The Phaserl


Zimbabwe to make you think…

by Bill Holter, SGT

My last piece was quite long and involved, some liked it and “got it”, others not so much. The breaking of confidence was the point I was trying to get to. I intend to try again with this writing but from a different viewpoint. Today, rather than continuing to hammer away at the fraud, collusion, and upside down logic of global politics, economics and finance, let’s look at a real world case. I received a rather long note from a reader earlier this week who was visiting of all places …Zimbabwe! I did not ask “why” he was visiting and can only imagine, but in light of where “we are going” it is fortuitous for us to have a pair of boots on the ground! The following is “the heart” of what he wrote. Please read this twice so it really sets in, I will comment afterward and hopefully this exercise will “make you think”.

…First Hand from Zimbabwe;

“Yes, they try to sell you their funny colored money with lots of zeros on it ROFL. They seem offended when you decline their offers. I told the guy I bought some off of ebay, and got the “deer in headlights” look back. I just moved on.

Anyway, met a guy who was friendly so started chatting.

This is first hand from someone who grew up here, born here, lived through the hyperinflation, had a real job, parents, house, savings, etc. I just asked him things point blank: what happened and what did you do during that period just to see what reality was.

His parents were pretty well off, brits of course, retired (or very close) for a normal Zimbabwean. Considerable savings. Not a mil USD (equivalent) but up there ($250K-$500K’ish I think in hard savings).

He said: “They went from set for life here in Zim to not being able to afford a loaf of bread in 2 days.” (these were his exact words, not mine, not a paraphrase, the exact statement, I remember it clear as day, and this was only 2 hrs ago).

The first question of course I followed with was: Um, why they didn’t buy gold? And here you have the story:

He said his parents were very conservative and placed complete trust in the system and the government. It would never even occur to them to do something like that, and he said they said it would be way way too risky to do something like that (not because it was illegal or anything, but because gold was viewed as risky, asset wise!).

He said he might (!!) do gold next time. His first response was he’ll buy a few barrels of oil and keep them in his back yard to sell/barter LOL. Seriously. But he said, yeah, gold would be worth doing next time. I honestly don’t think that this option had occurred to him yet even to this very day, until I asked him this question. That’s just the feeling I got, as he had to pause like he was thinking about do the head nod (thinking, thinking….) what I just said before he answered.

So even now, if it happened AGAIN, the people would not necessarily turn to gold (wow, wow, and wow!). They would all instead INSTANTLY convert everything (it seemed he was indicating) into dollars to be safe! (another wow, wow, and wow)!

I told him the USD was likely on it’s way towards hyper’ing also. He seemed quite (totally) surprised. He said, he thought the EUR was headed that way, but not the USD. It seems that Zimbabwe feels the dollar is now, and always, solid as a rock.”

First, please remember this was a conversation with just one person so it is by no means even a “sampling”. It was however a conversation with someone “who had something …and lost it all”. The story is important in my opinion for several reasons I will touch on.

“Mathematically”, the U.S. dollar is headed for the inferno of hyperinflation. There is no argument on this point from anyone with intelligence. Even Harry Dent and Martin Armstrong the most staunch “deflationists” around admit the final chapter is that of wildly high gold prices (which means a breakdown of confidence in the dollar). The difference between “them and us” is “how” we get there? I believe we have already been witnessing the “squeeze” and run into the dollar as a “safe haven”, they see it as a continuing and future event.

The absolute most important thing to take from our reader’s comments is this line He said: “They went from set for life here in Zim to not being able to afford a loaf of bread in 2 days.” Yes I know, something in your gut is telling you “but we aren’t Zimbabwe”, the U.S. is far more sophisticated, has the greatest military in the world and of course the “it can never happen here” syndrome is chirping in the back of your mind. Let me say this, “NO, we are not Zimbabwe, what a shame!”. I might have lost or confused you here and I’ll get to this in a moment.

“Banana Republicland” (debt to GDP ratios of 100% or more) is now occupied by a large percentage of the world’s sovereign nations. The U.S. has more than a 100% debt to GDP ratio just using “funded” or on books debt. The ratio goes ballistic and out of control when you add in “guarantees and future obligations”. After researching the Zimbabwe situation, their debt to GDP number was not greater than Japan’s currently and approximately (180%) equal to that of Greece …with Italy slightly behind. My point is this, the debt to GDP ratio in the U.S. when everything is included is some God awful number, maybe 500% or even multiples more! I have news for you, we are already Zimbabwe on STEROIDS! Before commenting further, I will refute the obvious, “but the U.S. has the strongest military in the world …probably yes, but we are stretched out with many various “scopes” targeted at us. The days of “forcing” the dollar on the rest of the world are waning very quickly! World War 3 will be our main concern should the U.S. try to “force” dollar dominance. All you need to do is look around, the ROW is and has been angered by our “forcing” the use of dollars. They have been reacting by doing trade to the EXCLUSION of the dollar. The days where our military could foist the dollar on the world are over!

I mentioned above, “it is a shame we are NOT Zimbabwe”, can you guess why? Because the U.S. still “has” (or believes it does) mass wealth. Yes we have really split into the have’s and have nots as the middle class has been attacked and fallen into the have not category but …our living standard is far advanced from Zimbabwe’s in general. We have more to lose. In other words, “it is better to have never had than to fall from grace”. Zimbabweans lost their savings, on average their “fall” in living standards is miniscule to an event like that happening in the U.S.. Not to mention the unrest and riots we will see when people who were previously “entitled” …wake up to nothing! As an analogy, their fall was off the bottom rung, ours from a skyscraper! A very timely side note, while writing this article, the Zimbabwe dollar will officially “go away”: Zimbabwe Demonetizes

I also found it curious that this person had not “figured out” gold and to this day still has a feeling of “risk” when it comes to the metal. Stepping back for a moment, why do you suppose invading forces ALWAYS steal their captor’s gold rather than the currency and the plates to make the currency? Please don’t tell me I am living in Roman times, or the Middle Ages, or Napoleonic times. I am not even living in WW I or II times, as recently as the last several years, Iraqi, Ukrainian, Greek and Libyan gold has ALL been pilfered! Ask yourself this question, if the U.S. was invaded, would our conquerors steal our dollars or break into our vaults in search of gold (maybe to a very bad and empty surprise?)?

Please think this through for yourself, can we in the U.S. and the West in general wake up to closed markets and panic conditions? Do you really believe paper currency will become more valuable (for more than a week or two) if the debt markets and derivatives are closed with no bids? Do you really believe gold and silver will be “offered” in any fashion except maybe for something you have as barter? I still cannot get over the deflationists argument the dollar will strengthen in this scenario. The killer question of course is this, where exactly should (can) we store all of these valuable notes and digits “safely”? I suspect there will be a run on wheel barrows and those old “Radio Flyer” wagons will actually again have a function beyond their antique value!

Regards, Bill Holter
Holter-Sinclair collaboration

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14 comments to Zimbabwe to make you think…

  • Eric B

    The difference between the USA and Zimbabwe……they actually printed up all their inflated $$$$ most of the USA’s are in digital form….just like Bitcoin! Gonna get me sum of dem Bitcoins!

  • NIX

    Warning ! very important and dangerous news!

    KILLER robots that will take over our lives

    Starting @ 0:35

  • Keith

    I still have a hard time wrapping my head around the deflationist argument. Yes’ gold and silver went down in the 08-09 period….for about a minute! Then they both went to record highs right? I’ll still take my chances with gold and silver all day long thank you.

    • SGT

      Keith, the Harry Dent’s of the world are not being honest, many of these same pundits assert that the Dollar will remain king which is a lie. All we need to do is look at the prices of gold and silver in nearly every currency other than the Dollar…

  • petedivine

    I have family living in Venezuela. I showed them my dried foods, guns, and preps. They thought I was crazy. Now their currency is hyper-inflating and they think I’m related to Nostradamus…. Right now in Venezuela, Food is hard to get, the basics like Toilet paper and soap are scarce. No one wants to accept Bolivars, crime is rampant and beyond our ability to comprehend. Fear is thick in peoples minds. No one wants to leave the perceived safety of their homes. People can’t sell their investment real estate, their businesses, etc. No one wants them. They want Dollars so that they can leave. Most businesses close down. What’s the point of transacting in fake money that can’t replenish what was sold. The shortages and depression are exasperated.

    We as Americans have no understanding of the violence, fear, and uncertainty that Venezuelans are living through right now. I have family that use to be literal millionaires with great businesses. Now they are burning through their cash looking for another life in another place. They are refugees. They think the Dollar is the place to be. Its always been strong. They and people like them are immigrating to Miami, Panama, Spain, Italy, etc.. the land of their forefathers and to perceived safe harbors. Just wait until the global depression deepens.

    Just google Venezuelan news or hook up with Venezuelans on facebook to see what we will eventually have to contend with.

  • mahatma

    Bill, you connect the dots unlike most. Hence your following. Your knowledge culminated in the Holter/Sinclair collaboration. If that isn’t proof positive about your skill sets I don’t know what is. When ‘Mr. Gold’ himself comes a knocking, there is a reason. Congratulations.

    In 1980 Rhodesia became the Republic of Zimbabwe and the Rhodesian dollar became the Zimbabwe dollar. At that moment in time, the Z$ was in fact worth more than the US$. Fast forward to the hyperinflation in Zimbabwe in the mid 2000s. Zim’s largest fiat currency was a $100 Trillion Zim note. It had a 6 month expiry on it, a redundancy that virtually no one, even today, understands. I carry in my wallet one of these $100T Z. notes. I show it to almost everyone. Here is the question that nearly everyone asks me: How much is that worth? Of course the correct answer to that question is: It’s worth whatever BTUs you can extract from it. I get a ‘deer in headlights’ look from most. Sadly, today most people are completely ignorant of all things, financial and otherwise (think health for example). They are of course well versed on things like ‘shopping’ and other similar mindless drivel (think non-stop sports, the modern day equivalent to Rome’s ‘Bread & Circuses’). As Ayn Rand once reminded us: “One can ignore reality but one can not ignore the consequences of ignoring reality.” Rand’s said reality is about to take a gigantic bite out of the asses of the ignorant masses. As Maximus says in the opening scenes of Gladiator, “At my signal, unleash Hell.” Not only is Zimbabwe likely to become our monetary model, but the horrors in Iraq/Syria/Ukraine/Libya/GAZA et al are most assuredly coming to a neighbourhood near [all of us]. I do not believe that we go to heaven or hell upon our death. Rather, I believe that we make them here on earth. As Gandhi once said, “Be the change you wish to see in the world.” To that end, the question we all need to ask ourselves: What change are each and everyone of us working towards? Godspeed.

  • Craig escaped from Detroit

    I am so VERY Thankful that I can READ & have some intelligence instead of blind ignorance to the problems that are coming. I’ve learned enough about past history, countries, money, debt, etc, to know that the super-krapp is going to hit the fan while I am still alive and trying to pay my bills, eat, etc.

    I think that anybody who is trying to prepare to switch their lives into “AMISH MODE” are VERY smart. For many years, deep in my soul, I have been “feeling” that something drastic is coming, even still have some copies of Mother Earth News Magazine from 1977 (saved it for the good gardening and self sufficiency articles.)

    Edgar Cayce predicted (back in the 1930’s & 40’s), that in the future, people who want to eat, must have some small farmland, etc. (become self sufficient).

    I finally moved out of Detroit and bought a few acres & small home in NW Florida/S.Alabama area. Plenty of good rain and long growing season, short, mild winter, good well water, and my elevation is more than 200 feet above sea level. (No floods, etc)

    I’m pretty well prepared to be able to switch into “Amish mode living” if things get Zimbabwe.
    And I suspect the USSA will fall down to Zimbab-Venez-Argent-Greece-USSR style before the next 5 years goes by.

    Stack and stock up wisely, and get away from population centers (and away from the FSA). Also be sure to have some decent bikes for gas free transport. I want to get a trike with big baskets and put a motor kit on it. I’m getting a bit too old (62) to be pedaling 10 miles from town with a basket full of groceries. FAT tire bikes will do it, skinny tire bikes are useless. Make sure you’ve got extra tubes, tires, chains, etc. And bikes don’t make much noise.

    Noise will get your family killed, and THAT’s why I got some solar panels, inverters, DeepCycle batteries, etc,, and NOT have any gas generator. Gas gennie, burns too much fuel, can be heard for miles, and needs too many repairs, etc. Solar, gets FREE fuel every sunny day, never makes any noise and can go years without needing anything repaired.

  • Well said Bill, always enjoy your insightful and thoughtful commentary. One other factor to think about when comparing USA and Zimbabwe. Zimbabwe’s crash was a localized event, it certainly impacted surrounding nations and to a small degree the world financial markets. But when the $USD crashes, it’s gonna drag down the entire world with it.

    I am not surprised many have not ‘figured out’ gold. There is a concerted effort in the mainstream media in the US to disparage gold(ie. propagandize against gold). I would assume this happens in other nations where Western CBs dominate. Obviously the Chinese and the Indians didn’t fall for it though. I concur that Gold is VERY important to the hyper wealthy and governments. Regardless of why, humans value gold, and have for millennia. It takes real energy and manpower to extract PMs from the ground, and it can’t be created out of thin air or created from something else. PMs are real. And IMO that simple reason alone is why their value will skyrocket when the fiat illusion falls apart.

    I still am unsure how long $US ‘cash’ will be valuable once the dollar collapses. There is so little actual cash versus digital dollars, and most people barely have any, regardless of how many digits are in their bank accounts. I’m confident we won’t be seeing any wheelbarrows… unless they’re filled with debit/credit cards… lol.

  • Craig escaped from Detroit

    Zimbabwe warning to all Farmers and Ranchers.

    Just like in South Africa, Zimbabwe, etc.. when the SHTF, the roving gangs of hungry looters, target EVERY farm and ranch.

    Everybody knows that farms and ranches, are the JACKPOT of supplies. Fuel tanks. Water tanks. Tons of fertilizers. Tools, machinery, tons of grain, seeds etc.

    The most survivable homestead,,are the smaller ones (just a few acres) and nothing that looks like a farm or ranch, but big enough to grow a family sized garden and still be far enough distance from the population centers.

    I live in such an area,, small homesteads and some farms. The only thing I worry about, is that I am only a few hundred yards away from the grain silos, water & fuel tanks of the big farm across the road. Those things will become magnets for looters and can bring trouble to my little home.

    I’m sure that most farmers & ranchers have been feeling confident that they have everything they need to survive the crash,, but have NOT considered that the looters look at farms and ranches as the NEW WALMART of free supplies.

    It’s great to be supplied,, it’s bad to draw attention to yourself because of all those supplies that are impossible to conceal. Kinda hard to hide a 50ft tall silo,, or several 1000 gallon water tanks, fuel tanks, etc.

  • Jerry

    Zimbabwe’s hyperinflation took considerably longer than just 2 days to go from being “set for life here in Zim to not being able to afford a loaf of bread”.

    That “reader” was exaggerating. Like all cases of severe hyperinflation it was a process that took months to sometimes years. You do not go from an inflation rate of 8% to severe hyperinflation overnight. And that is how it will almost certainly be in the U.S., unless of course the U.S. gets nuked.

  • Dante

    Adversaries to the US (if you chose to believe they ACTUALLY are) won’t have to invade to steal the gold. They’ve already pillaged the gold via stealth. This is what happens to a nation when it becomes a debt slave. A land invasion then takes on a declining sense of urgency. This is what the average Joe in the US cannot comprehend, even if he were introduced to the idea.

  • Guy

    After my parents divorce back in 1975 my father went to live in Rhodesia. He worked on a copper mine as a maintenance engineer and was a reservist for the military police for several years. At the age of 17 I went to visit him in 1982 or there about. Before I left the UK to visit him, we spook on the phone. I asked how I should bring my money to the then Zimbabwe. He told me to bring gold, specifically Krugerrand. But he told me that I would need to hid them form immigration otherwise they would seize them. Back then the new Zim Dollar was being inflated away and expats were desperate to get there money out of the country or into something real and portable. But the Mugabe government had put strict limits on how much money people could leave the country with.
    Anyway, I got on an Aeroflot flight to Zimbabwe via Moscow with a 1oz Krugerrand on a gold chain around my neck and another 1oz Krugerrand in my pocket with a load of other lose change. I sailed through customs and met my father in the bar of the airport. He was glad to see me, but seemed a little nervous. He asked if everything was OK and did I have the Krugerrands. I passed both of them to him under the table. He smiled and was gone for about 40 minutes. He returned with a big smile and a nod and we left the airport.
    He had sold the 2 coins to an expat for double there value in Zim Dollars. That’s how desperate people were to get there money into something that would be insulated from the ravages of a corrupt government. I remember him telling me that Mugabe’s wife was the only Zimbabwean at the time to have a licence to import televisions.
    I lived like a king for the next 6 weeks. Flying all over the country in light aircraft. It was a great holiday/education.
    To this day, I still travel with gold coins in my possession. Especially in Asia. I went all in on bullion back between 2005-2007 when I sold up my business/property and left the UK for Asia. I currently live in Japan.
    50% physical gold
    35% physical silver
    14% gold/silver junior miners
    1% cash.
    Banks. I don’t like them, I don’t trust them.
    I trade the mining stocks and still buy silver bullion with any profits, when I have them.
    It’s going to be every man for himself when peoples confidence in the dollar evaporates. Don’t be the chump that has to pay double for your gold bullion. It’s better to be early that late on this trade.

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