Cyprus, Herbs and Taters, Smith and Wesson M&P and Ramlings

That whole mess in Cyprus was pretty interesting. The model that government will screw citizens to protect banks is proven yet again. At this point banks are playing like Nicki from Casino. Gamble and collect if they win; should they lose they do not pay. If I was a Cyprusian, or whatever they call themselves, who happened to of had 100k Euro's in the bank I would be a lot poorer and very angry right now. Like buy a hoodie and a bandana then start burning stuff down angry.

The jilt of the situation is that bank deposits were stolen levied in a one time tax to help support the EU bail out of the countries banking industry. Cyprus is unique as it is a popular place for rich to moderately well off sometimes crooked Russians to stash money. Needless to say Russians are not a big fan of this. Maybe President Putin who is a real life bond villain and the most awesome man in the world will kill them all. I'm not sure.

This brings up a couple interesting points. As TEOTWAWKI Blog noted it is important to have some cash on hand. A month's cash expenses (food, fuel, medicine, incidentals) is a good reasonable goal. More would not hurt if your overall situation merits it. Given the effectively negative interest rates these days if you have more lying around one could go to 2-3 months cash expenses.

Claire Wolfe brought up a good point about considering how much cash you have in the bank. This is something that concerns us. We have a lot of money, by percentage and considering our life situation in the bank. Over the next several months we are going to do something about that.

Some dude in Tuscon is looking at handing out shotguns to low income women in high crime areas. I cannot see how it could make the war zone that is low socioeconomic status Tuscon any worse. Heck it might just make things better.

Today for dinner I heated up some frozen meatloaf MIL made when she was here. Did up some crashed potatoes to go with them. I liked that Greek oregano and green onions from the gargen were part of it. That is pretty cool. It looks like one of the strawberries died. The other strawberry plant I think is going to be fine.

So I've been hanging around in gun shops to buy ammo recently the opportunity to handle a couple of guns has come up. I really liked the ergonomics of the Smith and Wesson M&P. That gun feels great in my hand. It would be a very hard sell to get me to purchase a 9mm that isn't a Gen 3 Glock but I like the M&P a lot. Should I decide to buy a .45 it might be an M&P.

Also handled a Rossi Ranch Hand. That thing might just be a stupider gun than the damn Judge. A lever action pistol caliber gun you need to hands to reload, seriously people. If it's compatible with a bigger stock you could (of course pay $200 and fill out some forms first) make a Cowboy SBR I guess. Seriously folks just get a revolver that beats this piece of junk in about every possible contest.

Been doing a lot of reading about the battle of Grozny (the first one in late 94 to early 95) for some work stuff. Will probably talk more about that later. There are definitely some lessons to be learned and it is pretty interesting.

Well I'm bored of writing now so it's time to end this.

Hope you all are having a great weekend.

Economic Crack Binge and Coming Effects

The best comparison to our countries economic situation and coming problems I can think of is Charlie Sheen. Our problems with massive deficits are like Charlies problem with crack cocaine and alcohol. Lets call derivatives the Charlie equivalent of prostitutes/ porn stars.

Now I cannot predict the specifics of Charlie Sheen's next breakdown/ meltdown/ fail. I can however confidently say 100% that there will be one. Maybe he will shoot his celebrity fiance, hold a knife to the wife's neck at Christmas dinner, manage to mess up staring in the top rated sitcom on tv, who knows. (These are all things Charlie has actually done;)

 Disturbingly our upcoming economic problem is like Charlies upcoming breakdown/ meltdown/ fail. Just maybe we will manage to kick the proverbial can a ways down the road. Maybe it will be 70's era stagflation. Could be the standard South American currency devaluation/ hyperinflation or an all out Argentina like economic collapse. The old adage that big powerful countries do not go broke, they go to war (a la Germany) could prove accurate again. Maybe a combination of crumbling infrastructure and weakened defense makes an attractive time for an old enemy to attack or just use an EMP to keep us distracted internally. Maybe one of the dreaded black swans pops up in the time we are able to handle it the least.

What can we do about this? Well the usual advice to buy bullets, silver , gold and emergency food is always sound. Things like water filters might become important as infrastructure crumbles or breaks and standards just plain drop. (Yes that is a lot of linkeage in a paragraph. Got to keep the bill payers happy.)

Being as healthy as possible is prudent. Get fit, take care of lingering issues you may have, go to the dentist, order a couple spare sets of glasses and stock extra medication.

Buy food. Yes it is getting more expensive but basic staple food, even the long term stable stuff, is still a great deal. Right now food is ridiculously cheap by historic percentage of income. Most people here can probably make some choices to put a few bucks into food and fill up the pantry.

Learn skills. Specifically learn skills that will let you do things yourself instead of paying somebody else to do them.

Get ready to protect yourself. Things aren't getting better. Have realistic and sustainable (if it's not comfortable you will not do it) plans to carry weapons while still going through your normal life.

Most of these things are not new. In fact they are generally the same stuff I talk about. Best get too them before they are more expensive and harder to do.

Fed: Recession kicked median household wealth to 1992 level

Here is the article. This is not suprising but still sort of depressing. What they fail to mention is that a buck is worth considerably less today than back in 1992.

I look at who benefited from this, the classic cui bono if you will. It is pretty clear to me. Big bankers and financiers made a killing. Politicians did well on campaign contributions from those folks as well as using the money flowing into their coffers to buy votes. Personally they also made a killing on insider trading their consistently and consistently lucky investment choices. Some normal folks did well, if just for awhile. Nobody was complaining when their homes went up in value 20, 30 or even 40%. Nobody was complaining when the construction industry was booming.

I realized in writing this that I have sort of looked at bankers in the wrong way. I think a bit too locally. The assistant manager of West lake Trust in Peduke, Iowa population 50,000 didn't wreck out economy. That guy gives people loans they come to the bank looking for. Now the big bosses at Citibank, B of A, WAMU, etc all on the other hand had to knew what was really going on. That is why they got rid of these loans like a kid playing hot potato. They made money hand over fist for years. When the game was up they dumped all the junk onto the public in a variety of ways both above and below board. After that we loaned them cheap money which they used to buy up the competion which was slightly worse off or couldn't get easy money friend loans.

Between politicians making laws, setting conditions (keeping interest rates artificially low for years) and supporting their friends in banking and finance a lot of the blame goes to our wonderful elected officials. Banksters knowingly gave bad loans which they repackaged to unrecognizability then sold as rock solid. They bought politicians to do them favors and provide mafia like protection. These two groups royally screwed normal everyday Americans out of tons of money.

I cannot however totaly absolve people of the choices they made or the situations those choices caused. Lots of folks used electronic/ paper gains in their homes to finance vacations, new cars or home improvements and such. Some of them are mad now because they are "underwater" and have to pay back the money they so prudently cashed out during the boom. Lots of normal folks made poor choices thinking that somehow the good times would never end and ended up in a bad spot. Others tried to get in on the game and lost too, by the time normal folks get into the game the smart money is already on it's way out. Normal folks are standing when the music stops in the proverbial game of musical chairs.

Today I may be more disenchanted, with the establishment for lack of a better word, than I have been since the height of this mess in 2008 or so. Not exactly sure what if anything I will do about it.

Stuff From The Interwebz

How to live in your car

A very nice minimalist chest rig for an AK. I think they also make a 4 mag model. I will probably pick up one of these when I get around to filling out my whole AK setup.

A gal talks about how to carry a gun and a baby. I definitely have a soft spot in my heart for women who carry handguns that are not a) subcompact/ cracker jack box sized or b) in a diminutive caliber like .32 or .380. She is not a big lady or wearing a "I have a gun vest" or a parka.

Highlight, quote and understatement of the day "if your child can get to the trigger that is bad." My .02 cents on that topic. First put on your gun then grab the kid. Kid doesn't go where the gun is because it wouldn't be comfortable for everybody involved. I carry appendix inside waist band slightly to the right. Kiddo either goes on the left hip if he is just riding or in my chest area if I am doing the comforting screaming baby thing. Since we are talking about kids and guns it is worth rehashing my core belief on this topic. Simply put guns are secured or under the physical control of an adult. In other words lock it up or carry it.

Today I have been intrigued by Iceland's reaction to the whole great recession/ economic collapse thing. 1, 2, 3.

Also I stumbled into a new blog Jerking the Trigger andreceived an email about the Open Garden project.

Hope that stuff gives you something to read and enjoy or at least think about. Have a great weekend.

Ireland Bailout

Ireland says EU, IMF agree to fund emergency aid

Quantitative Easing Explained

I have seen this video floating around and Saddle Tramp sent me a link to it. Finally got time to sit down and watch it this evening. I suggest a stiff drink. In fact you might want to have a drink before watching this and another for during it.

Shades of Atlas Shrugged: Third World America

Third World America this article is disturbingly true. On another note Shades of Atlas Shrugged is going to be the series title for this sort of article.

I am not sure what the answer is. I do however think we need to create incentive's to promote desirable behaviors. [For example if we as a nation wanted to promote individual saving we could, say, not tax interest, dividends or capital gains on individuals with an income below $100,000 and a net worth below $750,000.] We aren't doing this. We aren't doing close to this. We are often in fact doing just the opposite. We have taken for granted that things are good and will stay that way. That no matter how much individuals or businesses get hammered they will stay in the same place and keep on doing the same thing. We've gotten cocky and lazy and it is coming back to bite us. Big time.

For example we need to attract manufacturing. America is never going to make sweat pants or t shirts cheaper than some random Asian nation where wages are a dime an hour. However I don't see why we shouldn't make computers, tv's, cars and all kinds of other stuff. Particularly the kind of relatively high tech manufacturing which employs more skilled individuals and pays them decent wages.

[If there is any positive way forward for America's low skilled blue collar workers it is if they can get the skills and we as a nation can attract this sort of higher skilled manufacturing jobs. The golden age for American manufacturing type workers from WWII to around the early 90's which has been dying a lingering death for awhile, set expectations which could not be maintained. Large numbers of people simply can't walk out of high school into a secure job that makes a comfortable wage with good benefits and retirement anymore.

I saw this play out on a smaller scale with the timber industry dying in the PNW. Some individuals were able to find a way forward in another job. Others managed to retrain and be successful. However when it was all said and done a lot of folks went from earning a comfortable middle class living to a couple bucks an hour above minimum wage or chronic unemployment. The restaurants and stores which these people patronized went under. Some towns died and a lot of others are sad shells of their former selves. The bottom line was that the jobs that went away were gone. The other industries were able to absorb some people, given that they received training, but a town that lost 100 timber jobs didn't suddenly have 50 new jobs as carpenters and another 50 for auto mechanics. Without some sort of X factor, such as a boom of high tech American manufacturing this will be the case on a larger scale.]

The biggest reason we have issues attracting or keeping these kinds of manufacturers is a grossly unfriendly business environment. Art Laffer said "Taxes don't redistribute wealth, they redistribute people (or I suppose businesses)" and the same could be said for regulations and all sorts of other little committees and agencies that make it hell to actually produce something. There are all sorts of ways America, or a state could do this. Simply streamlining the process for getting permits and clearances to build would be a good start. For a company that isn't going to dump tons of poison into the water system it should be a snap to open a factory. No taxes for 5 or 10 years would be a good one. Matching funds on select capital development would be another. Cheap or free energy would help too. Creating a work force which suits certain high tech manufacturing needs could work; especially if combined with a business friendly atmosphere and some tax breaks.

Instead of trying to hammer businesses for every dime we need to help them grow and employ more people and buy more machinery or other stuff. If every little bureaucratic despot and city councils could realize factories bring jobs; jobs which they desperately need we would be in such a better place.

As for infrastructure I think this is being blown out of proportion. Not significance but priority and who needs to be involved in addressing it. The answer is not big over reaching stimulus but government at all levels adjusting their priorities. Look at it this way. Most sane people would fix a hole in the kitchen floor before going out for a night on the town. If the family car breaks next week they don't need a stimulus from somebody; we need to shift our budget around and figure out how to fix it. If that doesn't work we can raid our hard earned savings. Governments from town to state have forgotten this. They need to make the important stuff work even if it means letting go of some of the flashy unessential stuff.

The economy is so bad that:

I got a pre-declined credit card in the mail.

I ordered a burger at McDonald's and the kid behind the counter asked,  "Can you afford fries with that?"

CEO's are now playing miniature golf.

If the bank returns your check marked  "Insufficient Funds," you call them and ask if they meant you or them.

Hot Wheels and Matchbox stocks are trading higher than GM.

McDonald's is selling the 1/4 ouncer.

Parents in  Beverly Hills fired their nannies and learned their children's names.

A truckload of Americans was caught sneaking into  Mexico  .

Dick Cheney took his stockbroker hunting.

Motel Six won't leave the light on anymore.

The Mafia is laying off judges.

Exxon-Mobil laid off 25 Congressmen.
 
Congress says they are looking into this Bernard Madoff scandal. Oh Great!!   The guy who made $50 Billion disappear is being investigated by the people who made $1.5 Trillion disappear!

And, finally... 

I was so depressed last night thinking about the economy, wars, jobs, my savings, Social Security, retirement funds, etc.,  I called the Suicide Lifeline. I got a call center in  Pakistan , and when I told them I was suicidal, they got all excited, and asked if I could drive a truck.

quote of the day

"Your country needs you Logan"-Striker
"I am Canadian"- Logan

I enjoy those easy going beer loving folks up north.  If they had better gun laws I would seriously consider moving up there. Yeah they have socialized medical care but we are headed that way at a dead sprint anyway. To their credit the Canadians managed to avoid the whole sovereign debt issue because their banks stayed out of the derivative and bail out madness.

This Was Interesting To Read

Canada's economy is suddenly the envy of the world

The American Dream

My recent post on Savings and Debt plus the follow up lead us down an interesting path. I have gotten my mind stuck on this topic for a few days. In order to fully grasp my thoughts you might want to skim through these past posts (1, 2). Now that I have referenced myself a lot lets get to semi new thoughts.

I think most of us grew up on more or less the same American Dream. Do the right thing and study hard then get a good job. By doing this you will be able to do a bit better than your parents did, assuming equitable career choices. Somewhere along the line you get married and buy a nice house with a white picket fence. Get a lovable dog and a good (not necessarily flashy but not shabby either) family vehicle. Join the local Rotary club or the Kiwanis or Lions or Moose lodge (in order depending on how much you actually want to help people and how much you like to party:) have 1.8-2.4 kids who also do the right thing and study hard. Maybe get a water ski boat or a  hunting cabin or a time share in Hawaii. A few more years down the road and then a gold watch and a comfortable pension. Now you have time to make ships in bottles or spend winters in Arizona and of course enjoy the grand kids.

So where are we now? Some folks would say that the American Dream is dead. I would not say that it is dead but I would say that it is realistic for fewer people than it was 40 years ago and far less realistic than 60 years ago. What were some factors that let then, well be then.

If we look at 60 years ago we see 1950. Things were pretty darn good. A lot of this was because the rest of the world was basically blown to bits and missing a big chunk of two generations of workers, under the iron grip of Communism or both and the rest of the world was still largely undeveloped.

40 years ago the nations largest employer was General Motors and wages started at the equivalent of  $17.50. Someone could graduate from high school or get out of the Army and walk into a good job with the kind of wage where you can afford the American Dream. Most jobs also had pretty good stability in addition to health care and pension plans.

 So why are things not going so well now? I think it is a combination of a lot of different factors. Lets look at some of them:

First as noted pretty much everywhere real wages are going down for a lot of jobs. Most notably manufacturing which used to be the ticket for a minimally educated and skilled person to have a solidly middle class American Dream life has taken a real hit. A nice young man can't graduate from high school and get a job at the plant with a secure future for him and a family anymore. The same sorts of folks are often getting the same sort of jobs; those jobs are just buying less.

Also what we consider to be "normal" has gradually trickled up. Homes are bigger and not surprisingly more expensive. We also fill our homes with all manner of expensive gadgets and electronics. People in 1970 did not have $150 a month IPhone and Blackberry packages or tv's that cost as much as a decent used car. As with anything else when the cost rises it means fewer people can afford it.

The above two reasons are the biggest issues at hand but a couple others are in my opinion notable.

Interesting credit and debt have also been factors, if smaller ones.  I am under 30 and I distinctly remember a time when many stores and shops did not accept credit cards. Debit cards were still a dream for some time after that. It is pretty hard to rack up debt when you can't buy stuff on credit. Of course stores have had payment plans and such but not too long ago most people only borrowed money for homes and cars.

Along with the long period of Greenspanian artificially low interest rates, an explosion in home prices, Fanny, Freddie (and eventually derivatives) home mortgages as well as other debt started becoming more and more available to less and less qualified people. I guess when it started bankers were confident that the long and reliable increase in home prices made them getting their money back a sure deal. Later on bankers made their quick money and sold the loans off anyway.

Somewhere along the lines it became more socially acceptable to be further and further in debt. Home prices were a huge factor in this. Getting that 3 bedroom 2 bath with a decent yard got a lot more expensive, but it was still the dream.  People used to have to wait until they could buy something or a reasonable person who was concerned about getting their money back (from them, not in general) would give a loan. For the reasons listed above the grip on reality in our economy loosened a bit and then just plain took a vacation for a couple years. Also to make matters even worse as it got more acceptable to be in debt the American Dream got even bigger.

So people were having a harder time and trying to reach bigger goals to boot. Also folks were were getting further into debt trying to get the American Dream. Somewhere along the line maybe a nice slightly idealistic idea turned into an unrealistic, unsustainable and warped vision of its former self, at least for some.

As Mayberry noted "EVERYONE is force fed the "American Dream" virtually from birth." Our parents, family, teachers and friends as well as the ever present media say this is a good thing and we should want it. I certainly would not say that (at least in the slightly more retro interpretation) it's not a nice idea. However sometimes the dream isn't for everyone, at least not today.

Tomorrow I will talk about defying the norms.

quote of the day

"They say the banks are too big to fail, I say lets make them smaller"
-Jim Wallace

quote of the day

"We have socialized risk and privatized gain."
-Eliot Spitzer last night on GPS with Fareed Zakari. I do not generally watch anything on CNN or like GPS. However they had Eliot Spitzer and the guy from Freakanomics on so it was interesting.

The guy is a first rate jerk by pretty much every account. His use of the obscure Martin Act as NY Attorney General was described as "the most egregious and unacceptable form of intimidation we've seen in this country in modern times." Basically my understanding is that he would just mess with people until he found something to convict them on or they were just ruined in legal fees or had their reputations permanently tarnished. Also as a special bit of irony he went after people for the (essentially victimless) crime of high end prostitution. One might find it amusing that he spent about a hundred thousand dollars on prostitutes, most notably Ashley Dupre. Any group of people who are foolish to elect him back into office truly deserve what they get.

In any case none of that matters because the quote is dead on.

quote of the day

(918): Someone should've told Pope jumper lady and terrorist pants guy that the Worst of 2009 lists already went out....

-TFLN 

quote of the day

"A point we learn from this event and every other banking panic in U.S. history is that crises have always lead to greater centralization."
-Ron Paul in End The Fed

A Year Ago This Season,

Last night I could not sleep for shit. Spent a lot of time thinking about life and blog junk and all sorts of stuff. I have been hearing all this stuff about recovery and lame duck recovery and jobless recovery. I got to thinking about a year ago. I am going to look at a lot of indicators and have some discussion. Doubt any huge conclusions will come from this but since it interested me you get to read about it.

First lets see what I was writing about roughly a year ago: I lived in an RV, This amused me,I was thinking about finances a lot with significant worry about institutional failures. I was also just beginning to really purchase precious metals. Too much more to list.

Second lets look at precious metals prices. Last year at about this time gold was in the $750-800 range and these days it is right around $1,000. Silver went from about $12 to about $16 but methinks that is going to drop a bit soon at least for awhile.

Thirdly the stock market has gone from around eleven thousand to a bit over nine thousand.

My last indicator is going to be unemployment. For this I will have to go with August numbers because Sep ain't over yet. Unemployment has increased by roughly 30% from the low 6 range to within spitting distance of that dreaded 10% mark.

For the unquantifiable I will go with what I remember which is fear. Banks folding left and right and the stock market dropping hundreds of points was a normal day. One day in particular I remember vividly. It seemed that the stock market dropped hundreds of points for the third or fourth day in a row. I slipped out for a few minutes to get as much cash as the ATM would allow me to because it seemed like a perfect storm for a banking holiday. Honestly I probably would have handicapped it at 1/4 one was going to happen.

Lets touch real quick on what has happened between then and now:

Barrack Obama won the presidential election. Who the heck saw that one coming!

For awhile it was darn near impossible to find Glocks, AR's, AK's, mags at any sane price or a bullet to go into anything. Eventually that situation got better though ammo prices still remain high.

Bail outs after bail outs after bail outs. Maybe we threw good money after bad and then used that good money to light our stack of really good money on fire. Maybe we will look back in 20 years and see the decisions made in those dark times as saving our financial system. I do not know and for a conclusive answer we will have to look to the history books in years to come.

Lots of people lost their jobs.

My memory isn't perfect but depending on the exact timeline I picked up a few guns or several over this period of time. Socked away a few hundred rounds of 30.06, about the same in shotgun ammo, a case of 9mm and a case of .38 with a few boxes of .357 mag for variety. Also we saved a good chunk of cash and got some precious metals.

Where are we going?

If I could predict this with significant accuracy I would be writing this from my 200 acre retreat in Idaho where I made a gazillion dollars a year playing the money game a few hours a day. That I don't have a 200 acre retreat in Idaho and today I worked a 12 hour day during which nobody asked (even once) what they should do with their money even once is a testiment to the fact that at best my great talents have not yet fully surfaced.

This seems like a good time to circle the wagons, munch on some leftover corn bread, sip a bit of water and watch vigilantly for rustlers, indians or desperadoes. While of course you will have to have a watch rotation so people can cook hot food, do chores, drink a little whisky by the campfire and get some sleep it is definitely NOT the time to have your cattle spread over the prairie, the Mrs at the creek washing clothes and your youngest off playing somewhere while you doze in the shade.

In slightly more practical terms this is a good time to suck up to your boss a bit more than usual, work extra hard and live very conservatively. Unless there is a very compelling reason otherwise every dollar you can get your greedy little hands on that doesn't go to basic living eexpenses should go under the mattress.

If your car is running reasonably well I would keep it and put off getting a new one. This is also not the time to go on that two week trip to Europe or buy a ski boat or do that big remodel on the kitchen. I would stick with whatever job you have now even if it is pretty lame unless something that is a serious step up comes along. You do not want to quit the job you hate to start a new dream carrear in X right now. Also since we don't have a clue what is going to happen to the stock market or the value of the dollar if I was seriously considering retirement hard thought would be put into potentially working for a couple more years to delay starting to draw from my savings and allow what I have in the market to bounce back.

I would also run full speed away from any debt that has a variable interest rate be it a home mortgage, a HELIC or just a maxed out AMEX card. Between the value of the dollar dropping and the increased defaults on all debt it is going to get ugly and painful for those holding variable interest debt.

Thoughts or observations on anything I said?

Replying to Comments on My Last Post.

So I wrote my first rant in awhile and it got a lot of comments. Some folks agreed with me and others spoke about ancillary issues. I do want to talk about a couple comments on here though.

To Occdude: As for bankers getting money at 0% and loaning that money out at 20%. I do not think that is entirely true. TOM wrote a great post on banks these days back on Oct 12, 2008. Banks are loaning money to credit worthy businesses and individuals with reasonable debts and they are doing it at reasonable interest rates. Also on the specific topic of loans home mortgages have not been so cheap in years. People getting quoted or given ridiculous interest rates are probably not very credit worthy. In short I think that argument is pretty flawed. I do think the bailout was pretty crappy and if this humble guy would have done anything it would have been handled differently.

to 1:20: I do not have a ton of experience with credit cards (some would argue that is a good thing:) but I am under the impression that when you get a credit card you sign a bunch of stuff which basically means they can change whatever they want whenever they want to. Going back to my original post "If you don't like the terms a bank will offer you then don't borrow their money." I can see why some people choose to have credit cards and the Mrs. and I each have one. Once during the time I have had mine they informed me the interest rate was going up. Instead of being financial doomsday for me it was just another thing to throw away because I do not carry a balance and when I charge something I pay it off in full when the bill comes due. These rate adjustments should be a reminder to everyone not to carry credit card balances.

So I completely reject your argument that people who took unsecured adjustable rate loans (essentially what credit cards are) are victims when the interest rates adjust.

Medical care in general and private vs "public" plans is a whole other topic. I can not help but observe that sick people are not flocking from our evil greed based private for profit medical system to good fair public systems when they get very sick; in fact quite the opposite happens all the time.

Quit Bitching- First Rant in Awhile

I am tired of people bitching and griping about bankers and 'the elite' plus of course the trilateral commission or some other such junk. [Now if you are complaining about how the derivative collapse and or government bailouts affected you fair enough. That isn't what I am talking about.] People who claim to be pro freedom but bitch about how someone else (legally) makes a lot of money are fucking posers at best. These folks want to have their cake and eat it too but do not have the guts to live in a truly free world where people are allowed to borrow and loan money at whatever terms both parties agree to. If you want to be a communist that is fine and good but at least be honest.

First of all class warfare has nothing to do with libertarianism or freedom. Don't begrudge anyone else the ability to (legally) earn a lot of money. I am sorry their skills are more valued than yours and their business sense is better but tough shit. If you want to make more money get better skills and make better decisions, nobody is holding you back but yourself.

If you don't like the terms a bank will offer you then don't borrow their money. As for bitching about how they just jacked up the rate on your credit cards I ask why are you carrying a credit card balance. If you don't want them to be able to change the interest rate on a loan then do not take a loan with an adjustable interest rate. This ain't fucking rocket science.

The bankers are not ruining your life, nobody forced you to take their money. I am honestly sorry if you got a [reasonably priced fixed rate] mortgage and now you can't pay it because of a job loss or whatever. That is a sad situation but it is not 'bankers' fault that you lost your job or whatever.

Running up a bunch of debt you can't service and then blaming bankers for your shitty financial situation is like eating 3 big mac's for lunch every day and complaining that 'donalds made you fat. YOU ARE AN ADULT WHO MADE CHOICES so fucking own up to your responsibility for those choices.

If you don't want bankers to be involved in your life then don't have any debt. Fuck don't even have a bank account, keep your earnings in a coffee can. Do like Dakin and Creekmore and get yourself a couple acres and a travel trailer (purchased with cash) and live off grid but stop fucking bitching.

The Emergency Fund: A Complete Perspetive

Jason Cato recently commented "My emergency fundage plans are to have 1k in cash in case of 1 - 2 month bank holiday, 500 in silver for bartering, and 500 in gold in case I need to bribe some authority figure. After that I plan to save as much as possible in case of more mundane problems like layoffs." on my post which talked about silver and gold.

This got me to thinking that though I speak of the emergency fund in fairly generic terms on a regular basis it is always about one part or another. Here is my complete emergency fund plan.

1. Cash on hand: This money is physically stored in your home or a safe place that is readily accessible 24/7. I think a months cash expenses is a good reasonable number. If you have ample liquid resources and a good safe 2-3 months would not be a horrible idea. This money is for a banking holiday or a natural disaster (money still spends but credit cards don't) or a plain old common power outage. Also if somehow your banking gets completely messed up you have something of a safety net.

I personally keep this in mixed bills with the first hundred in ones, the second hundred in fives and most of the balance in 20's. I find 20's as the compromise between being small enough for regular purchases (change may not be readily available) and compact enough to easily store and carry around. For most of us this fat stack of ones and a wad of 20's will be enough. However if you are going to store more than 2k or so I would say have the first 1-2 thousand in smaller stuff (20 and smaller) with at least and the rest in hundreds.

IMO this is more important than any other component of your emergency fund and should be squared away before moving forward.

2. Savings: [I am talking mainly about money in the bank. If you are seriously into the whole tangible investments thing then just skip to number #3] This is your money for job layoffs, sudden major car repairs, medical bills, etc, etc. The old wisdom used to be 2-3 months income stored in an FDIC insured account.Some folks say that 6-12 months is necessary. I personally think that is a lot of money to have sitting and not working for you in some way or another.

A big benefit of this money being in the bank is that you can readily access it anywhere. Maybe your car breaks down halfway from a distant cousins house or you get stuck somewhere unexpectedly during travel. This money being able to be gotten to from anywhere is a real advantage.

As for how much this should be I think you need to look at your own situation. Depending on your job security, bills and such this number can vary dramatically. For me with a pretty secure job and minimal bills 3 months seems like a fine number. A guy who works a job with frequent layoffs or radical income swings needs to have a lot more lying around. I know a real estate agent who has sold precisely one house this year and it closed in early Jan, he is fine because when things are booming he saves. Another friend of mine works construction. He makes pretty darn good money when working and still lives like he makes $14 an hour. He was recently laid off for 6 months and aside from being really bored he was just fine.

3. Precious Metals: I think there are lots of different perspectives on this one. I look at them as a tangible non dollar denominated store of value and buy them in case something completely fucked up happens. I will probably never sell them and do not expect to 'make money' off of them. What to get is sort of up for debate but I like the money changers advice "Buy silver first, then gold. Buy small gold first, then large."

As for how much to put into metals? We personally put $100 every month into metals. Often I throw some personal money in also. So for us we will just keep plugging along at a slow rate for the foreseeable future. This system works well for those with decent income but not a large lump sum sitting around. For the lump sum crowd I have heard it suggested that 10% of your liquid assets should be in precious metals and that sounds reasonable enough.

I think a complete emergency fund will have some cash on hand, a dedicated bank account with more money and some precious metals just in case it all goes to hell. The figures and amounts could be debated but I don't think many people would argue with those core principles.

quote of the day

" I believe that banking institutions are more dangerous to our liberties than standing armies . . . If the American people ever allow private banks to control the issue of their currency, first by inflation, then by deflation, the banks and corporations that will grow up around [the banks] . . . will deprive the people of all property until their children wake-up homeless on the continent their fathers conquered . . . The issuing power should be taken from the banks and restored to the people, to whom it properly belongs." -- Thomas Jefferson -- The Debate Over The Re Charter Of The Bank Bill, (1809)