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For years the US has had a fairly regular cycle of life.  Things go up and down but we have had a pretty decent amount of certainty.  We’ve been certain that the US will be the #1 super power, the stock market will rise, and the dollars in our hands will still be worth a dollar tomorrow.

These days, everything is a lot less certain.  Just about everyone will agree that the recession is about over.  Some will say that as we head towards the summer months we’ll see the usual upswing in the economy.  Others say we’re about to see such a sharp decline that the recession will quickly become the 2nd great depression.  I feel that one of the sides has more sound arguments than the other side, but one thing is for certain: one of three things will happen.  Things will get better and the gloom-and-doomers will be heralded as the bunker builders of the new millennium.  Or things might get really bad; the whole world will get a nice reset and we’ll all be reminded of what is really important (friendships and life, not rims and ice).  Or who knows?  Maybe things will stay right in the middle, in the lull of kinda-crappyness where it sucks but it’s not terrible.

Be Prepared!
Boy Scout Motto

You’d be hard pressed to find someone who has never heard the boy scout motto.  I spent many years in scouting while earning that Eagle Scout badge. It’s really a large part of me and the things I do.  Everyone can agree that we are headed somewhere, but everyone forgot their compass.  We’re going down the road but which way?  That’s why I encourage everyone to be prepared.

Lately I’ve been discussing my plans for wintering the depression.  It’s on my mind the most because that’s where we need the most help.  Monkeys can pick good stocks in an bull market (monkey beats market) so it’s relatively easy to survive in the US when times are good.  When times are lean like they are right now, most people are still carrying on as usual.  A few things here and there are tougher, but for the most part, if we just cut back on a few things we can still get by.  But who is ready for a depression?  There are lots of little things that each of us can do to really lessen the pain.  The bad stuff may not happen, but won’t you be glad you spent a day preparing if it’s necessary?

Now I’ll describe all of my suggestions on how you can prepare for each of our possible futures.

Economy Skyrockets Up

Earlier I mentioned that monkeys can do pretty well in a good market, but you should want to do even better.  This means the prices of things will probably rise again, so get ready to buy.  You’ll want to catch the wave as real estate and stocks shoot up in value.  Have your money positioned so it can quickly move into these assets as soon as things look safe.  Put off your purchases of all doodads because every dollar spent is one less that will grow in your investments.  And don’t invest too early; times are too scary right now to take unnecessary risks.

More of the Same

Just about everyone out there has cut back in one way or another.  But for the unfortunate 10% of our population who are currently unemployed, they’ve been forced to cut back a lot more.  As jobs become more scarce, you will need to be more diligent in your cutbacks.  You might be employed today but who knows what sector might be hit next.  It is important to decrease your unnecessary expenses and save for leaner days.  Some things you can do to save a few bucks:

  • Drop your cable bill by reducing your channels or lowering your internet speed
  • Eat our less frequently
  • Cut out subscription services you don’t need (magazines, movie rental, etc)

Hitting the Fan

I’m no extremist (or alarmist) so I won’t tell you that it’s time to buy some cammo and a small goat farm in the countryside.  But I will say it is conceivable that things could get much worse than they currently are.  I’ll discuss some of the things that might happen and what I’m doing to prepare for them.  If you really really like to be prepared, Sean Brodrick’s book, The Ultimate Suburban Survivalist Guide, seems to be a good compromise between being prepared and going over the top.  I haven’t read it though, so do so at your own risk.

Bank Closure

People might say, “who cares if a bank closes, I’m FDIC insured!”  And for most people that is absolutely correct.  But for the people who are anything like me, you haven’t carried cash since 1998.  Your bank might close and the government might be able to get you your money some day, but what will you do in the mean time?  It is really hard to buy things if the credit card machine goes down at the same time as your ATM.  I’m preparing by making sure I have several days worth of cash available to me at all times.  It’s nothing crazy, but just enough to make sure I won’t have any trouble getting incidentals I might need.

Store Closure

Stores might close for all sorts of reasons.  It could be things like riots and looting, or maybe some workers went on strike.  People like me also don’t keep much around the house.  Basically I’m collecting enough canned goods to get me through a few days.  I’ve also got spares of the common incidentals like a spare tube of toothpaste and a spare toothbrush.  These preparations lessen the amount of cash I need.  In some ways, the more prepared I get, the less prepared I need to be.  Funny how that works.

Loss of Power or Water

As the people up north were recently reminded, sometimes power or water will go out.  I’m preparing by making sure my grill has a full tank of propane and I have some spare water laying around.  Utilities these days seem fairly reliable, but it’s really not that hard to prepare…so why not?

Civil Unrest

When times are bad, it is hard to count of the behavior of others.  Someone who is normally a good person might be inclined to break into your home.  And it’s not because they’re a thief, it’s because they’re desperate…they probably have a daughter at home who needs some food.  Can you blame him or her?  I’m not going to buy motion sensors, cameras, and razor wire to make my house a castle because that seems a little much.  But what I will buy probably seems extreme to a lot of people.  Right now I have a gun on my shopping list.  There’s the obvious reason to remind people that my home is for friendly folk only.  But if you’ve ever tried to catch yourself a rabbit with your hands, you know it ain’t easy.  I don’t plan on ever pointing that gun at anyone or any thing, but I’m taking about preparations. A safe place to store my gun is also on the list, if you were curious.

Dollar Loses Value

In the first great depression, we actually saw deflation.  That probably won’t happen this go around.  Today the dollar is looking pretty good against the other major currencies of the world and the dollar has been the currency for all trading around the world.  Unfortunately the dollar is starting to lose a lot of its support.  The American government has spent itself into a pretty deep hole and the rest of the world has noticed.  They’re starting to feel uneasy when a spend happy government also controls the printing press.  There is a chance that the US dollar will stop being the world’s currency and we’ll go back to the old days of bartering with commodities (like gold).  I’ve prepared for this by purchasing some physical assets in both gold and silver.

Final Thought

In my last and biggest section I tried my best to not sound like a chicken little.  The sky really isn’t going to fall and I feel like there is a 90% chance that I won’t experience any of the bad things I’ve prepared for.  But at the same time, if the 10% stuff does happen, I’ll be comfortable.  Instead of scrounging for any scraps of food I can find, I’ll be eating some baked beans warmed up on my grill.  As I said from the beginning of the recession, I don’t particularly care where things go or who’s fault it might be.  Whatever my situation becomes, I’ll make the most of it.  My only real goal is the leave the recession poised to take advantage of our economy’s next revival.  If you can find a way to keep the good times good and the bad times less bad, you’ll have taken another step toward infinite happiness.

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