Aside from what you've heard in the news, I'm sure you've observed in your own town that the economy is down. That is, less spending, businesses failing, and/or prices rising. It's taken it's time but I've started to notice the physical effects of the down economy here where I live. Aside from the overstock of real estate properties in the market or dealerships fumbling around to make a sale, some other examples smaller examples I've observed prompted me to write this post today. The local TGIF has raised their food prices without increasing portion size. Additionally, two local restaurants have decreased portion size while keeping prices the same. On my way to one of these local establishments I noticed that all the surrounding retail spaces around it were empty. This was not the case a year ago. Black Friday wasn't so black in some places. I read that retail sales were down by almost 40% nationally. That's almost 1/2 the amount of sales made last year which is a huge hit for small stores who rely on the holidays to make up for their annual expenses. Because of this I would think we should expect to see major retail chains closing stores in 2010. Unemployment is working its way to almost 11%. That's 1 out of 10 people you know is without a job. I know at least 2 people. This will get worse because everything is connected and if I stop going to TGIF because they raise their prices they will still lose money in the long run. If I stop going to the local pizza shop because they give me less food for the money, they'll lose money too. Businesses who lose money either cut jobs or close. There's no other alternative except angel investors which are extinct. People who lose their job become another statistic. Speaking of which, I predict 14% unemployment by end of 2010. That will mean almost 1 in 5 unemployed people. I base this on the current .4% trend forming for monthly unemployment increases. Our economy will begin to retract in the coming year. There already will be less money brought into the government in taxes this year and this trend will continue in 2010. Unfortunately you will see the current leadership raise taxes or costs on the whole rather than decrease spending in order to offset this loss of revenue. This in turn will cause more harm to the economy resulting in further unemployment and further economic growth stagnation.
So what does all this mean? I have developed a sense of doing for myself over the years and I believe that I need to be sure that I will be able to continue to do for myself even if things start to go south for me or others. I think at this point if you have a job you should start preparing for not having one. That is, stop erroneous spending and start saving. I have spent a ridiculous amount of money over the past two months on going out and having fun. This helps only my short term happiness and the club's short-term bottom line. Long term I need to think about keeping myself afloat. We should all have at least 6 months worth of salary saved in an interest bearing account at a reliable (fiscally responsible) bank. I would go as far as to take 10% of this money and invest in physical gold or silver (not paper notes). Gold prices are a bit inflated right now because of the uncertainty of the dollar, but if the dollar collapses due to a global "F.U." on the USA, you will at least have some physical asset that's worth it's weight as apposed to nothing. Even if you consider this to be a "crazy survivalist" mentality, it's really not anything but common sense. It's about time I start following it.
I suggest you buy a gun. Yes, I said it. The reasoning behind this is security in knowing you will be able to defend yourself, family and property for just about all possible scenarios. If you are uncomfortable owning a gun I suggest you at least get certified or training in shooting one. You can usually do this at your local range.
I suggest you make a 3 day pack bug out bag. This is in case you need to move on short notice for any reason or emergency. Everyone should have one for weather calamities anyway.
Be prepared. I think we're still in for a bumpy ride.
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