Capitalist Eric

Truth is treason in an empire of lies.

So We’re In For an Economic Collapse. NOW What?

with 17 comments



Someone asked the pertinent question, if we’re in for an economic collapse (SHTF), what can I possibly do to expatriate my money?

To reiterate from my last post, the banks and our alleged “representatives” are working to outlaw cash, make it so that all transactions are via electronic means.  This gives the police-state government the ability to track our expenditures and send the police if you withdraw too much of your own money… And it also gives the banks access to all your funds, so that they can steal your money when their bad gambling debts come due.

So storing our money in banks is a very foolish thing to do.

As I’d mentioned before, money is not just an exchangeable commodity for commerce.  “Good” money also has some intrinsic characteristics: it’s durable, and a store of wealth (or purchasing power).  It must also be easily divisible, easily transportable, and impossible to counterfeit.  This last part is why American dollars (and every other fiat currency) are not money, only “currency.”  Or if you really want to be precise, dollars are government-issued scrip.

Since paper dollars cost essentially nothing to produce, and electronic dollars cost literally nothing to produce, the last point of real money is lost, where dollars are concerned.  In other words, they are just like Weimar Germany Marks.


Let me state it plainly: dollars are not money, they are not a store of value, they are no more valuable than Monopoly money.  What does make dollars valuable in our current (death-spiraling) economy is the fact that we’re forced to use them “for all debts, public and private,” at the point of a government gun.

And make no mistake, the US Treasury is a counterfeiting operation.

Counterfeit is defined as “made in exact imitation of something valuable or important with the intention to deceive or defraud.”

The deception is that you think you’re getting a store of value, when you most definitely are not.  Because the government increases the money supply ~7% per year, your cash holdings are therefore being devalued by the same amount every year.  Blue is actual inflation- what you see when you go to the grocery store, when you pay your bills or buy other consumables.  The red is the government-manipulated statistics that the blow-dried talking-heads push every night, in main-stream media.

Now, notice that the numbers start to diverge in 1983.  What happened?  To put it simply, the government started understating actual inflation to short-change retirees and people on Social Security.  Lower stated inflation rate equals smaller cost-of-living adjustment (COLA), thus short-changing SS recipients and allowing the government to spend more money on other programs.  The deep-dive explanation is here.  Oh, and our alleged “representatives” also amended the law to make SS payments taxable income– another way for government to steal from those who’d already paid their taxes…  Nothing like completely screwing over the elderly.  Considering though, that SS taxes collected for 2014 were $855 billion and payments were $823 billion, the Ponzi scheme would already be bust if they hadn’t played this trick.

But like anything else, when you start lying about one thing, the lies spread to other areas, including the computations for GDP.  Indeed, current government data is not believed by thinking people.  Only the morons still accept this propaganda:

loon girl

Gold Purchasing Power Parity

Let’s take a little detour for a minute, and talk about the value of the dollar versus average wage/salary and the price of gold.  Were we to talk about nutritional value of a particular food, it would be measured against an “ideal” standard, namely the egg.  In economics the ideal measure is an ounce of gold, or more precisely, the price of an ounce of gold.  100 years ago, in 1915, an ounce of gold sold for  $20.67.  An average person earned $867 per year, or enough to buy 42 ounces of gold today.    The average income in 2014 was reported at $53,891.  If we blindly accept that the free-market gold price is $1205 (as of this writing), than the average wage earner can buy 45 ounces of gold, about the same as 100 years ago.  But because we already know that inflation numbers are understated, and that the true free-market price of gold should be somewhere around $3053/oz, our actual purchasing power parity is ~18 ounces of gold, about 42% of what it should be.

The average house in 1915 cost $3200 (155 ounces of gold); today the average house for April 2015 went for $219,400 (182 ounces of gold at current prices, but 72 ounces when gold is properly priced).  Notice that when government manipulates the gold prices, the “inflation-indexed” price (as referenced to gold) remains the same, while true market prices for gold would show the average price falling over time, as a function of more efficient construction logistics.

The Federal Reserve actively manipulates the price of gold, of that there can be no dispute.  They do this to prevent people from realizing the dollar is dead, and avoid a financial collapse.  YOU can take advantage of this fact by buying precious metals- both gold and silver- in the knowledge that when the dollar collapses, your wealth will not only be protected, you’ll increase your overall purchasing power by hold such PMs as compared to simply cash.


As I posted before, it’ll be important to have cash on-hand to pay your property taxes and mortgage, when everyone around you has had their funds stolen out of the banks for “bail-ins.”  At least you’ll be able to hold onto your property as repo-men attempt to seize the assets of your neighbors…  until armed resistance stops the repo-men or the currency collapses.  Afterwards, having PMs will be your fallback for whatever commerce you engage in.  If a new currency comes along, you’ll be able to buy that currency (if desired) with the instantly recognizable PMs you’ve saved…

Those that haven’t done so, those that merely survive on a government-doled subsistence, will go from having EBT cards, Social Security checks, welfare/WIC/whatever, that they can use at the local WalMart, to this:

From McMansions, to this:

I Don’t Have Much, But How Do I Protect What I HAVE?

So now we get back to the question: how to expatriate or somehow protect what we’ve earned and saved?  We know the banks are not going to protect us, and instead will steal our money with the blessing (if not downright assistance) of the Feds.

Two recent articles just came up on yesterday, discussing this exact question (here and here), and they suggest the same tactics I proposed:

  • Maximize your stored purchasing power in precious metals
  • Have 6 months worth of cash on-hand to pay your mortgage, utilities and property taxes until the currency collapses.
  • Keep only the minimum amount of cash needed in bank accounts.  Remove any surplus and keep it as cash or as precious metals.

It’s a simple rule that you have to remember:  Whether it’s cash, gold, silver, jewelry or diamonds, IF YOU DON’T HAVE PHYSICAL POSSESSION OF IT, YOU DON’T OWN IT. 

I do not recommend expatriating your money to another country or a bank account in another country; bankers are loyal only to money and power, and you (as the tiny customer) don’t represent enough money or power for them to respect and protect.  By expatriation of your wealth to another country, you have surrendered possession; you no longer own it, and whenever those who possess your wealth decide to, they’ll just take it, and that’ll be the end of that.

So…  how do you maintain possession of your wealth, under your personal control?  How do we keep it from being stolen by thieves (whether they wear a government costume or not)?

It’s time to go “old-school,” as in, “do what they did during the Great Depression.”  Hide money and precious in places where people wouldn’t think to look.  An excellent website on this subject is Money Hiding Spots From The Great Depression.  Taking these ideas and adapting them to your situation is the best way to protect your wealth.

I don’t recommend expatriating yourself to another country, as the upcoming economic collapse will be a global event; there’s no place to run, no place to hide.  Stay where you have the most people to work with as a “tribe,” where a group or small community can work together.  I have extended family in Russia, and the offer is on the table for my family to move there in a SHTF event.  But from my perspective, there are several problems with this:

  • The government is just as corrupt as in the USA; they’re just more overt about it.  This includes the police literally robbing you on the side of the road, versus the USA (where they include a “citation” and a “judge”).
  • My money would still be at risk of inflation/confiscation by the banks and government.
  • Ownership of precious metals is not allowed.
  • Private citizens cannot own firearms (technically possible, but impossible as a practical matter).
  • In a SHTF situation, outsiders (foreignors) are not typically welcomed with open arms.

So we stay.


I had previously mentioned the survivalist/prepper/zombie-attack websites; there are hundreds of websites dedicated to this subject.  It’s quite common to have discussion forums where people talk about their favorite “zombie” weapon, how to build an underground bunker, combat tactics and so on…  But the vast majority of such discussions are fantasyland gossip, with people somehow thinking that war, disease, starvation and death are somehow romantic.

Let’s face it, NONE of those things are romantic, and you’d have to be a fool to actually want to be in such circumstances.  But a lot of people still dream of this, God only knows why…

So, instead of referring to more insane forums like this, I’d like to point you to a blog that was published in 2008, by a guy named Ferfal Aguirre.  He lived through the financial collapse of Argentina in 2001.  While this blog has been up for a long time, the lessons are timeless, practical, and actionable.  In other words, he offers insights on a variety of subjects, with ideas that you can implement yourself, without spending a small fortune on.  Subjects like weapons, trading in grey/black markets, physical and financial security…  He also makes it clear that “romantic” notions of what’s coming are not just foolish, but flat-0ut dangerous.

Protect your wealth, using old-school, common-sense.  Do NOT trust anyone else with your money and valuables.

[Final caveat: I get a variety of trolls that want to knit-pick certain aspects of what I post, with regard to economic theories, gold to silver ratios, exact pricing for certain products that I use for examples, etc.  I’m not interested in debating minutia, any more than I want to debate whether blue is better than red.  I’m putting the general information out there for people to understand, so they can make informed decisions to best protect themselves.  I don’t get paid for this, I’m not selling anything or making any kind of a profit on what I post.  Honest questions will be honestly answered, trolls will be quickly deleted.]





Written by capitalisteric

May 22, 2015 at 12:42 am

17 Responses

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  1. […] Capitalist Eric builds on his last post. […]

  2. Couple of points —

    * Some states have their own gold reserves (texas 1bn) and according to USC strictures they could start issuing their own gold and silver coinage. It would be interesting to see what the effects would be to the digital money changers if states starting minting their own.

    * I agree with the cash reserves proposed. The rub is once the trigger is pulled for digital only then what do you do? Some how I suspect that the drug king pins are going to make a big gain by trafficking in paper dollars on a black market. They hold tons of the stuff at any given time due to their drug trade. And how do you pay the RE taxes when the old paper currency is no longer accepted as debts public and private?

    * Once there is a move to digital there is no guarantee that a govt backed ewallet would be the winner. What happens if bitcoin became more popular? All I can see as their cure is making anything other than the govt backed wallet illegal.


    May 23, 2015 at 3:30 am

    • I agree that states which have their own gold are more likely to issue their own money, and are in better shape (post-currency collapse).

      You make some excellent points on transferring from physical dollars to digital. I’ll have to think about that for a while, as the conversion from physical to digital-only carries some serious problems, IMHO… How DOES one pay bills when the “official” currency is no longer valid? A paradoxical situation, it seems… Thanks for the comment.


      May 23, 2015 at 3:23 pm

      • I personally doubt that cash will go out of style any time soon, despite what the federal government says about it, or laws they pass about it. If people are willing to take it in trade, it’s still good. There are lots of reasons people would still be willing to take it in trade (buy ins, etc.).

        As to “drug kingpins”, keep in mind they are a creation of the federal government. As far as I’m concerned, anyone who makes his living on the black market is at least to some extent, a good guy. The violence surrounding the black market is again, the creation of government.

        Paul Bonneau

        May 24, 2015 at 11:49 pm

  3. Here is a non-fantasyland, non-BS, non-zombie-based reference for tactical survival and self-defense training:

    You have to be realistic about defending your tribe and assets. But you have to be able to do so, with knowledge, training, equipment and teamwork.

    Prepping without security is simply prepping it for someone else ….

    Max Velocity

    May 23, 2015 at 4:19 pm

  4. 9. The Child of the Promise Jan 10th, 2013

    Jesus and His Mother speak to a chosen soul in Pa, USA


    I will pour out all my love upon this new America. It will be the child of the promise. For years, it will be hidden as I was hidden. Then slowly there will be the manifestation of what I have prepared. Then, this new America will assume the mantle of justice and the full anointing of the Holy Spirit. It will have become of age and will be the light to the nations. This has always been my will for America.

    Do not judge me by what you see happen to the other America, the America of darkness that deliberately walks away from me and flaunts my laws. That America has renounced its role as the child of the promise and has chosen to become the child of the slave-woman. It can only live a life of nature, having set aside my promise.


    Because of this darkness, I must warn my church. The light that you now have is not sufficient to overcome. The light of reason and the judgments of the wise are no equal for this demonic intellect that plots against you. You must walk with me in a new light. Yes, my light will be more brilliant than ever before, but it will be seen only by faith. O Church, I call you to a deeper faith to grasp the plan of the heavenly Father in these times when your total existence is endangered by the darkness that will come upon you. I am your mother. Do not reject my light.


    May 23, 2015 at 5:11 pm

  5. I am originally from Russia (although it’s been more than a decade since we moved to the Land of the free, home of the brave).

    In 1998, all of our savings from my then-decent job, that we kept in a bank, were stolen by the bank when it declared itself bankrupt. Somehow, I don’t think that our money just disappeared: I am pretty sure that some people got it: the people who could make the banksters’ lives both painful and extremely short if those serious people did not get paid – with the adjustment for near-hyperinflation (that’s where OUR money went, I have almost no doubts).

    Also, one more bulleted point to your list of reasons summed up with your “So we stay.”:
    – In 2015 Russia, Americans are hated as the perpetrators of the Russians’ growing misery (economic sanctions pushed by the US, neo-Nazi buildup in Ukraine, etc.).
    So, WE stay as well.

    Yet again, I agree with you on blue-vs.-red.
    Quite honestly, I think that the human feces stinks the same regardless of color.
    Those who are STILL stuck in the right-left paradigm in the middle of 2015, cannot be helped.

    Regarding sometimes perceived romanticism of survival: agreed – again!.. – 100%.
    Having lived through JUST the economic hardships of 1990’s in Russia (without experiencing a war, real starvation, Mad-Max gangs, etc.), I can assure those “romantics” that it is no fun at all. Folks, if you think that your boss is an asshole now, imagine what he/she will be like when specialists like you (even real experts in your field) are a dime a dozen. As the great late George Carlin used to say, you just accept increasingly shitty job with lower pay and disappearing benefits. Oh, and – your kids take a chocolate bar as a present because that’s all you can afford.
    Add to that the [unknown for me personally] realities of civil and/or world war, and I shudder at the thought of it.
    People need to remember: “Be careful what you wish for; you might just get it.”

    Thank you very much for the awesome article.

    Best of luck to you and your family in the upcoming festivities.
    I hope we meet some day when they are over…


    May 23, 2015 at 8:14 pm

  6. Reblogged this on The Lynler Report.

    Alfred E. Neuman

    May 24, 2015 at 1:56 am

  7. Eric, about Mortgages…I don’t think they will accept cash payments for mortgages Eric. If there is a bail-in, all credit markets and mortgages will be badly affected. I think cash transactions will only take place between people, like they do now if you have a farmer who lives near you and sells vegetables and eggs. I don’t know how credit cards and mortgages will be paid when SHTF


    May 24, 2015 at 6:07 pm

    • I don’t think it will work the same after SHTF. There may be some initial attempts at evictions due to non-payment of mortgages, but even now before SHTF evictions are difficult. How much more difficult, when people correctly think the banksters are the cause of all their miseries? The evictions will fail, and any attempted will be met with loaded guns. Thus, the new paradigm will be, “Everyone owns the house he resides in”, and the paper owners won’t much matter any more. People simply won’t put up with being thrown out in the street, and any cops who attempt it will be killed.

      If this is so, then we don’t need cash stored up for paying mortages, or taxes for that matter. We need it for buying guns and ammo and general household supplies, and food. And to engage in general commerce with our neighbors.

      Paul Bonneau

      May 24, 2015 at 11:58 pm

      • To add a point, in the 1950’s my wife’s parents were land owners in China. They were driven out of China into Hong Kong by the Communists. This turned out to be a blessing in disguise because they missed the Great Leap Forward and the Cultural Revolution both of which killed tens of millions, but they lost everything besides their lives. Mortgages won’t matter when SHTF. Arms and will are the things that will count.

        Of course if the correction is quite limited, many of the old structures will remain, as happened to FerFal in Argentina. But all indications that I am aware of are that it won’t be a minor correction.

        Paul Bonneau

        May 25, 2015 at 12:05 am

      • Is this really true? You can stay in your house if you owe a mortgage? That’s great, I owe a little under 8k.I have been worried, about what I was going to do.

        Elizabeth Marie Brown

        March 21, 2016 at 9:04 pm

  8. Fernando “FerFAL” Aguirre expatriated to the UK.
    I appreciate his contrary views to the Rawlesian orthodoxy. Basically he asserts that the economic decline results in a rise in petty, property crimes and then violent crimes without devolving into roving bands of mutant biker canibals. Argentina accepted their economic collapse as the new normal and upgraded their personal and home security, kept old cars longer, downgraded vacations, food, clothing, etc. He maintains that is good to be in the city, near medical services and economic activity (such as it is), as opposed to off the grid, 100 miles from Bumfuc, Idaho hiding from the urban horde in a bunker stocked with beans and .308 to the rafters.
    Of course, Aguirre doesn’t take into account the extreme end of the spectrum (EMP, economic war, shooting war, Yellowstone Caldera eruption, etc) but those things are so unlikely as to be impossible, right? Right?


    May 25, 2015 at 8:40 pm

  9. […] about the coming economic collapse, WHY it is happening and what you can do to protect yourself, HERE and HERE. Since the fundamentals haven’t changed, I’m not going to rehash. It’s enough to […]

  10. I came to your site by way of wrsa. Would you say that productive agricultural land is as good or better than precious metals?
    I see the only downfall of land to be the property tax. That is a boatload of cash to hold till the collapse.


    August 10, 2016 at 5:00 am

    • The short answer is, “nobody knows for sure.” Precious metals are fungible, portable and a great way to store purchasing power. Land ownership is a viable option if you know how to grow crops (I don’t) and have water to irrigate with. Also, it’s obviously not portable, and must be defended. BUT… if you can overcome those issues with land, you can eat what you grow, versus PMs, which must be traded to get what you need.

      There’s no perfect answer, here. It depends mostly on you, your skills, your tribe and your capabilities to hold and defend.


      August 10, 2016 at 8:01 am

      • Thanks bro, I’m a farmer and have all my wealth in land. I will invest in some physical silver. I am adding your site to my reading list. Again, thanks


        August 10, 2016 at 9:07 pm

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