Financial Reserve

[Silver]

Venezuela...history repeats or rhymes...or maybe people are just greedy and stupid.

http://www.internationalman.com/article ... -economics" onclick="window.open(this.href);return false;

Wheelbarrow Economics
by Jeff Thomas

Wheelbarrow Economics
Subscribe to International Man
In 2014, we published an article entitled “Watch the Movie Before It Is Filmed.” In that article, I described the situation in Venezuela at that time. The effects of fifteen years of collectivism were threatening to collapse the economy. The government was reacting by printing bolivares (Venezuelan currency) on a large scale—a knee-jerk solution that has been utilized by over twenty other countries in the last century—always with the same outcome: hyperinflation, resulting in economic collapse.

At the time, I recommended to readers that they “watch the movie” as it was being played out in Venezuela, as it would offer them insight into what was on the way in their own country, should they reside in Europe or North America.

The pattern followed by Venezuela is roughly the same as for the other jurisdictions; Venezuela is just a bit more advanced in the progression. Therefore, what we are observing in Venezuela is likely to be played out in other countries that have made the same mistake of taking on more debt than they can ever pay back.

As predicted, Venezuela is now well along with regard to hyperinflation.

The traditional definition of “inflation” is “the increase of the amount of money in circulation.” Today, we think of inflation as an increase in the cost of goods, but this is merely a predictable by-product of inflation. If the amount of money increases, the cost of goods will always rise to meet it. Therefore, the issuance of large amounts of paper money has only a very temporary positive effect. Ultimately, it creates an increase in the price of goods and services, which, in turn, calls for further printing.

In 1922, Germany was up to its eyes in debt, to the point that it was beyond repayment. The government, in attempting to overcome the dire poverty that had developed, decided to print more paper banknotes. The printing didn’t (and couldn’t) solve the problem, so they printed more. Then more again. They kept up the printing, until, by the autumn of 1922, the reichsmark was worth so little that new bills were being delivered to the banks in boxcars. A story of the time describes a man bringing a wheelbarrow of reichsmarks to a baker to buy a loaf of bread. Whilst in the shop, making the deal with the baker, he was robbed—the wheelbarrow full of money that he had left out on the sidewalk had been stolen. The thief dumped the reichsmarks on the pavement and made off with the wheelbarrow.

Above, we see a photo from the time—a wheelbarrow full of reichsmarks. Next to it, we see a photo from present-day Venezuela—a wheelbarrow full of bolivares.

So, are the leaders of Venezuela learning from the mistakes of other countries that have followed this pattern? Far from it. Recently, they took delivery of over five billion banknotes—enough to fill three dozen 747 cargo planes. At the same time, Venezuela is selling off its gold in order to pay for the new currency and other debts. Venezuela will soon run out of real money to pay for the fiat money, and that will bring the charade to a disastrous end.

The reader may say to himself, “When will people learn?” Sadly, they don’t. Incredibly, when the reichsmark collapsed in 1923, no one blamed the excessive printing. In fact, many people felt that if only the printing had continued just a bit longer, everything might have been all right.

What we can take away from this is that what happened in Weimar Germany in 1922–1923 is happening now in Venezuela in 2016. (And has happened in some twenty other countries over the last hundred years, most recently in Argentina in 2000 and in Zimbabwe in 2008.)

The same will occur in Europe and America in the fairly near future. That’s not a “Chicken Little” overreaction; it’s a virtual certainty. The same economic errors always bring the same catastrophic results.

Ben Bernanke, just two years prior to being named head of the Federal Reserve, assured an audience that the Fed would react to any deflationary trend by printing as many currency notes as necessary. This was no idle threat. Remember, the owners of the Fed profit heavily from the hidden tax of inflation, but lose money if there is deflation. That assures us that, with the present unsustainable level of U.S. national debt (nominally, some nineteen trillion dollars, but actually some hundred trillion dollars, including unfunded liabilities), a collapse in the dollar is a given.

And, of course, the severity of the crash is always commensurate with the level of the debt, which promises us that, since this debt load is by far the greatest the world has ever seen, the crash will be the greatest the world has ever seen.

Those who have studied the histories of countries after they’ve experienced a hyperinflationary collapse will be aware of what’s headed their way, if they reside in Europe or North America. Those who have not undertaken such a study might choose instead to watch the movie—to observe what happens in Venezuela as its hyperinflation plays out and learn what their own fate might be.

Our predicted outcome, which may have seemed hypothetical in 2014, is now right around the corner in Venezuela. This will be of value to the reader who watches as the collapse occurs, then observes what follows. The events that unfold will be essentially the events that will unfold in Europe and North America when their respective collapses occur.

This “movie” is not meant to be entertainment at the expense of others’ suffering; watching it is a way to forewarn oneself as to what’s coming to those countries that are irrevocably on the same path, but have not yet reached the same point.

By watching, the reader may be forewarned as to how to prepare himself so that, whilst his country may be headed toward economic collapse, he may take action to assure that the impact to himself, his family and his investments are diminished.

[Silver]

Yeah, so Greece, China, Venezuela, Japan, Brazil...all the grand trouble spots, right? Uh, no. Do you know where your financial reserve is?

http://www.alt-market.com/articles/2901 ... ed-in-2008" onclick="window.open(this.href);return false;

Business Debt Delinquencies Are Now Higher Than When Lehman Brothers Collapsed In 2008
Monday, 23 May 2016 07:08 Michael Snyder

You are about to see more very clear evidence that a new economic crisis has already begun. During economic recoveries, business debt delinquencies generally fall, and during times of economic recession business debt delinquencies generally rise. In fact, you will see below that business debt delinquencies shot up dramatically just prior to the last two recessions, and the exact same thing is happening again right now. In 2008, business debt delinquencies increased at a very frightening pace just before Lehman Brothers collapsed, and this was a very clear sign that big trouble was ahead. Unfortunately for us, in 2016 business debt delinquencies have already shot up above the level they were sitting at just before the collapse of Lehman Brothers, and every time debt delinquencies have ever gotten this high the U.S. economy has always fallen into recession.

In article after article, I have shown that key indicators for the U.S. economy started falling in either late 2014 or at some point during 2015. Well, business debt delinquencies are another example of this phenomenon. According to Wolf Richter, business debt delinquencies have shot up an astounding 137 percent since the fourth quarter of 2014…

Delinquencies of commercial and industrial loans at all banks, after hitting a low point in Q4 2014 of $11.7 billion, have begun to balloon (they’re delinquent when they’re 30 days or more past due). Initially, this was due to the oil & gas fiasco, but increasingly it’s due to trouble in many other sectors, including retail.

Between Q4 2014 and Q1 2016, delinquencies spiked 137% to $27.8 billion.

And we never see this kind of rise unless the U.S. economy is heading into a recession. Here is more from Wolf Richter…

Note how, in this chart by the Board of Governors of the Fed, delinquencies of C&I loans start rising before recessions (shaded areas). I added the red marks to point out where we stand in relationship to the Lehman moment:

Delinquencies-commercial-industrial-loans-2016-q1

Business loan delinquencies are a leading indicator of big economic trouble.

To me, this couldn’t be any clearer.

Just like the U.S. government and just like U.S. consumers, U.S. businesses are absolutely drowning in debt.

In fact, a report that was just released found that debt at U.S. companies has been growing at a pace that is 50 times faster than the rate that cash has been growing.

Just imagine what it would mean for your family if your debt was growing 50 times faster than your bank account. Needless to say, this is an extremely troubling development…

Well, American companies may just have a mountain’s worth of problems, according to a new report from Andrew Chang and David Tesher of S&P Global Ratings.

“At the same time, the imbalance between cash and debt outstanding we reported on last year has gotten even worse: Debt outstanding increased 50x that of cash in 2015,” wrote Chang and Tesher.

“Total debt rose by roughly $850 billion to $6.6 trillion last year, dwarfing the 1% cash growth ($17 billion).”

And the really bad news is that banks all across the country are starting to tighten credit to businesses.

In other words, they are beginning to become much more reluctant to loan money to businesses because debts are going bad at such an alarming rate.

When the flow of credit to the business community starts to slow down, it is inevitable that the overall economy slows down as well. It is just basic economics. So the deterioration of the U.S. economy that we have witnessed so far is just the beginning of a process that is going to take quite a while to play out.

And let us not forget that most of the rest of the world is already is much worse shape than we are. Most global financial markets are officially in bear market territory right now, and some nations are already experiencing full-blown economic depression.

Now that the early chapters of the “next crisis” are here, most American families find themselves ill-equipped to deal with another major downturn. In fact, USA Today is reporting that approximately two-thirds of the country is currently living paycheck to paycheck…

Two-thirds of Americans would have difficulty coming up with the money to cover a $1,000 emergency, according to an exclusive poll, a signal that despite years after the Great Recession, Americans’ finances remain precarious as ever.

These difficulties span all incomes, according to the poll conducted by The Associated Press-NORC Center for Public Affairs Research. Three-quarters of people in households making less than $50,000 a year and two-thirds of those making between $50,000 and $100,000 would have difficulty coming up with $1,000 to cover an unexpected bill.

What are these people going to do when they lose their jobs or their businesses go under?

If you have any doubt that the U.S. economy is already in recession mode, just look at this chart over and over:

http://theeconomiccollapseblog.com/wp-c ... 60x275.png" onclick="window.open(this.href);return false;

For months, I have been warning that the same patterns that immediately preceded previous recessions were happening once again, and this rise in debt delinquencies is another striking example of this phenomenon.

This stuff isn’t complicated. Anyone that is willing to be honest with themselves should be able to see it. As a society, we have been making very, very bad decisions for a very, very long period of time, and what we are watching unfold right now are the inevitable consequences of those decisions.

[dlbww]

.

[Silver]

PeMmican and Precious Metals

[Jason]

Many of these countries have borrowed funds in $USD, do you think they will be paying that back? That amount might be more than $12 trillion if my memory serves me correctly. Add that to the current debt and you get a number that begs the question of whether any of this will ever get paid back. When the general population starts asking that question then you'll see the rise in gold in $USD.

It looks like there is currently a move into $USD's which will drive the dollar up compared to many other currencies (including the CDN dollar which is my currency). As far as holding precious metals or holding $USD it looks like the latter (at least in the short term will be the better bet).

Or just maybe we should be ignoring precious metals and go to the next item currently on this list and learn how to make pemmican (https://en.wikipedia.org/wiki/Pemmican" onclick="window.open(this.href);return false;).

I keep waiting for silver to hit $5/ounce....due to that inherent demand (debt) for USD.....

I agree with your outlook and betting perspective. I think the window for PMs will be very short before shifting to completely to barter (for things people absolutely need) and due to trust issues...I think there will be significant difficulty in dealing with "currency" or standard medium of exchange of which I consider precious metals to fit in that category.

In simple terms - I'm not going to trade food for some sort of precious metal of which less than 1% of the people have the technical abilities to decipher quality...and especially in a world where immediate needs will likely dictate the barter constraints/enticements.

Money is intended as a medium of exchange (sell stuff to buy stuff). If it goes back to true barter....who wants to give up food or other necessities for metal? Especially in a time of great wickedness (is that green gold, blue gold, white gold, yellow gold, pink gold, gold plated tungsten, gold filled lead, gold rolled iron, 10k, 14k, 18k, 20k, 24k, 10K coated with 24k, etc etc etc???).

viewtopic.php?f=1&t=22939&p=296343#p296343" onclick="window.open(this.href);return false;

Depending on the dirt, water, air, wood, etc location, quantity, type, etc - i.e. demand vs supply. Water has been cheap relative to gold...and also very expensive. Same with all the other items.

The preferred medium of exchange (i.e. money) of free people (and others as well) has been (in the history of the world) and quite likely will be fiat (i.e money by decree or by government). The decree sets the universal standard for the group thus making universal exchange characteristics positive - i.e. scale (this equal this and that equals that...whether numbers on paper or measures of commodity). Otherwise its just barter with commodities - blue/green/white gold of whatever purity...etc etc etc. Once the commodity is stamped/marked/etc (fiat - i.e. money by decree) then it becomes money that is universally accepted by the group at stated face values. The exchange value of course fluctuates with market supply/demand...and the universal appeal (strength or health of the fiat or that of the entity making the decree)

viewtopic.php?f=19&t=12158&p=378885#p378885" onclick="window.open(this.href);return false;

How do they feel now, when their granaries are empty? If they had a few thousand bushels to spare now, would they not consider it a blessing? They would. Why? Because it would bring the gold and silver. But pause for a moment, and suppose you had millions of bushels to sell, and could sell it for twenty dollars per bushel, or for a million dollars per bushel, no matter what amount, so that you sell all your wheat, and transport it out of the country, and you are left with nothing more than a pile of gold, what good would it do you? You could not eat it, drink it, wear it, or carry it off where you could have something to eat.The time will come that gold will hold no comparison in value to a bushel of wheat. Gold is not to be compared with it in value. Why would it be precious to you now? Simply because you could get gold for it? Gold is good for nothing, only as men value it. It is no better than a piece of iron, a piece of limestone, or a piece of sandstone, and it is not half so good as the soil from which we raise our wheat, and other necessaries of life. The children of men love it, they lust after it, are greedy for it, and are ready to destroy themselves, and those around them, over whom they have any influence, to gain it.

viewtopic.php?f=1&t=28478&p=375650#p375650" onclick="window.open(this.href);return false;

[Silver]

Jason wrote:
How do they feel now, when their granaries are empty? If they had a few thousand bushels to spare now, would they not consider it a blessing? They would. Why? Because it would bring the gold and silver. But pause for a moment, and suppose you had millions of bushels to sell, and could sell it for twenty dollars per bushel, or for a million dollars per bushel, no matter what amount, so that you sell all your wheat, and transport it out of the country, and you are left with nothing more than a pile of gold, what good would it do you? You could not eat it, drink it, wear it, or carry it off where you could have something to eat.The time will come that gold will hold no comparison in value to a bushel of wheat. Gold is not to be compared with it in value. Why would it be precious to you now? Simply because you could get gold for it? Gold is good for nothing, only as men value it. It is no better than a piece of iron, a piece of limestone, or a piece of sandstone, and it is not half so good as the soil from which we raise our wheat, and other necessaries of life. The children of men love it, they lust after it, are greedy for it, and are ready to destroy themselves, and those around them, over whom they have any influence, to gain it.

The key word in that quote is highlighted in red. Here's why:

What was in Brigham Young's pocket? The money of the day was silver and gold. Gold wasn't bad. Certainly paper money had existed long before BY was born, but the Federal Reserve did not yet exist. Precious metals were money. I contend they are still the only real money. If we hadn't allowed our politicians to stray from the Constitution, we wouldn't be discussing the purchase of gold with fiat currency/debt instruments. No, what President Young was decrying was the incessant search for wealth by some Saints prior to ensuring they had sufficient reserves of food and other necessary items.

It is an anachronism to use that quote in our modern times because BY wasn't speaking of getting rid of all gold -- that would have emptied his bank account. In more recent times, as in Weimar Germany or 2016 Venezuela we can plainly see that the holder of gold was/is better off. Of course, I am completely willing to accept that the next crash will be different and gold will be "worth less". In that case, I will contribute my meager holdings to the Official City of Zion Building Committee.

[larsenb]

. . . . Well, things are getting, as they say, real, in Venezuela. Wanton murder, riots, food shortages, drought. Do you expect those kinds of conditions to ever visit anywhere between the Gulf of Mexico and the North Pole? When things get like that, how much will your 401(k) parked over at Fidelity be worth? . . .

After they convert your 401K to Fidelity stock using a bail-in, it will be worth the conversion rate in Fidelity stock. Which action itself, could cause Fidelity stock to plummet. A double whammy . . . .

Another issue to consider is if there is a panic which gets out-of-hand enough to cause a run on ATM, etc., cash, which depletes the amount of available cash (only about a trillion or less is in circulation), the whole credit system could collapse.

[iWriteStuff]

In that case, I will contribute my meager holdings to the Official City of Zion Building Committee.

You mean "Zion's Paving Stones and Street Maintenance Cooperative"? ;)

What's Venezuela's take on gold and silver coins at the moment? If there was a future we were headed for, it would probably look a bit like that.

[Silver]

In that case, I will contribute my meager holdings to the Official City of Zion Building Committee.

You mean "Zion's Paving Stones and Street Maintenance Cooperative"? ;)

What's Venezuela's take on gold and silver coins at the moment? If there was a future we were headed for, it would probably look a bit like that.

Yep, that's the organization of which I speak.

Gold is up 80% in Venezuela since Dec 2015. What that really means is that as the local currency devaluates, gold's purchasing power has remained the same.

[Silver]

. . . . Well, things are getting, as they say, real, in Venezuela. Wanton murder, riots, food shortages, drought. Do you expect those kinds of conditions to ever visit anywhere between the Gulf of Mexico and the North Pole? When things get like that, how much will your 401(k) parked over at Fidelity be worth? . . .

After they convert your 401K to Fidelity stock using a bail-in, it will be worth the conversion rate in Fidelity stock. Which action itself, could cause Fidelity stock to plummet. A double whammy . . . .

Another issue to consider is if there is a panic which gets out-of-hand enough to cause a run on ATM, etc., cash, which depletes the amount of available cash (only about a trillion or less is in circulation), the whole credit system could collapse.

That's why in my private financial world, I don't own anything in paper or anything digital except for the minimum amount I keep in the bank. Food storage is my best investment followed by protection and way down on the list is precious metals.

[Jason]

Jason wrote:
How do they feel now, when their granaries are empty? If they had a few thousand bushels to spare now, would they not consider it a blessing? They would. Why? Because it would bring the gold and silver. But pause for a moment, and suppose you had millions of bushels to sell, and could sell it for twenty dollars per bushel, or for a million dollars per bushel, no matter what amount, so that you sell all your wheat, and transport it out of the country, and you are left with nothing more than a pile of gold, what good would it do you? You could not eat it, drink it, wear it, or carry it off where you could have something to eat.The time will come that gold will hold no comparison in value to a bushel of wheat. Gold is not to be compared with it in value. Why would it be precious to you now? Simply because you could get gold for it? Gold is good for nothing, only as men value it. It is no better than a piece of iron, a piece of limestone, or a piece of sandstone, and it is not half so good as the soil from which we raise our wheat, and other necessaries of life. The children of men love it, they lust after it, are greedy for it, and are ready to destroy themselves, and those around them, over whom they have any influence, to gain it.

The key word in that quote is highlighted in red. Here's why:

What was in Brigham Young's pocket? The money of the day was silver and gold. Gold wasn't bad. Certainly paper money had existed long before BY was born, but the Federal Reserve did not yet exist. Precious metals were money. I contend they are still the only real money. If we hadn't allowed our politicians to stray from the Constitution, we wouldn't be discussing the purchase of gold with fiat currency/debt instruments. No, what President Young was decrying was the incessant search for wealth by some Saints prior to ensuring they had sufficient reserves of food and other necessary items.

It is an anachronism to use that quote in our modern times because BY wasn't speaking of getting rid of all gold -- that would have emptied his bank account. In more recent times, as in Weimar Germany or 2016 Venezuela we can plainly see that the holder of gold was/is better off. Of course, I am completely willing to accept that the next crash will be different and gold will be "worth less". In that case, I will contribute my meager holdings to the Official City of Zion Building Committee.

Was it the fiat stamp on the precious metal....or the actual value of the precious metal in his pocket that mattered that day?

Goes back to the Articles of Confederation and all the states with their various currencies (some metal and some paper) but particularly troublesome for trading due to lack of universal standard.

As such in my opinion precious metal is of little if any value as a financial reserve. New Orleans with Katrina is a good case study. Cash will work until it doesn't. When it ceases to work...I believe precious metals will not fill the void. Just an opinion in a sea of opinions though for whatever its worth...

On a side note -

CARACAS May 23 Venezuelan state oil company PDVSA is preparing to issue $2.5 billion in promissory notes to settle unpaid bills to services companies, according to industry sources and documents seen by Reuters.
http://www.reuters.com/article/venezuel ... SL2N18K0YM" onclick="window.open(this.href);return false;

Coca-Cola to Halt Production in Venezuela
http://www.bloomberg.com/news/videos/20 ... -venezuela" onclick="window.open(this.href);return false;

The Venezuelan bottler of Coca-Cola has halted production of the sugar-sweetened beverage due to a lack of sugar, a Coca-Cola Co (KO.N) spokeswoman said on Monday.
http://www.reuters.com/article/us-coca- ... SKCN0YE2Q6" onclick="window.open(this.href);return false;

Milk, meat and beans – the main sources of protein in the Venezuelan diet – are hard to find or sold at exorbitant prices, and many are filling up on empty carbs from pasta, rice and the traditional arepa cornmeal cake. Critics of the socialist government of Nicolás Maduro say food production collapsed in the oil-reliant country due to a mix of the expropriation of farmland and agro-industrial enterprises and strict price controls that made importing food cheaper than producing it locally. But a byzantine currency control system and plummeting oil prices have slashed imports of raw materials and food products. To counter that “economic war”, Maduro has urged people to grow their own food and raise chickens in their homes and created the ministry of urban farming; more than 80% of Venezuelans live in cities.

In the poor Caracas neighbourhood of Carapita, residents lined up to buy vegetables brought directly from Trujillo state to their community centre. There, they were able to mix and match potatoes, tomatoes, onions, beets, red peppers and cabbage at 355 bolivars (82 cents at the highest official exchange rate) per kilo. At informal street market prices, they could go for as much as 1,000 bolivars ($2.33) per kilo.

María Hidalgo, has refused to give up on traditional corn arepas.

She pulled out an old corn mill she had in a closet, rigged it up to a small motor and started making her own cornmeal dough, selling to friends and neighbours.

http://www.theguardian.com/world/2016/m ... -shortages" onclick="window.open(this.href);return false;

Caracas (AFP) - Venezuelans on Tuesday woke up to discover that the government-controlled price of corn flour -- used to make corn patty arepas, a staple of local cuisine -- has risen 900 percent.

The socialist government of President Nicolas Maduro had kept the price of corn flour frozen for 15 months at 19 bolivares a kilogram (two pounds).

But late Monday the government's Superintendent of Fair Prices increased the price to 190 bolivares a kilo, or $19 at the government rate used for imports such as medicine and scarce food.

https://www.yahoo.com/news/price-corn-f ... tml?ref=gs" onclick="window.open(this.href);return false;

...the real valuable commodity...and 2nd by production capability and equipment...

Venezuela is holding the biggest military exercise in its history this weekend, citing threats to national security, as the opposition pushes for a recall referendum on President Nicolas Maduro. Maduro said the exercises included mobilizations of anti-aircraft, armored, amphibious, and aerial weapons systems. He ended his speech surrounded by troops with guns raised in the air.
http://www.bloomberg.com/news/articles/ ... ecall-vote" onclick="window.open(this.href);return false;

...followed by the precious metal - lead.

Never has a country that should have been so rich been so poor.
https://www.washingtonpost.com/news/won ... this-poor/" onclick="window.open(this.href);return false;

In a nation where two-thirds of the population live in poverty and are now experiencing life-ending shortages of food and medicine, the $75 million price tag for another presidential boondoggle was always outrageous. But that the boondoggle would end with the brand new custom jet so destroyed that it could not even fly just seems like an apt metaphor for a country with the world's largest oil reserves that is now on the brink of bankruptcy, hyperinflation and malnutrition.
http://www.laht.com/article.asp?Article ... ryId=10717" onclick="window.open(this.href);return false;

Debt repayments in crude cripple poorer oil producers

This year Angola, Nigeria, Iraq, Venezuela and Kurdistan are due to repay a total of between $30 billion and $50 billion with oil, according to Reuters calculations based on publicly disclosed information and details given by participants in ongoing restructuring talks.

Repaying $50 billion required only slightly over 1 million barrels per day (bpd) of oil exports when it was trading at $120 per barrel but with prices of around $40, the same repayment would require exports of over 3 million bpd.

"All of those oil nations – Angola, Nigeria, Venezuela – have taken money for survival but haven't got any money left for investments. That is very damaging to their long-term growth prospects," said Amrita Sen from Energy Aspects think-tank.

Iraq is trying to renegotiate contracts for investment and development of new oil fields that it has with companies including Exxon, Shell and Lukoil. It was supposed to repay the companies $23 billion this year with oil but is now arguing that it will only have enough crude to repay $9 billion.

Nigeria owes $3 billion this year in oil repayments to big oil companies which have helped the country fund its share of joint oil field development.

Iraq's semi-autonomous region of Kurdistan has leveraged all its oil production, worth $3 billion, to trading houses Vitol and Petraco as well as to Turkey to fund a fight against Islamic State, according to its natural resources minister.

Ecuador, one of OPEC's smallest member countries, borrowed up to $8 billion from Chinese and Thai firms, repayable with oil, between 2009 and 2015, according to the national oil company.

http://mobile.reuters.com/article/idUSKCN0YF0IC" onclick="window.open(this.href);return false;

[Older/wiser?]

In the long run ,precious metals probably are of no value. There are many different twist and turns the unwinding scene can play out. You can't eat them that is true, but what if the road to bondage takes a few years ,or happens in stages, a financial crash, will there still be some form of gov. Will a debtors prison be established, will people be forced out of there homes.
Everyone is not LDS with the long range belief system of the 2coming, so will some accept gold as payment on an abandoned property, way befor they realize how late it is. If this happens in stages over several years all kinds of things we don't expect could happen. A financial reserve of gold or silver you must admit is better than paper.Joseph in Egypts dream was over years by the end the people sold themselves into bondage to be taken care of. Joseph Smith Mathew 1:41 but as it was in the days of Noah, so it shall be also at the coming of the Son of Man; 42 for it shall be with them, as it was in the days which were before the flood; for until the day that Noah entered into the ark they were eating and drinking, marrying and giving in marriage; 43 And knew not until the flood came , and took them all away; so shall also the coming of the Son of Man be.
We have been warned to have our food storage, to get out of debt, to have a financial reserve, simple stated my choice of financial reserve is something that all nations consider
Of value, and paper doesn't cut it.

[Jason]

In the long run ,precious metals probably are of no value. There are many different twist and turns the unwinding scene can play out. You can't eat them that is true, but what if the road to bondage takes a few years ,or happens in stages, a financial crash, will there still be some form of gov. Will a debtors prison be established, will people be forced out of there homes.
Everyone is not LDS with the long range belief system of the 2coming, so will some accept gold as payment on an abandoned property, way befor they realize how late it is. If this happens in stages over several years all kinds of things we don't expect could happen. A financial reserve of gold or silver you must admit is better than paper.Joseph in Egypts dream was over years by the end the people sold themselves into bondage to be taken care of. Joseph Smith Mathew 1:41 but as it was in the days of Noah, so it shall be also at the coming of the Son of Man; 42 for it shall be with them, as it was in the days which were before the flood; for until the day that Noah entered into the ark they were eating and drinking, marrying and giving in marriage; 43 And knew not until the flood came , and took them all away; so shall also the coming of the Son of Man be.
We have been warned to have our food storage, to get out of debt, to have a financial reserve, simple stated my choice of financial reserve is something that all nations consider
Of value, and paper doesn't cut it.

Perhaps...is that green gold, blue gold, white gold, yellow gold, pink gold, gold plated tungsten, gold filled lead, gold rolled iron, 10k, 14k, 18k, 20k, 24k, 10K coated with 24k, etc etc etc???

Whether LDS or not....we are at the breakdown of moral society. A complete fracturing of trust. In order to make the trade...one has to recognize and believe that others recognize the value of the metal for an intermediary exchange. Or in other words...the gold is taken in exchange for something of value with the belief that it can be exchanged down the road for something else of value. Because as my uncle Brigham pointed out..."You could not eat it, drink it, wear it, or carry it off where you could have something to eat."

Even if it is perceived to be of great value...you run the Laban risk -

And it came to pass that when Laban saw our property, and that it was exceedingly great, he did lust after it, insomuch that he thrust us out, and sent his servants to slay us, that he might obtain our property.

https://www.lds.org/scriptures/bofm/1-ne/3?lang=eng" onclick="window.open(this.href);return false;

The prominent bullion dealer located near Seattle, Washington filed for bankruptcy court protection at the end of March. The losses of customers who never received delivery of orders plus the losses of other creditors could be as high as $50 million, according to news reports.

The U.S. Trustee in charge, Mark Calvert, recently estimated the firm has $56 million in liabilities and only $6.4 million in assets. He figures the recovery for unsecured creditors will be less than 10%.

https://www.moneymetals.com/news/2016/0 ... dal-000870" onclick="window.open(this.href);return false;

FORT SHAFTER, Hawaii -- Instability within North Korea will lead to its collapse "sooner than many of us think," a former U.S. Forces Korea commander says.
http://www.military.com/daily-news/2016 ... ooner.html" onclick="window.open(this.href);return false;

[Jason]

By voicing my opinion I hope that I have not been offensive. It is of no more weight than any others...and simply a belief that may or may not hold out. I have no crystal ball or revelation on the matter.

I do put it out there as a contrary viewpoint that perhaps may stimulate some additional thoughts for the readers.

[Silver]

Jason,
All good points. Everything tangible is confiscatable or stealable. Every business has the potential of ripping us off whether they sell food storage or coins. Every person we trade with could deceive us.

Me: I got a pound of flour and need some eggs.
Hussein: I got some eggs.
Me: Are they green eggs, blue eggs, white eggs, new eggs? Fresh eggs, old eggs, warm eggs, cold eggs? Can I eat them with a fox? Can I eat them on a box?
Hussein: I don't want your flour any more.

[Older/wiser?]

Relax my friend, I am not disagreeing with you, in the slightest .I have my stores aplenty, I
Have been listening to the spirit on preparing for 30 yrs. I have wells and wagons, and all that is needful to provide for my house and those the Lord brings to my door. I lay no attachment to the pretty stuff any more than stones.Others may , as I stated my choice , of financial reserve other than paper(have some of that stuff to) is what others may value for a time. I would always holler at any reading this forum "get your food storage for crying out loud" you've been told . So don't misread me ,I might be there to help you one day. Oh by the
Way need eggs , I have 30 chickens, and know how to store fresh eggs for up to 2 years. Want to trade something?

[Silver]

I'm perfectly willing to admit that my investments in precious metals may fall worthless to the ground...dust to dust...so to speak. However, I'm certain that all paper money always fails. Always. Like in Venezuela. Oh, well, that's some 3rd world banana republic. It would never happen here. If you think that, you don't understand the meaning of 'always.'

This Is The Maximum Amount Of Cash You Can Take Out At A Venezuela ATM

Submitted by Tyler Durden on 05/25/2016 15:47 -0400

As Bloomberg's Nathan Crooks demonstrates, this is the maximum amount of money one can take out from a Venezuela ATM each day.

venecash.jpg (64.97 KiB) Viewed 4272 times

For those wondering, the fistful of cash is worth about $25.

The good news: those locals lucky enough to still have money in a Venezuela bank don't need a wheelbarrow to carry it.

The bad news: those same locals soon will.

venezuela%20inflation_0.jpg (19.51 KiB) Viewed 4272 times

[Silver]

Governments can levy taxes but they can't create wealth. Governments can raise armies but they can't save money. Governments can print currencies but they can't guarantee the value of it over the long term. So how do you build your financial reserve as the Lord commands?

Add It Up...And It Doesn't Add Up
http://econimica.blogspot.com/2016/05/a ... dd-up.html" onclick="window.open(this.href);return false;

The growth of population has been the primary driver of global demand growth and growth in consumption. Rising wages have been largely offset by rising prices (inflation), so the primary basis of growth in demand is good old growth in population...and the deceleration in population growth should be very worrying for those expecting the next decade or two to look anything like the past seven decades.

The chart below gathers the combined 15-64yr/old annual growth of the 15-64yr/old population of the OECD, China, Brazil, and Russia against the Federal Reserve set Fed Funds Rate (%), global debt, and global GDP. To be honest, it's a very good fit showing very bad things to come based on the current modus operandi.

debt_gdp.png (41.96 KiB) Viewed 4269 times

But maybe that isn't fair or its simply cherry picking data with a desired result in mind? So, to be fair, the chart below shows the annual growth of the global adult population (20-64yr/olds) highlighted in yellow. The deceleration of the global adult population is plain to see and down 25 million (30%) from peak growth in 1988.

20-64 growth.png (30.54 KiB) Viewed 4269 times

The growth is further broken down by source of that population growth, OECD (34 wealthy 34 nations representing 1.1 billion people, outlined here...OECD), BRICS (Brazil, Russia, India, China, S. Africa...representing 3.1 billion persons), and the RoW (rest of the world...representing 3.2 billion persons). The collapse of growth in the OECD is well known, but the collapsing growth among BRICS less well understood.

Annual global adult population growth, total and by source, below. Also important is to understand that the next two decades on these charts (representing the adult population) are not an estimate or forecast...simply taking the count of those already borne and showing their replacement of the persons already there. Said otherwise, any change in birthrates now (up or down) wouldn't even begin to have impact on the adult population for at least 20 years.

And below, given the wealth and consumptive capacity of the OECD vs. the BRICS and particularly over the poor RoW...the chart below depicting the population growth multiplied by GDP per capita (all are held constant in $'s).
•OECD = $40k/yr
•BRICS = $15k/yr
•RoW = $8k/yr

[brianj]

First, let's establish one thing right up front: I don't believe for one second that you are ignorant. And you will enlighten me as much as the reverse through a conversation here.

It's called the Dunning-Kruger effect - I am smart enough to know what I don't know. I am almost totally ignorant of music theory. People have tried to explain the difference between major and minor keys to me but I still don't understand.

Thanks for your response. I still don't see why being inverted on a car loan is a bad economic sign, but looking back at your post I see the graph is not showing the percentage of loans that are upside down, but showing the percentage of people trading in cars while underwater. That type of action seems like a great way to set up an economy for a big crash.

[Jason]

While the tendency is to focus on the value of the money....its just a tool for trade. For example, while inflation in Venezuela across the board is 700+%...some things are more...and others less. If you can provide goods and services that are in high demand (like eggs for example)...you can still use the currency to transfer your value in eggs to value in something like toilet paper. Whether its 2 strips of paper or 200. The motivation in that environment though is to utilize the paper as quickly as possible (high velocity) because its not going to retain any value. The other incentive is to hold on to your eggs longer because you are going to get a bigger wad of paper in return.

For sure a yucky situation....but manageable as long as you have law and order (protection from mobs/thieves) and you are producing something of value.

The bright side is...quickly eradicate large sums of old debt. Although the tendency is to want to borrow as much as possible to obtain producing assets....because the production benefits will far outweigh the cost very quickly. That is if you can hang on to them (law and order).

High demand...very low supply....but lots of inherent risks which created the situation to begin with....ultimately people wanting something for nothing. At the end of the day....if they don't have something of value to barter with...its very difficult to obtain something of value.

[Jason]

So getting back to precious metals. There are many thoughts and visions of how things might go. Unless one has direct revelation its a gamble. But if you examine historical and current societal collapses...and you consider fundamental basic needs...you should have a pretty good idea of what things will be valuable and what won't. Perhaps a few surprises but general basic needs are pretty sure bet. Also much prophetic counsel along those lines.

Paper money is difficult. Will the people win out and the government will print more money in attempt to essentially write off the historical debts? Or will the banks increase the cost of debt (raise interest rates) or even stop making loans (new money) all together? Collect their pound of flesh and take control of all of their assets?

i.e. inflation or deflation

My bet for the US is still on deflation...since the banks pretty much control and run the government. And inflation in much of the third world (including China) as they try to stiff the banks after borrowing (US dollars and Euros, Pounds, etc) themselves beyond their productive limits.

[Silver]

“Let us avoid debt as we would avoid a plague; where we are now in debt, let us get out of debt; if not today, then tomorrow.

“Let us straitly and strictly live within our incomes, and save a little.

“Let every head of every household see to it that he has on hand enough food and clothing, and, where possible, fuel also, for at least a year ahead. You of small means put your money in foodstuffs and wearing apparel, not in stocks and bonds; you of large means will think you know how to care for yourselves, but I may venture to suggest that you do not speculate. Let every head of every household aim to own his own home, free from mortgage. Let every man who has a garden spot, garden it; every man who owns a farm, farm it.” (Conference Report, April 1937, p. 26.)

https://www.lds.org/ensign/1974/01/prepare-ye?lang=eng" onclick="window.open(this.href);return false;

[Silver]

The Saints have been advised to pay their own way and maintain a cash reserve. Recent history has demonstrated that in difficult days it is reserves with intrinsic value that are of most worth, rather than reserves, the value of which may be destroyed through inflation. It is well to remember that continued government deficits cause inflation; inflation is used as an excuse for ineffective price controls; price controls lead to shortages; artificial shortages inevitably are used as an excuse to implement rationing.

https://www.lds.org/ensign/1974/01/prepare-ye?lang=eng" onclick="window.open(this.href);return false;

[dlbww]

The Saints have been advised to pay their own way and maintain a cash reserve. Recent history has demonstrated that in difficult days it is reserves with intrinsic value that are of most worth, rather than reserves, the value of which may be destroyed through inflation. It is well to remember that continued government deficits cause inflation; inflation is used as an excuse for ineffective price controls; price controls lead to shortages; artificial shortages inevitably are used as an excuse to implement rationing.

https://www.lds.org/ensign/1974/01/prepare-ye?lang=eng" onclick="window.open(this.href);return false;

Where will you keep that reserve when cash is banned? https://www.armstrongeconomics.com/worl ... economics/" onclick="window.open(this.href);return false; And could an underground economy in PM's like gold, silver, etc. coins arise becoming the new cash? Will we see more barter occur?

[Silver]

The Saints have been advised to pay their own way and maintain a cash reserve. Recent history has demonstrated that in difficult days it is reserves with intrinsic value that are of most worth, rather than reserves, the value of which may be destroyed through inflation. It is well to remember that continued government deficits cause inflation; inflation is used as an excuse for ineffective price controls; price controls lead to shortages; artificial shortages inevitably are used as an excuse to implement rationing.

https://www.lds.org/ensign/1974/01/prepare-ye?lang=eng" onclick="window.open(this.href);return false;

Where will you keep that reserve when cash is banned? https://www.armstrongeconomics.com/worl ... economics/" onclick="window.open(this.href);return false; And could an underground economy in PM's like gold, silver, etc. coins arise becoming the new cash? Will we see more barter occur?

Be creative. Don't hide it all in the same place. Diversify into different materials and different weights. Each will have their purpose.

I certainly believe that desperate people will find a way to trade for the items they need. The church recommends having food, water and a financial reserve. Each of those items may be traded for something else.

Paper money may make up a majority of the reserve for most people, but eventually the paper will achieve its intrinsic value no matter how many zeroes are printed on it.

http://www.providentmetals.com" onclick="window.open(this.href);return false;
http://bullionexchanges.com/" onclick="window.open(this.href);return false;