Stock broker friend of mine, says all traders are buying land, gold, silver....

Those brokers are both right AND wrong. They're right in thinking that the US financial system ie. the banks, are in serious trouble and that we are likely to see massive bank failures in the not too distant future.

They're wrong about the impact on prices. $30 beer implies hyper-inflation. If you look at history, the only times any country had hyper-inflation was when it's banking system was stable. Why? Because hyper-inflation is caused by exploding credit and in order to have that you need stable banks. If banks are dropping like flies, they will also be taking a lot of their depositers' money with them and that means a falling, not exploding, money supply. Again history gives us examples of what happens when there are massive bank failures. The 1930's are the best example. You had the opposite of hyper-inflation which is deflation ie. dropping prices. So buying tangible assets such as land, gold and silver is the last thing you should be doing because you can't eat land, gold and silver and as far as farming that land, I don't see stock brokers turning into farmers overnight. An imploding financial system means a lack of liquidity. That means that people and businesses that owe money to the banking system via demand loans, which the banks can call at any time, will be forced to sell whatever assets they might have, including land, gold and silver, in order to pay off those bank loans and avoid bankruptcy. That wave of selling will depress prices for assets including stocks, bonds, land, precious metals, collectibles etc.

Even borrowers who have good credit ratings and are able to make their monthly loan payments will be in danger. In the 30's, a lot of perfectly viable businesses were forced into bankruptcy when the banks called in their loans due to the fact that those businesses weren't able to refinance those called loans somewhere else since ALL banks were in the same situation of having to reduce their total loans in order to keep their loan to reserves ratio within mandated limits.

So the best advice to survive the coming Grand Depression is: get out of debt now, keep your cash out of the banks as cash or at worst, short term treasury bills, stock up on vital items in order to get thru short term shortages and don't show off your wealth if you happen to have a lot.

Coming from someone who has been observing the ATS website for a long while now, I thought I'd give my quick two bits.

I work currently for a stock market data supplier for end of day traders who use our data. I speak to clients on a regular basis, and in the last little while (couple of months or more), I've had less and less calls for help and other discussions regarding a market bounce back and investments.

There is currently little enthusiasm in the markets. Just look at the Aussie ASX market indexes over the last 6 months! They've droped 1/5th! from 5000 to 4000 and still going down!!!!

The global downturn is not over yet people.

My tip... put your superannuation in to CASH before you loose it all.

[edit on 18-7-2010 by presario]

Keep one thing in mind. The current crap situation in which we find ourselves and whatever further unravelling comes is entirely the fault of the Elite. It was they that manipulated the housing market and Wall Street (and continue to do so) that casued the collapse and have continued to exacerbate it. Their greed is boundless and they don't give a rat's badonkadonk about anyone but themselves. Since they don't see themselves as part of general society they become part of a very special group: food stuff.

That's right, when the SHTF you will be morally able to kill and eat the elite. Just like any other animal. It's only cannibalism when you eat your own kind. They're not OUR own kind and they'll be the first to admit it (read the autobiography of the Rockerfellers if you don't believe me --- but make sure you have a barf bag close at-hand).

So folks, make sure the Elite get the word. when it all comes down they're on the menu. And happy hunting campers.

With all due respect to the OP, I know many people that work on the trade floor in Chicago at the Mercantile Exchange, talk to them often, and not a single ONE of them has said anything about "the coming crash" and how they're preparing for it.

If they are buying anything, its because they know they're going to make money on it.

In general I do not post much on this web site anymore. However this thread has some interest for me.

All have made some valid points as there is not going to be one strategy that is going to work for everyone.

1. if you are going to go on the road and bug out you are going to end up a scavenger and probably a predator on people. The number of people now days that have the skill sets and knowledge to live with a 40 pound pack is few and far between. Just as a point, how many miles is a good pair of boots good for? Do you know how to put new soles on a pair of boots, do you have the needed tools to do it?

2. Gold and silver will depreciate in value. Items that bring comfort, food, items for self protection will appreciate in value. Also you are betting with gold and silver that things will return to normal before you have gone to the happy hunting ground.

3. Social dynamics and the carrying capacity of the area you are in will determine the maximum number of people that you group up with. There is a critical mass of people that are needed but any more can be handy cap.

4. The tools that you have do not mean that you will be effective in using them. This comes down to knowledge and the skills to use that knowledge. In the event of a failure of society you will have precious little time to develop the skills needed. Knowing how to shoot a gun is not the same as knowing how to and having the skill to take a deer at 300 yards with one shot. Reading about putting in a garden is not the same as working it to the point that you get usable food out of it and being able to store the food with out it going bad.

5. Buying a place must be thought out putting away a number of your current ideas. Can it support crops with dry land farming? Is there enough water of good quality that is easily accessible? Is there enough fuel to keep you warm in the winter and allow you to cook? What is the population density with 50 miles, 100 miles? How much and what type of game is in the area and do you know how to harvest it? Is the place defensible and are there good people that live near by?

6. What is your physical condition and age? This will have an impact on where you go and how you set up your strategy.

My wife and I are just now closing on a place that will be our retirement home and bug out location if things get bad. Are schedule is to have it paid off in three years. It can be heated with wood, has a hand pump for water if needed, has timber on it for fuel and good black soil for crops with enough rain to dry land it. There are also deer, turkey, elk, bear moose and grouse in large numbers. It is almost 100 miles from a major population center if you call 200,000 people a major center. With the current interest rates and the depressed housing market it is also a good investment.

Originally posted by jtma508
So folks, make sure the Elite get the word. when it all comes down they're on the menu. And happy hunting campers.

Blue cheese and caviar might be considered rich food today, but it will be Jamie Dimon and Lloyd Blankfein's nuts that will be the rich food of the future.

I also know a lot of people who are investing in gold, and one of our clients we do design work for sells and trades in precious metals (gold, silver, platinum and palladium). Their sales have gone through the roof in the last six months, so much so that now make there own bullion (and I've had the logo I designed stamped into the bullion, wicked, but no free sample unfortunately ).

I've been thinking about investing in small amounts of gold as well, I'm not believing that things are going to go as bad as everyone is suggesting, but with the value of gold skyrocketing it would be a sound investment either way.

But could someone with more knowledge on the situation than myself answer this for me.

If the entire economy was to got t*ts up, in the most extreme and bad way possible, what use would gold actually be? Surely things of real value would be things that are useful to trade in that people actually want or need. Such as copper, wires, sheet metal, fuel, oil, water and food making facilities and equipment etc. If people are starving and the entire infrastructure has gone (in the UK we'd be completely shafted, on an island that barely makes any of it's own food anymore due to supermarket domination and foreign imports). What use would gold be to anyone, other than the ultra wealthy?

Just wondering as it doesn't seem to make much sense to me in a worse case scenario?

reply to post by dominicus



ok they are buying solid assets like gold, silver...but all the asset managers state that one should not tie up more than 10% of your wealth in such.

as for land... the property taxes are sure to rise way beyond normal increases because most municipalities are going bankrupt & need an influx of capital/revenues

as for land, those 5-100 acre parcels already have a cabin or hovel on it?
are they speculating that pot farms will be the rage as laws are passed allowing medicinal marijuana truck farms that the brokers will farm out the operations to knowledgeable grower experts?

as for land... i've heard that many of these monied Elites are taking their funds and lives offshore as expatriates. The Greeks are busy selling many of their Islands, does that sound like an bug out place to go?

as for land...in the recent weeks the Caribbean or even Jamica or Bahamas is not a place to excape to... see the 2nd article in this daily index: raptureready.com...
its about Dengue Fever going epidemic


thanks, those are just a few off the top of my head


[edit on 18-7-2010 by St Udio]

He said all of the financial guys have purchased home sites from 5-100+ acres where they can farm the land, out in the country, mountains, etc etc.

HaHa, you mean those guys on the stock exchange are going to trade in their suits and ties for overalls? start milking cows? Running the farmers market?

Are they going to actually drive the plows or are they going to hook up Elsie?

Come the "collapse" how are they going to hold onto those 100+ acres when the new American Barbarians are at the gate?

I think your friend is having a little chuckle at your expense.

Originally posted by waterdoctor
Reading about putting in a garden is not the same as working it to the point that you get usable food out of it and being able to store the food with out it going bad.

Its amazing how important safe storage of food is, and how little it is spoken of in "live off the land threads." In some areas, growing food isnt the problem. (like where I am now) Virtually anything will grow pretty easily, even a first time gardener could do it. Great growing climate and soil. Now keeping that crop edible for the entire year, thats the tricky bit if you dont have skill.

IF you plan to live off the land, finding a good small community of people who will work together to protect and help one another is key, in my opinion. Like the poster who mentioned small rural towns. We as humans didnt make it this far by being lone wolves. We did it by forming cooperative groups.

I agree 100% with everything you mentioned. I appreciate your insight and thank you for posting.

Originally posted by romanmel
Interesting post.

I might point out a few additional items relating to the preparation for the "crash". First off, these “broker” types were the same that said Y2K would cause chaos in the streets. Didn’t happen.

This time though I feel we may indeed be headed for at least a currency collapse. The system is crumbling beyond fixing

As for the “brokers” advice on buying land, gold and silver, I have concerns. They say they buy farm land so they can grow their own food? I seriously doubt they have a clue about growing stuff. One doesn’t just throw out a few seeds and set back and wait. Farming is detailed and it is HARD WORK! I mean drop dead hard work from sunrise to sunset most every day.

As for gold and silver, I discount gold as a means of exchange when currency has lost value. How do I pay for that $10 loaf of bread the OP speaks of, with a one ounce gold coin or bar, valued now at $1,200? How do I get change? For emergency exchange, here in the US, you would do well with the pre-1965 US issued Dimes, Quarters and Halves or one ounce silver rounds/bars. The $10 loaf of bread could be purchased with 2 silver quarters and 2 silver dimes (with silver priced at $18 per ounce, as it is now).

However, the "brokers", the OP speaks of, have missed the most important preparedness items out there. Emergency water and food come first. Before land, silver and gold you need to get a 60 day emergency supply of water and one year supply of food for each family member in your pantry. Your gold and silver will not cure hunger and thirst.

Two resources on articles about food and water are listed below:

Food:
beprepared.com...

Water:
beprepared.com...

Remember, When emergency strikes, it's too late to prepare.

I wonder how much it cost to get a decent terrain in the USA (let's see 1000 m2 (4000ft2) and with access to water)? In france you need at least 50 000, for such a small place .

[edit on 18-7-2010 by ickylevel]

reply to post by Illusionsaregrander


My wife cans fruit and vegetables, I dry fruit and make jerky. This year we hope to pressure can some deer. It takes time learn the skills but once learned it is like riding a bike.

People that are buying straight physical gold right now are braindead, IMHO. Buying at a premium + at an all time (non inflation dollar) high.

I mean you might catch a quick gain, but you gotta sell gold looking long term. I wish I just would have dumped mine at 1250 but got greedy. Will probably unload if something doesn't happen soon (only .2 units at 1165 average).

You are much better off IMO being a long term investor by buying the 10 year note and shorting the 30 year bond. At all time historical levels almost. Historically guaranteed has always worked above the 1.15 factor linear regression model going back to 90's.

Just think about the people that bought the SP at all time highs in 2007 at almost 1560-1600. Buy low, sell high - not the other way around.

Also, for those that think gold is that great it isn't even close to the price adjusted for inflation from back in the 80's. I really don't get it, but the ones that are buying physical I think have a screw loose. But I have been wrong before and will be wrong again.

Rather be buying long term SP 500 calls or rollover long futures than touch another .1 unit of any commodity.

reply to post by dominicus


dude, can this kind and resourceful city person come live with you rural folk when SHTF? I'll be your best friend.

reply to post by dominicus


dude, can this kind and resourceful city person come live with you rural folk when SHTF? I'll be your best friend.

Originally posted by ickylevel
I wonder how much it cost to get a decent terrain in the USA (let's see 1000 m2 (4000ft2) and with access to water)? In france you need at least 50 000, for such a small place

.

[edit on 18-7-2010 by ickylevel]

The place we are closing on is 21 acres with a home on it. $275,000 US.
This includes the well and 20 acres are in mature timber.

Very well said. It's reassuring to see calmer heads not focused on disaster fantasies like Mad Maxx or The Road. I think people are allowing their imaginations to take their minds to places they are familiar with such as hollywood movies and science fiction novels. With this mindset we limit ourselves to only reactionary scenarios and we prohibit ourselves from viewing the broader picture.

Originally posted by Studenofhistory
Those brokers are both right AND wrong. They're right in thinking that the US financial system ie. the banks, are in serious trouble and that we are likely to see massive bank failures in the not too distant future.

They're wrong about the impact on prices. $30 beer implies hyper-inflation. If you look at history, the only times any country had hyper-inflation was when it's banking system was stable. Why? Because hyper-inflation is caused by exploding credit and in order to have that you need stable banks. If banks are dropping like flies, they will also be taking a lot of their depositers' money with them and that means a falling, not exploding, money supply. Again history gives us examples of what happens when there are massive bank failures. The 1930's are the best example. You had the opposite of hyper-inflation which is deflation ie. dropping prices. So buying tangible assets such as land, gold and silver is the last thing you should be doing because you can't eat land, gold and silver and as far as farming that land, I don't see stock brokers turning into farmers overnight. An imploding financial system means a lack of liquidity. That means that people and businesses that owe money to the banking system via demand loans, which the banks can call at any time, will be forced to sell whatever assets they might have, including land, gold and silver, in order to pay off those bank loans and avoid bankruptcy. That wave of selling will depress prices for assets including stocks, bonds, land, precious metals, collectibles etc.

Even borrowers who have good credit ratings and are able to make their monthly loan payments will be in danger. In the 30's, a lot of perfectly viable businesses were forced into bankruptcy when the banks called in their loans due to the fact that those businesses weren't able to refinance those called loans somewhere else since ALL banks were in the same situation of having to reduce their total loans in order to keep their loan to reserves ratio within mandated limits.

So the best advice to survive the coming Grand Depression is: get out of debt now, keep your cash out of the banks as cash or at worst, short term treasury bills, stock up on vital items in order to get thru short term shortages and don't show off your wealth if you happen to have a lot.

Originally posted by dominicus

He said all of the financial guys have purchased home sites from 5-100+ acres where they can farm the land, out in the country, mountains, etc etc.

Buying acres in the country won't save them should TSHTF. Won't save the governments, or their rich backers.

Why?

Well, here's a message for the elite out there: When the pantry of the people runs out, they'll come looking for yours. Think about it.