After the Crash-You'll Live Like a Tourist in a Poor Country If you OWN GOLD

by Carol Serpa   www.gramsgold.com

 

By now, you should be pretty convinced that we are going to experience a financial collapse. For those who lament about why you shouldn’t buy gold, because you can’t eat it, consider this. Gold has always preserved it’s purchasing power over thousands of years in history.

If you don’t understand that, please read the article “Why Gold is Real Money” and the dozens of other gold articles on this website. Let’s say you have chosen to protect your money in precious metals and it’s a year or two from now. You turn on the TV and the stock market has crashed, really crashed. Or the US loses it’s world reserve currency status, or some geo-political event happens that causes a financial crash.

We heard it in 2008; it’s not a stretch that you will hear about another systemic financial failure again, considering the poor and declining economic situation in this country . 

Ordinary Americans will no doubt hear the shocking news on TV and think – here we go again, another 2008. The government will do something to save the economy like they did before. But this time will be very different. The government will not be able to do anything that will help.
 
From the book Aftershock, by Weidermer and Spitzer, 2010 

“The dollar bubble will remain relatively hidden until the end, but when it starts to blow up, it will look alot like the financial crisis of 2008, meaning it will come on very quickly. When it hits, it will be too large for central banks to solve…”

As the stock market plummets, everyone will want to buy gold. The first ones to cash out of the stock market will start putting major amounts of money into gold. 

That drives the price higher. In very short order, people are told that there is no gold for sale. At any price. The gold will be gone.

When the ordinary American figures out that he should maybe buy some gold, it will be long gone. The rich are buying 400 oz. bars at double the rate this year than last year, as we speak, and China and Russia have been stockpiling gold for the last few years, with sleuth and cunning. Those countries know better than to announce to the world what their future plans are, unlike the stupid leaders we have.  

They didn’t listen to the constant commercials on TV, touting the benefits of gold ownership, but instead listened to CNBC talking heads who laughed and mocked anyone who advocating holding gold. Now, they will have to suffer the losses that incur. 

Those that had a decent chunk of money in the bank, now realize that the devaluation is so severe, that they have lost over 75% or more of value. There will be long lines at the bank and ATMs and fighting may break out.

But even after they take out their money, if there are no restrictions (there may be limitations on the amounts that you can withdraw) they realize it’s practically worthless. They are literally wiped out. It won’t be pretty and people will be upset, to say the very least. Panic, depression, murder and suicide will ensue. 

You can hardly believe it’s happening as predicted, but you don’t panic, as you have been told that gold will protect you. 

“Interest rates will skyrocket, inflation will be very high, unemployment will soar, the US stock market will crash but still be open, the real estate market will crash, consumer discretionary spending will dry up, and the number of banks will be greatly reduced.”

“The dollar will be worth a fraction of its peak value…and gold will be a stellar investment for many years. Most Americans will lose most of their money…”

“When the US government can no longer borrow and has a rapidly declining tax base, the first action will be to make up the difference by massively increasing the money supply (printing money) and creating horrendous multi-hundred percent inflation. However, this will be a short term solution as the devastating effects of that level of inflation on our economy will fairly quickly force the government to make massive cuts in spending (just like the rest of us).”

Then there will be massive tax increases.

“Many people will be out of work and those who are working will see their incomes lowered by their employers and their standard of living squeezed down dramatically by the collapse of real estate and stock market values.”

Conditions in the US, according to Aftershock: 
 

• Unemployment will likely be in the 40-60% range. 
• At least half of all businesses will go out of business
• Whole life insurance companies will be insolvent but term life will be available
• People will stop paying their debts
• Squatters will be common, for both businesses and homes
• Frequent power black-outs
• Divorces, domestic violence and murder will drastically increase

Flooded with foreclosures on their books, the courts won’t be able to handle it, and people are not served foreclosure notices for many months. Squatters will be commonplace, as in third world countries.

Just look at Detroit, if you want to understand how life all over America will be.

Squatters are common place. The homeowner in this picture painted a sign on her garage to warn them to keep out. 
 

Detroit has been selling houses for $1, just so they can collect some taxes.

A once booming area, where high paying manufacturing jobs in the auto industry enabled a thriving economy, Detroit’s manufacturing businesses were  sold down the river with NAFTA (North American Free Trade Agreement). Auto companies began manufacturing overseas. 

Rampant poverty ensued and along with that came crime, squatters, and dilapidated homes with people still living in them. 

Now, Detroit is the most violent city in the nation and more homicides are committed in Detroit than anywhere else.  Meanwhile, the number of police officers in the city has decreased by about 1,000over that time period.  It’s a mess.

The latest is that Ford will start manufacturing in Mexico, another blow to jobs in this country.

But what about you? Your gold is now worth a lot more than when you bought it. There is now a big demand for gold, as there is no supply left. You have to understand that the world will not stop, and wherever there is a demand, there will be a way for you to cash in your gold. 

There may even be a reset in currency, which will no doubt be a currency that is gold-backed, whether it be the Chinese renminbi, Russian ruble or another global based gold-backed currency. From everything I’ve read for years, smart governments are hoarding tons of gold for a reason. 

So you cash in your gold on an as-needed basis, and are flush with cash. The following is an excerpt from Peter Schiff’s book Crash Proof: How to Profit from the Coming Economic Collapse:

“How has the American market place changed for you? Goods that were imported have risen significantly in price, but that doesn’t bother you. You’ve got the extra dollars to pay for them. You haven’t lost any purchasing power. 

Some American-made goods, though, have increased in price more than others. A shopkeeper explains that those items, with the dollar so cheap, have become popular exports.

“There’s a lot of demand abroad and we get much better prices there,” you’re told. “The prices you’re looking at here are globally competitive.”

Services provided domestically, in contrast to goods, will be terrific bargains for you. 

Things like haircuts, manicures, massages and meals in restaurants, as well as services of maids, fitness trainers, and nannies, will cost sharply less….because such services are not easily exported and American buyers are not in competition with wealthier foreign consumers.

You probably had the same experience when you took a trip to a poorer country, such as those in Eastern Europe. Sony television sets, for example, were selling at about the same prices they were in the United States. 

They might have been somewhat cheaper, reflecting lower rents or local salaries, but in general the global market for Sony products kept prices high and consumers in poor countries had to compete with those in wealthier countries for the same products.

If you dined in a restaurant, however, you probably ate like a king for next to nothing. That is because most of the costs reflected the labor involved in preparing and serving the meal, local rents, and locally grown food. Except for the occasional tourist, a restaurant sells its services locally, not to wealthy customers from rich countries. Prices thus reflect local incomes and living standards.

From a national standpoint, America’s lower living standard – meaning lower real estate prices, rents and wages – also means lower costs of production. That, if combined with reduced taxes and regulation, would be an economic trifecta. 

We’ll be a poorer nation but once again a viable economy. With hard work and sacrifice, out grand-children and great grandchildren could live in the hopeful America our parents and grandparents were born into.”

On another positive note, Aftershock states, ”In fact, because we have so much wealth to begin with, the United States will be in better shape than other countries, although life in the post dollar bubble world will be quite different than it is today.”

Because of our general wealth prior to the crash, “We won’t starve in the streets…There won’t be massive violence in the streets”.  But it will be vastly different and psychologically devasting for many.

Fear not. You will survive, if you have bought gold and have guns to protect your homestead and your person from the increased crimes of desperate people. Lay low and act like you’re suffering like the rest of them. Look disheveled and don’t wear jewelry.

When you do go out to eat, act as though it’s a big splurge. If you are smart and blend in, then you won’t be a target. As time goes on, you’ll figure it out and be able to afford to move to a safer area if need be, perhaps in a nicer home as well, as they’ll be selling for pennies on the dollar.

 

 

 

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