Doug Casey: “This is Going to be One for the Record Books”

Guest Post by Doug Casey via International Man

Just because society experiences turmoil doesn’t mean your personal life has to. And a depression doesn’t have to be depressing. Most of the real wealth in the world will still exist—it will just change ownership.

What is a depression?

We’re now at the tail end of a very long, but in many ways a very weak and artificial, economic expansion. At the same time we’ve had one of the strongest securities bull markets in history. Both are the result of trillions of new dollars created over the last decade. Right now very few people are willing to consider the possibility of tough times—let alone The Greater Depression.

But, perverse though it may seem, this is the very best time to think about it. The U.S. economy is a house of cards, built on quicksand, with a tsunami on the way. I urge everyone to read up on the topic. For now, I’ll only briefly touch on the nature of depressions. There are at least three good definitions of the term:

  1. A period of time when most people’s standard of living drops significantly.
  2. A period of time when distortions and misallocations of capital are liquidated.
  3. A period of time when the business cycle climaxes.

Using the first definition, any natural disaster can cause a depression. So can living above your means for long enough. But the worst kind of depression has not just economic effects, but economic causes. That’s where definitions 2 and 3 come in.

What can cause distortions in the way the market operates, causing people to do things they’d otherwise consider unreasonable or uneconomic? Only government action, i.e., coercion. This takes the form of regulation, taxes, and currency inflation.

Always under noble pretexts, government is constantly directly and indirectly inducing people to buy and sell things they otherwise wouldn’t, to do things they’d prefer not to, and to invest in things that make no sense.

These misallocations of capital subtly reduce a society’s general standard of living, but the serious trouble happens when such misallocations build up to an unsustainable degree and reality forces them into liquidation. The result is bankrupted companies, defaulted debt, and unemployed workers.

The business cycle is caused mainly by currency inflation, which is accomplished today by the monetization of government debt through the banking system; essentially, when the government runs a deficit, the Federal Reserve buys its debt, and credits the government’s account at a commercial bank with dollars. Using the printing press to create new money is largely passé in today’s electronic world.

Either way, inflation sends false signals to businessmen (especially those who get the money early on, as it filters through the economy), making them overestimate demand for their products. That causes them to hire more workers and make capital investments—often with borrowed money. This is called “stimulating the economy.”

Inflating the currency can actually drive down interest rates for a while, because the price of money (interest) is lowered by the increased supply of money. This causes people to save less and borrow more, just as Americans have been doing for years. A lot of that newly created money goes into the stock market, driving it higher.

It all looks pretty good, until retail prices start rising as a delayed consequence of the increased money supply, and interest rates skyrocket to reflect the depreciation of the currency.

That’s when businesses start failing. Stocks fall. Bond prices collapse. Large numbers of workers lose employment.

Rather than let the market adjust itself, government typically starts the process all over again with a new and larger “stimulus package.” The more often this happens, the more ingrained become the distortions in the way people consume and invest, and the nastier the eventual depression.

This is why I predict the Greater Depression will be … well … greater. This is going to be one for the record books. Much different, much longer lasting, and much worse than the unpleasantness of 1929-1946.

Editor’s Note: A financial depression far greater than any crisis America has seen could soon strike. For some it could completely wipe out their savings… and for others it could be the fortune-building opportunity of a lifetime. Doug Casey and his team just released an urgent video on surviving and thriving during an economic collapse. Click here to watch it now.

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john prokovich
john prokovich

get silver

john prokovich
john prokovich

Get old 90% silver coins…………

john prokovich
john prokovich

Get Silver,,,,,,,

MSyzlak
MSyzlak

fuck silver, get gold.
Wanna hide it? Or, wanna carry 10k as you bug out (or in).
8 oz of gold. 0.5 lbs. Put it in your pocket.
Silver? 43 lbs.. Make sure your preps include a wheelbarrow.

MSyzlak
MSyzlak

p.s. Anyone know much about Platinum?
Never invested; but as a kid I remember it being worth far more than gold. Now an ounce is 2/3 the cost of an oz of gold.
Why? Where will Pt go? Anyone know?

Harrington Richardson
Harrington Richardson

Nobody knows what PGM’s (platinum, palladium, rhodium etc.) are outside of metal bugs and industrialists. For dealing under SHTF climate, you need what everybody understands. Gold and Silver.

MSyzlak
MSyzlak

True enough. Good point.

MMinLamesa
MMinLamesa

If you anticipate every day items like say a can of tuna or a loaf of bread costing even a 1/10 of an ounce of gold, then gold. But I’m with jp, I say junk silver will be the coin of the realm. Stock up.

And if TSHTF, seriously, where are you going to “bug out” to?

MSyzlak
MSyzlak

And if TSHTF, seriously, where are you going to “bug out” to?

Good question that I need to find an answer to ASAP. Was in good shape in a good place 4 yrs ago. Now circumstances find me in a major (leftist) metropolitan area. In retrospect, I’ve really screwed the pooch.

I didn’t mean to sound harsh, but for years I bought silver piecemeal with what little extra I had. Now I have a big, heavy box of the stuff. Then I came into some money & bought gold, and have been delighted by how comparatively small, light and easy to hide it is. Some of each is the best plan, but if, like me, you expect the dollar to be worthless in some number of years, you’d be hard pressed to store your wealth as silver without a front end loader.

Vixen Vic
Vixen Vic

Read my comment below on gold and silver. If you have a large stash of silver, you can convert most of it into gold for lighter weight and easier transport. But you’ll still need silver for the small purchases. Is a single loaf of bread or a bottle of milk really worth a gold coin to you?

What if someone erects a makeshift guardrail and demands a toll over a bridge you need to cross? Are you willing to part with gold if the price demanded is much lower? And if you pay in gold, are you putting yourself in danger of robbery or worse? People with silver may not have gold, so are less (though not guaranteed) susceptible to robbery (especially if you look lean and poor, and if you tell them that’s all you have and it’s well hidden.)

In Venezuela, when the crisis first started, they had markets that only accepted silver dimes. No silver dimes, no purchase. I haven’t read any recent articles about what type of currency is being exchanged now, though cryptos have been mentioned (which I don’t trust), but that was the case at the beginning of the crisis.

If you don’t have all your of silver in dimes, trade the silver you do have into dimes. It’ll be much lighter than varied denominations, especially the larger coins. It’s also easily recognizable. It will purchase the small items you need, especially if there’s no way to give you change. A roll of dimes doesn’t weigh that much. So getting many rolls of silver dimes should not weigh you down too much or be too bulky if you’re on the move.

Vixen Vic
Vixen Vic

Get both gold and silver.
Edit: Gold to pay for the big things, silver for the smaller things.

oldtimer505
oldtimer505

For what it’s worth, stock up on those things you can’t do without or another way of saying it are absolute necessities. Educate yourself on taking care of yourself. Learn how to, “obtain and store potable water & grow food”. Growing food is more difficult than just poking seeds in the ground. Cultivate a small group of individuals with complementary skills to get through some of the issues that will blind side you. Last but not least, Require and or demand good daily personal hygiene of all individuals in your group. To fall ill during difficult times will be fatal to a great deal of individuals. These are just some of the basics.

If you are fortunate enough to make it through a whole year you may have a sporting chance. You will get to live the “good old days” of hard work, personal responsibility, commitment to God, spouse, country and self defense.

For those of you who want the easy way out; socialism, dictatorship, monarchy or communism. Then all you have to do is bend over, grab your ankles, take a deep breath and relax. It will all be over in a few strokes.

Pequiste
Pequiste

“The easy way out is socialism, dictatorship, monarchy or communism. Then all you have to do is bend over, grab your ankles, take a deep breath and relax. It will all be over in a few strokes.”
-oldtimer505

Sorry to disagree with you, oldtimer. Under the totalitarian systems you mention the fucking-over NEVER ends.

e.d. ott
e.d. ott

So death it is …. but first, RooRoo!

oldtimer505
oldtimer505

How true. I stand corrected. I edited my post so folks would better understand. Thanks

Harrington Richardson
Harrington Richardson

Good old Doug has now predicted 150 of the last one depressions. He may be right some day. I consider him filled to the gills with shit.

botclan
botclan

Yep

impermanence
impermanence

Although there is no question that major change is in the offing, suggesting that you can possibly understand and/or predict what is going to come down is, well, naive, at best.

If you would have told anybody 25 years ago that global central banks were going to print tens of trillions of dollars and life would go on “relatively normal,” nobody would have thought it possible.

The best thing about life is that we have no clue what is coming next.

BB
BB

I just got through watching the movie “Memphis Belle” about the fighting over Western Europe in World War Two . It hit at the end of the movie how white everything was. No “people of color” at all .That they are not needed in our nation. White Americans that are United can achieve almost anything.Our nation is in the process of destroying itself. When this Great Depression finally hits us the various groups are going to tear this nation apart. We will not survive as America. A hurricane of violence will overcome us.
Diversity is where nations come to die and that has the plan( by the Elites) all along. Destroy us from within.

Harrington Richardson
Harrington Richardson

There were two Blacks in the boat with Washington when he crossed the Delaware. Paul Revere got caught by the Brits on his “ride” while a free Black man delivering the same message the other direction got through. I like my own “kind” too but a lot of them also have an ownership stake from day one. That is why our only hope involves EVERYONE living within the boundaries of the Constitution. Our biggest problem today is white liberal shitheads.

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