My unpublished (100,000 word) book “The Financial Jigsaw”, is being serialised here weekly in 100 Issues by Peter J Underwood, author
Quote of the Week: “I cannot teach anybody anything. I can only make them think.” – Socrates
This week we continue with Jeff Thomas’s article about a food crisis and how people are unaware of the fragilities of our distribution systems, especially the trucking industry. Here is a short article describing the risks in this area and the need to prepare in advance. This is especially urgent now that oil supplies are at risk due to the recent Saudi attack:
What could trigger a food crisis? Our current bubble economies are due to burst soon and this short article describes how: https://dailyreckoning.com/the-four-dynamics-of-bubbles/
Just like in 2008, when the bubbles burst the distribution channels seize up and our 3 days of food and fuel stocks run out. It might not be possible to ameliorate it this time around and central banks might be powerless. What are you doing to prepare?
Here is the link to last week: Issue 69 (Sorry – 68-2; the number sequence failed last week)
Now that Brexit will not be coming to a final conclusion yet, I will continue to provide weekly updates as events progress:
Brexit Update – 20th September 2019
The Brexit deadline remains 31st October 2019 and stays in place unless Boris can get Parliament to agree a new exit plan. Last week saw a range of challenges to both Article 50 and the suspension of Parliament so everything is in flux at present and we can only sit patiently and await the outcome as events progress.
‘Mish’ has an excellent summary of the situation: https://moneymaven.io/mishtalk/economics/no-deal-still-on-the-table-scotland-silliness-dup-dealing-hlGaEp1l6EaB6zpinBcerg/
He says: “Between now and October 14 not much is likely to happen. The UK court will rule the Scotland challenge is nonsense; then we wait to see what both sides do. A breakthrough with DUP and Ireland is the main possible exception to the nothing much happening before October 14. Meanwhile, No Deal is still on the table. It has to be. It remains the default legal position.”
Brexit Hot Press – Parliament suspended
This week continues with an ongoing conflagration for who will win the various legal challenges being presented to the courts in Scotland, Northern Ireland and England..
Parliament is suspended for now until the courts decide. Details of Parliament’s deliberations when sitting can be found here:
CHAPTER 13
The New Emergent Economy
“Winning is a habit. Watch your thoughts, they become your beliefs. Watch your beliefs, they become your words. Watch your words, they become your actions. Watch your actions, they become your habits. Watch your habits, they become your character.” – Vince Lombardi
“Everything is determined, the beginning as well as the end, by forces over which we have no control. It is determined for the insect as well as the star. Human beings, vegetables, or cosmic dust, we all dance to a mysterious tune, intoned in the distance by an invisible piper.” – Albert Einstein
“The Chinese use two brush strokes to write the word ‘crisis.’ One brush stroke stands for danger; the other for opportunity. In a crisis, be aware of the danger — but recognize the opportunity.” ― John F. Kennedy
Jeff Thomas continues:
Panic sets in
Food panic doesn’t necessarily occur if a retailer carefully assesses his increased market and rations sales so that everybody gets a slightly lesser share. In fact, I’ve personally seen this work well in the event of a natural disaster in my home country. The panic does occur when the availability suddenly becomes non-existent (even for a brief time) and the shoppers are unsure when it will be resumed. In an inner city, this is exacerbated by three factors:
- Shipments from suppliers become erratic and insufficient
- A significant increase in the number of shoppers cleans out the store
- Individual shoppers become unreasonably demanding.
This last factor, in any inner-city situation, is almost always responsible for the chaos that evolves into a riot. It works like this: A mother complains that there is no bread for her children to have a sandwich. Her husband becomes angry at the problem and goes down to the corner store, demanding a loaf of bread. The store manager says that he cannot release the bread until the next morning, when the neighbourhood knows they can each come and buy one loaf only. The man, becoming angrier, goes in the back and takes a loaf of bread. The manager resists and is shot. The man, on his way out, grabs a carton of cigarettes and a couple of six packs of beer for good measure. The store, now unmanaged, is looted. Those shoppers who are normally peaceful people begin to panic and realize that it’s time to grab what you can. In these situations the food stores are generally cleaned out quickly. In a very short period of time, a full-scale riot may be in play. In most inner-city riots, the liquor stores are hit early on, then the appliance stores and so on down the line.
But this is no ordinary riot. Unlike a riot triggered by, say, a TV news clip of some policeman beating a seemingly innocent man, the trigger is ongoing and, more importantly, it is not, at its heart, anger-based, it is fear-based. And it is self-perpetuating. Shipments are not resumed to a store that has no one running it. Worse, additional store owners close for fear that they’re next. The situation escalates very fast.
Enter the Cavalry
While the US and Europe have seen many riot situations and we can therefore study how they play out, a series of self-perpetuating riots have not taken place before. It’s likely that, within weeks, a national emergency would be declared, and rightly so. But, how do we to deal with it? Certainly, the President and State Governors would quickly begin to work with wholesalers to assure that food got to the cities (and any other locations that are also troubled).
Needless to say, suppliers will all respond by stating that, in such a situation, they cannot get paid for any food that they deliver. Truckers will state that they cannot accept the danger to which their drivers will be exposed. Politicians, feeling the pressure from their constituencies, will want to act decisively, even if their decisions prove ineffectual.
In such cases, those politicians who are more conservative may decide to send in truckloads of food to be handed out for free, with the control of the Department of Homeland Security to (hopefully) keep order. Those politicians who are more liberal will believe that the right solution is to nationalise food supply in their states (and possibly nationally) – to take over the control of delivery.
As can be imagined, the results will vary from suburban situations in which the store [personnel] is still in place and the provision of food at the retail level remains orderly, to inner-city situations in which trucks will be routinely ransacked. The evening news will show a clip of a “shopper” running down the street with a case of boxes of cornflakes, while heads of lettuce roll on the pavement, some to be picked up; others to be trampled.
Meanwhile, at the other end of the supply chain, the wholesaler is trying to explain to the politicians that, if he’s not paid in some way for the food he sends out, he simply cannot continue. Politicians (especially the more liberal ones), not understanding the workings of business, regard the businessmen as simply being greedy and fail to understand that, without an orderly flow of money, business stops.
The politicians place a temporary ban on all food containers being shipped overseas (even though the overseas customers may be the only truly reliable payers). The politicians advise the wholesalers that they will be paid “eventually.” If the money does not exist in the state treasury, some politicians may even promise future tax credits as payment. As a result, the supply of food would break down on a major scale.
How it all shakes out
Historically, there’s nothing as chaotic as famine. As long as people have a crust of bread and as long as it arrives regularly, there’s a chance that events may be controlled. It’s the very unpredictability of supply that causes panic and the greater the concentration of potential recipients, the greater the panic.
Small wonder that, when I speak to friends and associates about the ‘Great Unravelling’, this one facet often makes them recoil in a desire to avoid the subject entirely. Once this particular house of cards begins to fall, it will fall much faster than the economy in general and the results will be unquestionably extreme. If the politicians are unlikely to effect a workable solution (at least in the short term), how does this all play out? After all, no famine lasts forever.
What historically happens is that chaos ensues for a period of time. Some people are killed in attempting to take food from the authorities who control the distribution. Others are killed on their way home by others who want the food they are carrying. Others are killed in their homes, when raided by those who are hungry. Still others die of starvation. It’s horrific to say, but, after a time, in such situations, famine becomes “the new norm” and, as illogical as it would seem, this is the turning point. Chaos eventually devolves into hopelessness and listlessness and the panic disappears. Then, at some point, the lines of supply are slowly restructured, generally on a more limited scale than before.
Is there a timeline for the above to occur? This is for the reader to decide. Each of us will have some general picture in our heads regarding the likelihood and timing of a second crash in the stock market, the rapidity and degree of inflation and the many other aspects that make up the ‘Great Unravelling’ of the economy.
Therefore, those who accept that harder times are looming, but would rather not consider the likelihood of food riots and famine, would be advised to read the above article a second time and then to begin to plan. Those who do not presently have “back door” situations in place may wish to set the wheels in motion and to internationalise themselves. One thing is certain: once riot situations begin, there will not be enough time to plan.”
We hope and trust that the elites who have advanced knowledge of the coming economic storm have already in place methods for dealing with the situation. One such offering is a rescue package from the IMF.
To be continued next Saturday
It will happen after the Planned Dollar Crash (Reset), or BRICS’ Sanctions, or Natural Disaster, or Crop Failures (ref the Grand Solar Minimum) or War. After the FSA has plundered and burned down all the stores, warehouses, and trucks, they will turn on the Hands that Fed them (unarmed Blue State liberals) and the White Useful Idiots (Long Pork) will nourish them briefly. But when the FSA invades Flyover Deplorables (armed Red States), the shoe will be on the other foot.
Good summary, Robert thank you – you do seem to have a good handle on these things and how they might unfold.