Economics and Investing:

Reader Jeanan asks: It this a sign of a commercial real estate collapse? Owners: $5.4Billion New York housing complexes go to creditors

Robert H. recommended this piece by Paul Mladjenovic: Three Things Everyone Needs to Do with Money in 2010

Our friend Evan describes this as sort of like “doubling down” at a casino: Greece Sells 8 Billion Euros in Notes After Offering Premium

GG flagged this Reuters piece: Record number of young Americans jobless

Also from GG: Deficits As Far as the Eye Can See

Economics Update from JWR: The last I heard, the Economatrix was still snowed in, warm by her woodstove, but sans Internet. You can expect more of her posts sometime later this week.



Odds ‘n Sods:

F.R. highlighted a post over at The Sipsey Street Irregulars blog that has a link to a PDF from a 1960s military journal, article, titled “Organized Looting.” Here is the Sipsey Street editor’s comment: “This article by Leo Heiman, a veteran of the Rossokovsy Brigade of Russian Partisans, from Military Review, February 1965 discusses some of the uncomfortable logistics issues guerrillas must face. Read it, consider which of its lessons apply to you and redouble your caching efforts.” JWR Adds: FWIW, the same thing went on in communist revolutions worldwide, throughput the 20th Century, and may explain why so many of them have failed: Citizens don’t enjoy seeing their property toted away for some amorphous “cause.”

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Man Arrested After Weapons, Map of U.S. Military Facility Seized From N.J. Motel Room. (Thanks to Word for the link. Word’s comment: “Gee, you don’t suppose the guy is a Muslim, do ya?”

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Trent H. sent me a news story that describes how the 2010 US Census is beginning in the hinterboonies of Alaska.

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Reader F.G. spotted this news article: California inmate release plan begins. Here is a quote from the article: “The state’s controversial plan to reduce its prison population by 6,500 inmates over the next year begins today, with victims and law enforcement groups once again warning it will increase crime.”





Note from JWR:

There are just three days left in the unprecedented 25% off sale on Alpine Aire freeze dried foods at Ready Made Resources. They are offering free shipping on full case lots. Don’t miss out, as this is a special “test” sale, approved for just Ready Made Resources by Alpine Aire, and might not be repeated.



Letter Re: Hyperinflation Appears Certain for the US Dollar

Jim,
During many years of “hiding, prepping and watching” I’ve tried to determine what series of events may lead to TEOTWAWKI. There are many, but not obvious to most.

Hurricane Katrina and Haiti are examples of either predictable events or unpredictable instantaneous events as would be a single nuclear event such as a “suitcase bomb” . Each of these has a number of things in common, but the most significant is the limited geography associated with each. The biggest difference between Hurricane Katrina and the Haitian earthquake is the lack of adjacent unaffected land. In the case of Hurricane Katrina there was a place to bug out to, on foot or by vehicle, without walking into hostility, and the time to do it. In Haiti, there is no warning and no place to go unless you are a long distance swimmer, but it will be remedied and controlled. There will simply be more deaths and casualties along the way. There will be survivors and they will by and large return to the way things were before the quakes.

By and large, events such as these are attended to with aid being provided from outside the immediate area. How well the aid is administered and how soon it arrives is a subject for another time. Needless to say, it always arrives later rather than sooner; get used to it. Survival during these types of events is always in the relatively “short term”, unless you are in the middle of it; I’m sure it then seems very long term. If not crushed by falling debris, me and mine will get through these types of events. We are prepared to do so.

I’ve quit thinking about those types of events, as I’m either prepared for them or I’m not, but they are not TEOTWAWKI events. I’ve focused on the type of events that creep up on you, but that cause long term and lasting changes to society as a whole. These are on a much larger scale with little or no aid or organization from anyone. The “aid providers” will be worried about providing for themselves, as will everyone else. This concerns me much more than a short term catastrophe. What events could cause this and what kinds of subtle warnings should one be looking for?

Our society is so intertwined that any number of small subtle events can build up to and then spark these events. As with Hurricane Katrina, those signs are out there. You are being warned, and just have to identify what they are and be on the outlook for them. I would compare Haiti to a localized small nuke; no warning, nothing to see coming, it just happens.

People will kill for a number of reasons. Lack of Food, Water and Shelter, and all that it takes to get them, will be the most common reason . Other immediate threats or perceived threats to their loved ones is on the same level or next on the list. All other reasons are subsets of those. We are now seeing, if we are aware and watching, the beginnings of many of those reasons.

It could be a stock market crash, droughts, government failure to renew its short term debt, political upheaval, increased taxes or something as obvious as hyperinflation caused by continued Fed intervention into the economy. It is likely that all of these things and many others, in their own small way, will collectively be the straw that breaks the camel’s back. There is no way to tell which one or ones and when it is likely to happen. History tells us that it will happen. I’ve decided to carefully monitor world events through all media sources and try to weed out the wheat from the chaff.

Some Observations:

I could ramble on forever about all of these things, but consider that hyperinflation is absolutely in our future. It’s caused by the Federal Reserve Bank and our government. The only way to decrease the value of what we owe is to print more money, or go to war. Printing more money simply dilutes the value of the dollar in this country. We buy oil with those dollars, and the less they are worth, the more dollars it takes to buy it. All things in our world are directly related to oil. The more it costs, the more everything else costs. Most of our goods are imported from foreign countries. The less the dollar is worth, the more dollars it costs to buy them. As the dollar decreases in value and it takes more dollars to buy the same old necessities, your paycheck never increases proportionately, and if the company you work for fails to make a profit, you’ll be unemployed. That $2 gallon of milk may soon cost $5 or even $10 dollars. As in Zimbabwe, $1,000 or more dollars. Sometimes it can’t be had at any price. Our money today has decreased dramatically in value and purchasing power since the Federal Reserve began in 1913. If you are my age, you’ll remember 15 cent per gallon gasoline. At that time minimum wage was $1.25 per hour. I could buy 8.3 gallons of gas for every hour worked. Today, using the same comparison, I could almost buy only 3 gallons for one hour worked at today’s minimum wage. This applies to all commodities. It’s only going to get worse, much worse.

Schumer rolls down hill. The prevailing attitude is: “When I can’t buy it but have to have it, I’ll steal it. If my kids are starving, I’ll kill for it.” Get the picture? It doesn’t take a single event to cause this, although a single event could get us to the same place.

Suppose that nationwide draughts caused decreased crop harvests. It’s already been happening for years. Food reserves are the lowest they have ever been. Supply and demand dictates price. Less supply equals higher prices. Watch the crop forecasts. The price of oil also dramatically affects the price of fertilizer, cost of food preparation and transportation. Just stop in a convenience store and buy a candy bar. How much does it cost now, compared to a year ago; compared to two years ago? On a very small scale that candy bar represents everything else in your life. Inflation, like many other things (such as loss of freedoms) sneaks up on you.

The government is giving away more money than we provide to it. It’s generating unbelievable debt. Taxes have to be increased. This will decrease how much money you have to buy the more expensive goods and services. Watch the M2 and M3 money funds. They are the gauge of how much money the government is borrowing. Watch the roll-over or default of the short term debt at the end of this year. Where will the money come from to pay the $2 trillion in short term debt? Why would China or anyone else loan us this money when even they can se that they will not get repaid in anything other than devalued dollars.

You will never see the truth about any of these topics reported in the mainstream media, and there is a dearth of connecting the dots, even on the Internet. As you read about these things, ask yourself, “what does it really mean” and how does it link the the other current happenings. I can’t list all of the inter-related subjects that have an effect on this, but can only advise you to pay attention. If you don’t, it will sneak up on you and you won’t be ready. – Tom H.



Letter Re: Nefarious Uses of Google Earth

Sir;
In response to what Art A. wrote about the koi thieves. I want to add an aside that I don’t know if you covered in your Google Earth piece. I work for a municipal police agency. Google Earth is widely used with the agency to be able to view locations of potential suspects. It is particularly informative when serving search warrants on large compound-like properties as it alerts officials to the location of all building, etc., as well as other things located on the property. When chasing criminals it seems a good tool but when the government decides that preppers, Christians, anti-abortionist, etc. are the biggest danger to the United States Google Earth has more ominous overtone. Here are a couple of links describing how Google Earth and GPS are used. Think about the possibilities.

How the police use Google Earth

Cops Find Pot Farm Using Google Earth

Thank you for your site. – Adnil



Economics and Investing:

Sue C. and Chris S. were the first of a dozen readers to forward me this article link: Seven Things About The Economy Everyone Should Be Worried About

Trent sent us this: Gold is “fairly expensive” could fall to $800 if Fed moves Midas fund manager says. [JWR’s Comment: I’m dubious about a big correction in the near future. I don’t expect interest rates in the US to change radically anytime soon. If anything, they are headed lower, in a desperate attempt to turn the real estate market around, and boost equities. Also note that the funds have continued to be big gold buyers, even after gold topped $1,000 per ounce. There will be some dramatic dips, but gold is still in a bull market. You can quote me on this: In the long term, gold will prevail, and the dollar will fail.

GG sent this: Home sales plunge nearly 17 percent in December – largest drop in 40 years. Meanwhile, we read: Government pulling out of mortgage support as home resales plunge. (Thank to EMB for the latter link.)

Also from GG: Will this decade prove even more volatile than its predecessor?

From Greg C.: Poverty rate hits 17.5 percent in Nashville

Commentary from Instapundit editor Glenn Reynolds: “MYSTERY BIDDERS” at Treasury auctions. Let’s hope they’re gullible!…



Odds ‘n Sods:

Mike The Blacksmith wrote to mention that BBC America will start to broadcast the new post-pandemic Survivors series (an updated version of the 1970s Terry Nation series, first aired in 2008) starting February 13th at 7 p.m. Central time. Like the recent “After Armageddon” docudrama, this should serve as a motivational tool. (But like most television envisionings of an inimical future, don’t expect to pick up many useful survival tips.)

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Matt T. recommended this book: Living the Martial Way: A Manual for the Way a Modern Warrior Should Think. Matt’s comments: “While it was written for military or law enforcement members who must or may have to fight to survive, I believe it could be useful to people preparing to survive. There is a lot in there from choosing a martial art, strategy and tactics, mindset, and importantly how to train, but written in a way that is applicable regardless of what your particular martial art is. Preparedness is about training, not just stockpiling, and I think this book helps in that area.”

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Mark H. sent us this bit of food for thought: Tourist skiers cause a food shortage, so Officials shut down highways. to Big Bear Valley. File under: Noteworthy Precedents.



Jim’s Quote of the Day:

“If there was a way out of this, someone would have thought of it long ago in the past 4000 years of one government after another spending itself into unpayable, bankrupting debt!” – Richard Daughty (aka “The Mogambo Guru”)



Letter Re: Clothing and Shoes, Post-TEOTWAWKI

James,
Okay, a year or three goes by, [after TEOTWAWKI]. My wife can sew, but where do you get cloth and thread?

I love Goretex (since I live in Western Oregon), but where do I replace those great Hi-Tec boots?

No one seems to be discussing what happens when a shoelace brakes after Schumer is in session. You can hardly find them now.

Cloth – one will make a spinning wheel and loom after “the fan” has become clogged!

All that I can recall is an anecdote about the early Oregon Trail, when the newly arrived – skinny and starving (but had good threads)- were greeted by the locals (fat and in rags)…

I woke up early this morning dreaming about this. Any ideas? Thanks, – Steve S.

JWR Replies: There will be no perfect substitutes to modern clothing and modern shoes/boots in a long term societal collapse.

Consider that shoes and boots weren’t even made with distinct “right and left” shape lasts until the early 1800s. Thus, you can get an appreciation for the level of comfort that we can expect, if and when we are suddenly thrown back into a medieval level of existence.

In anticipation of chronic shortages of good quality footgear and clothing in MGTEOTWAWKI, I can recommend the following as a baseline of preparedness:

1.) Stock up in depth on garments, coats, underwear, shoes, and boots. Watch for “Going out of business” sales and be sure to patrol your local thrift store vigilantly. Buy low, stack deep.

2.) Don’t overlook the need to buy children’s clothing and shoes in graduated sizes. If and when your own kids outgrow those sizes, you can pass them along to others, charitably.

3.) Develop traditional sewing, spinning, weaving, and cobbler skills, as previously discussed in SurvivalBlog. Stockpile the requisite tools and supplies, including sewing needle assortments in a wide variety of gauges, thread of various thicknesses, heavy waxed thread, a sewing awl, and so forth. If nothing else, it is important to learn how to make tire sandals, and how to make moccasins. These won’t be a proper replacement for a nice pair of Danner boots, but they will be better than nothing!



Letter Re: Building a Supply of Long-Burning Candles

Dear James,

I recently was walking through Ikea with my wife here in Minneapolis and came upon a candle sale. They are currently having a sale on red 8 inch, Unscented Christmas candles rated at 70 hours for 99 cents. I promptly filled the cart with 40 or about 2,800 hours worth of candlelight for 39 dollars. Not wanting to recommend anything I had not already tried I promptly lit one to see how long it would last and right now it is still burning on hour 85 – will probably be done between 90 and 100 hours. Thought your readers might appreciate a good buy on candles. Kind Regards, – Troy

JWR Replies: I’m also a proponent of stocking up on candles, but keep in mind the obvious fire hazards. In a disaster situation where candles might be left unattended, burn candles only on a steady surface, with a deep cookie sheet or or broiler pan beneath. Also, be advised that many of the decorative candles on the market are not truly long-burning. “Large” doesn’t always equate to long burning. Unless candles have an hour rating marked then avoid them, or you may be wasting you money on fast-burning candles made of wax with a low stearic acid (aka stearin or octadecanoic acid) content. (The higher the stearic acid content, the better.)



Letter Re: A Bugout Time Saving Tip

Hi Jim,
I just wanted to share a quick storage tip and a bugout time saver. I’m currently in a condominium but still working on my preps and keeping my stuff bugout ready. One of the issues I’ve overcome is the need to keep my bugout ready but out of the way. In my condo building we actually have storage areas in the basement (fenced off partitions with personal locks) so that is where 90% of my preps stay. In order to keep these preps bugout ready I’ve organized them into Rubbermaid [lidded storage] tubs that I stack about four high and two wide on top of a furniture moving dolly so that I can roll them in and out if I need to access storage behind them. These can also be used if I need to bugout I’m just rolling a furniture dolly out to my bugout vehicle and loading up. Even if some of your readers don’t have a storage issue I strongly recommend the furniture dollies for quickly moving their preps because they can stay dedicated to a particular stack of preps. Thus, when time counts during bugout you don’t have to load a hand cart several times. Thanks for your site! – Ben in Tennessee



Economics and Investing:

GG flagged this: State jobless rates on the rise – 43 states reported rising jobless rates in December, reversing signs of improvement

Kent B. sent this: Bernanke under pressure

Items from The Economatrix:

Dr. Gary North: Monetary Base Expansion to Ignite Inflation Not Deflation

The Future of Unemployment Benefits in the US

Will Obama Respond to US Voter Anger at Lack of Action on Banksters?

Greece Debt Default Could Take Eurozone Down With It



Odds ‘n Sods:

CBS News commentator Rebecca Solnit crosses the line into justifying the looter mentality, in this piece of editorial excess: When the Media is the Disaster. (A tip of the hat to reader Bill W. for the link.) A word of warning to Mrs. Solnit: If you advocate looting, then don’t be surprised if someday a group of low lifes comes to loot your house, whether or not you are at home. And when they do, try not to “judge” them! For that matter, don’t be judgmental about their preference for light or dark meat.

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I’ve been pleased to see that US firearms magazine manufacturers have finally caught up with demand, and that prices has dropped back down to normal levels. (For example, the recent sales ads at CDNN and Cheaper Than Dirt are indicative of the recent drop in prices.) Don’t complacently ignore the threat of a renewed ban on 11+ round magazines. Stock up and buy plenty of full capacity magazines, including some extra for barter!

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Dennis M. flagged this: Electrical Grid Weathers a Hit from Latest Storms. Dennis notes: “I call your attention to the bit about maintenance spending being cut by up to 50%. What will be the implications?”

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Garnet sent us this: Scientists create model of monster ‘Frankenstorm’