Saturday, April 30, 2011

Surviving Economic Collapse: Tips, Tactics, And Gear

"In this article we will discuss how to prepare for a wide-spectrum financial breakdown, as well as why it is absolutely necessary, not just to ensure ones own survival and ones own future, but the future of an ideal, and a way of life."


April 30, 2011
By Brandon Smith

SPECIAL NOTE: I originally published this article back in January of 2010 at Neithercorp Press, however, with the escalation of recent economic events, I feel it is a good idea to republish all my past survival pieces here at Alt-Market for those who are still learning how to prep, or looking for new ideas. Stay tuned for more survival articles in the coming week.

A large part of our society operates on a disturbing assumption, a belief that has been driven into the very fabric of our culture for generations; the assumption that preparation for disaster is unnecessary because all will remain the same as it always has been.

This collective assumption exists in very few countries. South America, Africa, most of Asia, and even parts of Europe experience and even anticipate upheaval and catastrophe from time to time, not only in respect to mother nature (as recently occurred in Haiti), but also in terms of economics and social unrest. Many Americans have attempted not only to insulate themselves from such events, but to also insulate themselves from the very idea that such events could ever happen to them. The concept of hyperinflation, loss of utilities, loss of police protections, loss of infrastructure, loss of grocery outlets, is so outside their pre-programmed world view that to dare discuss these subjects is seen as “absurd” and “alien.”  Read More

Spend It Like You Stole It

"Whenever the nominal amount of available money increases faster than the real goods and services that money buys, you can expect rising prices."


April 30, 2011

By Bill Bonner
Daily Reckoning
4/29/11

From the point of view of a modern economist, nothing stimulates better than a bank robbery. The money leaves the cold embrace of a bank vault; soon every pimp and bartender has his pockets full. Hot money gets around.

An article in Rolling Stone Magazine provides an illustration. It explains how one Wall Street wife, and one Wall Street widow, formed a company specifically to take advantage of the US government’s spending spree known as TALF. You’d think the feds had already done enough for the Mack family. John Mack runs Morgan Stanley. Had it not been for the generous support of the US government and the Federal Reserve, he might be parking cars. Instead, the feds bailed out the entire financial sector. First, it bought up Wall Street’s bad bets at inflated prices and then lent banks money at artificially low interest rates; they were invited to lend the money back to the federal government for a sure profit.

Business was so good at Morgan Stanley that the distaff side of the Mack household apparently couldn’t resist. In June, 2009, with her friend Susan Christy, Mack set up an investment company and put in $15 million. Then, they borrowed $220 million from the government. A brave move on their part? If you think so, you are as na├»ve as a turnip. The fix was in; the two used the money to buy non-recourse loans at deep discount. If the loans increased in value, they would make a profit. If they fell, the government would take the losses. Much safer and more profitable than robbing banks. Two months later, Mr. Mack, perhaps with a little assistance from his blond helpmate, bought a limestone carriage house in Manhattan, with a 12-space garage for the getaway cars.  Read More