Category: Economics & Investing

Letter Re: Advice on Retirement Plans and Precious Metals IRAs

Helo Jim, Just a note to let you know what a great job your doing with the blog. I have a question that as far as I know you have not addressed. Most of my individual retirement account (IRA) money is in a 403b at work. [A 403(b) is a tax deferred retirement plan for the employees of nonprofit organizations.] I had wanted to roll this over into a precious metals IRA. However I am not allowed to do this until I leave my current job. Is there anything you would advise that I can do to protect my 403b …


Are Your Neighbors Contrapreneurs?

The American newspapers are presently full of stories about declining suburban home values and the galloping foreclosure rates, mainly in the coastal markets. (The erstwhile “hot” real estate markets have turned bitter cold.) As more and more foreclosures get dumped onto an already over-saturated “buyers market”, there is a strong likelihood that prices will spiral downward. Anyone that bought a “spec” house is now trying to get rid of it, even if means taking a loss. The downward pressure on house prices is likely to continue for several years in the coastal areas, and in few inland markets like Phoenix …


From the SurvivalBlog Archives: Dumping of US Dollar Could Trigger “Economic September 11” (Posted August 29, 2005)

I very rarely post lengthy excerpts from other sources. However, I am essentially forced to in this case. You see, this prematurely archived article was posted at The Australian newspaper web site for just a few hours, earlier today. (Actually late afternoon on the 28th in the U.S., due to the time difference and being on the other side of the International Date Line). It was briefly on their “The World” page–one of their main pages. But it now shows up only in their archives. No explanation was given why it has mysteriously disappeared from their “The World” page. It …


Meltdown from Modern Financial Alchemy, by Thomas Tan

Nowadays after all the 3rd quarter write-off announcements from many banks, sub-prime has been mentioned less on television and newspapers. The market has returned to the old high and some more. Is this credit crunch crisis over? What might be coming next? The sub-prime is only the 1st layer of the onion being peeled; there is much worse danger yet to be revealed. It is amazing to see the high growth in all kinds of fixed income products during last 10 years called SIVs (structured investment vehicles) such as RMBSs (residential mortgage backed securities), CDOs (collateralized debt obligations), ABS (asset …


Two Recent Incidents Illustrate that the U.S. Treasury Wants to Have it Both Ways With “Legal Tender”

Consider the case of a lad that tried using some $1 US Mint Presidential series proof coins as spending money at a restaurant. And now consider the hung jury in the tax evasion trial of a building contractor that paid his employees in US Eagle one ounce (“$50”) gold coins, at their face value. So if I understand these stories correctly, the U.S. Treasury wants us to accept their “legal tender” coins at face value, when the face value is more than the metal value of a coin, but they’d happily see us thrown in jail when when use a …


Letter Re: Silver as an Inflation Hedge

Hi Jim, First of all please pardon my English but this language is hard to learn, especially being from Cuba. Let’s talk about silver. As a survivalist one of my tools is silver and at this time I am using that survivalist tool. At this time my cost per gallon of gasoline is of $1.21 and the reason for that is that I pre-paid for my gasoline for the next two years in one oz silver rounds. Back in 1972 I paid $4.90 per ounce for my silver and in 1980 I sold it for $63.65 per ounce. I started …


Letter Re: Why Physical Gold Versus Gold Stocks?

Mr. Editor: Why on earth do you place such a strong emphasis on gold “in hand” as opposed to gold [mining] stocks? From what I’ve read, gold may soon double or triple [in price], but gold mining stocks like Barrick and Newmont are set to go up 5x to 7x. I think that you’ll be missing the boat as this bull market in [precious] metals continues. I feel sorry for you, pal. – Pete in Tampa JWR Replies: I recommend buying (and personally holding) physical gold rather than gold stocks for three reasons: safety, safety, and safety: The first “safety” …


U.S. Foreclosure Numbers are Up–Some Retreat Property Possibilities?

There has been a lot of news in recent weeks about real estate foreclosures in the US. Foreclosure.com (one of SurvivalBlog’s Affiliate advertisers) just published the following US residential real estate foreclosure statistics: National Highlights: * Foreclosure activity increased 36 percent from July * Foreclosure activity increased 115 percent from August 2006 * REO (“Real Estate Owned”)s increased 59% month over month, the biggest increase of any of the three foreclosure categories (Default, Auction, REO) State and Metropolitan Statistical Area (MSA) Highlights: * Nevada, California and Florida posted the top three state foreclosure rates * The states with the most …


Hedge Funds–A Disaster Story that Could Unfold in Quarterly Episodes

One of the consequences of the collapse of the credit bubble and the subprime lending fiasco in particular is with hedge funds. There is a substantial risk of uncontrollable instability in hedge funds that could potentially be disastrous for investors. This instability will likely be seen in waves of bad news that will come roughly once a quarter. First, let me provide a bit of background: 1.) Most hedge funds have rules that allow only quarterly redemptions (“cashing out”) by by their investors. (A few hedge funds even have only one annual redemption “window.”) Typically, the redemption requests must be …


Letter Re: Information Security Considerations When Selling a House with “Special Features”

Mr. Rawles- I truly enjoy and appreciate your site and hope to soon be able to express that with a [10 Cent Challenge] commitment. Perhaps one solution to the marketing of property with “special features” would be a multi-layered approach to advertising and responding. First present the property with a limited description such as general location and non-specific amenities using descriptions such as “special”, “hardened”, if appropriate and perhaps a philosophy statement and pricing that would lend a sense for the property without risking over-exposure. Interested parties could pursue a phone interview or email exchange to determine actual depth of …


Letter Re: Peace of Mind Through Systematic Preparedness

Dear James and SurvivalBlog Family: Thank you for this tremendously vital preparedness forum. It has been the direct impetus for me to seriously prepare to survive various natural disasters that could assail the New England area, but more importantly, to be prepared for the inevitable TEOTWAWKI situation, which I expect, we will face within a decade, as soon as the oft-predicted Winter Solstice of 2012–Which still leaves us plenty of time to prepare, if we only make that crucial decision to begin (or to enhance) our preparations and remain steadfast in our intentions to survive whatever may come our way. …


Letter Re: Advice on Short Term Shelter from Inflation

Mr. Rawles: After reading your recent comments regarding the possibility of extreme inflation in the US, I began asking myself how well prepared I am to handle such a situation. The answer was not pretty. You see I am only 24 years old and my wife and I are saving for a house, so most of our funds are tied up in some sort of bank. I fear that if inflation hits, all that cash in the bank will be worthless, and all my saving will be for naught. Do you have any suggestions on how a person like me …


Letter Re: Estimate on the Likelihood of an Economic Depression or Full-Scale Collapse?

Jim, What a lot of folks don’t think about is that during the last depression, almost 80% of the population was still connected to a family farm. They also knew how to can meats and vegetables and had all of the equipment to do so. It was a way of life for them. Today less than 1% is connected to a family/small farm. That is daunting. Even if some of the population knows how to can and has a small garden, How many of them have 500-600 jars, lids and rings? Got lots of Salt, a working smokehouse that doesn’t …


Letter Re: Estimate on the Likelihood of an Economic Depression or Full-Scale Collapse?

Jim, I know you get a lot of mail so I’ll be brief. I highly value your information and input on the current economy. I also have read your book “Patriots”, and your current assessment of our economy’s future terrifies me. What are the probable chances of this turning into a worse case scale as seen in your novel? Even if it is not worse case, I have no idea what a Moderate case would look like. Your wisdom would be greatly appreciated. Thank You.- William JWR Replies: In the context of America’s current economic situation (namely, the implosion of …


The Fed’s Monetization Madness: A Word of Warning

I’m sure that most of you remember back in the first week of August when CNBC market analyst Jim Cramer was screaming hysterically: “Open the discount window!” Well, it seems that Bernanke and Company have done exactly what he asked. As of the past week, commercial banks are now taking $2.7 billion in loans per day from the Federal Reserve discount window. With just this lending from the discount window, the increase in the U.S. money supply has jumped to an annualized rate of more than 50%! I’ve said this before: The biggest red flag imaginable for pending economic catastrophe …