The Phaserl


An Alternative to Prepping

by Dr Jerome, TF Metals Report:

A few weeks ago I proposed that the bankers wanted to have gold close lower on the year, in percentage terms, than the major stock indexes. Just a few days ago, stocks were comfortably ahead of gold as the year was running out. But something happened they did not expect. Stocks began to tank as gold caught a bid. And as Fridays action got going, they had a problem. Just a few minutes after the opening bell, gold showed an 8.6 % gain on the year and was pushing higher quickly, only needing a $6 move higher to overtake the S&P. The S&P stood at a 9.1 % gain and was headed lower. Gold was overtaking the stocks.

Can you imagine the NYT headlines? “Gold outperforms stocks for 2017” (I can dream, can’t I?)

They could not let gold win! Something had to be done! At 10am the gold smash began. It did not let up, and even a small spike at day’s end was hammered back down at the bell. Stocks were juiced again an hour before the close. I bet it cost the banksters a bundle of fiat to get those moves to go counter to the trends.

The end result was 7.9% for gold on the year and 8.8% for the S&P. Whew! Were you surprised?

But with 2016 in the books, I am looking forward to a nice Q1 and Q2 for gold this year.

In other news, I am thinking deeply about where I want to live the rest of my productive life, and where I’d like to be situated as my strength wanes. It is certainly not in the city in this two-story condo with a postage stamp sized back yard I try to garden each year. And where might my kids live, and what careers will they find. 2017 may be the time to take control of the situation.

So what follows is a proposal I aim to share with family members and perhaps a few close friends later this Spring. At first glance, it seems audacious, a fool’s errand. Yet, the more I ponder and consider solutions for all the problems involved, I am encouraged that this proposal could be a reality. In fact, the time may be right.

I am sharing this here because maybe, just maybe, something in the proposal may ignite a similar spark in you. If so, copy, paste, and change the names to protect the innocent. Then share it with your family and see what happens. But also, we have a blog filled with critics, problem solvers, creative people, and experienced sages who can certainly contribute to a discussion that sharpens the idea. I am all ears.

An Audacious Proposal

In 2007, my wife and I owned 8 rental properties and a home in the Midwest. We were up to our ears in debt, but the budget worked due to incoming rents. All of a sudden, Lehman collapsed, AIG collapsed, and hte dominoes began to fall. Our banking system was mortally wounded and the recession punched our rental business in the nose. All of our equity was wiped out in a few months. Every property was “under water.” Even our home was under water. As the housing market slowly recovered from 2009 to 2016, we were able to finally sell all the property, but still booked a loss on every single one. The Midwest never fully recovered. Only our relocation to a hot housing market and two subsequent “smoking” real estate deals helped our personal finances to recover. But this new movie is starting to look like a bad sequel, with another housing bubble and more banking trouble. Do I want to try to survive another recession on my own?

Future challenges

The future is not rosy. Our nation has a 20 trillion debt problem, and its likely to grow. IF another economic collapse occurs, the way forward will be difficult for all. Yet there may be no economic collapse forthcoming (so-called experts debate it vigorously on both sides). But even if that miracle happens, we still have a debt problem that will, at the very least, keep the US economy mired in recession, just like Japan has been for the past 20 years. How then will my generation retire? How will our adult children earn a good living? What sort of world will our grandchildren inherit? Oh! I wish there was something we could do…

The world is changing. Even in my stable profession of academia, the writing is on the wall. No new professors (high pay)! Universities across the country are hiring “Lecturers” to simply teach more classes at half the pay. Every profession in the nation faces similar cutbacks due to this recession and the failed monetary policies that mired our economy in a bog of debt with nobody to pull us out.

If you are counting on the new president to fix all this, I wouldn’t hold your breath. My hope is that he will make things better, but it will require wiping out that debt of 20 Trillion through a default before we will make any headway.

We must somehow be pulled out of the mud bog of debt before the car will run on its own again. In personal and corporate finance, that happens through a bankruptcy. With nation states, it is the same. Don’t roll your eyes—the US has defaulted on multiple occasions in American history, we just didn’t call it a “bankruptcy.”

When this economy dives into another depression, I predict that life will get even tougher, because we never fully recovered from the last one. Back in 2008, we were only 10 trillion in debt. But too many middle class jobs have been permanently lost! Ninety-four percent of the “recovery jobs” of the past several years are now known to be part-time positions. and our national debt has doubled.

So, how can we boomers secure a workable retirement? How will our millennial children and their kids secure a living in the future? The challenges we face are real and closer than we know. At best, we are looking at more of the same—recession, interest rates too low for fixed income, poor job market, higher taxes at state & local levels, rising cost of all commodity-based goods.

Is there a better way to live than we have been–in our city home, in a crowded subdivision, fighting traffic each day to work for an employer who does not pay us enough and could cut our job at any time? Can we achieve our desire to have a stable home, stable career, and raise our kids in a healthy environment?

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