Money, Finances and Preparedness, by Mr. Zipph

As an executive with a multi-billion financial institution, I am a financial insider (boo, hiss). I also believe in preparedness. I believe that I have some insights into the money side of preparedness that you might want to consider. I will not delve too deeply into the fragile nature of the global financial system, but I will share my biggest concerns without going into detail:
• The fractional reserve banking system allows your bank to create money out of thin air
• The central banks of the world are creating unprecedented amounts of money out of thin air
• Fiat currencies are not real money
• The central banking systems of the major nations only exist to prop up large commercial banks and do not care about citizens
• There is an enormous amount of leverage in the financial markets, government balance sheets, shadow banks and the average household
• Some private equity firms operate in the shadows, taking enormous leveraged bets which can shake fixed income markets when their bets go bad.
• Regulators are incapable of understanding the risks being taken by the firms that they regulate

But enough about what keeps me up at night. My primary objective of this article is to share my thoughts with you on appropriate financial preparedness strategies. I will not go into the non-financial aspects of prepping, of which you are all so familiar.

I was oblivious to the concept of prepping until the 2008 to 2009 global financial crisis. It shook my beliefs about money and the financial markets to the core. During this crisis, I became “red-pilled” and started to question everything that I believed about our government, the financial markets and money in general. I realized that many of the concepts that I thought were ridiculous conspiracy theories, were not. I was very concerned about losing my job and realized that I would be in big trouble, if I did. I had way too much debt, very little savings, no cash on hand, no silver, no gold and only enough food in the house to last about a week. But I took the bull by the horns and started my various financial and non-financial prepping efforts during the depths of the financial crisis.

Natural disasters

What I have based my strategy on is the fact that I don’t know the nature or severity of the next event. Financial flexibility is a cornerstone of my plan. So, I plan first for events that will definitely happen but I don’t know when they will happen. These are primarily natural disasters like hurricanes, tornadoes, severe winter storms, earthquakes, etc. To prepare financially for these types of events it is important to have physical cash on hand. I live in an area where hurricanes or tropical storms are not uncommon. During one of these events, our area lost electricity for an extended period of time. For days, many businesses were closed but some with their own power generation capacity were opened. I ventured out to buy some groceries (because I was not prepared at that time) only to find that while the grocery store was open and had some items I wanted, they could not connect to the credit card system and therefore could only take cash and could not make change. Luckily, I had an ample supply of small bills and coins. So it is important to keep a sufficient supply of small bills and coins on hand at all times.

Man-made crises

Our recent (and ongoing) experience with the Covid pandemic is an example of this. It is likely that this was a man-made virus variant, but at a minimum the government response to the pandemic was man-made and had severe consequences for many people throughout the world. I still cannot believe that the ruling class shut down the global economy. We will feel the repercussions of that decision for years. We also see that many of our rulers are embracing leftist totalitarian policies that are destroying our liberties and fomenting social unrest on a shocking scale. Elected government officials and swamp bureaucrats are choosing which industries and companies will be winners and losers, ignoring the long-term economic consequences of their decisions.

So how would you prepare for a future man-made crisis from a financial standpoint? The crisis could be an economic collapse, war, out-of-control social unrest, totalitarian government actions etc. Since we are not part of the ruling elite, we are not privy to the information that they can use to front-run the stocks that will be the winners (and that is also illegal by the way). Some of you will likely wring my neck for saying this, but don’t put your money all in one thing. I see a lot of content on various prepper-oriented websites about only buying physical precious metals. I think that would be a mistake, because while we may have strong opinions on the subject, none of us have enough information to determine the nature of our future crises.

Since I don’t know the nature of a future crisis, I believe that diversification is key. Spread your money in various asset classes. You might want to consider the asset classes listed below:
• Physical real estate
• Physical precious metals
• A diversified basket of stocks or stock mutual funds
• A diversified basket of bonds or bond mutual funds
• Precious metals mutual funds
• Commodities mutual funds
• A diversified basket of cryptocurrencies
• And, obviously, investments in physical preps

More on physical precious metals: In the event that you had to leave your country due to social unrest, persecution, war or economic collapse, I believe that having physical gold could be extremely useful as a means of buying the services and goods that you will need during your departure and relocation. It is high value and easy to transport. How much should you have? I am still struggling with that question, but I would think that you should have enough to last for whatever period of time it takes you to relocate and get settled into your new country of residence. I do not believe that silver adds value in this particular scenario because it is too heavy to transport, at current prices.

Others also recommend investing in art and collectibles, but I cannot conceive of a scenario in which these asset classes add any value or provide any liquidity in a time of crisis.

I would highly recommend that you read the book Wealth, War and Wisdom, by Barton Biggs. He discusses, in detail, the repercussions of the events leading up to and including World War 2 and how they affected the markets and assets in various countries and the people in those countries, including the Jewish people living in Nazi Germany, and the people living the defeated countries.

I know many of you will balk at cryptocurrencies as they are not physical and have no intrinsic value, but here again, we don’t know what the future holds and having money on an app on your phone may come in handy in certain scenarios.


Many of my thoughts in the previous sections of this article do not apply in the event of a “The end of the world as we know it”  (TEOTWAWKI) scenario. I am thinking of a global Mad Max type of civilization that is the result of some unpredictable event, whether natural or manmade. Some considerations:
• Your stocks, bonds, fiat currency, and cryptocurrency will likely be worthless or non-existent
• You may or may not be able to hold onto your real estate depending on whether or not there is any semblance of rule of law. This is more of a non-financial consideration of how you are going to defend your real estate from criminal gangs or squatters, but owning real estate that you have to defend is much better than not having any at all.
• Physical precious metals will likely be of value, but maybe not as much as having bartering items that people will need and want. Well-worn old silver coins may be the most efficient form of precious metals as they are less likely to be fakes and more likely to be accepted by other people. Be aware that there are a lot of faked coins out there. I have seen displays of them at coin shows and I do not have the skill set to determine if a coin is fake or real.
• Traditional physical prepping strategies are far more important in this scenario than financial prepping

General Financial Preparedness

Like me during the 2008-2009 financial crisis, If you are in the situation that I was in (totally unprepared), then you need to start working on financial preparedness and preparedness in general. It may take some time. It took me about a decade to become debt-free and own a reasonable amount of the assets classes that I mentioned earlier. I recommend that you strive to achieve a position of financial flexibility so that you can survive the unexpected events that life throws at you. This not only includes the situations that I have already discussed, but also loss of a job, divorce, illness, etc.

I would recommend that if your employer is providing you with a 401(k) and you are not contributing to the plan, then consider doing so, in whatever amount that you can afford. This is usually a good vehicle to use to gain exposure to the stock and bond markets.

If you have a substantial amount of debt, then develop a strategy to pay off that debt, even if it takes a long period of time, like it did for me. Our society encourages us to go into debt to buy everything. But what happens if you lose your job for an extended period of time and cannot make your debt payments?
Have a safety net of liquid assets (bank accounts, money market funds etc.) that you can use if you desperately need it. Many financial advisors will recommend 3 months of living expenses, but given our recent experience, I think budgeting for one year of living expenses may be more prudent.

Start looking for opportunities to invest in the various asset classes that I mentioned earlier or other asset classes that you prefer. Try to avoid buying things when that particular market is high. For instance, I have been gradually accumulating physical gold for years, but I have stopped buying it for now because the premium that I have to pay is exceeding melt value by a substantial amount, at least it is in my area at this time. Make sure that you are also buying all of the physical prep items that you will need to work toward all of your non-financial prepping strategies.

What if you can’t afford to do anything prepping-related at all? The first step is to invest the time it takes to develop a very detailed summary of where you are spending every last dime of your money now. Then, carefully review every expense and determine if you absolutely must have this service or item or not. As an example; you must have electricity, but you do not have to subscribe to 5 online streaming services. Then categorize each item as:

1. Must have
2. Nice to have
3. Frivolous (An example of frivolous, might be going to Starbucks 7 days a week)

Then, build a new budget eliminating all of the frivolous items and see if that frees up enough money to start working on your various preps, financial or non-financial. If that doesn’t do it, then build another budget eliminating the nice-to-have items and see if that provides a sufficient financial cushion. If that still doesn’t work, then look at the must-have items and determine if there is a more economical way that you can meet those needs. A few examples include:
• Packing your lunch rather than going out to lunch when at work
• Finding a cheaper cell phone provider /cell phone plan
• Turning your thermostat up during the summer and down during the winter
• Buy your groceries at a cheaper grocery store
• Trade in a gas-guzzling car for an economy car (if it actually make economic sense)
• Move to a less expensive apartment when your lease is up

Be creative in your cost-cutting techniques and do not be afraid to think out of the box.
If you consider your income to be low, then consider looking for a new job or career that you believe will pay more. Some people feel that they can never achieve a better job than they currently have, but if you are in a low wage job, I would encourage you to explore job alternatives, educational opportunities, or a professional designation that will allow you get a higher paying job. It worked for me. A word of warning on education; be very careful about going into a significant amount of debt for college or graduate school. Some people in this situation have incurred huge amounts of educational debt that did not result in the increase in pay that they had assumed would happen. Sometimes relocation could also help you achieve greater income, depending on where you currently live.

Final thoughts

Given the current state of our society, I think it is very important not let anyone, other than your spouse know about your financial preps, if they include keeping cash, precious metals, and other valuable items in your home. I also encourage you, if you are more affluent, not to make your wealth too visible. Expensive homes and expensive cars are displays of wealth that will tempt criminals. With the defund the police movement in high gear, we need to focus more on our personal safety.