12 Warning Signs of Hyperinflation

Inflation is always and everywhere a monetary phenomenon. Inflation is an increase in the money supply relative to the goods and services it can purchase. It's conceivable that inflation could be caused by a contraction of the supply of goods and services, but that is almost never the case and is always temporary (e.g. a drought causes the supply of wheat to shrink). Printing of fiat money is almost always the case and is almost never temporary because everybody is very careful not to destroy money. In the cases where credit has been given monetary status during a bubble and the bubble implodes, destroying credit (which seemed like money), the government inevitably monetizes the credit.

What do you think caused the inflation of the 1970s? It was our removal of gold backing from the Dollar of course. Actually, it preceded that slightly, since the money printing went back to Johnson's Great Society and Vietnam War, and convertibility only ended when France called for redemption in gold the currency they held far in excess of gold reserves. So the monetary base expanded significantly, we removed all pretense that it was grounded by gold backing, and then it lost a great deal of its value on the open market. That was the root cause of the 1970s inflation.

What changed in the '80s and '90s was that the U.S. government used the military to impose a system of petrodollar hegemony, essentially backing the Dollar with Middle Eastern oil. That's why our military has taken up permanent residence over there. But that broke down when the Euro gained traction as an alternative currency, Saudi freedom fighters attacked us, and Saddam decided to stop denominating oil sales in dollars. The last straw was when the central banks ran out of gold to sell on the open market to suppress the price. Britain dishoarded the last of theirs at the very bottom trying to defend the fiat currency. Since that time, circa 2001, fiat currencies worldwide, but especially the Dollar, have been falling rapidly relative to commodities and especially gold. It's not that they suddenly lost value, but that they've been continuously printed for several decades and the charade propping up their *apparent* value broke down. You could no longer reliably buy oil with dollars and the huge supply of gold from the central banks stopped flowing, contracting the supply. The result is far more money in circulation versus the goods and services it can buy -- that's inflation.

Well since the founding of our nation til the founding of the Federal Reserve, we had a very mild deflation. The Dollar gained somewhere between 5-10% value in that 120 or so years. And that's the natural way of things when you have a stable currency. Over time, technological progress and productivity improvements make everything less expensive because the supply of products and services increases relative to the supply of money. That's a good thing. Everyone loves that computers and home electronics get cheaper every year due to rapid technological progress and production efficiencies. That particular sector is gaining in efficiency even faster than the Fed prints money. But if we had a stable currency, then every sector would tend to get less expensive over time. Constant inflation is not a normal state of a free market economy, but only with fiat currency.

The world goes on, but life doesn't necessarily go on for everyone. Hyperinflations kill millions.

 

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Agreed. Hope has no place. Prepare for all possibilities according to 1) their likelihood, and 2) their severity. The product of their likelihood and severity is the proportion of resources you should dedicate to preparing for that circumstance. E.g. heartburn is very likely but not terribly severe (it won't kill you), meanwhile hyperinflation is less likely (or at least less imminent) but could potentially impoverish you and cut you off from any and all functions of civil society, so buying extra canned goods and precious metals may be about par with buying antacids. One of the circumstances of course is that things go on "like normal" for the rest of your life and there are no major economic disruptions, though I think that has a fairly low likelihood. If you assign it a high likelihood, I would say you're probably suffering from normalcy bias.

 

In order of importance for me:

1. No Debt except Mortgage- completed

2. Well Armed- completed

3. Well stocked on ammo- still buying weekly

4. Ability to have clean drinking water- completed

5. Storable food supply- completed

6. PM hoard 300 oz Silver- 10-15 oz Gold- Silver complete working on gold

7. $10,000.00 cash- 1/2 way there

8. Survival Gear in the event I need to bug out- completed

9. Medical Kit with Lidocane, sutures, and meds that are required- completed

10. I will not accept the Mark of the Beast!!

Our founding fathers would be in shock to see what the Gov has done to our Country.

So do not pound on me for what I believe is coming. And more so do not pound upon my door for entry.

 

:rolling:

 

Well as someone who has put a degree to good use but use mostly things I learned after college, I agree that it can sometimes for some people be a good investment. I would say the vast majority of people get little to nothing from it though and on-the-job-training would be significantly more beneficial for the significantly less cost.

Anyway, what I find most amusing is how people often say that precious metals have no value, are a relic of times long since past, or are best used as a paperweight. It reveals complete ignorance about the actual purpose of monetary metals -- as money. Money is not worthless. I'm surprised I have to actually write that as a sentence. But as intuitive and counterintuitive at the same time as it may be, many people do not seem to understand that money is valuable. There are such things as good money and bad money, just like there are high quality cars and lemons. One reliably does the job intended whenever you call on it to, the other is ultimately worthless for that purpose. Between precious metals and paper, which do you think is good money and which is worthless? Well let's put it this way, if you're on board the fiat money car, don't be surprised when it breaks down in the middle of traffic and you have to run for your life before you get run over by a tractor trailer. At that point, everyone will be very eager to fill a seat in the precious metals car which will drive you away safely from the accident scene.

 

Nice imagery in that story! I'm in the precious metals car with gold rims, silver trim, and a platinum shifter knob! Lol

 

Poor Choice of Vehicle

 

This calls for a quote from Charles de Gaulle:
"Only peril can bring the French together. One can't impose unity out of the blue on a country that has 265 kinds of cheese."

 

Very nice!

 

I agree with investing in family. Add to that friends, community and faith but to say that metals have no value is easily debunked. This may have been hyperbole from Coleguy or a contrast of money with things of eternal significance. That said, if you were to list all of the fiat currencies of the world that existed prior to 1980 only a small percentage have any present value (other than collector value). Silver and gold is one of the earliest forms of money and can still be used as money or converted into the fiat of choice.

Regards,

Bluesboy65

 

I agree with that too. I just don't think college is a slam-dunk investment for everyone. I'm still helping my wife pay her student loans and she now runs a business that has nothing to do with her degree, plus she'd like to sell that and be a stay-at-home mom. I know others who got liberal arts degrees and now work in fast food. So it only makes sense for some people.

Also, I never said precious metals need be your foremost investment or insurance for monetary collapse. In fact, there are plenty of other things you should put first, including efficiency and energy-producing improvements on your home, the tools necessary to produce at least some of your own food, one or more guns, ammo, and safety and marksmanship classes, home maintenance and cleaning supplies, tools and supplies to maintain your vehicles, a stockpile of nonperishable food items, etc. Only after you've done those things, you should have physical silver in your possession (bolt-down safe), and gold in a foreign vault. This is so that you can buy things locally no matter what happens to the Dollar, and you could flee with nothing but the clothes on your back if you had to and start a life overseas.

Any investments in precious metals beyond that are just for speculation to make a profit. Obviously, the resources spent on this portion (which is clearly less critical than those purchased as insurance) must be weighed against other investments, including in family, friends, and community. Investments in family, friends, and community might include spending time educating them about these issues.

 

Well, there's also the older saying about give a man a fish and feed him for a day. Teach him to fish and he eats every day. Education trumps the value of gold. Thats my point. You can't eat gold, but you can feed a family on the knowledge you gain through education. I'm sure there are many more here that can attest to that fact than who can't.
Guy

 

Education is never worthless but I do see both sides here. However, am I not going to pay for my daughter's education and bank on her marrying a rich dude? lol. Paying for a good education is very expensive but you wont know if it will be worth it when you do it...... but you have to try. Education is a better long term investment, but you never know, just like with anything else.

 

Education is like a box of tools. You may obtain it, but it doesn't tell you how to use it. College expenses can be controlled by using community colleges or with scholarships or grants, or by serving "apprentice" type of arrangement in certain businesses. If the student doesn't want to work at learning, it could be a loss of money. IMO.

Jim

 

How do you function without a SSN number? :devil:

 

Pretty sure those aren't the same... until the US govt mandates that it be placed upon your body. This is akin to the military chips they've been installing...

 

After telling me I have my head in the sand in another thread the other day without even knowing me , I'd like to know how much gold is prudent to put overseas to be able to flee the country and start a new life . With the exchange rate of the Euro I'd imagine it would have to be at least $100,000 . What is your figure .
rzage

 

If you can settle your affairs and head into the mountains without the Government wondering where you got off to, you don't have the "mark".

Otherwise....

 

I suspect a couple of stun gun applications to the area of the RFID will render it quite useless, IMO.

Jim

 

I know you only by your words, and that is what I respond to. How much you keep overseas is going to be a personal decision for everyone. Some people may buy residence in a foreign country before they "need" it, and use it as a second or vacation home, or an investment property which is rented out. I can't afford that luxury, so I keep enough gold in a foreign vault so that if push came to shove, I could cross the nearest border without worrying about my wealth being confiscated as I cross, or mugged on the way, and have enough to not be completely impoverished wherever I set new roots. In my case, I have enough for a cheap used car, a few months rent, and basic living expenses so that I can find a job and start earning an income somewhere there is presumably not martial law, civil unrest, nuclear fallout, or some other condition which made me leave my home. Others may want to have enough to live very well, if they can afford it. Even if you never use it, it's still cheap insurance and the only kind of insurance I know of where you get to keep the premium. It's not like the money is "spent". It's merely saved in another country. It can be tapped or moved or otherwise managed as you please. There is no upper limit on how much you should store overseas, but I think $10,000 is probably a good lower limit. That said, even if you only had $5,000 or just one ounce of gold at $1,400, it would be better than nothing. It might pay rent and get you food for a month while you figure things out. Where you would go is probably something you should figure out ahead of time. My wife has dual citizenship and family in another country, so that's where I would probably go. Others may choose a bustling city (Hong Kong?) or comfortable climate (Costa Rica?). This planning may never be put into action, but I think it is at least as important as having a will and life insurance.