Letter Re: It Matters Not Whether We Face Inflation or Deflation–You Need to Protect Yourself

JWR,

That was an excellent post by Gentleman Jim! His view of insurance is right on and should be reinforced. I’ve come to realize that the best way to conceptualize prepping is in terms of insurance. As Jim stated, just like every family needs home insurance, auto insurance, medical insurance, etc., you must also have survival insurance. In fact, this should be the most important insurance you carry. If you have a family, you owe it to your spouse and your children to ensure that they will be safe no matter what life throws at you.

There are several good reasons to use an insurance perspective. The financial obligation is easier to digest once you consider all your insurance premiums together. For example, the cost of my health, auto, and home insurance combined (family of 4, 2 vehicles, 1 house) is now running about $12,500 per year (and this keeps going up, ugh!). So, a conservative estimate of the value of survival insurance could justify spending at least a quarter of this amount ($3,125/yr.). If you think survival insurance is more important than the others (and I do, at this point in time), then consider a survival insurance premium worth 50% of your current insurance ($6,250/yr). From an insurance perspective, I hardly bat an eye over spending several thousand dollars on supplies. While my numbers don’t apply to everyone, the point is the same: look at your current insurance costs; figure a percentage that your think is fair; consider it a premium like other insurance; and work it into your budget. You simply cannot afford to not have survival insurance!

Another benefit of an insurance perspective is that helps you conceptualize the extent of your coverage. In other words, how much coverage do you have now and how much do you need/want? Take the worst case situation that all the stores are closed a/o out of supplies, and ask yourself how long you could be self-reliant? Do you want insurance coverage for 3 months? 6 months? >1 year? Each time period carries a different premium. Also keep in mind that unless you are self-sufficient, after your insurance runs out, you are a refugee. I agree with everyone who advocates having at least a 1 year policy. This timeframe is based on the minimum it would take for a disruption of the food supply to return to normal. At whatever point a disruption occurs, there will need to be at most a year of seasons to regain farming and agriculture (that’s assuming there is a quick resolution to whatever caused the disruption). Of course, as everyone is are aware, there are worse scenarios that could disrupt supplies for a longer period (possibly indefinitely). If you’re worried about that, then you need to take out a larger insurance policy that includes ways to secure your own resources and food.

I would also like to point-out a purely semantic benefit to calling your preparedness activities “insurance.” How many of you have had a spouse/sibling/friend question your sanity as you’re pouring 50 lb sacks of red winter wheat into storage buckets? At some point, after one too many boxes of freeze-dried fruit, toilet paper and ammunition enter the house, someone’s going to raise an eyebrow. I hope your acquaintances are more intelligent and mature than mine, but if they’re not, explain it in terms of insurance. There is a quarterly insurance premium for our safety and peace of mind, and we are not losing grip on reality. I understand the fragileness of society and recognize my duty to provide insurance for the family. I can usually turn the insanity perception around and point out to folks that they must be insane not to have survival insurance.

I also like the way Jim describes gold & silver as insurance. Owning gold and silver is an important part of your survival insurance policy. While I think that being self-sufficient is more valuable than money, for those of us who are not totally self-sufficient, we will need an alternate and liquid form of money. In my opinion, gold and silver American Eagles are the best insurance against the collapse of fiats because: a) they are currently the most liquid form of bullion; b) their content is guaranteed by the mint (no assay required); c) divisibility; and d) they are currently a form of legal tender. In case some readers are not aware, bullion US Mint American Eagles are legal tender, while bars and foreign coins are not. While there is commodity value in owning bars and foreign coins, as long as there is a Treasury Department, they cannot officially be used as money. Here is a link to the US code section that defines money.

On the subject of legal tender [status], it should be pointed-out that bullion American Eagles have a value equal to the amount that is stamped on the coin. For a one-ounce Gold Eagle, this equates to a $50 value in terms of money. The gold commodity is currently valued around $950/oz. If you’re considering purchasing bullion, try not to let this price dissuade you. View it like a currency exchange similar to exchanging dollars for pesos. When you exchange for a foreign currency, you don’t balk at the exchange rate. It is what it is. In terms of bullion, if you understand that the reason you’re exchanging dollars for bullion is because you believe that the fiat will ultimately lose its value, then you are simply exchanging paper for a commodity at the going exchange rate. You can help offset the rising rates by making one cash-for-bullion exchange per year. Also, if you took at look at that Weimar Hyperinflation Timeline someone recently posted, you would know just how fast cash can lose its value. $950 today might be much, much more in a hyperinflated future. Make sure your savings don’t get completely wiped-out by hyperinflation. Exchange some of your cash for bullion and insure yourself against this! [JWR Adds: By the way, the established Legal Tender status of American Eagle gold and a silver coins opens up some interesting tax implications.]

I totally agree with the opinions for owning pre-1965 coins. They are legal tender and are the lowest denominated bullion. But I would also like to point out that in terms of divisibility, gold eagles can be purchased in denominations of 1oz, 1/2oz, 1/4oz, and 1/10oz. The 1/10th oz coins have a $5 face value and a commodity value of about $95. They are smaller than a dime (so are light and easy to carry), and would be the most suitable gold coin to use for small purchases in a post-SHTF economy. Keep the larger coins squirreled away (outside the banking system) as a store of value.

If you’re looking for a storage solution besides your backyard or home safe, there is a unique security company in Idaho called Idaho Armored Vaults that stores and segregates your bullion outside of the financial system. I have no interests with this company, but am acquainted with the owner. He is extremely knowledgeable about all things bullion.

One last point along the lines of insurance: this type of policy should be perpetual. If I am lucky enough to get through life without ever using my survival insurance (apart from eating the food and using the household products), I intend to will it to my kids. It is very gratifying to know that after I’m gone they will have bullion, firearms and other tangibles to help insure their futures. (If you like the idea of inheritance, be sure to consider creating a family trust. Keep all the possessions in the trust for protection from sour relationships). If you approach this as a perpetual insurance policy, you could be setting the foundation to ensure the safety of many generations in your family. Just think of how much this policy would be worth today if your grandparents had started it!

God Bless and Good Luck. – Chris G.

Economics and Investing:

U.S. dollar ‘seriously overvalued’

From SurvivalBlog reader GG: The next great crisis: America’s debt. At this rate, your share of the load will be $155,000 in a decade. How chronic deficits are putting the country on a path to fiscal collapse.

Another from GG (also sent by KAF): Get Ready for Inflation and Higher Interest Rates. The unprecedented expansion of the money supply could make the ’70s look benign

Fam sent us this: Treasury Secretary’s Secret Talking Points Reveal That Banks Were Forced to Surrender Ownership Stakes to Government

From DD: Foreclosures hit the upscale market

Items from The Economatrix:

Treasuries Tumble After Auction; Russian Threat to Cut Holdings “‘There are an awful lot of Treasuries being auctioned and there’s going to be more and more and more and more,’ said Jay Mueller, who manages about $3 billion of bonds at Wells Fargo Capital Management in Milwaukee.”

Stocks Falls After Weak Auction of 10-Year Notes

Fed Unveils Some Details on $1 Trillion in Lending, But Doesn’t Identify Borrowers (Which leads us to ask: How much money is being sent offshore?)

Survey: Dollar, Government Bonds Set to Decline As Economies “Recover”

High Court Clears Way For Chrysler Sale to Fiat “The United States government has, I continue to believe, acted egregiously by taking away the traditional rights held by secured creditors.”

Congress Subpoenas The Fed Over BoA-Merrill Lynch

Airfares to Fall Further in Recession

Former AT&T CEO (Whitacre) to Become New GM Chairman

More Politics in Auto Plant Closures?

Now Boarding At Gate C14: Capital Flight Airlines

Russia, Brazil to Buy $20 Billion IMF Bonds, Diversify Reserves “Russia’s central bank said it may cut investments in U.S. Treasuries, currently valued at as much as $140 billion, a week after China said it may reduce reliance on the dollar and American bonds. Brazil’s Finance Minister Guido Mantega said his country will purchase $10 billion of debt sold by the IMF, China will buy $50 billion and India may announce similar funding.”

You Just Have To Laugh (The Mogambo Guru)

Bullion and Bandits: The Improbable Rise and Fall of e-Gold

Parental Lifelines Frayed to Breaking
20-somethings having to move back in with parents

Odds ‘n Sods:

More about the proposed ban on one-hand opening pocket knives. The U.S. Government is Trying to Take Away Your Pocket Knives! Also see this summary comes from WorldNetDaily. The only thing worse than Nanny State meddling in your city, county, or state is the same nonsense promulgated at the Federal level. At least with state-level laws, you have the opportunity to “vote with your feet”. After a thousand small abuses, who will go so far as to emigrate? A special note: If this new law “interpretation” is enacted, crossing state lines with one of these knives will be considered a felony. The Federal bureaucracy is accepting comments – written only – that must be received by June 21 before its planned changes could become final.]

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From Cheryl: Consumer Alert: Recycled Radioactive Metal Contaminates Consumer Products

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Naiveté and Gullibility: To some, they’re not just words–they’re a way of life: Now…Go Break The Windows; Crank caller wreaks havoc on Arkansas hotel, duping employees, guests. (Be sure to click on the tab down in the photo section of the article, to view the police report. At times the truth is stranger than fiction.)

Jim’s Quote of the Day:

“I have long had a tendency to tie marksmanship to morality. The essence of good marksmanship is self-control, and self-control is the essence of good citizenship.
It is too easy to say that a good shot is automatically a good man, but it would be equally incorrect to ignore the connection.” – Jeff Cooper, Cooper’s Commentaries Volume 9, No. 4 22/73

Note from JWR:

Several SurvivalBlog readers have written to mention that they’d like to help with The Memsahib‘s medical expenses. That was very kind, but by God’s wonderful providence, we are in no need of contributed funds to pay for her health care costs. (I recently signed a contract with Simon & Schuster to write two novels as sequels to “Patriots“). We covet only your prayers.

Letter Re: Advice For Older Preppers With Limited Mobility

Hi James,

Thanks for your many years of great work. While I was enjoying and learning so much from your books and the web site, I was also growing older and have physically “lost the edge”. More accurately, I reaped the unintended consequences of 55 years of smoking and now have a tough situation Chronic Obstructive Pulmonary Disease (COPD). This is [best described in layman’s terms as] a combination of bronchitis and emphysema. I have not smoked for three years and my breathing is now stable at 51% of normal. This ailment is not unusual in the senior community, and COPD is the third largest killer in the USA. It severely restricts activity and higher altitudes are deadly. Like most of us with COPD, I am on oxygen 20-to 24 hours a day, seven days a week, plus lots of varied and expensive medications, to include my liquid oxygen, mostly supplied to me at low or zero cost by the Veterans Administration.

Additionally, and this may apply to many of your readers, my wife and I are the primary care givers, in our home, for her mentally disabled older brother. He too is a vet, Korean War Era and age 79, and receiving 100% of his medical care from the local Veterans Clinic, as I do. The Veterans Administration (VA) is a terrific source of excellent health care. All eligible vets should enroll ASAP a the VA web site. Go there and get in before the Obama National Health Carelessness Agency gets to their house! I expect the VA will be forced to shut out all non combat vets soon!

My wife and I, and a few friends, all sorta elderly fellow military vets, have been like minded about preparedness since well before the Y2K era. About 20 years of learning and prepping! We have the basic stocks of food, water, meds, clothing, and appropriate security items. We have learned to help one another and to be able to give to others in need. I have stocks of dvds to enjoy and to use to teach others. We have a 2,100 Watt solar system for power. We have devised a simple system to safely filter irrigation water for our local water needs, to include drinking, cooking, and laundry. We’ve worked together and planned together successfully. We are a team and care for each other as an extended family.

We live in small town in rural Utah. My wife and I are pleased to live in a close knit town of about 500 good caring folks. This area is highly LDS, about 50 – 60 %, and they are mostly “not very well-prepared” …. surprise! surprise! The [majority of] Mormon people–and I can say this as an active LDS–are not ready for any disaster. Less that 10% have a emergency response mindset. The LDS Provident Living web site is great, and while the LDS Church strongly promotes and enables provident living, far too few members are prepared for any emergency. Many have a little bit and very few have enough. As a people we are not well prepared. [JWR Adds: But on average far better prepared than most other Americans, and that is commendable.]

As a family, we’ve done all that preparation, and still I have a serious problem with no answer. You see, I will be dependent on solar power to enable my oxygen concentrator to produce O2, power the kitchen, and the computers, and to recharge the batteries. I can’t leave our home area for more than about 6-9 hours (maximum battery life for the portable concentrator). In an emergency my darling wife of 43 years will not leave me. My Veterans Elderly “A” Team / Extended Family wants to “zip cuff, gag, and bag” me and take me out of danger, but they too recognize the travel difficulty and are without a solution. Moving the solar array and the necessary ancillary equipment is a two day exercise.

We seniors are a large portion of the community and an even larger part of the preparedness group. I have yet to see or hear any preparedness help for folks like us. Many seniors are just like me; older, somewhat “”less abled physically, somewhat less able to travel, and more dependent on local medical services. 20% of us are raising our grand children… At the same time we are surely more knowledgeable, more able to lead, more experienced, more secure financially, more able to teach and to mentor, more equipped, and more likely to have lived through hard times and to have serious military training. And very importantly, many of us have real time combat experience. We have been to see the “Elephant Country”. The younger folks need what we have to offer because they will die without it.

My problem is very simple. I have done all of the right preparedness chores and now I find that my family can not get in the truck and bug out. And I’ll be 69, next birthday. What do I do now?

thanks again. – Old Bobbert in Utah

JWR Replies: My general recommendation for retirees is to set yourself up as the retreat destination for the younger members of your extended family. You can provide them with their bug-out location, and storage for their supplies, and the benefits of your years of preparation. They can provide you with the young and healthy hands, strong backs, sharp eyes, and sensitive ears you will need after TEOTWAWKI. I often stress the need to pre-position retreat logistics. By having your extended family’s supplies at your locale, it provides insurance that they will be there to help out, when the balloon goes up.

OBTW, you mentioned oxygen. For anyone that heavily dependent on medical oxygen, I strongly recommend buying a portable oxygen concentrator. Many of the portable models are compatible with 12 VDC power. This means that you can run them from your alternative power system battery bank, without the need to run a DC-to-AC inverter. For much greater “range” away from your retreat, you can keep a charged pair of deep cycle 6 VDC golf cart batteries in your vehicle.

Letter Re: Growing Food on a City Lot

JWR:
While we all dream that perfect place in the country it is important to emphasize how much that can be accomplished on a small city lot. My home sits on about 6,000 square feet of land, a small suburban house in a cookie-cutter neighborhood . The house and garage and drive way take up about half of the lot . Of what’s left, I’m slowly converting the ornamental landscape to organic food production. My current garden consists of 48 tomato plants (4 varieties) 2 beds of sweet corn, 2 rows of cucumbers staggered 2 month s apart for continuous harvest, 2 similar rows of pole beans, one row of lima beans, 30 sweet pepper plants, 6 pumpkins, 12 winter squash, 12 summer squash , 6 cantaloupes , 4 peach trees, 2 nectarine trees , 2 pear trees , 2 apple trees, and one fig. In addition, numerous herbs –(basil , dill, rosemary, sage, and thyme) and 4 artichoke plants . Could easily plant enough onions and garlic to last us all year and I plan to do so as I add beds.

Last year I grew enough popcorn to last two years. Next year I plan on a large bed of dent corn for corn meal. Am still experimenting with winter crops but peas, beets, carrots, and kale all do well and I’m anxious to see how many potatoes I can get from 100 square feet.

I figure that I’ ll pull about $2,000 worth of food from the garden this year and that ’it is going to increase because I still have about 1,000 square feet of ornamental beds and lawn to tear out and plant and the fruit trees are still young . Over the past 8 years I’ve spent less than $1,000 for tools and equipment: two spades (one all metal for my heavy clay soil) , a Mantis tiller, metal fencing stakes for pole beans, tomato e s, and cucumbers ( they last forever, much better than wood) , various clippers, twine, a bit of organic fertilizer , and the bare-root fruit trees . This year I’ve spent less than $25 ( seeds, twine, and a bit of seaweed spray) since I have all the tools already. Could rent out my tiller at $ 30 / day if I took the trouble to post at the local store. Meanwhile, we’re eating healthy and free and will start putting up food as I expand my beds and grow enough to save as well as eat.

I love the work so it is not drudgery for me it is great exercise and a relief to be outside after working in my office all week . Weekends in late winter and early spring are a bit busy –– perhaps 5 or 6 hours per weekend for a month or so . But once the winter garden is out and the spring garden is planted, it requires about two hours per week for the rest of the season.

Yes, we all want to life in the country. But until then there’s free food for eating and survival storage right in your backyard if you’re willing to do the work. – Patrick C. in Southern California

Two Letters Re: It Matters Not Whether We Face Inflation or Deflation–You Need to Protect Yourself

Mr. Rawles,
Just a quick comment on Gentleman Jim’s excellent letter. He wrote:” [U.S. Silver Eagles] are obviously more valuable than the pre-1965 junk silver coins, and thus you can get a great store of value into fewer coins. … Plus, they get very heavy very fast.”

Silver is silver is silver. You shouldn’t be too concerned with what particular impression or markings are on the coin, or where it was minted, or what year, etc etc. All those things have their place, but when it comes to investing in silver and gold for the type of wealth storage and protection we’re discussing here, they are irrelevant at best and can in fact be a detriment. You’re buying silver, period. The silver content should be your primary concern, and the coin/bar/ingot/whatever that allows you to acquire the greatest amount of silver at the lowest price per ounce should be your choice. Melt value is what matters.

Thus his comment that “you can get a great store of value into fewer coins” is somewhat misleading, and “they get very heavy very fast”—while being technically true from a mere scale standpoint—is missing the point. An ounce of silver is an ounce of silver is an ounce of silver. 100 ounces of silver in the form of Silver Eagles is no more or less valuable than 100 ounces of silver in the form of pre-1965 coins. Either way, you have 100 ounces of silver. True enough, 10% of the weight and space taken up by 90% junk silver coins is “wasted” on irrelevant [hardening, for circulation] metal content, and thus for a given dollar amount the pre-1965 coin stash will weigh a bit more, but for most folks the practical differences are moot. I’d rather pay a much smaller premium than be concerned with the marginally different storage and handling requirements. The same [“buy with the lowest premium”] principle applies to gold. – CH

Jim,
Regarding the “Jim from Colorado’s” article I agree with his premise, however there are a few errors I’d like to correct.

He states:

“Look back to the 1930s in the United States.when the devalued dollar led to such extreme measures that in 1933, FDR confiscated nearly all of the gold in the country-and reimbursed owners at a fraction of the value of their gold (absolutely true statement; I have a copy of the Executive Order, if you’d like to read it).
o Yes, households were allowed to keep a small fraction of their holdings, no more than $100 worth of gold, and also numismatic collector’s coins were exempted.
o Yes, industrial concerns and business were allowed to continue storing “appropriate” amounts of gold for things like making jewelry, etc.
o The point here is-the government literally came and took people’s gold from them.at bargain basement prices.”

The correct timeline for “confiscation” and subsequent devaluation of the dollar was as follows:

“March 6, 1933
Using a wartime statute passed in 1917, Mr Roosevelt issued a proclamation closing every bank in the U.S. for four days. The banks were closed from March 6 to March 9.

April 5, 1933
President Roosevelt, acting under the sweeping authority passed to him by Congress on March 9, signed Presidential Executive Order 6102 which invoked his authority to make it unlawful to own or hold gold coins, gold bullion, or gold certificates. The export of Gold for purposes of payment was also outlawed, except under license from the Treasury.

January 30, 1934
The “Gold Reserve Act” became law. It had passed through Congress in five days, with minimal debate. Under this act, the Federal Government took away title to all “Gold Certificates” and gold held by the Federal Reserve Bank (the independent Fed?) and vested sole title with the U.S. Treasury. The Fed banks were to be provided with “Gold Certificates” in return for their Gold, but these certificates had no specific value in Gold assigned to them.

January 31, 1934
The day after the passage of the Act, President Roosevelt fixed the weight of the Dollar at 15.715 grains of Gold “nine-tenths fine”. The Dollar was thereby devalued from $20.67 to one troy ounce of Gold to $35.00 to one troy ounce of Gold – or by 69.3 percent. The Treasury, which had become the possessors of all the nation’s Gold on the previous day, saw the value of their Gold holdings increase by $US 2.81 Billion. The Treasury now “owned” the Gold, and no one else inside the U.S. was allowed to own any Gold except by the express permission of the Treasury.

The new ratio of $US 35 [per ounce] was adopted at Bretton Woods in July 1944. The U.S. Dollar was made the world’s Reserve Currency and the IMF and World Bank established in 1947. The now international ratio of 35 U.S. Dollars to one troy ounce of Gold lasted until August 15, 1971.”

In short they called in the gold and paid $20.67/oz on April 5, 1933, but it wasn’t until January 31, 1934 that they devalued the USD to $35/oz. And the so called “confiscation”, never really was. They were simply ordered, under threat of imprisonment to turn it in and it was declared illegal. They never went door to door and took anything. There was IIRC only one attempt at prosecution and it involved millions of dollars in gold bullion. Many (most?) people never turned in anything. Also, from what I can gleam from passed down second hand stories the safety deposit box line from the Executive Order was not strictly enforced either. All the best, – O.E.

JWR Replies: You mentioned: “They never went door to door and took anything.” Yes, that is correct, but only because government officials didn’t have to. By declaring possession of gold coins illegal, they “smoked out” nearly all the gold coins that were in circulation. People dutifully exchanged their gold coins 1-for-1 (at face value) for FRN paper currency, knowing that they wouldn’t be able to spend their gold coins after the new law went into effect. A $20 gold piece got them a $20 FRN. Wow, what a bargain! Only later were they stabbed in the back by the official revaluation of gold. This was larceny on a grand scale, committed by the FDR administration. There is no more powerful coercive force than that wielded by an ostensibly constitutional government, acting under color of law. In short, FDR did what was expedient, and his administration robbed the American people of their gold. What would be a felony for an individual to do was deemed “lawful” for a government to do.

Economics and Investing:

From “Kevin Lendel”: China airs fears on US debt, dollar: lawmaker

10 big banks get OK to repay $68B in bailout money (Thanks to H.D.K. for the link) “Experts say allowing 10 banks to return $68 billion in bailout money illustrates some stability has returned to the system but caution that the crisis isn’t over. Some worry the repayments could widen the gap between healthy and weak banks.” Cheryl N. notes. “Just remember, these banks suddenly were able to pay their bills after the FASB changed some accounting rules. It’s just more “green shoots” based on falsified accounting records.

HPD spotted this piece by Mish Shedlock: Eight Step Program to Improve Fed’s Image

Items from The Economatrix:

Charles Hugh Smith’s commentary: Why The Current Depression Will Be Deeper Than 1929

Justice Ginsburg Delays Chrysler Sale

Geithner to Sen. DeMint: Bailouts May Never End, No Exit Plan. JWR Adds: Gee, that sounds like the very definition of the MOAB…

Obamanomics: How Stupid Do They Think We Are?

The Economy is Still at The Brink “We have both spent large chunks of our lives working on Wall Street, absorbing its ethic and mores. We’re concerned that nothing has really been fixed. We’re doubly concerned that people appear to feel the worst of the storm is over —and in this, they are aided and abetted by a hugely popular and charismatic president and by the fact that the Dow has increased by 35 percent or so since Mr. Obama started to lay out his economic plans in March. But wishing for improvement and managing by the Dow’s swings are a fool’s game.”

Bank Profits From Accounting Rules [Relaxation] Masking Looming Loan Losses “The revival may be short-lived. Analysts who have examined the quarterly profits and government tests say that accounting rule changes and rosy assumptions are making the institutions look healthier than they are.”

Economist: Housing Bubble Caused Great Depression, Too

Skousen: Something Rotten In Auto Bankruptcy Deals

Medvedev: Russia, China Should Dump Dollar In Trade “Medvedev said bilateral currency deals between trade partners ease impact of the economic crisis in an environment when many countries have difficulties tapping international capital markets.”

Russian Rouble to Go Palladium

US Expert: India, China Ready to Rule World Economy “… the Centre for Economics and Business Research (CEBR), a London-based economic consulting firm, had predicted emerging market economies may overtake the US and the rest of the Western world this year instead of 2015 as predicted earlier.”

Peter Schiff: The Charm Offensive “…no matter how slick the sales pitch, no amount of lipstick can dress up this pig.”

Odds ‘n Sods:

From my old friend “John Jones”: Solar Storm Threat Assessment

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SurvivalBlog’s Editor at Large Michael Z. Williamson spotted this video clip. Bobcat wood splitter. Wow! As my dad always said: There’s nothing like power tools!

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Christopher T. flagged this: Texas company offers ethanol mini-refineries

The folks at Ready Made Resources, mentioned that they just received a limited supply of genuine made in the U.S.A. stainless steel surgical hemostats. These are not made in Pakistani, (some of which will rust in an autoclave) .Still sealed in original packages $17.95 for a pair, in 5-1/2″ and 6-1/2″ length.

Jim’s Quote of the Day:

"…compared warfare to a grand ballet, where every minute, every second, is carefully choreographed and orchestrated, but when the conductor raises the baton for the first note, two homicidal maniacs jump out of the orchestra pit onto the stage with bayonets and begin chasing the ballerinas – that is warfare. Much the same is true for disaster planning. Nevertheless, because you went through the planning process, you understand the key challenges, the key questions, and the critical issues regarding your specific business – and that is what will give you the flexibility to adapt in a crisis." – General Norman Schwarzkopf

Note from JWR:

Our SurvivalRealty spin-off site has several new retreat property listings in Wyoming, Montana, and Idaho. Also, a very unusual underground house in Colorado has also been re-posted. Check them out. These properties represent some of the best available to get yourself ready to zurück. Find a good retreat and head for the hills!

It Matters Not Whether Inflation or Deflation–You Need to Protect Yourself, by Gentleman Jim from Colorado

No matter who you are, where you live, or whatever your political proclivities, economic trends such as inflation/hyper-inflation/deflation simply don’t care which party you belong to, who you voted for, or whether you’re believe in Keynesian “prime the pump” spending by the government, or not. The laws of economics may be somewhat fungible and give us surprises from time to time, but overall:

* They don’t care whether you love the earth, hate the earth, drive electric tiny-cars or huge Hummers or travel by foot or horse.
* They don’t care whether you’re in a blue state or a red state or a purple state or a pink state.
* They don’t care whether you rent a tiny apartment in the city or own 10,000-acres of ranch land with a huge mansion thereon.

Let me say it one more time: inflation, hyper-inflation and/or deflation don’t care who you are! They’re like unwelcome guests who stop by uninvited and visit you and help themselves, no matter who you are or where you live or what you believe.

Did you know that in the modern history of our world, there are over 500 currencies (systems of money) that simply no longer exist? Yep, the only folks that even know about all those currencies are the coin collectors and a few historians.

* But almost universally, they all share one feature: they died due to hyper-inflation and subsequent devaluation.
* In nearly every one of those cases, the corresponding governments fell, and quite often the societies pretty well ceased to exist—they were subsumed by other nations with stronger currency.

Can’t happen here? Please, do some reading and allow yourself to be impartial.

* Check out the recent cases of [mass] inflation and hyperinflation in Zimbabwe and Argentina.
* Look back to Germany’s Weimar Republic in the 1920s—it is quite easy, via the Internet, to find pictures of everyday Germans taking a wheelbarrow full of money to the store to buy just a loaf of bread.
* Look back to the 1930s in the United States…when the devalued dollar led to such extreme measures that in 1933, FDR confiscated nearly all of the gold in the country—and reimbursed owners at a fraction of the value of their gold (absolutely true statement; I have a copy of the Executive Order, if you’d like to read it).
o Yes, households were allowed to keep a small fraction of their holdings, no more than $100 worth of gold, and also numismatic collector’s coins were exempted.
o Yes, industrial concerns and business were allowed to continue storing “appropriate” amounts of gold for things like making jewelry, etc.
o The point here is—the government literally came and took people’s gold from them…at bargain basement prices.
o Today…what might they take? Your 401(k)? Your military retirement pay? Your teacher’s retirement pay? Your extra cars–and the government gets to define what constitutes “extra”. After all, it isn’t fair for some to have, and others not, right?

· Scary? Over-wrought?

· Again, read the 1933 FDR gold confiscation order. It is real, it happened, and you can even look it up on the Internet or any encyclopedia.

Now then…if you’ve read this far…you’re probably asking yourself the question: “Okay, so what should I be doing about all this? What should other people be doing about it?”

First and foremost…try to staunch (or at least quell) the storm. Contact your city, county, state and federal officials, representatives, senators, presidents, etc.

· Ask them…beg them…demand of them…that spending be reigned in.

· That our governments at all levels live within their means.

· That taxes be kept at lower levels.

Because if we don’t get our spending under control, all of us will suffer. From the top to the bottom, east to west, north to south, rich to poor, old to young.

* Do something…now…before it is too late. Reign in our governments’ spending before it is too late!

Second: You need to start considering the possibility that the looming storm will break right down on top of you…me…us…our children…our grand-parents…everyone we know.

* So, yes, you need to prepare yourself against that day. You don’t have to believe Armageddon is here, to read a couple of history books and understand what happens in a classic deflation—inflation—hyperinflation—government collapse type of situation. And, fortunately, there are some common-sense things you can do to at least reduce the eventual impact on yourself and your loved ones.

For example, pay off all debt. Immediately! Okay, if not immediately, pretty darn fast. Remember that during the Great Depression, many a farm was foreclosed upon because there was a mortgage on it, but sometimes for only a few hundred dollars. It’s just that no one had even that few hundred dollars with which to redeem that mortgage, and thus family homesteads were lost forever.

Understand that one day your bank may close or be closed. Your bank accounts may not be accessible for days…weeks…or even months. It doesn’t really matter if those accounts are FDIC-insured for up to $200,000. If you can’t get it out for six months…and inflation is running at 20% per month…your money will be worthless by the time you can get it out. So, buy a safe and keep a few thousand or few hundred dollars stashed away, just for emergencies. How much do you need to stash away? That is up to you and your particular circumstances. But you should break up the currency into mostly tens, fives and ones…and probably 30% of it should be in coins (quarters, dimes, nickels—but don’t bother with pennies). (BTW, don’t let the neighbors know that you’re doing this!)

If you have the resources, it would be exceedingly wise to store some silver and gold coin, preferably in coin form. Since most of us can’t afford that buy-in prices of gold (now well over $900 per ounce), that means buying silver. Survivalblog has some excellent recommendations in this area, and you should check that source. However, for most of us, you can break it down into two easy-to-remember areas:

1) Pre-1965 U.S. “junk silver” coins (back when U.S. coins were still mostly silver-based, at about 90%). These include quarters, dimes, half-dollar and dollar coins of the era. But check the silver content of half-dollars—those made from 1965 to 1970 are only 40% silver. Look at places like SurvivalBlog and Coinflation.com to understand why buying pre-1965 coinage is a good idea; for this article, suffice to say that these are a good idea. Your budget will of course determine how much of these you can buy. Potential sources include local coin dealers, local coin collectors (potentially the cheapest sources, if you can find an elderly couple who are liquidating their collections), eBay, Goldline.com and many others. You should be able to buy these junk silver coins for between 10 and 12 times the face value of the coins selected, depending on your source.

2) U.S. Silver Eagle coins. Now, many smart folks like Jim Rawles of Survivalblog are not fans of the Silver Eagle series of coins—check his web site for those opinions. On the other hand, I am personally of the opinion that Silver eagles represent a very strong option. They are obviously more valuable than the pre-1965 junk silver coins, and thus you can get a great store of value into fewer coins. After all, the space considerations of storing a zillion dimes and quarters is pretty significant. Plus, they get very heavy very fast. Silver Eagle coins, on the down side, may represent too large a store of value in one coin….you don’t want to be buying a loaf of bread with a U.S. Silver Eagle, when a 90%-silver Mercury Dime will do the job.

1. On the other hand, I can’t see anyone carrying thirty pounds of silver through what could be very dangerous streets, on their way to try to bribe some embassy official to provide a visa to a more stable country. Heck, even the Silver Eagles might be too big and heavy for that purpose, so you probably will need to have some gold coins, as well.

2. Don’t laugh too hard at that concept. Remember, gold & silver were how many Jews and other ethnic minorities bought their way out of Nazi Germany and occupied Europe, at least in the early years of the Hitler era. Today, a few of the minority farmers in the Zimbabwean countryside are using gold & silver to buy passage to safety, once they have been driven off their farms by the mobs.

If you can afford to buy some gold, as well as silver, be sure to include a lot of the smaller [fractional] gold coins. You don’t want to be getting out a hammer and chisel, trying to cut a gold coin in half, in the middle of a long immigration line. But never forget that U.S. government has confiscated gold once before (1933), and could well do so again. You might want to be discreet in how you purchase, store and transport your gold.

Finally, remember that such silver and gold purchases are not investments. They are insurance! Just as you pay “XXX “dollars a month for your auto, home or life insurance, yet count yourself lucky if you never have to make a claim for your policies’ benefits…you should look at Gold and Silver the same way. Try to buy consistently over time, and try to buy a little more whenever the prices drop some.

* But recognize that you are buying insurance against the partial or total devaluation of our nation’s currency. Don’t expect to make any money off of these purchases in an investment sense—but I’ll bet you sleep better at night, once you have stored a small amount of silver & gold in your home safe.

Third, you need to invest in commodities and hard assets—“things.” The good news is that you can do this without owning 50 guns or living on the Canadian border.

* If you think inflation/hyper-inflation is coming….having a few months of food in the pantry is a sure money-maker.
* If you believe deflation is coming…having some food on-hand is even more important—because in a deflationary environment, many farms will be going out of business and cease production…meaning that no more how little it might cost or how much money you might have…if the corn is never grown in the first place, it can’t find it’s way to your dinner table.

If you find the pantry & storage room getting cluttered with canned goods and boxes, invest in some shelving units. I recommend specialized food storage shelving units such as those sold at Rocky Mountain Home Solutions (Disclosure: my wife owns and operates this company.) Or, check out the various advertisers on SurvivalBlog

* Think about buying a four-wheel drive SUV or truck. If not, at least make sure your vehicles are in good repair, with excellent tires and brakes, recently tuned-up, and with new air filters.
* Buy some new/extra camping supplies…and then use them to take the kids camping this summer. You’ll save money over hitting places like Disney World or Six Flags, probably have more fun, get closer to your kids, create some lifelong memories, and then still have the camping equipment that could be used “just in case.”
* Think about a means of self-defense, keeping in mind local, state and federal laws.

1. How, How Much and What Kind are completely up to you, within the bounds of your budget and your good conscience.

2. One good rule of thumb is that for any means of self-defense to be useful, you must also invest in initial and ongoing training.

3. So, if you want to use judo or karate as your self-defense means, then you need to stay in shape and practice on a regular basis.

4. If you want some knives—you need to take a couple of courses on how to effectively defend yourself without risking harm to yourself or innocent bystanders.

5. And if you buy a firearm of some type, then you really need to know what you’re doing. Don’t put yourself in a bad situation by not knowing how to handle your weapons. This is not meant to discourage you from owning firearms—we own several—but to emphasize that they require an investment of your time and attention, as well as money. [JWR Adds: Get training from well-qualified instructors. Start with an NRA firearms safety class. Then take advantage of the inexpensive training offered by the RWVA (the Appleseed folks) and WRSA. Then move on to advanced training offered by schools like Gunsite and Thunder Ranch. As time and budget allow, move on to advanced force -on-force training.]

6. And of course, firearms require an investment in ammunition—or you risk having only large clubs to defend yourself with.

After taking these initial steps toward preparing for an uncertain future, consider other resources for further information and “next steps. Obviously, SurvivalBlog is an excellent source—very even-handed and stays on topic. We’ve also found the Mountain Steps Blog to be a great source of straightforward, honest advice—perfect for the beginning or “early” preparer. Stay away from any radical blogs that focus on conspiracy theories and potential violence—they simply spend too much time focusing on “why” things are happening, and you probably don’t have the time for that. Instead, focus on preparing for a broad spectrum of potential scenarios that will give you the widest scope of options in any real-world emergency.

Well, that’s probably enough advice for now. I hope some of you have found it useful, and perhaps even inspiring. As my old basketball coach used to say: “Don’t be caught watching the paint dry!!” Do something, because anything is going to be better than nothing.