Category: Economics & Investing

Economics and Investing:

Vicki sent us a bit of video mirth to cheer us up, since there is more bad economic news to come: Taxpayers Clearinghouse Prize Patrol – Yes We Can! Thanks to OSOM for this: Marc Faber goes survivalist (as quoted in Bloomberg). “The best bet for investors may be to buy a farm and escape from the cities, as a prolonged recession could lead to war, as the Great Depression did.” From Bill in Ohio: The D-word: Will recession become something worse? From reader HPD: Bernanke Says U.S. May Need to Expand Bank Rescue. (Yea, the girth of the great …


The Long Arm of the Lawless, by Fred Burton and Scott Stewart

Last week [in a STRATFOR briefing] we discussed the impact that crime, and specifically kidnapping, has been having on Mexican citizens and foreigners visiting or living in Mexico. We pointed out that there is almost no area of Mexico immune from the crime and violence. As if on cue, on the night of Feb. 21 a group of heavily armed men threw two grenades at a police building in Zihuatanejo, Guerrero state, wounding at least five people. Zihuatanejo is a normally quiet beach resort just north of Acapulco; the attack has caused the town’s entire police force to go on …


Economics and Investing:

Tony W. sent this: Even ‘Dr. Doom’ Is Scared: Economy Much Worse Than Roubini Predicted Bill from Ohio spotted this: 5000 Dow? 500 S&P? From Kevin A. come this sign of the times: Manhattan Apartment Buyers Abandoning Six-Figure Deposits Rather than Closing on Deals. Reader Kris N. mentioned in a recent e-mail: Over the last few weeks I have heard several politicians say that credit markets need to be opened up so Americans can start spending more to improve the economy. Is this not like Marie Antoinette proposing the solution to the peasant’s bread shortage is to have them switch …


Economics and Investing:

JWR’s Introductory Comment: Gee, in light of all the following very bad economic news, can someone please send me something cheery to post? Perhaps some more articles about gun makers making record profits and building huge order backlogs? Frequent contributor HPD sent this: Brown told us not to question banks on risky practices, says City watchdog Reader “Bigbird” mentioned a piece in The Australian by Niall Ferguson with some biting criticism of Keynesian economics: The Great Repression CJB flagged this news story on the Chinese economy: China warns of unemployment risk GG sent us this one from Smart Money: Nothing …


Letter Re: US Dollar Slide Versus Iraqi Dinars

Mr. Rawles, I just wanted to drop you a line and tell you I enjoy your blog daily and have read it almost from the start. I am currently in Iraq a little North of Joint Base Balad. On the local economy the Iraqi Dinar is 1000 dinars to 1 American dollar. However, the past few months if you want to pay with American dollars in the local economy, they are discounting it by 66%. What 1000 dinars buys, 1 dollar used to buy. Now it cost 3 dollars. At the local Iraqi police academy there is a stall that …


Letter Re: Deep Apprehension About Dangers in the Near Future

Mr. Rawles: I, as well as possibly tens of thousands of my fellow Americans, are extremely fearful that the United States Government is slowly becoming like the former Soviet Union and that the day will come when the citizenry is in serious trouble. I continue to prepare as best I can for my family in the event it all comes crashing down but I cannot see where I will prevail long against American soldiers, police, and gangs that might try to harm me and my family. I am further afraid because I do not know Jesus Christ as my Savior …


Economics and Investing:

Reader HPD recommended this: Why the U.S. Government Should be Cut Off Like a Subprime Borrower HPD also sent this bit of news, which comes as no great surprise: AIG Breakup Likely. Al H. said that he liked this Business Week interview: Jim Rogers Doesn’t Mince Words About the Crisis Items from The Economatrix: Fear of Global Depression Up as US Reveals True Extent of Decline Fresh Evidence Points to Paralysis of Global Economy 750,000 jobs were lost in US in February, worse to come Iran Threatened with Economic Meltdown Buffett: Economy Will Be in Shambles in 2009 Wall Street …


Three Letters Re: The Feeding Frenzy Continues–Gun Store Shelves are Depleted

JWR: I saw the article on how Cabela’s shares surged based on gun sales. Let me tell you, we are in the midst of a feeding frenzy here in Colorado. First, its not just guns, its all of the accessories as well. I had to return some items from Christmas to Sportsman’s Warehouse and found that the whole gun department was basically empty. They only had some black powder firearms and a couple of shotguns. Nothing else. I had run into this before Christmas when I bought my two oldest boys new elk rifles – and got the last .308 …


Economics and Investing:

G.G. flagged this: Silver outshines gold for investors. “Sales of silver American Eagle coins have reached just over four million ounces so far in 2009, almost double the rate of last year, when sales reached 19.6 million ounces for the full year.” Pat M. forwarded this Reuters news video: Hard Times Push Brits to Bartering Frequent contributor Bill N. recommended this commentary by Paul Craig Roberts: How the US Economy Was Lost. Items from The Economatrix: Watch Now as Pension Funds Get Vaporized Ron Paul: This is an End of an Era…We Can’t Reinflate the Bubble Boomers: 30% Underwater Weak …


Depression Proof Jobs for a 20 Year Depression – Part 2: Developing a Home-Based Business

Yesterday, in Part1, I discussed the “safe” and counter-cyclical occupations for the unfolding economic depression. Today, I’d like to talk about one specific approach: self-employment with a home-based business. I posted most the following back in late 2005, but there are some important points that are worth repeating: The majority of SurvivalBlog readers that I talk with tell me that they live in cities or suburbs, but they would like to live full time at a retreat in a rural area. Their complaint is almost always the same: “…but I’m not self-employed. I can’t afford to live in the country …


Economics and Investing:

A picture is worth a thousand words: Graph of Four Bad Bear Markets. Based upon house prices, commercial real estate prices, and stock P/E rations, I’d say the markets have another 50% or more to fall, and the painful process may take another eight to ten years. And that is just to reach rock bottom, There may be another 10 years of climbing back up out of the hole that “Easy Al” Greenspan and his successors dug for the planet. (Link courtesy of Jesse’s Café Américain blog, and brought to our attention by SurvivalBlog reader Ben H.) Thanks to Thomas …


Depression Proof Jobs for a 20 Year Depression – Part 1: The Counter-Cyclical Jobs

The current economic downward spiral has prompted several SurvivalBlog readers to write me and ask: “My job is now at risk, so what are the safe jobs?” I’ve actually addressed this topic fairly well since I started SurvivalBlog in 2005. We ran a “best recession-proof jobs” poll, back in May of 2006. Then, in February, 2007, we ran a poll on “Best Occupations for Both Before and After TEOTWAWKI”. Later, we even ran a poll on the current occupations of SurvivalBlog readers. In the past three years, we’ve also posted a panoply of more detailed employment-related letters and articles on …


Letter Re: Is it Deflation or Inflation Ahead? Should I Pay Down My Debts?

JWR, Thanks for the always excellent blog. I recently came into a significant wad of money, more than $100,000. I have been toying with my options. I owe around $200,000 on my house, but I can afford the payments no problem; I am self employed in a health-care related field that I do not expect to struggle. My thought process goes something like this: Why should I pay the mortgage down on my house since (1) I can afford my house easily, (2) with inflation coming I would rather pay it down with 2012 or 2014 dollars (that are “worth …


Economics and Investing:

E.L. sent us the link to this “must watch” seven minute video clip of from Fed Chairman Paul Volker. It has some interesting nuggets and is a somber assessment of the unfolding global economic collapse. Reader “Darth Paul” mentioned a video clip of an ex-IMF Chief Economist. Paul’s comment: “I especially got caught up at 6:40 on the counter: “Obama’s and Geithner’s choices for administration? It’s a huge problem!”, “I’m trying to be positive but my intuition from crises is that this is gonna get a lot worste…we are going down a long, dark, blind alley”.” Mark in Michigan flagged …


Economics and Investing:

Steven L. sent this bit of good economic news: Cabela’s shares surge on gun sales Eric S. sent this snippet from Bloomberg : “Gold is likely to more than quadruple from the current level of $986 per ounce currently to $3,500 in 2010, he said.” Reader “Jericho Jo” flagged this article from New Zealand: European chiefs propose global rules (for world economies). A quote: “Even the global crisis and a change of Administration may not be enough to convince the US to hand over its autonomy.”I see the US as wary of giving away powers of oversight and regulation,” said …