid by being on the internet? Probably not…
We could theoretically get out of this, but it isn’t probable at all. The federal government would have to basically slash its own wrists and bleed itself to a fraction of its current size, cut benefits, cut spending, cut taxes (enough to encourage economic growth, but not so much as to prevent it from getting enough revenue to pay its debts), cut regulations, give up power to states, cut everything (even the good things) and perhaps our grandchildren would live to see the day when we are out of debt and prosperous again.
“We could theoretically get out of this”
No not really. The point of no return is long past. Austerity policies don’t work. Cutting back, scrimping & paying more can’t even make a dent.
Reset is the only choice now. It is as if you & your family, normally budget conscious, by accident found yourselves in debt millions for medical bills. You had no choice, and you pulled through but you now find that simply paying the interest on your debt monthly leaves you with nothing to cover the basic necessities.
At some point you would need to finally admit that the only way out for your family to survive/thrive is to declare bankrupsy.
THAT is where we are…and the sooner our government takes action to repudiate the debt (Sovern Governments don’t declare bankrupsy because they can’t give up sovernity/peoples rights to a third party), then the sooner the reset can take place, and life can begin again.
The longer they wait, the worse it will be…
Reset is the ONLY solution.
Is financial ruin going to occur this decade? Maybe… maybe not.
Sure our elected officials could pass new laws and repeal ‘their’ entire outrageous and exorbitant private retirement plans, but then that would be a conflict of ‘their’ interests. I further believe that even if people get elected under the proposed agenda of eliminating such outlandish ‘plans’ will just drown in the sea of politics and essentially be laughed out of any credible positioning; the only way to turn it around would need a huge infusion of like minded candidates to assume a position simultaneously, which would require a mass agreement of no incumbents to be re-elected.
For your own finances, getting out of debt should be paramount on your ‘to-do’ lists, at lest all but your residence. If you have money in the bank gaining a pittance of interest compared to the interest placed on the debt, it would be worth contemplating to use that money to pay down/off that debt while still retaining a cushion in reserve.
Once you get to a debt free condition, then you need to ensure you do not regress into the old pattern of credit and start living within your means. My parents lived through the great depression of the 20th Century, and lived by the method and thought ‘if we do not have the money to pay cash for [item] then we do not need it’ and “everything” was paid for in cash except our home. If only I had taken heed to that lesson earlier in life… hindsight is 20/20.
While you are working to eliminate debt, you still need to acquire supplies and other necessities to help sustain you and yours for extended periods, even if that is only adding a few cans of soup, beans, bag of rice… whatever ‘your’ needs are that you normally use each time you go shopping. Those few additional items will likely grow faster than the earned interest from any bank savings account.
If the collapse does occur, bartering will probably be the primary exchange rate so increased knowledge and skills along with physical items of trade will become a commodity for survival and commerce… hone your skills, learn more about food preservation, agriculture, woodworking, structural engineering, and medical procedures/preparedness to name a few.
Get to know your neighbors, associate yourself with like-minded people and share ideas… that level of collaboration helps to create a tighter bond, and may ultimately become a situation where ‘safety in numbers’ becomes a reality when faced against the hordes of sheep.
“Getting out of debt should be paramount on your ‘to-do’ lists” & ” it would be worth contemplating to use that money to pay down/off that debt while still retaining a cushion in reserve”
Sorry, that won’t work. This is a collapse, not a depression. We have paper for money, not silver/gold. When people realize the Nation is bankrupt, they will soon realize that ALL money denominated assets (pensions, savings, checking, insurance, and eventually bills of all types…including dollar bills) are worthless.
At that point, the ONLY thing left valuable, is things people need to survive.
Maybe we agree to disagree.
I agree, paper money, aka Fiat Currency is becoming more worthless daily, but it is still the primary exchange for services and goods for now.
If you have debt now, in a collapse you will still have debt and the creditors will make every effort to collect on that debt. If you currently have money in savings collecting 15% interest, in essence giving you a better rate of return on your worthless money.
For some reason the less than symbol and great than symbol posted incorrectly…
If you have debt now, in a collapse you will still have debt and the creditors will make every effort to collect on that debt. If you currently have money in savings collecting less than 2% interest, it would be better to pay off a debt accumulating greater than 15% interest, in essence giving you a better rate of return on your worthless money.
If there’s evidence of a breakdown I intend to max out the cash advances in my lines of credit but continue to pay any secured debt to avoid foreclosure/repossession. Lenders have virtually no recourse on unsecured loans and I want to get my hands on cash ASAP if the SHTF!
Great post and comments. Thanks for the info and perspectives!
Remember it take about 1,000 pounds of food a year to keep a person alive . Some more some less . Gold and silver markets are manipulated by Uncle Ben . If rice and beans store 10 to 30 years and are super cheap why not stock up.
The Zeitgeist Movement; The Venus Project
agenda 21 plans dumm dummm
@Aaron says:
March 4, 2013 at 4:55 pm
The Zeitgeist Movement; The Venus Project
?????
Some further elaboration on your comment would be nice, Aaron? I am aware of the Zeitgeist series and movement, just not sure why you you blurted it out here, seemingly at random.
In the words of a famous Australian Politician;
“Please Explain”
Just in case the world doesn’t go berserk anytime soon, it could be a “possible” long-term solution to world peace. It’s just a suggestion.
On second thought, what I should have said was that if the world does go berserk and the economy collapses, this might be the best way to start a new system.
Good article, Rob. There is really only one way out that is legitimate and that is declaring bankruptcy since there is no way enough taxing of the people can pay the $16 trillion bill.
Currency rises and falls, but food will always be a useful commodity … I agree with the person who commented (a few up from this one), if certain foods can store for long periods of time, why not stock up?
Also learn how to grow your own food and preserve what you do grow. It takes less space then you think.
I PERSONALLY THINK KEEPING ANY CASH IS A WASTE OF RESOURCES. I SPEND ALL MY EXTRA ON GOODS I CAN TRADE OF THINGS I WILL NEED. THE ONLY THING CASH WILL BE GOOD FOR IS TO START A FIRE OR WIPE YOU BUTT. REMEMBER OUR DOLLAR IS BACKED BY NOTHING. TOP ITEMS FOR TRADE WILL BE FOOD, WATER, MEDICAL SUPPLIES, AMMO, ALCOHOL, AND FUELS OF ALL TYPES. NEVER STOP PREPPING FOR WHAT WILL HAPPEN. FIND LIKE MINDED PEOPLE AND FORM A GROUP. IT WILL GREATLY INCREASE YOUR CHANCE TO SURVIVE. TRY TO GET PEOPLE WITH A VARIETY OF SKILLS.
I believe that cash will only be good for a short period of time after the start of a collapse, as the sheep will continue to believe it has value, and may be reluctant to exchange for goods versus the toilet paper. So I still hold about $1,000 in cash in denominations no larger than $20.
Thanks for all the great info. Moved off grid 6 years ago and finally just got solar station up and functional 1 year ago. Looking for food sources now as well as survival preparations. We’ll be back often.