Some Inconvenient Truths About Collapse Economics

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Published on The Doomstead Diner on September 2, 2018

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One of the first collapse pundits I ever read was Chris Martenson, way back before he turned his site into pay-for-view. I read The Crash Course, and took it to heart, like a lot of doomers. I know there are people who check in here who hold Chris in high regard. I do too, but my continued experience with collapse since 2010 when I started prepping has led me to some conclusions about typical collapse planning advice that I want to write about.

And I'm not just singling out Chris, who is a sincere, smart guy who gets it right about a whole lot of things. What I want to get to has to do, not with what happens AFTER the SHTF and BAU ends, but to WHAT happens between NOW, today, and THEN, whenever THEN turns out to be. It applies to each and every one of several collapse pundits whom I've read who all agree on one or two or three important issues.

One issue is the automatic knee-jerk assumption that everyone is better off if they're debt free.

Another other issue is that the best hedge against an uncertain future is to buy and hold gold (and/or silver), to the exclusion of any other wealth preservation strategy.

A third issue is that you need to sell your house and move to some "redoubt" or doomstead.

All of these ideas make enough sense that they tend to be accepted as gospel in the doomer community. But like most things in life, the truth is complicated, and and this kind of approach, which I'll call Collapse Financial Planning for Dummies, is an oversimplification, and it contains some seriously bad thinking.

The prevailing paradigm in the collapse community is that all debt is bad (assumably because debt-based money is evil) and that those who carry much of any debt will somehow all be swept away when BAU ends and nobody has income anymore to pay their bills, etc, etc.

Houses will be worthless because they'll be abandoned when the die-off comes and JIT delivery ends and the only people left standing will be people living on rural doomsteads.

And the only assets worth holding are preps, gold, silver, and farmland.

Over and over, I've read well-meaning and supposedly well informed people who claim expertise, say these things. If you read the collapse blogosphere, it's everywhere, and the people who were saying it 8 years ago are still saying it.

I have some real problems with this. People who traded in their 401K's and bought gold and/or silver in order to save their bacon about the time I started prepping, at the beginning of 2011, should look carefully at their feet to look for bullet holes.

Gold was about 1400 bucks an oz at the end of 2010. Now it's about $1200. The S&P on the other hand, has tripled. Are stocks in a bubble? Hell, yeah. But they still tripled in dollar value. That's money you could have used to buy a lot of fucking preps, folks.

Preps are important, and I believe in preps and tools and solar panels, and having a plot of land for food gardens and maybe subsistence farming (which is not easy if you aren't born into it, unfortunately). But all that costs money. I don't apologize for making money. People who claim not to care about money are either naive or lying, or they should enter the monastery, because they belong there.

Hell, it's not easy for people who were born into farming to subsistence farm, but it's doable. For most people it's a total fantasy. It takes skillz, baby. Mad skillz.

This last year I started to see stories about people who took this good advice several years back and went off-grid. Now they're coming back. Maybe not to suburbia, but closer to work and stores and civilization. Off-grid living is HARD and it has it's own problem set….and so far, working people are mostly still working, even if their standard of living isn't great.

I'm not knocking gold.

I own some gold and more silver. It's a nice insurance policy, if you can afford it.

It insures you against one thing…..total currency collapse. It's done, over the last eight years, exactly what it's supposed to do, which is hold some value. Over historical time, it has a good track record for holding value when many things lose their value, particularly fiat currency, stocks, bonds and ETF's and other "paper" financial instruments. But over the short term, it's value against fiat currencies varies quite a lot. Ouch!

And I'm not knocking freedom from debt. But freedom from debt is more valuable when debt is expensive than when debt is dirt cheap. We've been through eight years of crazy cheap debt. In 2015 I got two new mortgages for 4.5%. it sounded high, until I looked at the historical record. Pre-2008 crash, the last time mortgage interest was that low was 1949.

And there is debt and there is debt.

Debt incurred for cheap consumer shit that ends up in the trash is always bad, no matter how cheap it is. But debt that helps you acquire a tangible asset, especially one that might be an inflation hedge or (gasp) a good investment, doesn't rate the same scorn.

Debt incurred to make a cash flow investment is "just bizness". If the numbers work, and the deal makes money, and the risk is not high, WTF not?

If you had grown up somewhere like Mexico, where you can't even get a mortgage to build your own house, you might have more appreciation for the benefits of carrying a little debt. The median home price here is lower than Portland or Seattle or anywhere in California, but but it's still $300K. Try saving 300K to buy a house. You might live long enough to move in when you're 60, unless of course, prices keep going up with inflation.

And not a single pundit ever mentions that if you are somebody with a high income, that being debt free has enormous negative tax consequences in this country. Probably this is because most of the respected pundits never had any real money in the first place to have to pay taxes on.

You don't write about things that are completely outside your sphere of knowledge. We have a system that was set up to favor debtors. It's not a stable system, that's true….and if you have a mountain of debt when the music stops on this little game of musical chairs, you'll get wiped out. That's the true part. But it  is NOT the ONLY part you need to understand.

Sorry. That's the real truth.

We have a system set up to FORCE people into stocks and bonds. Because that's what the government wants (because Wall street tells them to want it). What I mean is that the tax consequences of NOT doing it are not insignificant. It costs you money, and the more money you make, the more money it costs you to go against the flow.

All 401K'S and IRA's and various other pensions are designed to steer you into stocks and bonds. There is some leeway, you can hold gold in an IRA. But forget the minutiae. Basically the government gives you tax breaks to make financial decisions that they want you to make. They have a carrot and a stick, and they use both to get what they want.

You literally have to decide if fighting them is worth it. Sometimes it is. Sometimes, though, it makes sense to understand where you can get ahead by participating, to some degree, in the "sanctioned" investments that have been set up primarily to benefit the rich.

I got out of the stock market in 2010 or so, because I believed all the doomer hype. I could have bought the five or six most stupid, popular stocks at that time and made BANK over the last 8 years, but I didn't. Instead I sold my Whole Foods in 2010, and then watched it split again and then watched it get bought out by Amazon. Yeah. Great move there.

I made some money trading last year, which I wrote about here. But I've mostly stayed out of stocks all these years  because I viewed stocks as an unstable bubble that would pop, and I still do. That much is 100% right. But when I see a short term opportunity, I'm willing to take it. I made 90K last year trading pot stocks. I paid my taxes, paid some debts, and finally, last month, I bought another rent house. I roll the profits back in.

I'm not saying the world is economically stable, that collapse isn't coming, or that you should be bullish on stocks now, which is madness. But while gold was drifting around and ending up slightly lower, clueless idiots made a lot of money in equities. Just dumb luck, to some degree. But more so because the markets are manipulated, and they went with the flow instead of going contrarian.

The point IS that my risk averseness cost me money. I did not come out ahead by taking the advice of Chris Martenson and the other collapse gurus…or by taking the advice of any of the dozens of well-respected goldbugs out there. To the degree I followed their advice, I lost money, and I missed opportunities to make money.

I also lost some money through my own stupidity. But I learned from that. People should learn from their mistakes, and I learned a few things the hard way, especially about leverage, which almost nobody understands…..outside of the world of professional trading. You can read about using leverage, but losing your ass teaches you the most. Trust me on that.

But I digress. Back to the subjects at hand.

The most important thing to understand about saving and investing is to get WHY it is necessary in the first place. Do you know? Think about it for a minute and pick an answer now…don't read ahead until you do. (Don't peek.)

Okay.

If you had to think about it….that's a problem. You should know. The reason is simple. One day you will be old and unable to work and you will likely still want to eat, have a bed and a roof over your head, and a few amenities to make your life comfortable.

If you don't think you need that, or you know you don't, then save yourself a lot of effort, because saving money and investing the right way is HARD. It requires discipline and a willingness to delay gratification. It requires making good decisions and then staying the course over a long, long time. It requires the ability to change course, but more times than not it takes the confidence to NOT change course at every bend in the road.

I save and invest, not so much for me, but for my beloved. Women often outlive their husbands now by decades, and the moment I croak, my dear wife will be out of a job, since she works for me. She will have to retire at that moment, or at least within weeks or months.

That's responsibility. I have a responsibility to take care of another person besides me. And I take that seriously. So I have damn good reasons to save and invest, other than adding zeroes to my fat-ass bank account. I do what I do because I don't want my old age or that of my wife to really suck. For me, that's reason enough. You have to figure that part out for yourself.

Younger people look ahead and see collapse and tend to think none of this matters for them. Because….why bother, if the end of the world is a few months or a few years away? All I can say is that I was young, not that long ago. And now I'm on the verge of old age. Are you so sure that collapse is going to wipe the slate clean that you want to risk being wrong? Do your feel lucky…er..or is it do you feel unlucky?

I don't know the future, but I know everyone who was writing about collapse in 2010 got it wrong in the short run. EVERYONE.

This is NOT intended to make anybody do what I'm doing. I won't write about what I do in depth, because that isn't my purpose.I just think people need to have a PLAN.

I'd say that I have Plan A which is aimed at my belief that I might possibly be old enough not to be able to work before TSHTF. My plan is aimed at making my day job optional by 7 years from now. That isn't young. It's 70 years old. I might work longer. There is nothing particularly magic about retiring.

But ….just for example…….I mostly buy a certain class of real estate now. I do that for several reasons.

1. It's tax advantaged.

One year (I think it was four years ago now)  I paid 240K in income tax. It was nearly double what I had planned for…. I had to struggle to pay it. I wasn't planning on that. I had to use up almost all of my cash savings I had at the time. My problem was that I had paid off a lot of debt, owed very little, and had put my home and my lake cottage on a 15 year mortgage and thereby lost a couple of big mortgage interest deductions. Also, my kids were no longer dependents. I never intend to do that again. I now have lots of mortgage interest and expense items related to investments. My taxes have come way down. Taxes matter, if you make a lot of money.

2. My houses (modest single family homes only) flow cash. Positive cash flow is essential to make the kind of deals I like work.

That means I get monthly  income. Rent. Enough to pay the debt and the maintenance and the insurance and a little more. Cash flow is absolutely FAR superior to any kind of "flipping" or buying anything on the premise that price will automatically go up. Prices often go down, not just up. Cash flow buys your dinner whether prices are up or down.

Rents can go down, sure. That's why you have to either pay a huge down payment (well advised) or have enough savings to cover shortfalls (or both). You do have to plan these days for deflationary events. I expect one within two years, and perhaps as soon as next month. Life is uncertain. Don't get over-leveraged. That's what makes people go broke. Borrow a little money…what you need, not as much as you possibly can. Pick one mortgage at a time and pay it off. I own two properties outright now, and the rest have 40-50% equity.

3. I borrowed all the money I owe at or below the current real inflation rate (which I expect to go higher). And (this is important) I locked in some stupid low rate loans for 30 years. And houses are still a reasonable inflation hedge at this time, meaning that they appreciate faster than the inflation rate over the long haul. That can change. But it's been true and it still is true, in my market area, since 1990. 

I know all the doom and gloom scenarios. I read Harry Dent. I read Jim Kunstler. But by the time TSHTF, my loans are likely to be paid. If you own it, you only HAVE to pay the taxes. I started a long time ago. But…if the Fed crashes the markets and they drop interest rates AGAIN down to the 3 to 4% level, I'm probably a buyer again. That could easily happen. It's at least as likely over the short term as is a sudden end to western civilization.

I could pay most of my debt off in full now if I needed to, but I don't…because I don't want to, and I don't need to do that. If you borrow below the real inflation rate (which has been possible for the last several years, until very recently) and the property appreciation keeps up with inflation, then the interest ultimately costs you NOTHING.

I don't go by the inflation rate the government quotes. It's higher, believe it. I expect to pay my loan off with dollars far cheaper than today's dollars. Dollar dropping? Good! Let the son-of-a-bitch fall.

I fear a precipitously RISING dollar, because it's a signal of a deflationary event on the horizon. Anybody who wants deflation must not own any inflated assets. And almost ALL assets are inflated these days. Bubbles do pop. Be prepared for that. But it's a thing to plan for, not a thing to keep you from making any plan at all..

If you have nothing, you have nothing to lose. But most people are HURT by deflation, no matter what level they're at. But I am well hedged for inflation and deflation. I can weather most any financial storm now.

Don't drink the Collapse Kool-Aid. Nobody knows the future with certainty. Plan A, I retire comfortably. Plan B, I subsistence farm as best I can. I can't control collapse, but I can, at least to some degree, control my own destiny.

The collapse pundits only ever see a need for Plan B. the older you are, the more you need a Plan A, in my book.

It's been almost 8 years since I started prepping, and BAU is still happening. I don't know how long it will last…but I don't have to pray for collapse to feel good about my own future.

 

17 Responses to Some Inconvenient Truths About Collapse Economics

  • UnhingedBecauseLucid says:

    I agree with a lot of what is said about the self-defeating tactics of premature decoupling from the System. It's a paradox of sort; a derivative of Keynes' maxim that  "…the market can stay irrational longer than anyone can stay solvent…"

    ***

    However:

    ["It's been almost 8 years since I started prepping, and BAU is still happening. I don't know how long it will last…but I don't have to pray for collapse to feel good about my own future."]

    By and large, it's not like there are a multitude of possibilities here…

    The name of the game is 'growth by asset price inflation'. From "their" point of view, the [M]achine is the agregate accumulations of  knowledge, technology and specialized workforce of scientists and technicians embeded in corporations that keeps the wheel turning, and on that front, they aren't wrong. It's what it is. From their perspective, that cohesive aggregation of knowledge and resources is THE [C]apital keeping [C]apitalism's life support system online, which isn't entirely wrong. 

    They wen't off the gold standards because the numbers didn't add up, and did it again after 2008 with QE 1,2,3. and a drop to 0%. They'll do it again.

    QE 4 is going to happen because it's the financial expression\quantification of the valuation of the machinery that keeps us alive. The U.S. empire has the reserve currency and the most valuable 'safe haven' stock market for foreign capital. I think it's going to be quite surprising how long this can go on until the Oil Shock That Reveals a Bit Too Much…

    (…although I must say the periphery is taking a beating these days that I don't think can last very long without a major "disturbance" occuring…)

    Just like in banking, it's the pace of liquidity retrieval that counts. There will be inflation, we can already see it; but with so much outstanding debt, they need incentives and a narrative.  "Bullshit is the glue that binds us all as a nation" as Carlin put it, and buying equities will probably be pretty profitable until the [G]reat [E]vent.. and maybe beyond  ! The fiction is an integral part of the [M]achine. 

    So equities will go even more deeply into the fucktarded realm in my humble opinion.

    I'll never call it "investing" though, because: 

    https://youtu.be/vdqiVpkvMQ8?t=59m37s

    Which leaves pretty much only one option for collecting the 'unearned increment' (besides banking): Land. 

    Private equity firms like it too.

    I'd simply say that it 's a telling fact that you chose to aquire land you don't need for nothing except for becoming a 'rentier'; by definition, a plan that not everyone can implement. It's a great metaphore of the whole system if you ask me…certainly reinforces one's Doomerish convictions…

    • Eddie says:

      I agree with much of what you're saying. Thanks for your cogent reply.

      But let me set you straight on one thing. I am a "rentier" only in the sense that I rent properties. The common use of the term these days comes from Marxist theory and means "someone who derives income from society without making any real contribution". All these current  left-leaning economic pieces one reads are usually talking about "the rentier class" and "the 1%" and the point is all about rising wealth inequality in the world, as if ANYONE who makes a little money is some kind of vampire.

      It ain't nearly that simple. I call bullshit .

      For one thing, I'm a great landlord, I take care of my tenants, charge fair rents, and they GET something for their money, a decent place to live. If they were buying a house, they'd be paying for that. I rent houses to people who WANT to rent a house. It's a fair exchange. So when somebody calls me a rentier, making it sound like I'm ripping somebody off, I take exception to that. 

      Secondly, the term 1% is sort of a smokescreen for the real rich, who constitute more like. only  .01% of the population, and mostly are people who are the beneficiaries of intergenerational wealth building by old money. I'm in the 1% alright, but I get up and go to work at my regular job every day, and work all day, with my two hands. If I lose my hands or my eyes, I'm done. People who have to work for a living are not in the rentier class. 

      The real rich like to perpetuate this myth, because they, the ones who do live off massie passive wealth, want working peolple to support the government taxing the dogshit out of people who make $200K to $800K pr year, while they manage to pay almost nothing. 

      I do what I do because it's the best cash flow investment I've found. Also because it takes advantage of the liability side of investing. I acquire a good asset, but I do it with a stellar liability, which is 30 year mortgage money locked in at crazy low rates. I'm writing about it and it's going away as we speak. Unless Daddy owns the bank, you have to pay about an extra percentage point for an investment property, compared to your personal mortgage. I said I had 4.5% investment mortgages. Now, today, they would be 6.5% with the same credit score (730 or so). I got one last mortgage this summer for 5.5% and I had to pay 40% down to make the deal flow cash, whcih is absolutely essential.

      A real rentier? Mitt Romney. Carl Icahn. Any corporate raider you can name. People bitch about jobs going overseas. They don't beginto understand that many, many decent American companies have been killed off by Wall Street predators with dirt-cheap borrowed money, who prey on these smaller public companies run by people who were never expecting to be blindsided by someone who bought their stock. The jobs the companies created vanished forever. 

      Even Sears, now. Sears has been completely destroyed, while the CEO managed to cherry-pick the real estate, spinning it off into a company he owns, while the common stockholders have been left holding the bag. 

      My biggest reason for (me) not really investing in equities (as opposed to trading, which I do when I think it's a reaonable risk environment) is that small stockholders aren't just little fish….more like they're chum in the water. Public companies are set up to benefit big stockholders and officers. Not Joe Sixpack. They will drink your blood.

      I am in charge of my deals. Me. Not some young  CEO looking to retire at 35.

      I am standing pat now, and hoping for another round of QE, which hopefully will drive mortgage rates down so low I can refinance everything I own. I already have a 2.75% mortage on my personal house and a 3.25% mortgage on my lake cottage. I have one mortgage that isn't locked in, and that's on my farm. You simply can't get a a fixed rate mortgage on land, at least not here. So I've been making big extra payments evey month for nearly 10 years. I expect to burn the mortgages on all the non-cashflow holdings in a few more years. The rest just need to keep up with inflation, and I'll be fine. If real estate really tanks (It did not here in 2008,and rents never went down a penny. I live in a good demogrpahic area) I have enough cash to stay in business for a long time.

      I have no problem with savvy guys speculating on stocks. You can make money if you're educated, if you can execute quickly, and behave like a real trader. Control risk. Most people don't know how to do that. Real traders know how to hedge using a variety of vehicles that most "retail" longs don't begin to understand. And they don't understand how to decide how big their position size should be based on the size of their trading account, or anything else they need to know.  Trading is a science and an art form. 

       

       

       

       

       

       

  • William Hunter Duncan says:

    Well said, Eddie. Well planned. I'm sure I did not make as much money since 2010 as you paid in taxes four years ago, but then I have no retirement plan A, B…Z. if I have any furture in my 70's and beyond, I can't see it. Still, the only investment I regret not taking part in, since 2010, is bitcoin. What would a $500 investment in 2011 be worth now? Enough that I would be working retired at 45. 

    Curious too, I invested in my knowledge and skills, from wild plants to gardening to building to economics generally to history….thinking when TSHTF, I would be fine, even if I had little but a hand full of fiat money to burn litterally long enough to start one good wood fire….but hardly anyone gives a shit. No one is handing me any paid work more than a month's worth, and nothing beyond October. Not sure how I am going to make it through this winter, let alone to retirement or TSHTF. 

    Maybe I will buy buy buy the next dip, if I have any money, or access to credit. Because I'm starting to see, money and assets now means fuckall more than a Doomstead later, or ever. 

     

  • MountainHiker says:

    Solid observations. I too have gone through this same dooomer tutorial since before 2008. Still trying to figure it out, but I've become quite diversified the past several years. Gold, silver, cryptos, stocks, preps, solar, skills, etc… Anything that helps towards independence, although I do know the one man island is a bullshit story too.

    I have had many thoughts about debt over the years. I know most doomers shun it, but if a nasty collapse really does happen, will it really matter? Debt requires consequences for nonpayment and those consequences require enforcement. Owing a debt to your neighbor is different than owing a debt to a faceless corporation in Delaware or the Cayman Islands. Shunning debt in the current structure only matters as long this whole game remains intact. If an economic collapse comes swift and fast do we really think all of these empty houses will just sit there, unoccupied while a majority of people live in the streets, never squatting in those places? How much money or resources will be required to patrol these properties to keep out the squatters? If the JIT delivery system goes out and banks collapse they'll still have collectors out there hunting us down for payment? It all seems like the futility of people worried about mowing the lawns after the zombie apocalypse. But maybe I'm crazy? As Ed Abbey said "One thing more dangerous than getting between a Grizzly sow and her cub is getting between a businessman and a dollar bill."

    The hardest part of it all is the uncertainty. The debt system with stocks, bonds, etc… requires a certain amount of certainty about the future. Anyone with a modicum of observation and analytical skills has some reservations about the future's certainty when they look around and see amazingly inept people at countless levels across the social-political spectrum. But, as you say, BAU still goes on. For now. And maybe for much, much longer. I'm watching and planning the best I can. What else can I do? Quit worrying about it. Living more day to day. Trying to be present. Living life.

  • Michael says:

    There is only one case where debt after a huge crash can bite you – when they abolished all tangible money. If they can survey and control any flow they want they still know after a huge crash who was and still is a debtor. If those records somehow got lost we all have different problems, like basic energy needs problems. 

    Some Roman banking survived decades after everything burned down in a region. And this was back when paper was luxury. 

    I guess the most prudent appraoch ist to not consume silly stuff. No two cars e.g. and move to a place where the consumerish tredmill is not that of a force. Save normally to hedge against indefinite BAU but divest consumer budget into something like a plot of land, skills or fund local projects which in turn will be beneficial to you. "Useful altruism".

  • Eddie says:

    WHD, it does my heart good to see you reading my post. I assume you stil have your house? Take heart. As I once told you, being slightly underwater on a personal domicile that also is a food forest, is not the worst thing. I expect that you are no longer underwater either. I hope you still have a mortgage to worry about. Winter is always coming. Unless summer is coming, which is worse, apparently.

    I still have the hat you gave me. Not sure if it's because I left it at the cabin way back when we were all there, or because I still don't have the conjones to wear it in public.

    MountainHiker and Michael, thanks for your comments. I expected the worst when RE said he was going to put this rant, which started out in the slightly-less-public world of the Diner Forum, and wasn't intended for widespread consumption. I was wrong, (so far.).

     

     

     

    • William Hunter Duncan says:

      Eddie,

      Ten years after the collapse of 2008, I am still underwater by ten grand or so…on a shit mortgage that can go up two points a year to 11% (that served well when interest rates were 0% basically and I was at 2.85% for seven years. Now with America being made great again?) 

      The food forest was more productive than ever though, 200 peaches, 150 apricots, 80 pears, five gallons of raspberries, etc. probably I will have twice the production next year, as this year was twice+ the last.

      But I am currently in Oregon and seriously considering moving here. The Twin Cities is polluted for a hundred miles in every direction and beyond. No really wild place for 250 miles. Most of the state is sold out to corporations foreign and domestic, and now the state is preparing to sell out the Boundary Waters Wilderness to foreign corporations, 20 years of copper/nickle mining for 200-500 years of sulfuric acid pollution – for that I will never forgive. Oregon is comparitivley clean and wild. We will see if anyone wants to buy my one bedroom house in a food forest….

      As to that hat, it warms my heart to know you still have it. No worries if you never wear it, and no worries should you let it go…

      WHD 

       

       

  • Eddie says:

    A word on bitcoin. I know some of your have made money on bitcoin, and others, like William, have felt the FOMO. 

    Blockchain technolgy  is something I can grasp the utitlity of…but bitcoin doesn't really amount to a worthy alternative investment, from my stodgy old point of view. Not yet.

    Not a true peer-to-preer currency. Not completely fungible. And not as secure as I require my holdings to be.

    I'm more interested in the return OF my money than the return ON my money. Wiil Rogers said that during the Great Depression, btw. It's still extremely apropos today.

    Bitcoin is a fine idea, but not a complete reality. All kinds of issues. The energy cost of bitcoin mining alone is prodigious. Price has run way up and way down. I'd sooner invest on the software side than hold the actual asset, if I were interested in speculating. jmho.

    Speculation is a nice word for gambling. Gamblers win big and tell you all about it…..and then lose big and don't say a word.

    Cash flow buys your dinner every night of your life.

    I personally do better when I try to hit singles and doubles, than when I swing for the fences. Babe Ruth is the most famous home run hitter of all time, with 714 home runs. Many people know that number from memory. Not many people remember he was also called the Strike-Out King, accumulating 1330 of those in his career.

    Take the easiest profit you can find, and keep repeating the same strategy if it works. Find the sweet spots in your tax situation, if you can ID any. Use leverage sparingly and wisely. Play the long game, but be prepared to cash out any time. By now, if you're doomer, you can probably recognize the signs of a fast collapse.

    In BAU, you can start small and still make a lot of money slowly over 30 years. Forget the fast money. Or at least gamble with a tiny stake, and don't risk your whole future on lottery tickets. Some people have that kind of luck. I don't. 

     

     

  • Volvo says:

    Looking back and saying now how to have invested is the easy part. The hard part is looking ahead. AMZN now? Anyone?

  • Eddie says:

    Not sure if that was a joke, but the answer, at least my answer, is no. Not because Amazon is going broke. Amazon just broke a trillion in market cap.

    But because risk is rising. It just is. A flattening yield curve means big players are getting out of stocks, that's what causes the yield curve to flatten. Rising interest rates will probably push us into recession. The Fed always tends to go too far.

    Nobody knows where the stock market is going. The one given is that markets are going to be manipulated. I will not say Amazon won't go up. But the most important thing about investing is managing risk. 

    And your comment tells me you need to learn some things before YOU tell ME what the easy part is. Not that my rant was about looking back anyway. Read for comprehension. This is the Doomstead Diner, not Seeking Alpha.

     

  • Volvo says:

    “The point IS that my risk averseness cost me money.”

    This is exactly the thing. And it happend to me too. But we didn’t know back then that it would If it had worked you would  not have written this article in this way, I think. 

     

  • TopofTheMorningtoYou says:

    Wow – a doomer site that isn't all in with the Trumpists, Right Wingers, Alt-right, white supremicists and neo-fascists.

    Refreshing.

  • maurice h crumbly says:

    Great perspective on the financial aspect of prepping,  You have inspired me to look at some personal financial moves I've been mulling over in a different light.

    • Eddie says:

      Why thank you, Maurice.

      Everything I think I know, I got from someone else. Many someone else's at this point. If I said anything at all that helps you, I am gratified.

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