With the continuing insanity of uncontrolled spending by Obama’s Democratic administration it seems that a fiscal crisis is inevitable, and for good reason. More than 17 trillion in federal debt, 80 billion a month in US currency being printed monthly by the Federal Reserve to pay the federal government’s bills as the White House continues its uncontrolled spending spree and only adds further insult to injury. Each debt ceiling arrived at by the Obama administration is only met with more demands by President Obama to force Congress into allowing even larger expenditures. Where is sanity?
Plagued by the government
According to Peter Schiff is his book “After Shocks” it will be the uncontrolled monetary policies of the federal government which will create out of control inflation as the US dollar devalues under the weight of the incessant fiat currency printing of the Federal Reserve. He predicted this in his book while the Bail Out signed by President Obama in 2009 would later prove to be a politically motivated slush fund for his cronies while the US infrastructure never got the shot in the arm it needed to address US bridges and roads badly in need for rebuilding. Schiff, time and again, warns people not to get caught holding onto US dollars when the anticipated collapse occurs. While the Bail Out effectively nationalized 2/3 of the US auto industry, bailed out Wall Street, and bought influence by the federal government into several major news networks, it did nothing to stimulate the economy.
Destruction by the CRA
The Bail Out merely perpetuated the position of the banks made insolvent by the provisions of the Community Reinvestment Act orchestrated by the Democrats to buy votes through the easing of credit requirements for the unqualified buyer. When a number of real estate backed investments were being turned into residuals from the sale of these packaged bad loans to investors, an entire financial industry was poised for massive failures as defaults by mortgage holders who never should have been awarded loans piled up. According to Peter Schiff, many of those financial institutions should have been allowed to go bankrupt as it was much more expensive to bail them out especially so they could continue go back to doing what they had done to destabilize the economy with their poorly advised practices in the first place.
Toppling a benevolent giant
Ultimately, the undoing of growing US financial markets, a world leader in economic stimulus that also brought trading partners such as China into prominence was solely the responsibility of the US federal government for interfering with policies and laws that allowed dangerous abuses in the banking community. This would create the need for a huge Bail Out funded by the US taxpayers. Doing this solidified the fate of the US dollar as a devaluing currency that will not hold up against other printed money of the world. As the continued Quantitative Easing of 80 billion dollars each month floods the market with more US dollars the value of American currency decreases.
How it will go down
According to Dan Celia, prominent financial analyst, when the collapse occurs there will be no warning. Aside from the false assurances of Federal Reserve officials and talking heads of the US government which will continue until the final deadly moment occurs. Banks will immediately shut down internet access to the accounts of their depositors effectively removing access from people to their very own money. To prevent a run on banks by panicked customers, doors will close as they did during the Great Depression. The practice of fractional banking used by the Federal Reserve as a premise for fundamentals will be once again exposed for being the totally insufficient method that it is. For the guarantee of their client’s financial assets it will prove to be a farce. Under the guise of a temporary closing to reorganize and rectify the situation, in Dan Celia’s estimation, the banks will have no answer for the minimal amounts of liquidity they maintain in their vaults compared to their large outstanding obligations to their depositors. It will be a disaster! The resulting chaos and social unrest will become inestimable in the days and weeks that follow as the desperation grows.
Americans whose financial prosperity has been sabotaged by faulty government legislation and corrupt banking practices will find themselves holding a US dollar that will lose 15 to 20 percent of its buying power overnight, but it will get much worse. Just as in post war nations suffering the ravages of war, people will find their money is worth practically nothing as they try to purchase even the most basic necessities in order to survive. Bread, milk, and meat will cost hundreds if not thousands to feed a family as the desperate days go by.
So, what to do? What can possibly be done to counteract this horrid scenario or even survive in the middle of it? Will there be any utilizable strategy in the midst of such a catastrophic situation?
Peter Schiff and Dan Celia both concur on certain points. The most important thing to remember is not to wait for this cataclysm to happen. Know that this is not a matter of if but only a matter of when it will happen. Dan recommends having alternative tangible assets at home and not tied up in banks. Get a safe. He recommends getting alternative world currencies in quantity such as the Swiss Franc which will retain its worth compared to the US dollar.
Peter Schiff advises investing in gold coin and having plenty of it stashed at home. Yet, I might interject here that when looking back at history and the Great Depression we might recall that the federal government seized the public’s gold and prohibited its ownership! Gold has undeniable value but this is a disturbing proposition to consider. Silver coin is highly recommended as it too retains value despite the failure of paper currency in a crisis. One would be well advised to keep a substantial amount of it at home.
The true Survivors
Those in rural areas such as farmers will be the best off in a financial crisis. As in the Great Depression as city dwellers found themselves out of work and paying exorbitant amounts of money for the simplest necessities, farmers could grow their own food and slaughter their livestock in order to eat. They could barter their resources in exchange for manufactured goods they did not have cash for. Despite the fact that the federal government encourages dependency and lack of ambition, only those who are self-reliant until whenever the crisis subsides and a monetary adjustment is arrived at by the authorities stand to recover . That adjustment will result in many losing their money or a great percentage of their financial holdings and we can all thank Washington for that!
Third word style conflict
As violence in inner cities rages and unrest spreads to urban areas, Dan Celia advises staying home and staying out of the direct conflict by having your valuables and subsistence food stores within reach. Sitting out the crisis with an effective back-up plan is an effective strategy. This is not some wacko survivalist theory here. The US dollar is headed for a problematical devaluation that it may never recover from. Dan Celia even worries that this is the very event that will usher in a new form of monetary system either involving electronic credit or a world government form of exchange that will be used to enslave Americans under an international system of law never intended under our Constitution.
In short, in view of the US federal government’s refusal to heed the danger signals of pathetic fiscal management it is expressly advised to seek other currencies that are more solid than the US dollar. The Swiss Franc is a great alternative. Gold and silver coins are also highly recommended. Keeping your savings out of the banks is also a shrewd move. Having stored rations would also be a great idea if you are not living on a farm with resources already stored for any future contingency. The writing is on the wall for those who can heed a warning.