Preparing for a Financial Crisis

[loppar]

@H_factor

Venezuela is always thrown out but never European area countries with arguably more active governments than us and better quality of life metrics.*

We’ll they’re not comparable individually for the most part. Civilization-states (China, India, Russia, Brazil, Turkey…) are.

[Legalsteel]

@loppar

Many people were calling me old fashioned for holding a very significant part of my assets in gold

So long as you actually hold it, I’m in total agreement. Gold you hold is valuable. Notional gold may as well be toilet paper.

[Californiagrown]

Eh. I think holding physical gold is only a good idea if you think the banking system will collapse, but society won’t. Tough to buy a loaf of bread with a whole bar of gold… And if it was that bad all stores would be ransacked and supply lines shutdown. You gotta pay a premium to sell physical gold, but no premium to sell the idea of physical gold.

I’d rather own some good hunting rifles and a cabin in the woods with a well that backs up to natl forest as a hedge against a societal collapse, but YMMV.

[treco]

I never understood SHTFers holding miners and non physical, then worrying if they had enough dog food and ammo.

Buddy of mine said he was learning how to make spirits so that he had a demand skill

[loppar]

@Californiagrown

You gotta pay a premium to sell physical gold, but no premium to sell the idea of physical gold.

It’s a liquid asset class that appreciates in times of crisis. I’m not saying it’s extremely liquid like cash, but more liquid that other asset classes.

@Californiagrown

I’d rather own some good hunting rifles and a cabin in the woods with a well that backs up to natl forest as a hedge against a societal collapse, but YMMV.

As someone who has experienced a societal collapse first hand, I can tell you that this isn’t how it unfolds. It’s not that overnight everyone dons leather helmets and starts LARPing as Road Warrior.

It’s more like Venezuela, only instead of a decade it happens overnight. There’s scarcity of all kinds of goods, absurd levels of crime, but the bare-bones of society are still there - people are semi-starving but they’re still going to work to earn a pittance.

My Wealthy Country Became A Dystopia Overnight: 6 Realities

So lessons learned:

• Spot the warning sings and get out fast. “I can’t leave my practice/house/appartment” were the last words of many

• Pick a tribe if a tribe hasn’t already been picked for you (examples are skin color, religion etc.). It’s not uncommon that your tribe end up people you’ve never actually communicated or lived with, just by virtue of a common identity (having foreskin comes to mind in many parts of the world) In times of crisis identities are very reductionist and there’s no place for nuanced opinions. Also, loners with guns don’t last long, even if they’re in remote cabins. Buy-in or make yourself indispensable to the tribe.

[Legalsteel]

@Californiagrown

I’d rather own some good hunting rifles and a cabin in the woods with a well that backs up to natl forest as a hedge against a societal collapse, but YMMV.

I was more speaking to the fools that buy gold futures assuming the gold will ever be there when they need it. I’d take a castle and a moat before a bar of gold.

Physical gold is the only way to hold the asset, if you’re so inclined.

[Legalsteel]

@treco

Buddy of mine said he was learning how to make spirits so that he had a demand skill

That skill, and the capacity to make cow blood edible, was the saviour of many an Irishman in times gone by.

[H_factor]

@Legalsteel

I’d take a castle and a moat before a bar of gold.

You need a lot of gold to get a castle and a moat though!

[H_factor]

@treco

Buddy of mine said he was learning how to make spirits so that he had a demand skill

Now that’s someone who is fully prepared for the apocalypse. I’m fucked. I converse well, lift weights, that’s about it. I can’t make shit with my hands really though I do know my way around a car decently which works until we have no gas. Maybe some survival group wants someone who knows a lot about Batman? I feel like I’m going to be one of the first people killed and consumed for sustenance.

[Legalsteel]

@H_factor

You need a lot of gold to get a castle and a moat though

Oh, you assume I was going to pay for it? No, I’ll just find some ailing aristocrat and become his black watch.

[Uncle_Gabby]

In my neck of the woods, being able to make spirits wouldn’t get you far as it’s pretty common place. I would like to be able to convert my truck to run on almost pure ethanol. That would be very handy, post collapse.

Rumor has it that’s where prohibition came from. No one gave a shit about a bunch of old prudes marching for sobriety. It was the early days of the internal combustion engine, and you couldn’t have those small farmers making their own fuel and being all independent and whatnot.

[loppar]

@Legalsteel

That skill, and the capacity to make cow blood edible, was the saviour of many an Irishman in times gone by.

It is worth noting that these scene from Kubrick’s masterpiece wasn’t something extraordinary. In 17th and 18th century Europe and even Asia, Irishmen frequently met [each other, wearing different uniforms and serving different lords. Often such encounters ended tragically.

Barry Lyndon - Barry meets the Chevalier de Balibari

[plinnyc88]

You apparently don’t understand it’s effectively run by the UN. There’s something interesting articles on Mises about it.

[plinnyc88]

Heavy handed? Lol, nonsense. I have a residence there, that’s complete nonsense.

[Aragorn]

Absolutely great post plinny. Thanks for the insights!

@plinnyc88

Well the currency crisis will jump around - Euro, Yen, then USD. I do not trade currencies or sovereigns, but I find it hard to try to fathom how this does NOT happen. When it goes, the entire curve will just implode, won’t matter if you’re in bills, notes, or bonds

This was my best guess, but as the interplay between all the financial instruments is essentially like a foreign language to me, I never trust my own opinion. This is how I imagine many people feel with my sandbox (biochemistry), so I suppose turnabout is fair play lol.

@plinnyc88

I never, ever, try to predict an average of 30, 500, or 2,000 equities. We aim to be market neutral, so we buy what we believe are undervalued equities and short what we believe are overvalued equities

This makes a LOT of sense to my layman’s understanding. Correct me if I am wrong but that is the 5 second “dummy” breakdown of Warren Buffet’s philosophy?

@plinnyc88

Gun to my head wild guess? More likely to be higher than lower regardless of unemployment

Thanks again. It’s interesting the way you explained it, since that’s not something I’d thought about, but makes perfect sense sticking to your best competitive advantage and not straying from what you know is your biggest asset. What is involved in the kind of deep dives you’re talking about?

Hope you stick around this war zone, if only for the interesting insights in to a foreign world (finance).

@Polar-Bear

Two reasons: the market can remain illogical longer than you can remain solvent - and don’t fight the Fed

Lol. That’s a great way to put it!

[H_factor]

@plinnyc88

Heavy handed? Lol, nonsense. I have a residence there, that’s complete nonsense.

Reply was to me but not sure what you’re referring to or if it was meant for someone else? Forum still buggy?

[treco]

@Aragorn
With respect to @plinnyc88, whose financial acumen appears accomplished

If you want to passively invest for your working career, buy a similar $ amount on an ongoing basis of an index fund or Buffett’s (which is plenty diverse, well researched, bought with privileges small traders can’t get, and has decades of record to see.)

Buy that $xxx every week (month) going up or down, at top or bottom - but commit to it until career do you part. Do it before you pay a bill. Decades from now, it will be like grandpa left you a big inheritance. The other investing you do, let plinny manage actively or buy a rental etc.

For a real financial crisis - buy gold from loppar, ammo from idaho, and some good hiking boots - you and legalsteel ain’t holding no fixed castle…

Warren Buffett just won a $1 million bet—and highlighted one of the best ways...

[mnben87]

@treco

Buy that $xxx every week (month) going up or down, at top or bottom - but commit to it until career do you part. Do it before you pay a bill.

Better yet have it automatically taken out. Never seeing the money really helps me not expand my lifestyle.

[Californiagrown]

Yep agreed. I treat BRK. B as an etf or fund instead of individual stock, though I do pay attention to it’s largest holdings (eg AAPL is like 40% now) so I don’t double up on stock. After bills, 401k, and small upkeep of my hobby equipment, I will be putting a nice chunk into my investment portfolio (75% safe stuff, 25% riskier stuff).

I would like to amend my previous statement about a cabin in the woods… I will be going with a Toyota tundra and northern lite camper. Mobile, and plenty of BLM and national forest roads to camp out at, plus I can get anywhere an RV cannot, but do it in relative comfort, even in snow.

[Aragorn]

@treco

For a real financial crisis - buy gold from loppar, ammo from idaho, and some good hiking boots - you and legalsteel ain’t holding no fixed castle…

I do believe between everyone’s skills on this forum we can kick the apocalypse’s ass.

Dibs on “mad scientist”, but most willing to share with ActivitiesGuy. Sharing is caring, after all.