Why we prep...

[Clay]

I'm a firm believer in taking notes and learning from history. It's good that you are as well, even though you may be preaching to the choir.

IMHO, what's been happening is that the wealth of the USA has slowly been transfered from here to China over the last 30 years. From there they have propped up our economy to make it appear ok while they set up China for a their version of the money grab. It looks like the Chinese population is getting robbed as we speak. The IMF is not our friend, nor theirs.

Predicting the collapse is probably going to be nearly impossible, all that can be done is to prepare ourselves and be ready when the time comes and it seems like you all are working hard on that.

[TWP]

To return to the situation in Greece, this article addresses how the Greek people are responding to their crisis:

http://readygoprep.com/website/signs-of-financial-collapse-and-how-to-avoid-last-minute-mayhem/

It contain a useful list of signs for a "faltering economy".  Look at this list and compare it to our situation in the US.
I reproduce it here:

Increasing signs to look for in a faltering economy:

• Increasing unemployment [/l][/l]

Increasing budget deficits

Downgrading of national or municipal credit ratings

Salary freezes at government level

Increased taxes on fuel, tobacco, alcohol and luxury goods

Cuts in public sector pay

Bailouts

Civil unrest, Union strikes

The use of the word austerity

Bank closings

Limits on bank withdrawals

Stores run low on supplies

Medical supplies and services reduced

Law enforcement, civil servants reduced

Bartering becomes more common

In addition, there is a list of what commodities are being "hoarded" by Greeks.  Read the article to see it.

The writer reports that Greek cash is in short supply, even though the ATM machines are technically still operating. 
They are simply out of physical cash, currency notes. 

This suggests that having some cash "cached" is going to be valuable.  The question of "How Much" is debatable,
but note that even with the devaluation of currency, physical cash is still the most common value exchange
method.  Barter is certainly taking place, but if you have cash, it is preferred, at least for the moment.

Greece is not, to my knowledge, printing more Euro bills, which makes them scarce.   The rest of the European
Union (EU) is not offering to provide more physical bills.  So physical cash is hard to find. 

So how does that relate to us here in the US?  What will our banking system (the Federal Reserve Banks) do
about cash supplies in this situation?  My bet is that they will NOT print more physical money, but require that all (most?) transactions be run through the electronic payment systems.   I am already seeing talk about preventing the use of cash here in the US.  Control is the name of the game.

Of course the above assumes that the electronic banking system remains in operation.  In Greece, it still works
except that outgoing money is blocked.  Payments outside the country are not allowed...   This keeps the money
flow inside the country.  This is why having some physical cash in your prepper stock makes sense.

The remaining parts of the article present a list of items intended for "Last Minute" purchase.  The list is subject to
change, but is a good starting point.  These are the things, in the authors opinion, which "should" be highest priority
during the SHTF event. 

Personally, I would be using this list NOW, to add to my prepper stock.   If you have money now, it is more valuable than during and after a SHTF event.

FYI[/list]

[Clay]

Thanks for that link. It makes a good case for having a few months worth of cash for bills and goods on hand, doesn't it?

[TWP]

I wish I had that much to spare.

This could be a case where the goods one has for barter are worth as much as cash (crossing my fingers and toes).

Cash does have the advantage that it is portable and easily hidden when traveling...

[Clay]

I'd rather have it under my mattress than making .001% in a savings account. Cash is an often under rated prep that everyone needs to have. Squirrel it away, just like beans, bullets and band aids. A little at a time if you have to.

Just FYI, I did read a couple of presumably first hand accounts from Greece saying that the stories about food being absent on shelves in stores is not true. At least yet.

[TWP]

Re Greece, what we are seeing is mostly media sourced images, and that comes with the "if it bleeds, it leads" atitude toward reporting.  I do assume that the reporters/photographers are actively looking for images to make the situation look as bad as possible...

I'm looking locally (or in the US) for such responses.  That is where the comments to threads are worth as much, or more, than the actual articles.  I'd rather hear from the people who are experiencing it, than the people who are reporting on it.

Heads up, eyes open.

[David-Audrey]

As most of us are, We've been following the financial market mess led by Greece and China with cameo appearances by Puerto Rico, Chicago and other entities.

I also remember something my father used to say..."When you start watching the unbelievable and it appears to be accepted by the masses as 'just news;' put your head on a swivel...that means the masses have already come to grips with and are accepting some bad s___t!"  Well, I've been watching small, then large cities go BK.  Then some large ones...Detroit.  Now there a country is in the process of, essentially, going BK. 

Do I think this is the end?  Not necessarily.  Could things get really ugly...you bet!  But I'm not going to comment on that angle of this mess.  Rather, I'm going to take my father's words and think about them.

Not too long ago, TWP posted a topic titled "Real Event, 13 days long."  I can't tell you how much I recommend everyone read it.  And here's the reason and connection to China, Greece, Et.al.

The man in the TWP's story is living in his "SMALL" crisis.  And because it appears that there isn't really anything SPECIAL or THAT far out of the ordinary, he misses the signs/warnings.  He's a Prepper and doesn't recognize that he went from an everyday situation to a survival (with some life and death aspects) situation.  Circumstances just get a little worse each day and there is no big single event to turn his "Prepper" button on. 

My message is that we should all watch today's events, but recognize that much of what we are seeing is NOT normal.  That, in and of itself, should make us turn our Prepper antenna up a notch.

                 ...because change is inevitable!

[Clay]

Isn't it sad that after all the trouble people went through with voting over there, their government decided to go against it anyways and take the EU money? The average person there must be very disappointed.

[Jerry D Young]

Just one more place where the will of the people has very little to do with what elected and non-elected officials choose to do.

Just my opinion.

[TWP]

So the end result is that Greece still faces lack of resources (food, water, fuel).  Imports are blocked except as black market trading.

I'm reading reports that suggest Greece may start printing the Drachma to replace the Euro.  No confirmation on this.

[edit] I found this reference to internal, not cash based, use of the Drachma.  It was only on a computer billing system,but perhaps they are getting ready, in case the Euro is dropped in Greece:

http://www.thedailysheeple.com/the-euro-is-finished-reporter-catches-first-glimpse-of-drachma-in-greece_072015

Other report say that there are not enough Euro bills (physical notes) to go around.  I wonder where they went?

People were spending what notes they had (mattress cash) or could pull from ATM machines.  If the economy was working, that money would or should remain in circulation.

No outside cash is being sent to Greece, so there is no cash source outside of what was in-country at the start of the bank closures.  Except, again, for black market import.

My suspicion is that two things are happening to the physical cash.  This is supposition on my part, no reports to confirm or deny this.  But it relates to what could happen here...

1)  Banks are not accepting deposits, so retail businesses have no place to spend the cash they receive from sales (banks are closed).  They are sitting on the cash because they cannot use it to buy more stock and cannot deposit it in bank accounts.

2)  That there are no more goods to buy from retail stores and the people are hoarding (prepping) their supplies.  Barter is not yet extensive enough to offer a route for cash exchanges.  Some cash is held in the hands of people, but they cannot use it as readily as pre-crash.

Physical notes do not just disappear, but where they went is still not clear.

Could this happen here?  It is reported that our own banks do not hold a lot of physical notes, since they don't make money sitting in a vault.  There is no "reserve" of bills available to distribute.

Greece (or the EU, not clear which) has banned the transfer of money into and out of Greece.  Wire exchange, for the average customer, is not allowed,  Credit cards are either not accepted or limited to in-country exchanges.

In our country, in similar situation, I would expect to see regional currencies start to appear.  Their value would be whatever the people would give them (sound familiar?).  It's hard to compare since I don't think we (Americans) would accept an internet blockade, but who knows what might happen if the US dollar crashes.  Coming soon to a country near you?

[TWP]

On a side issue, but related, US banks are "failing", not in a catastrophic manner, but non-the-less failing.
The latest is reported here:

http://www.denverpost.com/business/ci_28466729/regulators-close-premier-bank-branches-will-reopen-united

quoting from the link:

"Premier Bank is the sixth FDIC-insured institution to fail in the nation this year, and the first in Colorado. The last FDIC-insured institution closed in the state was Community Banks of Colorado, Greenwood Village, on Oct.  21, 2011, according to the state Department of Regulatory Agencies."

I've not been following the bank situation in this country, so I have no history on the time, place, names etc.
I note that the above quote says "...in the nation this year,..." so I'm going to assume this is not a new problem.
I cannot say whether the rate of closure is increasing, decreasing or constant.

This is also a statement only about FDIC insured banks, there are other, non-FDIC, banks in the country and I don't know whether they are also experiencing failures.

It is sometimes (frequently?) not possible to discern whether a bank was truly "closed" or merely acquired by other banks, and the difference might not be that great.  There is a great deal of crony support within the banking community and they all try to prevent the appearance of instability, it would be bad for business...

So, how safe is your money in the bank you use?  I don't say "your bank" because not only don't you own it, it owns your money... 

Think happy thoughts, there are no problems with the banking system, all is well... NOT

[Clay]

I may be mistaken, but I do believe that there are about 100 computer dollars for every one tangible dollar bill. What I think is going on in Greece is that there are not nearly enough actual physical euro bills in existence, so now that everyone wants their money out of the banks they don't have it due to the fact that they never really ever had it. I'd guess this is one of the real scary sides of fractional reserve banking, though there are obviously more than just this.

About the US banks failing, it's not at the rate it was a couple years back, but it certainly is still happening. Does this make a case for using a "too big to fail" bank like Wells Fargo or Bank of America? I'm still not sure, but for a long time I used a little home town bank and when they went belly up it was ugly. Luckily I had my money out at the time (I was broke..) and didn't suffer much. It was enough to make me not want to use a little bank any more though.

[TWP]

I'm no so sure that even the big banks are safe for the depositor.  The bank might not be "allowed" to fail, but the money on deposit is just as likely to be seized to cover the banks mistakes.

I'm watching Greece for this event (seizure of depositors money) after reading reports of the possibility.  They already have a de-facto seizure, since the account holders cannot withdraw their money.  The question is: will they ever get back the money on account?

I like the "cold well" bank idea better.  It might not pay interest, but then neither are the banks, anymore.

[Clay]

One problem with that is buying a house. If you go to buy a house you have to show where you got the money for the down payment, and it has to have been in your account for a minimum of six months to be used. Unfortunately they know how to play the game, and are trying really hard to keep your money all safe and sound for you.

[TWP]

So, as a prepper, were I in the market for a house (with enough money to consider buying one), the risk is still mine until the money is spent.   Kind of a trap, isn't it?

I would plan on having a mattress account with enough cash money (physical notes) for the SHTF event.  How much that would be is up to the individual.

Were I NOT planning on a big item purchase, like a house or bug-out vehicle, I would be converting my money to other commodities (gold and silver, for instance) that would not be in a bank vault.  Sheltering my "money" is still number one priority.  I certainly do not think banks are a good investment or saving opportunity.

Even if I were planning on buying something large, I'd still be putting away a nest egg in commodities, whether that is gold / silver or prepper stocks like food and equipment.

Disclaimer, I don't fall into the category of being wealthy enough to consider buying large ticket items, so I'm just making supposition about how to handle finances.  I am not a financial adviser, etc.