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Economics & Investing For Preppers

Here are the latest news items and commentary on current economics news, market trends, stocks, investing opportunities, and the precious metals markets. We also cover hedges, derivatives, and obscura. Most of these items are from the “tangibles heavy” contrarian perspective of SurvivalBlog’s Founder and Senior Editor, JWR [1]. Today, we look at high lumber prices. (See the Commodities section.)

Precious Metals:

Brett Owens, at Forbes: Inflation Is Coming. Here’s How I’m Getting Ready [2]

o  o  o

The Reddit Revolution” – Key Battle Tactics [3]

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Goldman Sachs sees silver price rising to $33 an ounce, Reddit squeeze was doomed to fail [4]

Economy & Finance:

Bloomberg: Ultra-Low Interest Rates Are Here to Stay: 2021 Central Bank Guide [5]

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The US Federal Reserve is caught in a trap of its own making [6]

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At Zero Hedge: U.S. Billionaire Wealth Rises 40%, Up $1.1 Trillion, Since March 2020 [7]

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CBO projects U.S. economy will return to pre-COVID-19 level this year [8]

o  o  o

At Wolf Street: The Year of the Plague in Charts: Weirdest Economy Ever [9]

Commodities:

Lumber prices [10] are remaining strong. JWR’s Comment: With real estate and construction booming, and the advent of a Democrat administration, I expect high lumber prices to continue. (Democrat administrations often stymie USFS timber sales.)

o  o  o

OilPrice News reports: Oil And Gas Pipelines Set To Suffer Under Biden [11]. Here is a snippet:

“Last week’s Executive Order [12] on Tackling the Climate Crisis at Home and Abroad directed relevant authorities “to ensure that Federal infrastructure investment reduces climate pollution, and to require that Federal permitting decisions consider the effects of greenhouse gas emissions and climate change.”

The strengthened environmental impact scrutiny, including on siting and permitting processes in progress, is set to make the entire environmental and permitting reviews more complicated, with longer lead times from project to definitive approval from all relevant authorities, including federal agencies.”

Derivatives:

Futures Debut to Test Ether’s Bitcoin-Beating Rise to Record [13]

o  o  o

Government Regulators Should Not Expand Derivatives Trading at Credit Unions [14]

Forex & Cryptos:

EURUSD Direction still down [15]

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Reserve Bank of Australia Lays Out a Long Path Before a First Interest Rate Hike [16]

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Stimulus Hopes Send Bitcoin Rallying, Ethereum to Record Highs [17]

o  o  o

China could shut down Bitcoin for $7B a year, says Logica Capital chief strategist [18]

o  o  o

US Bitcoin exchange traffic explodes as analyst says flows hint at new BTC bull run [19]

Tangibles Investing:

I’m often asked: “What is so special about pre-1899 guns?” To reiterate my advice to one of my consulting clients:  I am fairly confident that by an act of congress the window of opportunity for buying private party modern guns will be closing nationwide, sometime in 2021 or 2022.  That law won’t affect pre-1899 guns, but the spillover effect of a private party transfer ban (under the feel-good guise of “Universal Background Checks”) will be that it will cause the prices of Federally-exempt pre-1899 cartridge guns to at least double or triple.

Provisos:

SurvivalBlog and its Editors are not paid investment counselors or advisers. Please see our Provisos [20] page for our detailed disclaimers.

News Tips:

Please send your economics and investing news tips to JWR [1]. (Either via e-mail of via our Contact form [21].) These are often especially relevant because they come from folks who closely watch specific markets. If you spot any news that would be of interest to SurvivalBlog readers, then please send it in. News items from local news outlets that are missed by the news wire services are especially appreciated. And it need not be only about commodities and precious metals. Thanks!

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#1 Comment By Jack Hammer On February 5, 2021 @ 12:24 pm

The environmental movement has been co-opted by communists since the late 60’s to early 70’s. I’m an energy manger for industrial clients and have seen great pipeline projects delayed or cancelled due to the so-called environmentalists, who are simply communists in disguise over the last 25 years. They want to keep these resources in the ground. Water will be the next big thing in trading commodities.

#2 Comment By Matt in Oklahoma On February 5, 2021 @ 12:39 pm

Boone Pickens, before he passed, thought the thing about water and water rights. It’s a long term play but I believe it.

#3 Comment By BWL On February 5, 2021 @ 5:33 pm

Obama tried to get control of water when he was president.

#4 Comment By TeresaSue On February 5, 2021 @ 6:13 pm

We call them green commies in my neck of the woods.

#5 Comment By Francis Marion On February 5, 2021 @ 8:51 pm

Watermelons. Green on the outside, red on the inside.

#6 Comment By Nathan Hail (not to be confused with generic Nathan) On February 6, 2021 @ 4:24 am

As I recall, there are over 4800 pipelines in the United States. Are these stupid sh!ts planning to dig them all up and repair the land that they all are buried under ? They are all as stupid as our VP who wants to have the coal miners retrained to dig up and de-fuse all the land mines around the world. I can’t wait to see all the ways that they will destroy everything in sight, making way for a new country and see the price of PMs go to the moon.

#7 Comment By Matt in Oklahoma On February 5, 2021 @ 12:48 pm

There is a push from GM and Ford to have all electric by 2035 and leave the oil/gas market.
That should be something to watch I think for long term.

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I know we’ve seen this push before in the 80-90s but the difference is now the technology exists and is being mass produced so this push could be the change.
I’m interested in hearing y’all’s thoughts

#8 Comment By Canuck On February 5, 2021 @ 8:25 pm

I have done the math for my area (Canada) based on publicly available data. For transportation to be replaced by EV’s it would require roughly a *doubling* of both electricity production *and* tranmission.

If EVs truly takeover, be prepared for widespread brownouts and even blackouts.

The calculation include petroleum used, energy of said petroleum, energy efficiency at the wheel of ICE’s, followed by EV efficiency at the wheel and electrical needs for equal work done. Also included a rough average transmission loss. The math for EV’s is going to be a heavy, even impossible burden for the grid to bear.

#9 Comment By Greg On February 9, 2021 @ 4:18 am

Matt, I think it’s possible. GM wants to compete internationally. They and the rest of the world are making the investments. New wind power is already cheaper than fossil fuels and will only get cheaper with innovation. Solar isn’t far behind. The only piece missing is the battery and companies are investing to discover and develop the right technology and reap the billions of potential profits. I don’t know if it will happen with current batteries. Don’t think just US. What the rest of the world wants to buy matters.

#10 Comment By JG On February 5, 2021 @ 1:32 pm

Electric Cars: a few problems come to mind with this plan. The folks in charge of this idea still don’t get the fact that we will need more of the evil power plants to charge all of the batteries. Battery material availability is an issue. Every house will need a charging station. The distances traveled in most of America will present issues. Most semi-conductors are made out of country and have almost shut down present vehicle production. On the bright side, a job opportunity will be created for young people to go around refueling cars that run out of charge.
Worst of all, playing a recording of some nice V8 pipes when you accelerate in an electric car just isn’t the same as the real thing.

#11 Comment By BWL On February 5, 2021 @ 6:03 pm

My thoughts exactly, need more power. Also increased strip mining for those rate earth metals they’ll need.

#12 Comment By Marie On February 5, 2021 @ 1:57 pm

JG: my friend has a muscle car, and it’s fun to pass in traffic. My car is a little 4 beater, and there’s no joy in Mudville as it chugs (yes, chugs) around. No power, no noise, no fun.

#13 Comment By MacHam On February 5, 2021 @ 2:32 pm

Not one bushel of grain can move in the US and Canada with[out Lily Edit] the permissions of Bill gates (Owner of Canadian Rail ) and Warren Buffet ( Owner of BNSF) and now Gates is the largest farmland owner in the USA . Food and food prices is the ultimate weapon and the perfect choice for those that want genocide

#14 Comment By Ron On February 5, 2021 @ 4:45 pm

MacHam:Maybe the power brokers believe that the people will tolerate their control forever.
I think that they are badly mistaken.
If food is weaponized they will be lighting the fuse to the revolution bomb. Right now the
citizens are not thrilled with the government nor those that control the food chain but when
the children get really hungry the game will change.
For now our means to resist are stored under the bed or in the closet but if the nations troubles continue the way they are then they will wish that they hadn’t under estimated us.

#15 Comment By JW On February 5, 2021 @ 4:46 pm

Lumber prices aren’t just going to remain high, they’re increasing. My brother-in-law builds shipping crates for the oilfield business. Three weeks ago his supplier doubled the price of the lumber he uses. He’s a one man operation, and is now looking to sell his business (probably just the property) because its no longer going to be profitable for him to continue.
Its not going to get better any time soon…

#16 Comment By benjammin On February 5, 2021 @ 5:12 pm

The CBO is smoking dope if they think this economy is going to ever recover, let alone quit falling down. Do they think anyone will believe their claims at this point?

#17 Comment By Anonymous On February 5, 2021 @ 5:19 pm

Speaking of Amazon:

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#18 Comment By Gold Prospector On February 5, 2021 @ 5:52 pm

So is “Doctor Evil”. The Kenites and Internationalists run the world.

#19 Comment By BWL On February 5, 2021 @ 6:22 pm

The Jews are God’s chosen people.

#20 Comment By Anonymous On February 5, 2021 @ 6:38 pm

There are those who call themselves Jews and are not.

#21 Comment By Don Williams On February 5, 2021 @ 7:00 pm

One thing that is hilarious about some environmentalists is their ignorance.

People driving Teslas never ask where the electricity comes from. In the USA a lot comes from coal generating plants –and the percentage is much higher in China.

My brother-in-law, who oversees construction of gasoline stations , calls Teslas “coal burning vehicles”.

And lets not forget that environmentalists destroyed the carbon-free nuclear industry in 1980 in favor of those coal-burning electrical plants.

Nor have I heard them complaining about our billionaires promoting a Green Revolution that caused Asia’s population to explode from 1 billion to 4 billion in just a few decades. Destroying thousands of animals species. The bulk of the carbon pouring into the atmosphere is coming from China and India, not from American businessmen.

I have never understood why we let idiots –who could not pass an engineering exam if you held a gun to their head — decide what our technology road map into the future will be.

#22 Comment By BWL On February 5, 2021 @ 7:04 pm

You’re right, but God knows who they are.

#23 Comment By HP On February 5, 2021 @ 7:07 pm

It’s not just lumber. Here’s a sample of the notices I’ve been receiving from vendors:

****Lead Times on Steel are currently 3-5 weeks****

**2021 POTENTIAL MANUFACTURER INCREASES**

– Steel 10% January and 10% February, w/ extended lead times, possible allocation, and is in a very unstable market.

– Gypsum 10%-20% January, w/ extended lead times and allocation

– Joint Treatments 5% January

– Corner Bead and Tapes 10%-20% January

– Insulation 10% January w/ extended lead times and allocation

– Fasteners 5% January

– Ceiling Tile 10% January

– Suspension Systems 7% January, 15% February w/ possible extended lead times, possible allocation, and is in a very unstable market

– Lumber is in a very unstable market

** Lock in your jobs as early as possible, w/ accurate start and end dates**

#24 Comment By Bear On February 5, 2021 @ 8:11 pm

Oof, thanks for the heads up. Gonna go make a few phone calls…

#25 Comment By Wheatley Fisher On February 6, 2021 @ 1:10 am

Bear, and anyone else who might be building or improving a place:

in the past I have gone thru Home Depot and Lowes to purchase entire bunks of 12 foot by 4 foot drywall, bundled pallets of insulation and things like that. We get the volume discount, plus a Veteran’s discount.

I simply store the excess amounts inside or under carefully attached waterproof tarps and doubled tarps outside.

For a fee, they deliver and unload and stack it for you where you want.

So in my house rehab project I locked in lower prices two years ago and have ample supply for future projects and barter.

The next 18 months will have hyper inflation on just about everything, so plan accordingly.

After about 18 months I expect to see mega mortgage and loan defaults with big jumps in interest rates. I’m planning for that.

#26 Comment By Greg On February 9, 2021 @ 4:51 am

Do your vendors have a reason why? I’ve heard demand is up as people stay home from Covid and fix up their houses. How much is from production declines? The answers could help predict future prices.

#27 Comment By HP On February 5, 2021 @ 8:21 pm

Steel is about to skyrocket. A machinist family member of mine has been working 60+ hours a week since the holidays. It’s not because the economy is booming. It’s because manufacturers know what’s coming and are buying tooling at today’s prices.

#28 Comment By Don Williams On February 6, 2021 @ 5:25 am

Somehow I think the brainiacs in Washington have not calculated what a carbon tax will do to the price of steel and cement. And the resulting inflation as those price hikes ripple downstream through multiple industries.

#29 Comment By Ron On February 6, 2021 @ 3:39 am

Egon von Greyerz is the smartest guy in any room. His latest UTube interview posted today
is titled The Great Inflation Debate and Precious Metals Price Distortion.
His knowledge and insight is professional grade. Take a look.

#30 Comment By Don Williams On February 6, 2021 @ 5:29 am

Anyone notice that increase in the 10 year Treasury rate over the past two weeks?

#31 Comment By Wagstaff On February 6, 2021 @ 5:50 am

Environmentalists now want to stop lithium mining… the element necessary for creating the batteries in the electric cars they want…

Is it crazy, or are these people being manipulated by, … ohhhh, I don’t know… who owns most of the rare earth and strategic minerals now? China maybe?
I’m sure they would love for the US to shut down lithium mining AS WELL AS shutting down oil pipelines…

I’m sure China Joe will be getting a phone call any day from his old pal Xi.
“Joe, you no want dirty Riffium mine… no, ret China make batteries… you likey me now?”

Check out: Counter punch dot org
“Warriors Dreaming: Can Thacker Pass Lithium Mine Be Stopped?“

#32 Comment By Don Williams On February 6, 2021 @ 2:10 pm

Does no one remember how China shut off the export of rare earths in 2010 and threatened Japan’s electronics industry in retaliation for a minor dispute?

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Prices shot up through the roof.

#33 Comment By CR On February 6, 2021 @ 4:26 pm

Trump was merely a speed bump for what they want to do to all of us.