muses of the moment

November 21, 2008

Excellent Economics Education (For Free!)

Filed under: Long term investing, The Financial Crisis — totallygroovygirlfriday @ 3:43 pm

“The next twenty years will be completely unlike the last twenty years.” Chris Martenson

I ran across a wonderful website. I highly recommend that you spend some time viewing “The Crash Course”.

The most important concept to take away from this post, the concept that will effect your life personally and our world as a whole is the idea of exponential movement, always shown on a graph in the shape of a hockey stick. Chris does an excellent job of explaining how this concept will impact your future. Understanding this concept, you will be light years ahead of the herd in planning for and moving into the next great depression between the years 2010 and 2020.

I was having a hard time understanding the economic researchers that said the US (and probably the world) would have a hyper-inflationary depression. I understand the concept and I understand it flows from creating too much money, but I didn’t understand how it is TOO LATE to stop now and it is FAST approaching. We are past the point of being able to slow down the economy or drain liquidity out of the system (even if the government did an about-face in their policy). A hyperinflationary depression is down the road in a few years no doubt about it now. And because of the nature of exponential formulas, it will appear to “come out of nowhere”. All of sudden prices will rise, then double and triple in a matter of weeks, then days. All commerce will slow to a crawl or shut down.

Study this course and prepare now based on your current situation.

Because of the law of the hockey stick, these things will happen:

US Dollar (and most fiat currency) will be worthless. So, don’t save in dollars, pay off your current debt with your dollars or buy valuable assets (listed below).

Precious metals and practical tangibleassets (real estate is not a tangible asset right now) will be valuable. Store savings in these items.

Debt (loans) will be inaccessible or too high in interest. Pay off your debt NOW and don’t acquire more. Don’t plan on it being available in the future.

Natural gas, automobile gas, coal, and therefore electricity will be very high. Get off the grid as much as possible or plan for most of your income to go toward food and heat (and taxes).

Taxes will be high. Plan to make some or all of your income from skilled labor paid in cash or a barter system of some kind. Learn how to barter.

Supply chains for food and everyday products/services will be clogged or shut down. Have 6 months of the bare essentials ready. Learn to garden and grow your own food. Start now, it takes experience to master these things.

The health care system of today will collapse. Learn basic emergency care and health care. Have basic medicines and your prescriptions on hand. Find a doctor to barter services with.

People will be angry and fearful, as they are caught off guard by this situation. Secure yourself, your family, and your assets. Be ready to help and educate those willing to listen.

Have a plan B and plan C and plan D. Remember the next twenty years will be completely unlike the last twenty years. Because of that truth, there will be great opportunities never before seen. Look for that opportunity. You will not be able to see those opportunities if you are distracted looking for food and shelter.

Thank you for reading.

November 5, 2008


Filed under: The Financial Crisis — totallygroovygirlfriday @ 1:20 pm

This truly unbelievable. This guy should be IN JAIL, not working for the FED. At the very least he should be alone in a room with the investors who lost all their money in Bear Stearns.

The New York FED just hired the former chief RISK officer of Bear Stearns:

Jim Sinclair’s Commentary

This has to be a joke of some kind. In 2006 the cancer of OTC derivatives was growing like a locust storm at Bear Stearns

NY Fed hires former Bear Stearns chief risk officer
Tue Nov 4, 2008 9:29am EST

NEW YORK, Nov 4 (Reuters) – The Federal Reserve Bank of New York has hired the former chief risk officer of Bear Stearns Cos, Michael Alix, to advise on bank supervision, according to a release in the Fed’s Web site.

Alix will serve as a senior advisor to William Rutledge in the Bank Supervision Group and his appointment is effective Nov. 3, according to the release dated Oct. 31

At Bear Stearns, an investment bank that collapsed in March and has become hallmark of the global credit crisis, Alix served as chief risk officer from 2006 to 2008 and global head of credit risk management from 1996 to 2006.

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