Why would the cost of renting a room go down during hyperinflation, or why would total income decrease, and is this in real terms or nominal terms? From where are you going to get those brand new fiat bills if you don’t have a source of income? I suppose you could sell the food from garden, but my point is that not everyone can do that.
Good point.
Nor should everyone do that. I would rather have a generator and some fuel than a victory garden. The scarcer and more capital intensive the good, the more valuable it will be.
The idea is not to survive independently, it is to be able to create smaller division of labour hierarchies if the economy flattens with a currency crash or other disaster.
Gold is only really going to help you curb the losses of a dollar crash. If you want a tradeable currency go with Silver. It’s divisible to a point that gold cannot get to. You can purchase buckets full of pre-1965 silver coins. You don’t want to waste your money on anything thats considerd a “Collectors item”. You just want the coins for their value in silver.
Also please keep in mind that your assuming that people will use silver as a means of exchange during the crash. This bet though has a good track record in history and even presently Zimbabwe citizen’s have been using Gold/Silver for years while their own dollar was destroyed.
My uncle swears on bullion. He only carries silver and gold coins. I am lazy and live in a city where I don’t have the space to place things in vaults so I have stocks. Stocks however are tied to the dollar one way or another and can be a dangerous place to be in.
Ofcoarse if your really placing a bet on urban blight then store Food, Tobacco, Marijuana, Alcohol, Firearms, Ammo. If you have all of those in fair quantity you will be a wealthy man.
There isn’t going to be hyper-inflation this year or next year. Hyperinflations don’t appear all of a sudden, but after years of sustained, worsening inflation, and when it gets to the point where everybody thinks things can’t possibly get any worse, that’s when speculators start the final arbitrage process borrowing limitless amounts of money to buy assets.
You are young. That works in your favor. You don’t need cash to survive. People looking at retirement are in a much worse position than you are. The little money that you have, you should spend it on something useful, like a car, or a tool of some kind.
If you absolutely want to prepare for the worse, get to know your neighbors. Make sure you can support each other if the need arises, with supplies, with skills, but most of all, with security.
Real terms.
Why do you assume that I don’t have a job?
I recommend the ingestion of beer, mescaline, peyote buttons and/or toad licking. Also, lots of chanting of [preferably pre-memorized] quotes from Keynes, or Krugman et al would be a great help .
I don’t. My original question did not concern you specifically, but instead, it generally concerned people who are now renting or have a mortgage. But what makes you think you retain your job during hyperinflation, or that your income will rise in proportion to hyperinflation? I think your strategy makes sense if you have something that you can during hyperinflation, such as gold. Say you have a few ounces of gold, when hyperinflation hits, you’ll be able to sell the gold and pay off your house. But I think your strategy is bad for people who wouldn’t or might not have an income during hyperinflation, or wouldn’t have something to sell for those crispy new billion-dollar fiat bills.
“I recommend the ingestion of beer, mescaline, peyote buttons and/or toad licking. Also, lots of chanting of [preferably pre-memorized] quotes from Keynes, or Krugman et al would be a great help.”
Haha I’ve grown out of that lifestyle, but thank you for the suggestion.
Right now we are living in a stagflation and it will stay with us (in the western world at least) for quite a while. What will happen next nobody can tell with complete accuracy.
What should be done? Getting out of debt is always a good idea, no matter how good or bad the economical landscape is. Next thing is, if you haven’t done it already, turn part of your saving into gold. I mean physical gold you can carry with yourself and hide away, not gold stocks or titles. Even if you cannot afford the most sought after and expensive pieces (Mexican 50 pesos, 1oz Krugerrand, US 20 $ etc) you can get smaller denominations like the 1/10 Krugerrand, Quarter Eagles and Mexican 2 pesos. That will be your emergency fund. Sell all stocks while the market is still in a bull phase. Learn some basic skills (like plumbing) to save on household expenditures. Do not spend money unless is strictly necessary. Then sit tight and keep yourself well informed.
Alright, well I’m trying to come up with a plan for sh*t REALLY hitting the fan, as in 6 mo. food supply etc. Now this is more of an attempt at individual survival… but what are the advantages of “creating smaller division of labour hierarchies”, Liberty Student? And what does this mean, exactly? Learning a trade, like plumbing, for example?
I would still like myself and my family to be able to be independent for 6 mos, and to do that I would have to take the following course of action:
*Invest in 180 days (~6 months) worth of food and water. To provide 2,000 cal, per day, per person, I’ll need 300 lbs of Jerky, and about 500 lbs of dried fruit, vegetables, peanuts, rice, etc.
*Weapons for security and safety - first being a shotgun prefereably bought from a friend (not traceable for confiscation) and perhaps a couple Mosin Nagant (traceable) rifles and a good supply of ammo… 500rds per weapon, maybe?
*Luxury goods for use and trading - tobacco, alcohol, marijuana, marijuana seeds, candy, ibuprofen, vitamins, medical supplies, & hand tools. I guess these would be considered commodities.
Goddamn jerky would cost thousands!! I haven’t even figured out the rest… but it seems like a good idea, so I’ll slowly build up my stash. Have any criticisms, better ideas, questions??
This was true in Zimbabwe, but I think there is another possibility you should consider. I’m no historian, but my cursory study has lead me to believe the one class of people you don’t screw over is bankers. What if they decide they won’t take dollars as repayment and will only take commodities?
Ok, this is going to be short and sloppy.
Without a division of labour, everyone might have to grow/catch their own food, chop their own wood, refine their own gasoline, generate their electricity etc. A division of labour splits up these tasks, to be filled first by those who can accomplish them most productively.
So if you have tools like a shovel, you are already more productive than someone who has to dig holes with their hands or some makeshift scoop. And likewise, if you have a hammer, you are more productive as a carpenter than someone who has to bang nails with a rock. And so on. In order to re-establish the division of labour (specialization of labour using productivity as a guide) in a crisis scenario, it will be necessary to have skills, and capital goods (tools), which is why I advise people acquire skills like sewing, first aid, etc. It doesn’t need to be as formal as a trade like plumbing. In a crisis, we might not need a toilet installed, but we might need someone to set a broken bone.
If you have goods that are capital intensive to produce (and thus will be very rare in a crisis scenario), those are valuable in trade. Anyone can grow a garden, if you have cases of canned meat, that is going to be rarer and more precious in trade than some carrots because most people will not have the capacity to catch, process and can meat for longer term storage.
I wouldn’t worry about America (or the planet at large) regressing back into primitivism, but for the short term, if there is political and social chaos, independence will be a big advantage. The production and maintenance of security, health, food, and shelter.
Good point. If you wanted to take the risk, you could max out your credit and not have any real obligations later, but a stockpile of valuable things for it. (The risk is that you’ll be repo’d first)
The plan won’t work if you have an adjustable rate interest rate.
Don’t buy jerky at the store; make your own. If that’s not possible, focus on grains rather than on meat–wheat berries will store for decades if kept away from oxygen and ground only when needed, and it’s much less expensive than commercial jerky.
Research your state’s gun laws; it may be possible to buy rifles or even pistols from a friend/other non-dealer without paperwork.
The best resource I know of for what you’re talking about–individual survival–is James Wesley Rawles’s new book, How to Survive the End of the World as We Know It. It’s a concise overview of all sorts of things you should be thinking about. He talks about transportation, communications, and medical stuff as well. And related to Liberty Student’s posts, there’s a chapter on skill development and home-based businesses.
Liberty Student, I commend you.
Almost everyone else - you suck, you’re hijackers, and you muddied my thread with debate that hasn’t helped me understand a single thing. I got a couple straight answers about personal preferences for investment of currency/energy, but very shallow reasoning behind it (if any). Take note of that, if you so choose. All is forgiven.
Liberty Student, how did you aquire the insight that you have? Where did you start?
Hm. Well, I gotta meet protein needs somehow. I can’t imagine wheatberries are high in protein. I plan to store both grains and jerky. How I do the jerky is the question . I know for a fact, in NY State you do not have to register Rifles or Shotguns, and you won’t be thrown in prison for buying from a non-dealer unless the weapon is found to be stolen or used in a crime.
And thank you for the book suggestion!
(double post was here)
I’ve been in tough situations quite a few times. No power, no heat, no food, no shelter. The way to get through times like that, is cooperation with your neighbors and family. That means having skills that assist others, and encourage others to cooperate with you.
Gold will not help you if the division of labour breaks down. Gold is a replacement for dollars, not a replacement for real production.
There is one other thing you might want to consider. Losing weight. You’ll be healthier and have more energy, which is a boon regardless of what comes next.