The sky is falling.....

[W2R]

I actually know Cajuns who eat nutria and like it. I haven't personally tried that, er, delicacy but there are plenty of them in the canal. Rats, too! Maybe I could become a vegetarian.

I forgot to mention that even though I don't like guns, between F. and the guy across the street with the purple heart, I would be well protected.The guy across the street sat in his carport all day long with a shotgun casually across his lap after Katrina and I think that caused some ne'er-do-wells to speedily exit our neighborhood. We all gave them evil looks too but I suspect the shotgun bothered them more than the evil looks.

 

[Alan]

I actually know Cajuns who eat nutria and like it. I haven't personally tried that, er, delicacy but there are plenty of them in the canal. Rats, too! Maybe I could become a vegetarian.

I've eaten nutria and liked it. They are herbivores so although they look like a big rat they have totally different eating habits.

 

[bld999]

If you run out of bacon, spam tastes pretty good after a week or so, esp. if you have whiskey in the camelback.

 

[NW-Bound]

@W2R. I dunno. Even people who stand watch have to sleep sometimes.

But with nutria so abundant, there should be no danger. Anyone can get his own. Have not had a chance to try, but I would not be hesitant. It's a herbivore, right? Same as cattle that eats grass and hay. On the Web, they say it tastes like rabbit. I am fine with that, although I have not had rabbit since childhood.

All I would need now is something to wash it down with. Git myself some moonshine, and I am set.

PS. Cross-posting with Alan. That's my man!

 

[FUEGO]

I'm stockpiling vodka and mixers, if anyone wants to barter with me. I'll take guns, ammo, and rations. And you can hunt and fish in my lake. But you have to share all the catfish, turtles, deer, egrets, herons, hawks, falcons, geese, etc that you catch.

Cross posted with NWBound - I see I have a ready trading partner for my extensive liquor stash. You can park your camper in by back yard. Just don't dump your grey water in my lake aka drinking/irrigation water source.

 

[W2R]

I've eaten nutria and liked it. They are herbivores so although they look like a big rat they have totally different eating habits.

Ewww... Oh, and NW-Bound, I don't like rabbit either.

Alan, Louisiana automobile license plates say "Sportsman's Paradise", and as I'm sure you remember, there is a reason for that. I know how to fish for dinner so I will leave the nutria to you and my Cajun friends, and I'll just go fishing out in the swamps instead...

 

[NW-Bound]

@bld999 When one is hungry enough, anything tastes good. Spam? People would kill for it.

Seriously, I hope these jokes show how tough it would be to survive if society collapses. But if one looks back at the threads made back in 2008, he will see that we were talking about "Mad Max" scenarios back then too.

 

[grasshopper]

Ewww... Oh, and NW-Bound, I don't like rabbit either.

Alan, Louisiana automobile license plates say "Sportsman's Paradise", and as I'm sure you remember, there is a reason for that. I know how to fish for dinner so I will leave the nutria to you and my Cajun friends, and I'll just go fishing out in the swamps instead...

Good I still have my good for life Louisiana fishing licence I hooked at the 1964 Worlds Fair.

 

[FIREd]

I watched Wiedemer's "interview". I can't say I learned much from it. The proposed ways to protect one's wealth against the purported upcoming chaos are far from novel and have been discussed at length on this forum (get out of debt, avoid long bonds, etc...).

 

[rbmrtn]

No need to panic! However, if the collapse is scheduled to occur in 2012 it had better get a move on, because 2012 is more than half over.

Still have Dec 21st to look forward to, the Mayan calendar ends.

 

[Dawg52]

I am telling y'all, you've got to have a plan.

I do.........

 

[ejman]

@bld999 When one is hungry enough, anything tastes good. Spam? People would kill for it.

Seriously, I hope these jokes show how tough it would be to survive if society collapses. But if one looks back at the threads made back in 2008, he will see that we were talking about "Mad Max" scenarios back then too.

The whole societal collapse /conspiracy scenarios are fun to talk about but looking at recent history of world upheavals when countries were really faced with the end of everything as we know it scenarios (Japan, Germany, The old Soviet Union, even Vietnam etc) there really was no total societal collapse. After a while, people regrouped and things carried on and I'm optimistic that we as a nation wouldn't be any less (although I hope we don't get to test my optimism).

 

[MichaelB]

The whole societal collapse /conspiracy scenarios are fun to talk about but looking at recent history of world upheavals when countries were really faced with the end of everything as we know it scenarios (Japan, Germany, The old Soviet Union, even Vietnam etc) there really was no total societal collapse. After a while, people regrouped and things carried on and I'm optimistic that we as a nation wouldn't be any less (although I hope we don't get to test my optimism).

You're thinking too rationally, too focused on facts. Look at Mad Max, Beyond Thunderdome, The Postman, Zombieland. Thats the kind of stuff we need to be worried about.

Soylent Green.

 

[easysurfer]

You're thinking too rationally, too focused on facts. Look at Mad Max, Beyond Thunderdome, The Postman, Zombieland. Thats the kind of stuff we need to be worried about.

Soylent Green.

Soylent Green. A great movie. I never thought of crackers the same again.

 

[M Paquette]

Nobody will even notice. We'll just slowly, quietly continue our transition to neofeudalism.

 

[Gumby]

Nobody will even notice. We'll just slowly, quietly continue our transition to neofeudalism.

I would think Manorialism. This guy's got it all figured out.

World Made By Hand, by James Howard Kunstler -- a novel of America's post-oil future

 

[marko]

I'm slowly coming to the conclusion that nobody, anywhere, has a single clue on what they're talking about!

 

[MichaelB]

I'm slowly coming to the conclusion that nobody, anywhere, has a single clue on what they're talking about!

No no. Among all those people talking about all those things that can go wrong and giving advice, especially investment recommendations, one of them is dead right and knows exactly what he / she is talking about. Just one. If you can figure out who it is you and then take their advice you will be forever grateful.

OTOH, if you can't figure out who is right, it's like sitting at the poker table. You take a look around, and if you can't spot the sucker, it's you.

 

[NW-Bound]

I went to the link in the OP, and spent some time to watch the video, the same one FIREd discussed earlier about an "interview" with Wiedemer, the author of Aftershock.

It was a bit tough to watch this infomercial, same with all of them, and I was tempted to just quit. But I decided to tough it out to see what the message really was. Half-way through, I had a sense of déjà vu, and realized that I had seen a similar video before from the same source. I must have followed a link in an ealier and similar thread posted in this forum.

Basically, Wiedemer warns of higher inflation and interest rates. It would decimate house prices, and stocks. He said that eventually everything would recover, but a lot of people would get hurt.

So, what is for one to do? He says to sell your house, and get what you can. Buy gold because although it will build up to a bubble, the price run-up may last another 10 years. I did not see if he recommended selling all stocks or not, but he recommended some sensible things to me and most people on this forum. And that is to avoid long bonds, get out of debts particularly credit cards, and to convert from adjustable mortgage to fixed rate.

But if one sells his house now, is it to buy back later cheaper? Would not rent go up with inflation, which means that it is better to keep one's house, whether it is paid for or not? And in the early 80s, the last time we had high inflation and when I bought my 1st home with a 14% mortgage, house prices went up with inflation, not down.

Wiedemer said that there would not be social collapse and widespread unrest and chaos, the same as there was none during the Great Depression. But there will be a lot of misery.

It may all sound plausible, but about gold, I have to repeat a personal story that I have told often on this forum. In the early 90s, a close friend of mine read a book about the impending collapse of the US economy. He believed it fully, and cashed out his entire 401k, paid heavy taxes on it, and bought gold. Nowadays, he could have rolled out to an IRA, then bought a gold ETF, but this mechanism did not exist then.

He paid something like $500 or $600/oz. Of course we know what happened to gold price afterwards. He eventually had to bail and sold out at below $300. Now, gold has climbed back up to $1700.

My friend complained that he was "too early" in his prediction, and should not have sold. I did not have the heart to tell him that had he just kept his money in stocks, the stock price appreciation as well as dividends for 20 years would have been more than that gold price appreciation.

 

[NW-Bound]

I have set the record straight about the OP linked article never suggesting that widespread unrest and society collapse will accompany the hard time and high inflation ahead, which it does predict.

I felt that I needed to do that, because I took off with Audrey's comment about us living under a bridge, then so many joined in that the original article was not discussed and the thread's theme was subverted. Part of the reason was also the OP's choice of thread title, which conjured doomsday or Mad Max scenarios in the reader's mind.

But now that things have come to pass, and there has not been any further post, I'd like to add something that is out of topic.

The whole societal collapse /conspiracy scenarios are fun to talk about but looking at recent history of world upheavals when countries were really faced with the end of everything as we know it scenarios (Japan, Germany, The old Soviet Union, even Vietnam etc) there really was no total societal collapse. After a while, people regrouped and things carried on and I'm optimistic that we as a nation wouldn't be any less (although I hope we don't get to test my optimism).

Yes, people instinctively know that they need to form some bonds with some other fellows, at least their temporary neighbors, in order to enhance their survival. In the Mad Max movie series and any other disaster movies, we always see the survivors organize themselves into a group, sometimes to face their adversaries which also form a band. This is quite plausible, and indeed happens in real life already in the form of neighborhood watch or vigilante groups to deal with thieves and gangs.

When it comes to the major upheavals like the ones you listed, it is different. In these great political disturbances or revolutions, an individual would not know how to plan or to protect himself, if that is even possible. Each of those was a unique situation, and no-one could really predict how history would unfold. There were so many factors at play, so many actors. I am thinking of events such as the French Revolution, the Russian Revolution, or the Holocaust. Yes, the nations did survive and the people did regroup. But for the individuals, survival was a hit or miss. How could one plan for events like that?

For example, one of my favorite movies is Dr. Zhivago. Another is The Killing Field. Both depict real history. The main character in the first movie is fictional, while he is real in the second movie. People in the US have not been through such a war, and with the US being an isolated country, there is no reason to fear such risk. However, put yourself in the place of the main characters of the above movies and you would feel the true helplessness of the individual, whose survival is as haphazard as a coin toss.

 

[ejman]

I have set the record straight about the OP linked article never suggesting that widespread unrest and society collapse will accompany the hard time and high inflation ahead, which it does predict.

I felt that I needed to do that, because I took off with Audrey's comment about us living under a bridge, then so many joined in that the original article was not discussed and the thread's theme was subverted. Part of the reason was also the OP's choice of thread title, which conjured doomsday or Mad Max scenarios in the reader's mind.

But now that things have come to pass, and there has not been any further post, I'd like to add something that is out of topic.



Yes, people instinctively know that they need to form some bonds with some other fellows, at least their temporary neighbors, in order to enhance their survival. In the Mad Max movie series and any other disaster movies, we always see the survivors organize themselves into a group, sometimes to face their adversaries which also form a band. This is quite plausible, and indeed happens in real life already in the form of neighborhood watch or vigilante groups to deal with thieves and gangs.

When it comes to the major upheavals like the ones you listed, it is different. In these great political disturbances or revolutions, an individual would not know how to plan or to protect himself, if that is even possible. Each of those was a unique situation, and no-one could really predict how history would unfold. There were so many factors at play, so many actors. I am thinking of events such as the French Revolution, the Russian Revolution, or the Holocaust. Yes, the nations did survive and the people did regroup. But for the individuals, survival was a hit or miss. How could one plan for events like that?

For example, one of my favorite movies is Dr. Zhivago. Another is The Killing Field. Both depict real history. The main character in the first movie is fictional, while he is real in the second movie. People in the US have not been through such a war, and with the US being an isolated country, there is no reason to fear such risk. However, put yourself in the place of the main characters of the above movies and you would feel the true helplessness of the individual, whose survival is as haphazard as a coin toss.

Although it is true that planning for such type of events on an individual basis is somewhat suspect ( As the old saying goes "man plans, God laughs") I would like to point out that each of us is the end result of countless generations of such miracles happening. For instance, I would guess that a lot of posters on this board can trace their ancestry to some European country or other. In the middle ages the black death wiped out close to 50% of the population in Europe. Whole towns completely disappeared with not a single survivor. But yet countries survived, cultures survived and we are here.

 

[teejayevans]

More bad news from Bill Gross:
PIMCO | Investment Outlook - Cult Figures

Together then, a presumed 2% return for bonds and an historically low percentage nominal return for stocks – call it 4%, when combined in a diversified portfolio produce a nominal return of 3% and an expected inflation adjusted return near zero. The Siegel constant of 6.6% real appreciation, therefore, is an historical freak, a mutation likely never to be seen again as far as we mortals are concerned.

 

[F-One]

Bill Gross makes one incorrect assumption per Brad Delong:

Bill Gross implicitly makes three assumptions: (i) that the total stock and bond valuations in the economy add up to the economy's private corporate capital stock, (ii) that the capital stock of the economy cannot grow much faster than real GDP (currently projected to grow at between 2.5%/year and 3.0%/year), and (iii) that all transfers from corporations to savers--dividends and share backs and bond interest and principal payments--are reinvested in the market. If those three assumptions are true, then indeed the weighted average of stock and bond returns must be in the 2.5-3.0%/year range.
But assumption (iii) is wrong. When a company pays me money by buying back a share, I do not have to reinvest that money in the market. When a company pays me money by issuing a dividend, it does not have to raise that money from the market by selling a new stock or bond--it can (and does) raise that money from its customers by selling them goods and services at more than their cost of production. And if (iii) fails, then there is no necessary direct arithmetic connection between the rate of return on stocks and bonds and the growth rate of the economy.
So what is the right forecast of long-run future stock returns? The S&P earnings yield is currently 7.7%. If the economy strengthens wages will rise and that would tend to push earnings yields down, but if the economy strengthens businesses will be able to take greater advantage of economies of scale and that would tend to push earnings yields up. I have seen no arguments that one factor is likely to be much stronger than the other.
That 7.7% earnings yield means that every year, after repairing worn-out capital, businesses have $7.70 for every $100 of stock market valuation adding to their physical capital stocks (which should boost fundamental value and so show up as a capital gain) or paying out via dividends and stock buy-backs. The right stock return to forecast is to mark that 7.7% earnings yield down to whatever you think the sustainable profits of American companies are, and to go with that.

 

[FIRE'd@51]

The most egregious error in Gross' commentary is a complete misunderstanding (or ignorance of) the Gordon-Shapiro model.

Real Return = Dividend Yield + Real Growth

Gross has ignored the starting dividend yield which was in the 3-4% range at the beginning of the historical period he referenced. Add to that a real growth of 3.5% and you get a real return of 6.5% - 7%.

He may well be correct that the real growth going forward will be less than 3.5% and since the current dividend yield of the S&P 500 is about 2%, the expected real return going forward is likely considerably lower than the historical 6.6%.

Nonetheless, all of his rantings about Ponzi schemes and investors skimming only make him look stupid. It's incredible to me that one of the equity guys at PIMCO didn't point out this oversight to him.

 

[marko]

Yeah, that Bill Gross...what a dumbbell.