JWR Post on survialblog.com

[Runajam]

"...I'd say that there is a 25% chance of a Dollar Panic and devaluation in the next four years, and a 5% chance of a hyperinflationary Dollar Collapse." (www.survivalblog.com)

Maybe it's me but when I read Jim's blog today it seems that he does not anticipate financial meltdown at all! Although he does mention he believes the currency is ultimately doomed. Confusing?

John Williams at www.shadowstats.com is in total opposition to this position.

What I hear from JWR is that everything is going to be OK , at least financially, sounds no worse than what we are going through right now. So maybe 13 Trillion in debt is just a bummer, not disaster. Over $100 Trillion in unfunded liabilities an inconvenience.

How does the instability with Iran, N. Korea factor in? Solar flares, earthquakes. Is this why we prep? I know it is more complex than that but man has been going through rough times since the beginning, nothing new.

It sounds like I need to focus on the possibility of the unexpected, not the expected (Financial Armageddon bought on by Gov insanity)

So I am I prepping for the unexpected,right? I guess so, because financially things don't look so bad if you are already riding this wave.

That is just my take away from his blog today.

[1Admin]

He's been around for a while (Jim Rawles). Like the rest of us that have, he's seen a lot of folks "crash and burn" from making rash predictions. Some that have made silly, even stupid rash predictions are even STILL AROUND. Steve Quayle's and James Lloyd's "half of the country WILL be nuked by July 4th, 1996" prediction comes to mind.

Is the economy bad? Sure without a doubt. Does this mean that for 100% sure the economy is going to collapse within a few months? In no way, shape or form.

People in positions of authority/leadership, etc. HAVE to be careful when making statements like that. If not, they end up looking foolish like Quayle and Lloyd did.

No where did I see Rawles say "everything is great, go and get a second, third mortgage on your house and live it up" he's smart enough to not make rash predictions as some are apt to do.

Their is a economic guy on one of the major boards. He started off giving little updates on hurricanes and then went into quasi economic forecasting. I can't tell you how many times he has either directly or indirectly stated or acted like the economy was fixing to collapse, i.e, within a few months. Most of the "old timers" blew him off as another prophet of doom looking for followers. Yet new folks eat it up like it's candy.

In 24 years of prepping, I've seen a LOT of folks burn out by freaking out over some dumbbutt's "the world is going to end tomorrow" freak fests. Date setting is just NOT conducive to staying with preparedness over the LONG TERM. What happens is that Joe New Guy gets into this cause "Prophet of Doom Professor X" says that the economy WILL collapse by early 2008. Joe New Guy realizes he's behind the curve in preps so he goes and blows a couple thousand dollars on his credit cards. 2008 turns into 2009, nothing happens. Joe was SO sure of Prophet of Doom's message. Prophet of Doom comes up again with a "well they pulled another rabbit out of the hat but this time it's DEFINITELY going to collapse by summer of 2009." So Joe pulls out the CC again, blows another couple thousand because it's "DEFINITELY" going to happen this time.

Late 2009 finds Joe New Guy pi$$ed off because he now has bu koo credit card bills, he's lost his job and oh yeah, Prophet of Doom's dates were wrong. Joe gives up on survivalism.

With 24 years of preparing and 18 years in the preparedness industry, I've seen this happen FAR TOO MANY times.

We HAVE TIME. The question is how will we USE IT?

None of this should be construed to mean I think the economy is rosey. I don't. I've took my preparations a lot further than most people do. I just refuse to live my life always thinking that TS is going to HTF tomorrow.

If it happens, we are ready. If NOTHING EVER HAPPENS, well we own our land and houses, we produce most of our own food, we produce our own energy, we have food storage for a good while, we have income from two businesses. Sounds like a good retirement plan to me!

On a side note- I don't make "predictions" but I would have to assume that the economy will continue to su$k for at least the next 2-3 years. Will it completely collapse? Probably not outside of a large terrorist attack, war or other major event that causes that to happen. I'll balance that by saying I've seen the economy bad before, but not this bad. ;)

[Patriotic Sheepdog]

I would "ditto" what 1Admin had to say.


Is this the article you are refering to? http://www.survivalblog.com/2010/08/...sting_529.html

By James Wesley, Rawles on August 10, 2010 12:14 AM
I've recently been asked by several blog readers and consulting clients about my predictions for the economy for the next few years. Here they are, in a nutshell: The US economy will remain weak for for at least five years. Both the commercial and residential real estate markets are unlikely to recover before 2018, especially as interest rates begin to increase. Noticeable inflation should begin around the Spring of 2011 and will become uncomfortably high by 2012. If the announced Federal income tax and capital gains tax increases do indeed go into effect, they will stifle the economy for the foreseeable future. Continued financial instability in the periphery of the EU will continue to keep the Euro weak versus the Dollar, but in the end, both currencies are doomed. Global credit market chaos will probably continue for several more years, as will the Mother of All Bailouts (MOAB) here in the United States. I'd say that there is a 25% chance of a Dollar Panic and devaluation in the next four years, and a 5% chance of a hyperinflationary Dollar Collapse. But regardless, some inflation is coming. Its severity is difficult to predict. The bull market in precious metals is nowhere near its end. I still predict that spot price of silver will eventually exceed $50 per ounce.

I don't see the same thing as you noted in your OP. I don't see anywhere in this piece that JWR says everything will be OK. I see he says there will likely be inflation with a 5% chance of hyperinflation. The gov will likely continue with the MOAB (heck they just passed a $26 Billion bill last night) and real estate will be depressed for several more years.

I have been paying close attention to economic news now for several years (since 1999). I don't remember living through economic times like we are seeing. What will happen? I don't know and will not, no cannot, predict the future. I have learned something though...nobody else can either with great accuracy. Heck, even the "people" in charge, Big Ben, Turbo Tax Timmy, etc., cannot predict it. The US economy is closely tied to the world economy and it responds not only to what "we" do, but what other countries do as well.

You will find I post many economic articles because I want everyone here to watch what is happening to your economy. You need to be aware of how our government is spending your money. If you look hard enough, you will find someone telling you to buy gold, sell gold, the housing market is better (just heard that on a radio commercial just now) so buy a new home, sell your home, collect pennies, buy bonds, don't buy bonds, the list goes on. What I found is the one telling you do do something usually will gain somehow on you doing that transaction. YOU need to become aware and informed of the economic times we live in and make decisions based on what you read and learn from MULTIPLE sources.

I have a self-directed IRA and am taking full responsibility for that account. That is why I do so much financial/economy reading as I don't want someone else making decisions for me based on incentives that (s)he may be getting from a company to buy a particular stock, bond, etc. They want YOUR money and it is your job to try and keep as much of as you can. Read and learn, you will be better off for it.

I would suggest that you don't get caught up on dates or predictions like 1Admin advised as you will get burnt out and frustrated. Having said that, there are a few people that I may "listen to" more than others. One of those is JWR. He always tells it like he sees it, but without the "doom and gloom" mentality.

Prep without going into debt! A liitle at a time as it is not a race. Watch for sales and prioritize your needs (not wants). Just my two cents...

[Runajam]

I understand what you are both saying. Makes sense. because I do get my news from multiple sources it would seem to me we are in a heck of a lot more trouble than I read in JWR's. So I now know why he posted that way. It did seem a bit contradictory to me, 5% chance of hyperinflation but the dollar is ultimately doomed? 25% chance of the dollar being devalued? My estimates would be way higher. The economy will be weak for at least 5 years? The scenarios he puts forth would lead one to believe it would be weak for far longer, what would make for a better outlook? We can't pay down the debt (with what?), taxes are going up, health care costs are skyrocketing because of Obamacare and nobody knows what else is in the bill, nobody knows whats in the financial reform bill (including the guys who wrote it), deficit spending is projected to get us to 19 Trillion in debt by 2019, as he states the MOAB is getting bigger and bigger, we are monetizing the debt to boot! So possible recovery in 5 years, 25% possible devaluation, 5% possible hyperinflation? Hmmmm....

No problems with JWR at all, I just see his scenario as best case. Maybe I should stop listening to Peter Schiff, John Williams, Nouriel Roubini, Gerald Celente, and Glenn Beck. : )

[Lowdown3]

Think about it this way- someone will keep his "prediction" and call him on it in 5 years. I can pretty much guarantee you of that. He's probably being a little conservative and thinking long term.

If he was to say "the economy will collapse by 2014" in 2015 someone would be ripping him up on the net. I'm pretty sure Jim is smarter than that.

It's like the "silver will eventually hit $50" prediction. I'm not big in PM's but I agree, "eventually" it will hit $50. It may take 30 years or it might take 3, hard to tell. It didn't move much till just a few years ago. The great "inflation protection" that PM's are touted for have really just barely kept up with inflation (posted gubmint propaganda numbers not real inflation). And then they really were NOT keeping up with inflation for a long time.

I bought a bunch of silver in 93-94 for $7. an ounce. It took till just a few years ago (2005-2006'ish) to get it over $12. I think if you work the numbers out, that's around 3-4% a year compounded. Now if you bought at less than $7. in 2002-03 and then sold in 06-07 you would have had a good return, but with holding it for some many years, it wasn't. Yes someone will post "I'm not interested in return, I'm holding it forever" etc. When you HAVE to be concerned with returns because the whole premise of silver is to "protect wealth against inflation." If it isn't even keeping up with inflation, than it's not doing it's job.

That's my take anyways ;)

[Bearman202]

A friend explained this one to me. He said that in 1973, it took x percent of an ounce of silver to buy a loaf of bread. In 2010, it still takes exactly the same x percent of an ounce of silver to buy a loaf of bread. In other words, you're not getting a return on your investment, you're staying even. With the shadow "inflation" that nobody is willing to admit to, that's important. Officially, we have no inflation. Unofficially, I'm paying more and more for everything. With bank accounts paying less than 2% interest, I feel like I'm falling behind. With silver, I may not be making money, but I'm not losing money either, and sometimes that's as good as it gets.

[Lowdown3]

True, your technically not losing money but if it's not keeping up with inflation, then you really are losing money.

I think people should have SOME precious metals. However the problem is most folks get into them WAAAAY before there other priorities are met. The guy with 100 ounces of gold and no food, still could starve or at the very least, get royally screwed over trading gold for food.

As with all prepping, balance is important.

I think in the first phases of some emergencies, CASH will be more useful than PM's for a short while. We have been programmed to think cash will automatically be crappola two seconds after something happens. I don't think this will be the case early on. Also, your likely to run into some polyanna's that no matter what has happened, will think that "everything will be o.k., the gubmint will help, etc." These folks will be interested in cash.

[Runajam]

I keep about $1000 in small bills on hand. I have food and other survival necessities (water, wood, medicine, etc) for about 1 year (space restrictions). I have barter items. My problem is do I put my earnings (somewhat meager I work for Christian ministry) in dollars, the market? I just don't trust any of those right now. With silver I feel at least have something of value. I have no faith in the markets, or the dollar. Where am I wrong?

[Lowdown3]

Your not "wrong", no one said you were.

That being said, their is likely just as much if not more of a chance that something very catastrophic WON'T happen as their is that something will.

Now don't toss tomatoes at me just yet ;) We need to be prepared for bad stuff to happen, but we also need to be prepared if NOTHING ever happens.

A little illustration from my experience-

We moved out of Florida and away from "city life" in late 1999. Now we weren't "running from Y2K" or anything like that. That being said, the two years previous were very good for me and I was able to get my home built, our AE system going, etc. Basically made some good strides while I was making good bucks. I also stockpiled a fair amount of cash. Everyone in the industry with half a brain knew one of two things would happen after 1/1/2000. Either

A. Nothing would happen and preparedness related sales would plumment. Certainly most of the major "Y2K" sales push was for all purposes over by April of 1999. While it would be great that nothing happened, smart folks in the industry realized we all would likely be in for a time of very slow sales.

B. If something did happen, who was going to be foolish enough to sit at their shop and continue to sell products? What would you take in payment?

We saw the handwriting on the wall and while others in the industry were building "1 million square foot" warehouses (really dumb mistake) or had "80,000 #10 cans in inventory afer the first of 2000" we didn't. We pared down our inventory and the end of November of 99 we had a huge clearance sale before closing our shop and moving.

Despite what I consider fairly decent planning, I figured business would go back to 95-96 levels. Enough to get by, certainly not a king's ransom, but good enough for someone who owned everything they had.

The reality is that we starved (financially speaking) for most of 2000. Late that year we started another business- more mainstream- and that helped carried us over.

The lessons I learned from that were- your gonna always need SOME sort of income, even when your retired. Hoard at least some cash. I can't tell you how many weapons I sold to raise cash in 2000 and 2001 but let's just say it's in the mid range double digits. What gold and silver I did have was at the time BELOW what I paid for it, so that wasn't an option.

Had I thought- as a lot of people did- that we had no need for money and that y2k was definitely going to be the big one, we would have been up fecal creek with no paddle, oh AND a new baby!

I'm not saying you should completely trust the market, or put everything into Microsoft, etc. but you DO need to plan for a NON APOCOLYPTIC future as well.

If you plan right and take your preps to the level you should, you won't NEED a lot of money, but you will need some.

Just some thoughts.

[Runajam]

Thanks Lowdown for taking the time, I appreciate it! This forum is great, I have tons of questions look forward to getting to know you better.

[Rmplstlskn]

We moved out of Florida and away from "city life" in late 1999. Now we weren't "running from Y2K" or anything like that. That being said, the two years previous were very good for me and I was able to get my home built, our AE system going, etc. Basically made some good strides while I was making good bucks. I also stockpiled a fair amount of cash. Everyone in the industry with half a brain knew one of two things would happen after 1/1/2000.

Lol! I remember you in those days... I was in Ocala trying to escape... ha! You were one of the few who actually gave a darn, talk the trade and would tell it like it is...

The "good ol' days" of the "Preparedness Expo's" were such a great time... sigh............

I too parted with "stockpiled items" to get me through thin times... But that is why I bought them... Some of it made great profits, like the NBC protection stuff after 9/11...

Rmpl