Note from JWR:

The SurvivalBlog Benefit Auction ends tomorrow (Sunday, June 15th.) The high bid is now at $920. This big auction is for any of you that are gun enthusiasts. It includes 17 items: A four day “gray” transferable Front Sight course certificate, which was kindly donated by Naish Piazza of Front Sight (worth up to $2,000), a $200 gift certificate from Choate Machine and Tool Company (the makers of excellent fiberglass stocks, folding stocks, and shotgun magazine extensions), $450+ worth of full capacity magazines from my personal collection including five scarce original Ruger-made 20 round Mini-14 magazines and five scarce 20 round Beretta M92 magazines, and an autographed copy of the book “Boston’s Gun Bible.” The total value of this 17 item auction lot is $2,700! (See the SurvivalBlog Benefit Auction page for details on exactly what is included.) Note: Because this auction includes full capacity magazines, no bids will be accepted from outside of the US or from a resident of any state with magazine restrictions. Please e-mail us your bids, in $10 increments. Place your bid soon!

Two Letters Re: Some Observations on Recent Flooding in the US Midwest

James,
I got this from a friend in Indiana:
All is well at our house but the town is suffering. Here are a few comments for your edification.
– Small rivers come up fast with 10 inches of rainfall. Unknown to me, but if I had delayed another 30 minutes in going home, I would not have been with my family where I was needed.
– This was the first time other than snow events when I could not leave town. All roads underwater, including interstates and state highways.
– My Chevy 4WD pickup will go through deeper water than most cars. Don’t purchase any used cars from Indiana for awhile.
– The portable generator worked great. With smart load management I could essentially run the entire house including frig, freezer, microwave, geothermal air conditioning, and lights. Total power off time was 12 hours with less that 6 hours of generator run time. Now I want to have more fuel on hand. A quieter generator would have been a plus.
– When the power went off and it was expected to be off for the duration of this emergency, we all immediately took showers to use the available hot water. Sometime later the city water pressure went way down but not completely off. Toilets remained operational.
– The hospital was flooded and will be closed for an indeterminate length of time. All patients were evacuated. Plan your medical emergencies accordingly.
– I’m in the market for a battery powered AM/FM radio with headphone jack so I can listen to local news without disturbing others during the night. Local radio seems to be the best source of information. Cable went off line. The weather band radio was useful as they routinely give river level conditions.
– The middle school and later the high school were opened for those seeking shelter. I’d rather sleep in the woods.
– My brother lives 30 miles away but works here. He was stranded and spent the night with us. He appreciated the hot shower, clean bed, dinner, etc. He’s now thinking that a bug out kit would be a good thing. He would have slept in his truck rather than go to the shelter. Drinking water would have been his first issue.
– Cell phone communications stayed up but were overloaded. Too many folks use them for non-essential communications. Same for 911 calls. I don’t have a good work around but will give this some thought.
– There was no car or pedestrian traffic in our subdivision during the night. I anticipate this would change if the situation had stretched for several days. With no street lights or city ambient lighting, night vision [equipment] would have been helpful.
– The headlamp on a headband really makes the odd jobs in the dark much easier to manage. LED flashlights are a good thing. Surefire [flashlight]s were kept in reserve.
The town is in clean up mode now. Thanks and Best Wishes, – Bill N.

Mr. Rawles

Hello from a long time reader. Thanks for all the info. I thought I could give everyone a heads up on what is happening in the new Wisconsin wetlands. First off it is amazing how foolish people act when a disaster strikes. There a literally hundreds of people walking around in backed up sewer water which is waist deep. Without even shoes? People think that if they drive their sports car fast enough through the water they can make it. People who live within sight of a river are on television saying how shocked they are. Didn’t it ever occur to anyone that if you live within 20 feet of a body of water it might rise someday?

My house is fine, on a hill in the higher part of town. Our Bug Out Location (B.O.L.) is fine too, just called and got the”okay” word. It is nice to know which ways to take out of town in the event of a flood for next time. Make a note of this it might come in handy. People are helping each other sand bag their homes and businesses. I wonder how long people will work together if food were to not be trucked in. It was funny to watch my neighbors load groceries into their house in the pouring rain. Preps come in handy on a rainy day, literally.

There has been lots of damage around all of Wisconsin, I had to take an alternate route to work as they shutdown a few of the lower roads. Seeing the damage first hand is sad and at the same time I think is good for people because it makes them realize how quickly everything can be lost. Coming home from my in-laws’ house, I had a man hole cover blow off two feet from my truck, due to the water pressure. The next day there was an article in the local paper on how one woman’s SUV was totaled because she wasn’t so lucky.

Now I’m just waiting wondering if I will have a job, if the d**n on Phantom Lake goes, so does the building that I work at. – Bill C. in Wisconsin

From David in Israel Re: Some Preparedness Implications of Rapidly Escalating Fuel Prices

James
We are all seeing the rise in fuel prices affecting food prices. I would like the readers to do a acres of farm to miles traveled evaluation of their plans when planning for a world with sparse petro-fuels.
The current option is to ignore the prices and continue to fuel large SUVs and pickup trucks even for for “pick me up milk” runs.
A fuel efficient car or motorcycle makes more sense depending on the number of passengers travelling.

Bio-diesel or ethanol from your field rarely makes sense for anything other than a few very important drives per year or towing a harvester, the effort to farm these crops are better fed to work animals and
human workers. Although if you really only make these few drives it might even out considering you make one or two batches of fuel and garage the truck the rest of the year, no daily feeding of a huge hungry beast.

Horses and oxen are very useful on a large post-petroleum farm, replacing the tractor and truck, but you need to feed that large living muscle mass even in the dead of winter when there is little
important(to your survival bottom line) travel or work. It is important to remember that even into the steam age before bicycles and automobiles reduced the number of work animals around half of the US farm output went into the mouths of work and transportation animals. Even if you are able to graze in the fair months of the year most Americans in the northern
states need to have plans to safely mow and store large amounts of hay and grains to feed your livestock. A donkey or mule is smaller and must pull a smaller plow or load but in the off months they are
a smaller idle eater and need less exercise to stay healthy and content .

The last stop in labor is the human body, around the world many poorer peoples use themselves as farming machines. You will see a man pulling a plow with his wife or child steering. A bicycle converts muscle energy many times over saving calories and time for longer range travel, as long as the bicycle can be maintained. The trick with human energy is we don’t slaughter ourselves if times get tight, and we can still do useful work even in winter when most work animals are idle eaters. This is why the farm family has always rejoiced in another new baby, not only was it filling the command to be fruitful and multiply but it was another helping hand.(Have you ever noticed that the more religious families even in urban areas often have many children?)

On the plus calorie side chickens, goats, sheep and larger free grazed food animals add calories to your bottom line by metabolizing insects, kitchen scraps, and cellulose like grass into food that humans can easily consume. We need not say that the beast deal is gathered fruits, honey, netted fish, and hunted or tapped nutrition which require tiny amounts of exertion compared to the calories obtained.
Shalom, – David in Israel

Odds ‘n Sods:

Eric sent us this one: Man Retrofits Freezer to Make an Ultra-Efficient Fridge

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Courtesy of Bob from Minnesota: BIO5 Researcher Identifies Cities at Risk for Bioterrorism. Generally, this is yet another piece of confirmation for my preferences in the SurvivalBlog Recommended Retreat Areas page.

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Frank S. flagged this: Too Much Money: Inflation Goes Global

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Carl H. found this MakerFaire video on making crystal iodine from potassium iodide. This, BTW, ties in to the DEA restrictions on Polar Pure crystals–previously mentioned in SurvivalBlog

Jim’s Quote of the Day:

I remember hearing:

How high’s the water, mama?
Two feet high and risin’
How high’s the water, papa?
Two feet high and risin’

We can make it to the road in a homemade boat
That’s the only thing we got left that’ll float
It’s already over all the wheat and the oats,
Two feet high and risin’

How high’s the water, mama?
Three feet high and risin’
How high’s the water, papa?
Three feet high and risin’

Well, the hives are gone,
I’ve lost my bees
The chickens are sleepin’
In the willow trees
Cow’s in water up past her knees,
Three feet high and risin’

How high’s the water, mama?
Four feet high and risin’
How high’s the water, papa?
Four feet high and risin’

Hey, come look through the window pane,
The bus is comin’, gonna take us to the train
Looks like we’ll be blessed with a little more rain,
Four feet high and risin’

How high’s the water, mama?
Five feet high and risin’
How high’s the water, papa?
Five feet high and risin’

Well, the rails are washed out north of town
We gotta head for higher ground
We can’t come back till the water comes down,
Five feet high and risin’

Well, it’s five feet high and risin’

– Johnny Cash, Five Feet High and Rising

Note from JWR:

Please mention SurvivalBlog whenever you call in to a talk radio show or a podcast where they are discussing preparedness. Thanks!

Some Preparedness Implications of Rapidly Escalating Fuel Prices

The recent jump in fuel prices are going to have some far reaching effects on our economy. There is speculation that crude oil may soon spike to $150 to $170 per barrel. As prepared individuals, we need to adapt our plans, accordingly. It is noteworthy that many of us long hence foresaw these dark days, and installed underground fuel tanks, bought alternate fuel vehicles, multi-fuel generators, and at least one vehicle just for the sake of fuel economy. (If you look at the Retreat Owner Profiles–most of which were written in late 2005 and early 2006–you will see a remarkable number of fuel-efficient “secondary” vehicles.) SurvivalBlog readers plan ahead, and it shows.

In a recent issue of The Daily Reckoning, Bill Bonner wrote: “Just on Thursday and Friday of last week, wholesale gasoline prices went up 33 cents. No typo. That’s 33 cents, in two days. So let’s round it out and add another $500 to the annual gasoline bill to operate one average automobile in the US of A. If you are a two-car household, make that number $1,000. Just from a two-day spike. And that does not count the impact on diesel (killing trucking and agriculture) and jet fuel (killing airlines).”

Effectively, the recent price jumps will be like inflationary snorts of cocaine. Sooner or later, the higher cost of fuel will be “passed through” to consumers. Can you imagine what will happen to the retail price of just about everything if and when the price of gas tops $5.50 per gallon? Transportation cost increases are significant, but will impact some product prices more than others. The heavier and bulkier the item, or the farther it must travel (all the way from raw material to your doorstep) the greater the impact of the fuel price jumps. (One hint: If you’ve been planning to buy a gun vault, then buy it soon, and do so locally, from inventory that your dealer already has on hand. If you delay, it will likely cost $200 more, this time next year.) What will happen to Fed-Ex , UPS, and US Postal Service rates next year? It won’t be pretty. OBTW, if you are thinking about setting up a home-based mail order business, then you’d had better consider focusing on small and lightweight products, such as used DVDs.

Think through what the fuel prices will do for various product prices and availability (think: spot shortages), and who they will affect life at your retreat.

I predict that there will be a long lag time while the price of propane catches up to the prices of other fuels. The cost of electricity will also lag behind, especially in regions that have predominately hydroelectric power. In the long run, however, prices will undoubtedly catch up. Exploit this lag time to build up the alternative energy potential of your retreat. Think through you options, do some comparison pricing, and then get busy. (Consider the merits and drawbacks of photovoltaics, wind, micro-hydro, bio-gas, biodiesel, geothermal, wood-fired steam/co-generation, and so forth.)

Vehicles

If you are planning to buy additional vehicles for your retreat, consider the following:

One of your vehicles should be a very fuel-efficient runabout. (Something like a used Geo Metro or Toyota Corolla–but for serious preparedness planning avoid the high cost and complexity of a hybrid.) If you need four wheel drive, consider buying a used Subaru. Notably, Subaru all-wheel-drive cars are the most popular cars with America’s contract rural mail carriers. Also consider getting a mo-ped or motorcycle for handling some of your errands in the current pre-Schumeresque times.

Look for a fleet surplus propane-powered pickup. (Utility companies often use these. Watch for auction announcements.) If you could get one that is 4WD, that would be ideal. But even if you can’t find one that is 4WD, one option is finding a 4WD of the same year and the same maker as your 2WD propane-engine truck, and then combining parts to create a “Frankentruck.” Not only would this be great mechanical experience, but it will leave you with another nearly complete vehicle to cannibalize for spare parts. Another option, albeit more expensive, is converting an existing 4WD to propane. Because Propane tanks are large, this is best accomplished with a 4WD pickup. (I have seen pairs of 47-gallon capacity “torpedo tanks” installed above the wheel wells in a pickup box. This allows nearly full use of the pickup bed space.) Since a propane conversion will likely void a warranty, it is best done with an older vehicle that is “out of warranty”. Speaking of propane, don’t miss the recent piece by FerFAL, (SurvivalBlog’s correspondent in Argentina), posted at his personal blog site: Alternative fuel for your car. It describes a gaz naturel comprimé (GNC) conversion done on his Korean import car.

Own at least one E85-compatible “Flex Fuel” vehicle (FFV).

If your budget allows it, consider getting an electric vehicle. (Several times in SurvivalBlog, I’ve mentioned Bad Boy Buggy electric ATVs as well as ATV suspension conversions for electric golf carts.) An electric ATV makes an ideal “at the retreat ” utility vehicle, particularly for someone that has a large alternate power system with a battery bank.

Here is one vehicle possibility that might at first seem counterintuitive: There will probably be thousands of used recreational vehicles (RVs) hitting the market in the next few years–some for pennies on the dollar. Budget-minded preppers might consider buying an older RV to live in, while building their retreats. Just keep in mind that the resale value will likely drop to nearly nothing if gas prices continue to escalate, so only buy one if you can truly get it dirt cheap.

Horse Power

For the really long term, learn as much as you can about horses, and change your purchasing plans is this approach matches your needs and the pasture carrying capacity of your retreat. There is a lot to this: horsemanship, hay cutting (preferably horse-powered), hay storage, pasture fencing, a barn, tack, veterinary supplies, and so forth. Here at the Rawles Ranch, our saddle horse Money Pit may soon have some new friends in the pasture.

Hay and grain prices have been sky high for a full year now, so this has pushed the price of horses down tremendously. At present, in much of the western US, good saddle saddle horses are literally being given away. Just ask around. If you are not yet an experienced rider, then limit your search to older, gentle “bomb proof” mares or geldings. If you have plenty of pasture and hay ground, take advantage of the current low prices for horses. Buy them while they’re cheap. Watch your newspaper classified ads and Craig’s List for horses as as well as tack, hay mowers, and a horse trailer. In addition to saddle horse, think in terms of working horses. So while you are searching for saddles, also look for wagons, buck boards, horse collars, long reins, log chains, and other work horse tack.

Fuel Storage

Storing extra fuel is a natural for family preparedness. If you use propane, consider buying a larger tank. That fuel will be like money in the bank. Ditto for gasoline and diesel fuel. (See the SurvivalBlog archives for details on fuel stabilizers and and antibacterial additives. (The latter is for diesel. Yes, bacteria will actually grow in diesel fuel.) What size tank(s)? The bigger, the better. That way you can buy during occasional dips in the market as well as have a reserve that will help ride through any spot shortages. Consult you local fire code for any limits where you live. I generally prefer underground tanks, for both OPSEC and fire safety.

Generators

Needless to say, flexibility will be your goal with your backup generator(s). Various diesel generator and tri-fuel generators have already been discussed at length in SurvivalBlog. Despite its current high price tag, diesel is still a viable fuel for standby generators. Keep in mind that you can legally burn less expensive off-road (untaxed) diesel, biodiesel, and even home heating oil in your diesel genset. (Of course consult your state and local laws before doing so.)

Retreat Locales

Higher fuel costs will likely change the way the at you look at your retreat, and where it is located. If you are retired, self-employed, or if you telecommute, the impact won’t be nearly so great. You can simply adapt your lifestyle to make trips into town less often. But if you have a daily job “in town”, then the impact could be substantial. The whole concept of “public transportation” is foreign to folks that live in places like Wyoming or the Dakotas. Even carpooling can be difficult for people that live in lightly populated areas. OBTW, speaking of carpooling, I predict that both carpooling and ride sharing will undergo a great resurgence in the next few years. The information networking power of the Internet will undoubtedly be put to full use in matching drivers/riders and destinations. The carpooling networking sites like SpaceShare and eRideShare will probably become very popular.

Remote properties will seem even more remote when gas tops $5 per gallon. This has both positive and negative implications. The good news is that it will make remote properties more affordable and will also make them less likely to fall prey to “commuter criminals” and looters. But the bad news is if you are trapped in a corporate job and must commute to work. Ditto for farmers and ranchers that must get what they produce to market.

If you have not yet bought a retreat, then you might want to make the new fuel cost paradigm a more important part of your locale selection process. As I’ve mentioned before in SurvivalBlog, if you do some concerted searching, you might be ale to find a piece of land with a low-volume natural gas well, or a surface coal seam. Another possibility is finding a property with a large year-round stream and sufficient change in elevation (“fall”) allowing installation of a micro-hydro system. If you are an adherent to Peak Oil theory, then you might consider buying a retreat that is close to a community in a truck farming region–someplace that can expected to be self-sufficient in the event of chronic gas and diesel shortages. There are of course security trade-offs, so such a decision might be a momentous one to make. (Since most survivalists value having “elbow room”.)

Letter Re: Neighbors and Friends are Failing to Adapt and Prepare for New Threats

Mr. Rawles:
I stumbled upon your blog site last month and it was the equivalent of a “reboot” in terms of my own thinking about how to adapt to the conditions surrounding “Peak Oil” and Global Warming. I’m grateful for your web site and efforts. I commend your honesty. I envy your faith.

In the past months local and national events highlight the scope of the trouble we now all face. I’m afraid the direction is irreversible. To list a few, gasoline and diesel prices have climbed to new heights, both global and local weather conditions indicate a promise of drought and large scale crop collapse, and our infantile and narcissistic population is in grave denial. I would add this denial is paired with ignorance – as most people in American are unfamiliar with grave or harsh living conditions, nor do they care to learn about adapting to them. “Oh, that’s not going to happen here.”

As I urge those in my closest circle to begin to prepare for a number of increasingly bad scenarios – I am met with interest, curiosity, indifference and some ridicule. I am the family “kook”. My wife reminds me; “Jeremiah.” (This was discussed in the book, “Night” by Elie Weisel.)

People are not ready to think about what is coming. For example, in response to a Craig’s List ad I posted for a car pool rider (to share my commute.) I’ve received zero interest. A local news channel did a story on my ad and interviewed me for the story. The article included my comments about “Peak” and a “Long Emergency.” No takers. At the YMCA, where I train regularly, most men I speak to feel there is no global warming and either don’t know what Peak Oil is or feel the best solution is to bomb another country that has oil. I think to myself: these are the folks I’ll be defending my home against. Finally, when I suggested to my parents the need for spare supplies in their vacation house – my suggested list brought denials, anger and ridicule. They can’t even begin to think of survival scenarios or WTSHTF. (Their home is a McMansion built on some nice farmland – which I see has having great agricultural value in the future, provided there is adequate rain.)

James H. Kunstler, who wrote the book “The Long Emergency” recently spoke at our school auditorium. Only 20 or so people attended, and few had questions indicating any understanding of how violent these events may actually become. Another professor recently lectured at an area college on the same topic – and spelled it all out. He planned to bug out in advance. A local news paper carried the story. Perhaps this shows some progress? I commended the writer by e-mail.

To adapt, I began to prepare for the worst; I’m reading more about the subject, making no assumptions, stocking food, water and key equipment. I intend to train my 12 year-old to soon have familiarity with all weapons in our home (.22 rimfires, 12 gauge, and 9mm pistols.) Given our home location, its defensibility, and our firepower – I’m unsure as to how long we can make it – especially if civil unrest or military response is too strong, but I’m committed to dedicating resources to the cause – to do what I can for as long as I can and to educating those around me who will listen (this is tricky.)

From speaking with others on the same page, many are overwhelmed. I am too, but I always remind them that they can do a little every week. Underscored here also is that resources such as the bogus tax stimulus checks can be used to build food and supply stocks. I keep a purchase list ready – which will go against my fake tax give back. Grocery runs always include “extras” that will store well.

On a final note, although I’m dedicated to “hoping for the best and preparing for the worst,” I find it very difficult to bring my wife and only child into some of these scenarios. My wife is a great life partner and understands this situation very well – but some of this remains unspeakable. Further, I caution great care as to how to work with children on these matters. It is worse than the movie, “I Am Legend” because the “infected” will be real and much more plentiful, and the survival resources few. Camping and “activities” build the skill sets and offer the instructional opportunities, as someone already posted.

Thanks again for what you do, – Jon

JWR Replies: You are correct. Pollyanna denial is rampant. You aren’t the only one that encounters it.

Don’t worry about ridicule. Noah was considered a “kook”. So were the Jews that emigrated from Germany in the mid-1930s. Most of them survived, while those that didn’t ended up in the camps and many of them were subsequently victims of Nazi genocide.

Odds ‘n Sods:

Matt in Texas suggested this piece: Kobyashi Maru. Matt’s comment: “This should help make it clear that the Federal Reserve is between a rock and a hard place. No matter what decision is made on the discount rate…we are toast.”

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Thanks to David F for sending this: Two dead in Europe fuel protests. David notes: “For those who think food riots and fuel shortages are limited to the Third World, I think this article might bring things home a bit. This is hoarding, boycotts, people dying, [all] because of oil. Could the US be next?”

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Flood news from the Midwest: Downtown flooding ‘devastating and unbelievable’ say onlookers. And meanwhile we read: Corn hits record, soy rallies as floods expand

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I just noticed that following news of some short term “strength” in the US Dollar, the spot price of silver has been pushed down below $16.40 per ounce. Dips like these are a great buying opportunity!

Note from JWR:

There are just three days left in the SurvivalBlog Benefit Auction. is now at $650. The high bid is now at $810. This big auction is for any of you that are gun enthusiasts. It includes 17 items: A four day “gray” transferable Front Sight course certificate, which was kindly donated by Naish Piazza of Front Sight (worth up to $2,000), a $200 gift certificate from Choate Machine and Tool Company (the makers of excellent fiberglass stocks, folding stocks, and shotgun magazine extensions), $450+ worth of full capacity magazines from my personal collection including five scarce original Ruger-made 20 round Mini-14 magazines and five scarce 20 round Beretta M92 magazines, and an autographed copy of the book “Boston’s Gun Bible.” The total value of this 17 item auction lot is $2,700! (See the SurvivalBlog Benefit Auction page for details on exactly what is included.) Note: Because this auction includes full capacity magazines, no bids will be accepted from outside of the US or from a resident of any state with magazine restrictions. Please e-mail us your bids, in $10 increments. The auction ends on Sunday, June 15th.

Two Letters Re: Request for Investing Advice

Hello Jim,
First off, thanks for an excellent book/resource in your novel “Patriots”. I read it in the last week and it has had a profound effect on me. I also felt the writing was quite good, being entertaining and educational at the same time. Thanks for it!

After reading your book (and listening to my brother, who has been talking about TEOTWAWKI for some time now), I did finally do some things to prepare in the last week, but I wonder what the next step is for me.

First off, I invested about $80 to make some shelving in a storage closet downstairs that had previously been filled with junk.

Then I went to the local Wal-Mart and bought canned and dry goods: about six each of peas, corn, refried beans, tuna, pinto beans, stove top stuffing, rice, ramen, breakfast cereal, and so forth. I made sure to only buy stuff that we would eat anyway. I guess I’m not quite sure to buy whole grain and a mill, because truthfully unless we get to TEOTWAWKI, there’s no way we would use that stuff. Anyway, total cost for all this food was around $180, and it filled about 2/3rds of my shelves (the [shopping] cart was full though). I figure this is a good start, and now I feel if there was a “run on the grocery store” we would still be able to live for one to two months.

I also have lots of guns of varying calibers, including 8 rifles and 5 handguns, and probably 500 rounds of ammo total, approximately 300 of these are cartridges for my 9mm Glock which I just purchased new a few months ago.

Based on my brother’s advice, I did buy 12 one-ounce gold coins within the last year, and have those here in my house. After having read your book, I did go trade one of those coins for silver the other day, so I now have approximately $900 in silver as well.

I have decided to allocate all of my tax “stimulus” check towards preparing for the future. Our stimulus was approximately $700 (I made too much money to get the full amount), so I have about $400 left. So here’s the question: What do I spend this $400 on? More silver? More food? More ammo? I assume your opinion is that the price of all of these is going to continue to go up, but I hate to buy ammo when I see how doggone expensive it is now!

One more question: Between my wife and me we have a substantial sum invested in retirement funds, mostly in low-load mutual funds through Vanguard. I am wondering about taking a portion of this money and putting into a money-market account so that when/if the stock market crashes I will retain some value. However, I am also aware that inflation would eat this money alive, if we get into heavy inflation. I would be interested in your opinion on this question as well. Thanks, – Mr. H. in Wyoming

JWR Replies: Your tax stimulus check is probably best spent on additional useful tangibles such as food, first aid supplies, and ammo. Despite what appears to be the high price tag, the price of ammunition will likely continue to go up. Don’t think of it as ammo going up in price. It is more a function of the dollar going down in purchasing power.

With the recent collapse of the credit market, US stocks are now quite precarious. The dearth of credit is shutting down the economy. But regardless of whether or not there is a stock market crash or if US companies continue to limp along, US stocks certainly won’t have the same returns that they did in years past. So it is best to divest yourself of nearly all of your stocks and stock mutual funds. IMHO, the only stocks that are presently worth holding are in the energy sector and precious metals mining, and even then those should be the minority of your full portfolio.

At the present time, after paying off any outstanding consumer debt (such as car loans or credit cards) I’d recommend that you then reinvest the remainder of your mutual fund divestiture, as follows:

40% in inflation indexed US treasuries (TIPS),
20% in a global currency fund (to minimize your dollar exposure),
10% in additional food storage and various preparedness gear (first aid, communications, et cetera.)
10% in money market account
10% in silver mining and energy stocks
10% in barterable tangibles (as I’ve described in my blog–things like guns, common caliber ammo, and full capacity magazines)

However, your priorities my differ so you might want to adjust those ratios. The important thing is insulating yourself from inflation, and a the likely collapse of both the stock market and the US dollar in foreign exchange. Because of the global credit collapse, we are on the verge of a depression that could be as bad or worse than that of the 1930s. Be ready. Get out of stocks and minimize your US Dollar exposure.

If and when inflation jumps to double digits, even TIPS won’t be a safe investment (since government figures under-state inflation). At that point you should then sell your TIPS and close you money market account. Invest that more heavily into tangibles–both barterables and retreat-worthy land. By that time, the real estate market will be in cardiac arrest, so there will be some genuine bargains. Living in Wyoming, you might consider some of the locales I mention in my book “Rawles on Retreats and Relocation”, such as The Big Horn Basin, and the Star Valley. Look for properties with good topsoil and plenty of water. Be sure to buy land that is on defendable terrain and that is well-removed from any major highway.

Good Morning Mr. Rawles,
I found SurvivalBlog about a year ago have been hooked since, [your novel] “Patriots” was inspiring and awesome.

I would like your opinion regarding 401(k) retirement funds. I am 49 years old and have a fair amount of 401(k) funding, I understand any early withdrawal would result in about 30% tax and loss. I know you don’t have a crystal ball but would 70% not be better then a 100% loss in a situation of a full economic collapse. I know these are very hypothetical questions but I have come to respect your opinions, and could fast-track my preparedness if I cashed out early. – John V.

JWR Replies: First, ask your company if they offer a “Self-directed 401(k)” option. If so, you can put your money in a contrarian (“bear”) stock (and stock shorting) fund, and some energy and silver mining stocks.

Is there any chance of rolling over your 401(k) into an Individual Retirement Account (IRA)? If so, you can get a US Gold Eagle IRA. (The folks at Swiss America can set one up for you.) I have heard of some people “trapped” in very limited 401(k)s that have switched to independent contractor status, changed jobs, or even gone so far as to briefly quit their jobs and then get re-hired, just to free up their 401(k) funds to accomplish a rollover without penalties. (Some of these approaches, of course, would require having a sympathetic boss.)

If none of those approaches will work in your situation, then at least re-direct your 401(k) out of stocks and stock mutual funds and into a money market fund. (Most corporate retirement fund plans allow at least a small portfolio “menu” of investment approaches.) But I would not recommend doing anything so radical as taking a 70% loss.

Letter Re: What is a “Gray” Front Sight Course Certificate?

JWR –
Is the Front Sight certificate [offered in the current auction, and available as writing contest prizes] good for the course that includes the “free” pistol? Also, you keep mentioning “gray” certificates but not all of us know what that means! Thanks, – MDR

JWR Replies: The “gray” course certificate is for one person to attend one Front Sight four day course (or for two people to attend a two day course.) The certificates printed on gray paper are transferable, but are “introductory”, meaning that they can’t be used by someone that has already attended a Front Sight course. The four day courses are normally $2,000.

Front Sight’s current “Get a Gun” training and gear package offer (including a Springfield Armory XD pistol) is a separate offering. But that also includes a gray course certificate, which makes the offer a real bargain!

Letter Re: Bulk Storage Grain Now Available in New Zealand

Dear JWR,
You have rightly pointed out in the past that New Zealand is a good location for surviving a world crisis. New Zealand has less than half the average population density of the USA (39/sq mi. versus 80/sq mi.), there are just 1.3 million people in our largest city and many regions are blessed with wonderful conditions for horticulture.
Of course there are downsides to New Zealand’s isolation during normal times. The United States of America is a large marketplace with over 300 million people – you can have supplies for any niche need delivered to your door. Over here, often the airfreight on specialized survival goods from the US costs more than the goods themselves! And unless you can fill a shipping container, you can forget about purchasing any heavy goods.

I’m writing to let your readers know that there is a new company offering bulk storage wheat and rice in New Zealand. Our product is packed into mylar bags and the oxygen is removed, leaving a partial vacuum with a nitrogen atmosphere. The bags are protected by a heavy duty HDPE pail with sealing lid, for durability and a secondary oxygen barrier.
Wheat stored in this way has the potential to last 20 years or more, and white rice for 10 years or more.

I’m a survivalist who has got into business, not a businessman who has got into survival – I regularly use a grain mill to turn my own product into delicious wholemeal breads at home. I would like to invite your readers to view our Enduring Supplies Limited web site. As an introductory offer, I will offer Survivalblog readers a 10% discount on whole pallet orders and a 5% discount on smaller orders placed in the next two weeks (finishing Friday 27th June). I look forward to hearing from some like minded ‘locals’. Kind Regards, – Craig (a 10 Cent Challenge subscriber)

JWR Replies: I wish you the best with your business. It will certainly fill what has been a chronic need.

OBTW, you mentioned New Zealand’s population density. The stats that I have seen list North Island’s density as 27.5 per square kilometer, compared to just 6.7 per square kilometer on South Island. There is no doubt where I’d recommend our Kiwi (and Kiwi wannabe) readers live: the farming and ranching country on South Island.

Odds ‘n Sods:

Our friend Michael Panzner of the Financial Armageddon blog just linked to this key article: Crisis shifts to regional lenders. This shows that the global credit collapse is s far from over!

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Larry W. flagged this piece by Jim Sinclair: Total Notional Value of Derivatives Outstanding Surpasses One Quadrillion Dollars. That is a lot of zeros! BTW, I think that Sinclair’s figures are high, since among other things, credit derivatives are actually dropping rapidly in their notional aggregate value. This is inevitable as the global credit market is continuing to contract. But regardless, the risk posed by derivatives is still enormous The recent Bear Stearns bailout is indicative of the extreme measures that could be required, when a counterparty suddenly ceases to exist.

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Bob H. spotted a safety alert article that describes in detail a threat posed by the “The Meth Head Next Door”: Anhydrous ammonia and propane cylinders

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Pain at the Pump: It’s Time to Start Thinking About $7 a Gallon Gasoline. Meanwhile, we read: An ominous warning that the rapid rise in oil prices has only just begun