Tuesday, August 3, 2010

Meanwhile I Was Still Thinking

Part 1 -- Pyramids in Argentina
Part 2 -- Bricks without straw

If we really are in a deflationary cycle, then the best thing a person can do is get out of debt and stockpile cash. If we are facing inflation or hyperinflation, then cash is going to become increasingly worthless. Debt will be more or less wiped out. People on a fixed income or who are functional creditors will suffer significantly.

What should the wise and the prudent do? Bug out to the country? Go live with the Amish? Move to Belize? There is no easy answer, but we can consider some things as catalysts for thinking about our specific, personal situations.

Unless a person lives in a really bad neighborhood or bad situation, staying put and "fortifying" the position is usually going to be the best long-term approach. If you live where you can reasonably expect to be flooded, hit by a hurricane or earthquake, or get caught up in rioting, then having a plan and provisions to hurriedly leave the area is clearly the wise thing to do. All of us should, in any case, have a grab-and-go bag with some essentials in the event we have to evacuate quickly in the face of fire, threatening weather, or other issues.

I'll cover various preparations I think it wise to make, mostly to help me think through all of it myself. I'm not advocating "survivalism" or any kind of paramilitary "militia" preparation. I don't think those things are necessary. I do not believe we are facing a total collapse of civilization. I think we are about to face significant economic hardship such as has not been seen in America at least since the Great Depression. Indeed, I suspect it could be even more difficult than those times.

And if I'm wrong? None of the things I suggest will really make anyone look foolish. Nor am I selling anything. I am certainly not encouraging people to spend money they don't have on things they don't need. I just want to think through it myself and perhaps help others to do the same.

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