At the risk of being labeled a crazy prepper, I would advise you to prepare for the worst.
The Media has utterly failed the American people in explaining to them what the Federal Reserve (with the White House’s full blessing, not that it matters) has been doing to this country. I’ve alluded to in the past to the potential for the crash of all crashes but I probably haven’t elaborated as much as I should so here’s a crash course:
It starts by not letting anyone tell you that capitalism is “in trouble”. What’s “in trouble” is central planning and fascism. At least it would be if this crash wasn’t the intended result (and it is). When banks and interest rates are controlled exclusively by the Federal Reserve and the Federal Government, you no longer have capitalism.
Quantitative Easing gets talked about with some frequency in the media, but nobody ever explains accurately. QE is the Fed printing money out of thin air, then using that money to buy bad equities or assets (toxic mortgages, government bonds at prices that nobody else would pay, equities and stocks in public companies. The simple fact that the Fed is buying equities means you throw out the normal controls of capitalism.
When the government is buying stock in publicly trade companies, those companies make tons of money without building or creating anything. That’s why you have so many large companies making tons of money but not hiring anyone or retooling their workforce to increase productivity. There’s no incentive.
So, no. This is not capitalism failing. This is Dr. Evil pulling levers and destroying lives, portfolios and the middle class.
To somehow make matters worse, the government has been buying its own debt. Imagine using your Visa card to pay your Visa bill and then pretending that you have plenty of money to spend. That is literally what the government has been doing for the past 7 years.
The Federal Reserve is making enormous profit based on these games. In 2014 alone, the Fed made 100 BILLION dollars in profit from assets they bought with made up money.
In the past couple of days, I’ve seen analysts on CNBC, MSNBC, FOX and the three major networks all stating that those awful Chinese started this by their intentional devaluation of their own currency. The problem with that assertion is that it’s absurd. It’s like owning a house on a busy street corner and you spend years dousing the house with gasoline. Then one day an ember from your neighbor’s bonfire drifts over and your house burns down. After which you tell everyone that your awful fucking neighbor burned your house down. The Fed and the White House have been laying the foundation for an epic collapse for years.
Perhaps this won’t be so bad. The best case scenario is that the market undergoes a 30-40% correction. That’s about how much the stock market is overvalued due to the Fed’s meddling. If that’s the case, and good decisions are made in the wake of the crash, we could have a good economy again in five years.
But here’s the problem: We’re in completely uncharted territory. We’ve never had a debt sheet like this before. We’ve never had a bubble like this before. We’ve never had such abjectly awful financial fundamentals. We’ve never reached a point where there are literally no tools left in the drawer for the Fed to stop a crash from bringing the entire house down… if they wanted to.
There’s a possibility for this to be a crash that fundamentally transforms this country. Every time this country experiences one of these fundamental changes, the Federal Government immediately swoops in to reassure everyone that they’ll be taken care of and then they consolidate even more power over us. So imagine a crash to end all crashes..
But then add in the racial and identity politics that the President has played from day one of his Presidency. This is a fractured country with different groups despising one another. What happens in a big city if suddenly the power goes out? What happens if a month after the crash, we have 50% unemployment. That friendly neighbor of yours? In two weeks without food or water, that friendly neighbor will be ready to kill you in order to take what you have to feed his family. Don’t scoff because it has happened before. Just not in America.
So hope and pray for the best. Prepare for the worst. As I said, we’re in uncharted territory. The worst could be more awful than you imagine. Have 30 days worth of food and water for your family. Have a plan to get out of the city if you live in a big one. Have a solar charger for phones and devices. Have a multi-fuel camping stove. And for god’s sake, get a fucking firearm and get reasonably proficient with it so that you can operate it safely if needed.
I won’t pretend to know what’s coming. But I do know what’s possible.