Quantitative Easing - What it means for you

Welcome to another episode of the Be Prepared Channel. Today we do a quick post on the state of things in the prepper world and some of the things you might want to consider doing in your own prepper plan.

Economy Slowing from Sugar High
Once again the economy is slowing. The sugar high from all the stimulus and government spending is wearing off. The housing markets across most of the country are still collapsing, foreclosures are up, and most of the news if you dig through the spin machine headlines is negative. The Federal Reserve is talking about quantitative easing by buying US debt outright so that we can float more funny money in the economy. Everyone knows that the more cash they dump in the markets the weaker the dollar gets and the more expensive things are for the consumer to buy. So the Fed is preparing to step in with more funny money so that we can continue our spending insanity.

Well in case you have been asleep for the last couple of decades and are unaware of the fact that most everything has been exported overseas to include the clothing industry. This means the price of most items including clothing are subject to pressures as the dollar falls. Now at the moment the Chinese are still participating in economic warfare on the world by pegging their currency to the dollar which means even as the dollar falls in value around the globe the Chinese currency goes down in value with us. For the time being this means we shouldn't see a lot of cost pressures in the price of Chinese imported goods. This is a temporary situation of course. Everyone fully expects as the dollar continues it's decline the Chinese will finally decide they are getting the short end of the stick and diversify their investments and break this peg. They promised to break this peg earlier this year, but it has not happened. What this means if they do finally decide to break the peg is that goods that are imported from China will climb in cost dramatically.

Now the clothing industry doesn't appear to be all in China as I still notice clothing coming from other countries and as that is the case we can expect to see the cost of those goods climb. This inflation is going to put serious pressure on the US consumer, and of course on our prepping plans since so much is imported. One of the things that my best friend reminded me of last year was just how hard things have gotten for him and his family with the lack of work and no income. A couple of things that stood out to me when he was talking was the fact he mentioned he hadn't had money for a couple of years to buy clothes at all. Of those clothing items he missed most was underwear and socks. These are the items that seem to wear out the fastest and need replaced the most often. So when he made mention of this I made a mental note. I went to look and see where these items are made and see if any of them are still make in the US. Sadly I didn't find anything on the local store shelves that indicated they were still made in the US. Times are hard enough, but when the cost of things are going to see 20-50% price increases in a year due to devaluation of our money maybe it is time to think about where the things you buy come from, and think about the frequency you replace them. Those items might be just the sort of thing you should be putting in your prepper plan. As funny as it might sound to recommend buying socks and underwear I think it is an important thing to mention that we are very exposed and vulnerable on so many levels. Don't make something as simple as a daily use item something we forgot to put in our emergency plans.

Fake left right paradigm
Well the big promises are pouring in from the politicians trying to get your votes. It is really sad for those who are interested in the content and depth of the real proposals beyond the sound bites. Sadly both the left and right are making the list of promises that sound all to familiar, but never get done. Some of them point blank shouldn't get done if we have even one or two firing braincells. So what is in the deal for us and will any of it make any difference to the outcome that many of us see coming?

From the Right:
The Republicans are talking big smack this year. They are talking repealing the Healthcare. I say this is fat chance as they won't have the votes to get it done. The only real chance of getting this repealed is if the courts overturn portions of the bill as unconstitutional and render huge portions of it illegal. That could happen, but electing a Republican won't get it done. They are talking about cuts to 2008 levels. Well I hate to break it to you but running a 560 billion dollar a year deficit like we did in 2008 is not going to save this country from the financial demise of the country. I know it sounds refreshing compared to the last couple of years of 1.6 trillion dollar deficits and 1.3 trillion dollar deficits, but it is still deficit spending. The repubs want to talk about tax cuts and spending cuts, but rarely do they ever pay for these things. They decided to exempt huge portions of the budget from cuts like military spending, security, and the whole big brother system while they continue to ramble on about the evil Muslims that supposedly are the cause of all evil in the world. Considering the portion of the budget that make up the military spending and that which is social security there is not much left on the table you can cut. So the numbers just don't add up. Again the Republicans talk smack, dance around facts, and are still in the camp of bigger government and we are all suppose to applaud and clamor to vote for them.

The left wing spin:
Well the left is out there trying to say that voting for evil Republicans is a vote for things that didn't work in the past. Who am I to argue with that!? To counter that argument? The dems seem to think you can tax, spend, and use debt to dig your way out of a hole and into prosperity. Now as stupid and disconnected as the Republicans are on reality I have to say the democrats really have outdone themselves in looking like absolute morons. The economic reality is that we cannot afford 90% of the government we have and until someone finally does the math and figures out the way this is going to play out we are forced to see that this is a train wreck in progress. The dems are out talking about how they are going to keep jobs from going overseas... Well that all sounds good until you open your eyes and look at the job market of the places that are getting these jobs. You look at an auto worker in China who makes transmissions for Honda who is making 170 Yuan a month, and a Yuan exchange rate today is .1492 Yuan to the dollar. That autoworker in China is making $25.36 a MONTH! Now the only way your going to stop jobs from leaving the US is if our wages are competitive with the competition. Oh, let's dispel another myth. In China these workers do not have free housing, free medical, and all the freebies we are told that they have. So this isn't a case of they worker makes 25 bucks a month and has all of his/her big bills items paid for by the government. So there it is folks we can continue to bury our heads in the sand or wake up to the economic reality that our country is not economically competitive and that unless our standard of living, wages, and lifestyles were to collapse there is very little that the dems are going to do that will change the nature of this global economy. As long as the large multinational corps are allowed to just shop for the cheapest labor and materials around the globe and there are no tarrifs or common sense measures taken to protect your local economy from those that would dump on local markets to crush the competition and own everything in sight we will continue on this race to the bottom. So what is the dems plan? Well tax, spend, tax, spend, regulate, and have the government run everything... oh and debt, deficits, and economic collapse well that is just stuff that crazy conservatives talk about.

What is the answer?
Well until we start looking for independents and 3rd parties to inject some reality into this conversation we are on a glide path to collapse. I don't see much so far to change that trajectory yet. The Tea Parties appear to be co-opted by the Republican spin machine. I hope I am wrong, but there is little coming out of the Tea Party "candidates" that gives me reason to believe much if anything will come out of all of this. I am a supporter of Ron Paul's son Rand Paul in the KY senate race. There are a few other bright spots around the country, but not enough at this juncture to turn the tide toward freedom, and abolishing the out of control and insane government we are dealing with or the monster corporations that have grown out of the massive lobbying and live and grow fat on market controls and government subsidies and protection as they exploit these global markets. So when you see a bright spot and someone doing it right please support them. The momentum is finally building in a few places around the country for real change. As the country gets more angry with the trajectory of this mess there is a real chance that more positive change will happen. Sadly it will mean that the state of our affairs will be a disaster and that appears to be what it will take to get the sleeping masses off their butts to finally get involved. I just hope it happens before the people who created this crisis can spin doctor some fake solution and get our politicians to pass more bills or ratify new treaties basically giving our country over to the world government crowd. If that happens then I seriously have my doubts that we can get out of this mess without it turning seriously ugly.

Wheat crisis?



Well all kinds of crazy is going on in the global wheat market. Sadly our farmers didn't get to profit from it as they sell their crops early in the spring with wheat. The announcements from Russia that they were banning wheat exports didn't happen until much later in the year and the world grain supplies are at very low levels. This combination has sent wheat skyrocketing in price. Everyone is very aware if you have been paying attention that world grain supplies have been low for a while now and we have seen shortages in many markets causing fear and panic. Some of this I think it is speculation and manipulation, but some of it is very real and the threats to our food supply are very real. The US is a net importer of food so we are just as vulnerable as everyone else in this regard. Those who buy and store wheat in their food plan know that you can keep these grains if properly stored for 30+ years. Food price inflation is a fact and it is these spikes due to shortages, and to devalued currency are going to play a key role in our standard of eating and living going forward. If you don't grow it yourself you can expect to pay a lot more for it going forward. The Russian wheat story is important, and how the market reacts to these stories is an important indicator of some of the things we may see shortly as a daily problem. In our planning it is a good idea to think about what your going to grow, what others are growing and how you might be able to barter, and trade with each other as things become even more crazy. Do be caught flat footed. Since you know that grains like wheat, rice, beans, lentils keep for a very long time we have no excuse not to be buying and storing these items while they are still affordable.

Well enough rambling for now. Our thoughts and prayers are with you that you may prosper and have abundance even in these hard times.

God Bless,
Longsnowsm