Category: Economics & Investing

Letter Re: Did Western Civilization Actually Peak Around 1970?

Jim, I wanted to comment on something that was mentioned near the end of the Utah home break-in article: The author hit on the idea that TEOTWAWKI already took place in the late 1960s. Possibly some gifted insight. I’m a member of a regional Peak Oil group. (I originally joined this group a few years ago, in order to learn food-growing skills: You’ve always suggested getting with various groups, in order to learn skills), we’ve begun a spin off group meeting–a ‘meeting of the minds’ so to speak, involving predictive analysis, regarding the collapse of the current civilization. We were …


From The Memsahib: Buyer Beware When Purchasing Livestock

While most of my livestock purchases over the years have been satisfactory, I have found that buying livestock can be full of pitfalls. I will share some of my mistakes in hopes you can learn from them. I have found livestock sellers may not outright lie to buyers but they often do not volunteer important information. So it is very important that you get a detailed book for each type of livestock you plan to purchase and do some research, so you’ll know exactly what questions to ask. Make certain the book has a chapter about choosing healthy stock. The …


Letter Re: Market Observations From The Trader Blog

Mr. Rawles – Thank you for your recent mention of my site, TheTraderBlog.com. I am a former Lehman Brothers employee, I worked in New York City on the FX trading desk, but left in 2002, so I am glad to have missed all the recent excitement. I publish my blog in an effort to help me reason through my personal trading strategies, and also like to share my opinion about the markets and related events in general. I have not yet figured out how to make any money off of the site, so for now it is just a great …


Letter Re: The Depression of the 1930s–Why No Societal Collapse?

Jim I run a museum that covers, in part, the Great Depression. In a reply to Steve’s letter about how people may react to a “modern” 1930s type depression, you listed a number of economic, social and cultural differences in America in the two time periods. I might add, or expand on, a few. In the 1930s, many more people lived on farms or gardened. Even in many towns and cities, it was common to have a garden and raise a few animals including chickens, rabbits, pigeons. An enormous difference, then and now, is that the garden seeds then were …


Letter Re: The Depression of the 1930s–Why No Societal Collapse?

Hi Jim, I really enjoyed reading your novel “Patriots”. I’ve read a few other books also, like “Lucifer’s Hammer” and I have to admit that they spurred me to buy a 22 LR [rimfire rifle] as a starter. I’ve been doing a lot of thinking of our current situation in this country and it occurs to me that every generation has things going on that is very concerning. But in particular was thinking the Great Depression should have been a good example of things going to h*ll. Yet there was not this great meltdown where people needed to go to …


Letter Re: How to Handle Real Estate Holdings in a Economic Depression

Sir: If the global economy melts down and we experience a “greater depression” or worse. What is the best strategy for real estate that is already owned? I own a primary home and two rental properties in central Virginia but if the SHTF, I’m going to retreat along with numerous family members, to our farm about 25-30 miles from the nearest city. (It has hundreds of acres for growing, and has ample water, etc.) I don’t have substantial equity in any of my three houses and all mortgages 30 year fixed through Bank of America. Is it worth continuing to …


The Financial Crisis Will Soon Abate, But The Real Crisis Will Soon Begin, by Steve Saville

In an essay first published in 1969 and recently re-published, Murray Rothbard summarizes the causes and cures of economic depressions by drawing on the Business Cycle theory developed by the great Austrian economist Ludwig von Mises. Here’s an excerpt from this essay: “Mises, then, pinpoints the blame for the cycle on inflationary bank credit expansion propelled by the intervention of government and its central bank. What does Mises say should be done, say by government, once the depression arrives? What is the governmental role in the cure of depression? In the first place, government must cease inflating as soon as …


Three Letters Re: The Savvy Barterer

Hi Jim: That first paragraph touched a nerve, because it was so truthful for me. My senior year in college everybody went to Ft. Liquordale. I went to Marrakech. Amazing experience. And boy did I get burned on some of the things I bought there. Some by as much as 1,000%. But the learning experience I came away with was priceless. The negotiation skills I learned there have become by far my most valuable business tool. That experience really made me think. On one hobby web site where I have collected much feedback my favorite one of all is “He …


The Savvy Barterer–References, Skills, and Tools for TEOTWAWKI Barter

One of my long-standing Precepts is that every prepared individual should be ready for both barter and dispensing charity. Today, I’ll be briefly discussing barter. Being ready to barter is not just a matter of having a pile of “stuff” to barter. While barter and charity logistics are important, what is even more important is what is between your ears. A Bazaar Experience Bartering takes practice. Dickering is an acquired skill. Short of buying yourself a plane ticket to Marrakech, I suggest that you start attending gun shows, garage sales, and flea markets. Learn how to haggle. One of my …


Four Letters Re: Currency Inflation Expectations for the US

James: The letter [from reader PNG] has severe mistakes and is fundamentally misleading – your readers deserve even more refutation before anyone is lulled into a false sense of security. To quote: “Let’s say the Treasury just invents another two trillion dollars by printing currency and forgiving loans. Let’s say they do that every year for the next five years. How much inflation would that create? The absolute maximum inflation rate from this example is about 20%, because there’s ten trillion dollars in circulation already.” These numbers are incredibly far off the mark. Actually M1 is the narrow definition of …


Letter Re: Advice on Silver Coins for Barter

Mr. Rawles, I have only a small amount of silver American coins but I constantly look for more. I find your advice to buy pre-1964 dimes, quarters and half-dollars difficult to realize as coin collectors are not selling junk silver in my area (Dallas/Fort Worth). To be frank the silver coins that are available are being sold at crazy prices (two or more times spot) over priced right now as everyone is freaking out about the economy. Reasonably priced coins, though significantly delayed, are available online and my collection has mainly been purchased this way. On the other hand, silver …


Letter Re: Recreational Vehicles and Investing in Tangibles

Jim, Thank you for the blog and all the great info you put out. I have a couple of questions that I would like to ask you, but first a little info about myself. I am a 40 year old male with a wife and two kids. I live in Kansas, I work at a large manufacturing plant and my wife works for a insurance company. We have a mortgage and other dept. I would like to buy some land out of town and build a retreat for my family and myself for when TSHTF but can not afford it …


Letter Re: Currency Inflation Expectations for the US

Jim, You recently wrote: “The Treasury will undoubtedly be forced to monetize a good portion of the National Debt. This is effectively creating money out of thin air. Each new dollar so created will dilute the purchasing power of the dollars that are already in circulation (Both paper and electronic “dollars”.) This wholesale dollar fabrication will be outrageously inflationary. Be prepared for double digit and then triple digit inflation in the next few years.” Let’s say the Treasury just invents another two trillion dollars by printing currency and forgiving loans. Let’s say they do that every year for the next …


Don’t Confuse the COMEX Spot Prices with Retail Reality–Bullion Coin Supplies are Tight!

I was recently chided by one of my readers for being “dead wrong” about the direction in the spot price of silver. I had to laugh about that. The COMEX spot price of both silver and gold have indeed been pushed down in recent weeks. But this is an artifice. This has been attributed to some massive and well-orchestrated short selling in the futures market. The spot market typically echoes moves in the futures market. This short selling has distorted the COMEX spot price significantly. This distortion has become so pronounced that at this point the official COMEX prices do …


Letter Re: What Happened, and What Should We Watch For?

Jim, Thanks for the awesome blog. I consider it essential reading every day, especially now considering the terrible situation we find ourselves in. You keep speaking of mass inflation yet we see oil and other commodities falling in price along with, sadly, our home values. In a recent post you also mentioned being able to buy classic cars at rock bottom prices, closely followed by hyperinflation. Can you explain for all of us how this can come to pass and some of the warning signs? Thanks, – DZ in Louisiana. JWR Replies: To clarify, I mentioned buying older, fuel-inefficient vehicles …