So in light of this, how do we save for the rainy days to come?

Once you’ve established the basics of your survival preparedness, you can protect your personal wealth by investing in precious metals. There are many different ways to acquire gold and silver. Here are a few:

• Purchase the pieces from mints or exchanges
• Purchase old pieces of jewelry or coins from yard sales, estate sales, thrift stores and Craigslist
• From trusted sellers on EBay

Mints and exchanges offer a sure thing. These businesses are built on trust and integrity. However when you purchase from everyday people or take a gamble on buying something at the thrift store, you need to be able to identify and test the metals yourself.

1. Look for markings. Jewelry made from precious metals in the US was required to be marked for metal content in 1906. On silver pieces you are looking for the numbers “925” – this indicates that the piece is Sterling Silver or 92.5% silver. If the piece you are considering is gold, you are looking for 10K, 14K, 18K, etc. 24K is 100% gold, and is very soft, so the other numbers are indicative of the gold content that has been mixed with a harder metal to make it less pliable.

2. Inspect the piece carefully. Is it rough near the edges? Is it discoloured in places? Is the finish chipping or flaking? These are all indicators that the piece may only be plated with silver or gold. These items require further testing. (Note: Sterling Silver will “oxidize” and tarnish – don’t be put off by black discolouration. This should wipe off with a soft cloth.)

3. If the piece has been marked, then you will want to test it further. Carry with you a strong magnet. Precious metals are NOT magnetic, nor are the other metals that are used in jewelry to harden them. If the piece of jewelry or coin reacts to the magnet it is not gold or silver.

4. Test it with ceramic. You can purchase a small piece of unglazed ceramic tile at your local hardware store. If you have a piece of questionable gold, run the piece across the ceramic tile. If it leaves a blackish mark, it is not genuine gold.

Once you have performed these quick tests, you may want to go further. There are two more definitive tests – the “Archimedes Test” and the acid test.

Archimedes Test

Break out your physics hat and perform a density test to determine the content of the metal you have on hand. For this you will require a vial marked in millimetres in which you can submerge the item in question.

Do not fill the vial to the top, since you will be displacing water with the jewelry item. Note exactly the amount of water in your container.
Weigh your item on a digital jewelry scale, marking down your result in grams. This is the “mass” of your item.

Place your piece in the vial and note the new water level.

Calculate the difference between the two numbers in millimetres. This is the “volume displacement” of the item.

Use the following formula to calculate density:

Density = mass/volume displacement

Here is a sample calculation:

Your gold item weighs 38 g and it displaces 2 milliLITRES of water. Using the formula of [mass (38 g)]/ [volume displacement (2 ml)], your result would be 19 g/ml, which is very close to the density of pure 24K gold.

Remember that different gold and silver purities will have a different g/ml ratio:

o 14K – 12.9 to 14.6 g/mL
o 18K yellow – 15.2 to 15.9 g/mL
o 18K white – 14.7 to 16.9 g/mL
o 22K – 17.7 to 17.8 g/mL
o 999 Silver – 10.49 g/mL
o 925 Silver – 10.2 to 10.3 g/mL

Nitric Acid Test

This is the most definitive way to test the metal in question. This test is where the saying “passing the acid test” originated.

WARNING: Nitric Acid is highly corrosive. Wear safety eyewear and protective gloves when working with this product. Protect all surfaces that could come into contact with the acid.

To perform an acid test, you will require Nitric Acid, a non-reactive dropper, and a stainless steel container in which to perform the test.

Place your item in the stainless steel container. Using the dropper apply a very tiny drop of acid on a non-exposed part of the item in question. (Remember: If the item is not gold or silver, the acid may permanently mar the finish.)

If you suspect that the item was merely plated, you can make a small scratch in a hidden place in which to test the item.

The acid will turn different colors in reaction to different metal contents:

Cream: 90 to 100% silver
Gray: 77-90% silver
Green: less than 75% precious metal content
No reaction: Gold

Test kits containing the chemicals and instructions can be purchased through Amazon for less than $10.

Finally, when purchasing gold or silver, always trust your instincts. You may not always have access to your testing kit when an opportunity arises. If an item looks suspicious or the price seems too good to be true, it probably is.

These days, making the family budget work is an art form in itself.  Let’s be honest, times are getting hard and we are all starting to feel it.  There are times when it seems that no matter how much money you save, there is nothing left from your paycheck at the end of the month.  This mainly due to extraneous and unforeseen expenses such as medical bills. 

Slashing the family budget is a daunting task where the end product is frustration.  Some have tried bundling their services, cutting back on extras such as movies and eating out, and some are beginning to see the wisdom in clipping coupons.  As much as the above mentioned can help the family budget, some of us are going a step further in our endeavors to save a buck.

7 Ways to Help a Person Save a Buck

Remove the phantom charges.  Did you know that when you leave your appliances (computer included) plugged in to the electrical socket, they still consume electricity?  You can reduce your electricity charges by 10%, simply by unplugging the kitchen appliances, tv and computer.

Buy food staples in bulk.  Learn from businesses, they save more money buying in bulk than they would buying individual products.  Use what you can and store the rest for another day. Due to the increasing food prices, it’s a postive way to buy your food staples at the most economical price.  This is a great time to start an emergency food supply.  Foods such as flour, sugar, oatmeal, and popcorn can be bought in bulk quantities at discounted prices.  Instead of paying $2.50 for a pound of sugar, you can buy 25 pounds at $13.00. 

Create a rotating refrigerator – Just like rotating your stored preps every 6 months, rotate perishable food items in the refrigerator.  Foods such as produce, eggs and meat every week. If no one has eaten the fresh fruit or vegetables you bought last week, dehydrate it and store it for another time.  Each household wastes close to $600 a year on spoiled food.  Start making an effort to cut down on this.

Go Vegetarian a few nights a week.  Who said that you have to have meat with every meal?  Buying meat for every meal is expensive.  Making a few vegetarian dinners will save you money.  For instance, make a vegetarian pizza.  It’s filling and healthy.  Or make use of those beans and make a vegetarian chili!

When you do buy meat, make sure it’s on sale:  When you see deals for meat, buy them and do one of these tricks to and save it for a rainy day:

• Freezing meat in a marinade can be enjoyed at a later time, as well as be a life saver on those days that get away from you. 
•  On weekends, my family enjoys eating buttermilk pancakes.  I always make an extra batch and freeze them for weekday breakfasts when we are running late. 
•  Another way of saving time is to freeze a crock pot meal.   Adding some vegetables, meat, rice or potatoes and spices and freezing it will save 20 minutes in preparation time.  Just take it out of the freezer and put into the crock pot and viola!
• Another easy solution to free up time is to take frozen vegetables and add a cheese sauce or a herbed butter sauce and freeze it for another time.

Homemade is better tasting and cheaper.  Let’s be honest, a lot of the products we buy are to make our lives easier, but can be costly.  Find ways to make it yourself.  For instance, make your own granola mix to make for healthy snacks.  This can later be make into granola bars, cereal or yogurt toppers.  Another easy snack to make is homemade fruit leathers.  The kids love them and they are healthy.  It’s a win-win situation!

Do-it yourself . Start simplifying your finances by doing things yourself.  Mow the lawn yourself, fix the plumbing and wash the car by yourself.  There are great how-to articles, as well as helpful neighbors who would be more than willing to help you out if you need some pointers.

Go solar!  Some of us can’t afford all the solar gadgets, but that shouldn’t stop you from harnessing the power of the sun. Dry your laundry outside on lines to save money on the electricity bill. Furthermore, doing your dishes by hand will cut down on electricity used by the dish washer.

With the market as volatile as it is these day, it is better to start investing in safer commodities that one can use for their future well being.  Stocks are plunging around the world!  Long gone are the days of  “easy money” from trading in the stock market.  Now, all that is left is the bitter, mood swings of  a dying market.  No one can trust in the market’s reliability. Investing your money in real assests that you can live off of for the next 10 years will be a better approach than investing in short term stock investments.

Many economic forecasters have warned that the coming days and the coming collapse will be nothing like we have ever seen before.  Some believe this crash will be worse than the previous one.  It turns out that economic forecasters such as George Soros, Gerald Celente and Martin Armstrong may, in fact be right with their warnings of an upcoming collapse.  In fact, Soros says that the full impact of the the collapse has not even been felt yet!

Invest into Hard Assets

Hard assets (anything tangible that can be used for the next 10 years) is an investment one could make that will have a reliable return on investment.  Hard assets, such as long term food, food devices (grain mills, cast iron pots), silver or gold, farming equipment, tools, necessary clothing, are items that can be put to use over the next 1-10 years that will ensure one’s well being.

Store Basic Necessities – Due to the possibility of a food shortage, as well as an increase in food prices due to an inflationary period from a major recession, the price of food will go up at least 20% or more.  Buying foods before this crisis hits will help sustain a family longer than foods bought later on during the inflationary period. Depending on what is purchased, lasting foods such as seeds, dry goods, dehydrated foods and dry beans and rice can be stored for years.  Additionally, begin storing water.  Water may be hard to come by in future.  Investing in a good water filter and ways to collect water would also be advantageous.  This will give a person the best bang for the buck. 

Invest in Precious Metals- If a person cannot invest in expensive precious metals, try and find junk silver.  Junk coins are typically quarters that were minted before 1965 and include Morgan and Peace dollars; Liberty Head “Barber,” Walking Liberty, Franklin and Kennedy half dollars; Liberty Head “Barber,” Standing Liberty and Washington quarters; Liberty Head “Barber,” Winged Liberty Head “Mercury” and Roosevelt dimes; and Jefferson “Wartime” nickles.  These coins are 90% pure silver!  The best way to find these coins is to go to banks and ask for rolls of coins that were given to the bank by private persons.  Do not accept the rolls of quarters that were given to the banks by bank security trucks.  Typically, bank security companies sift through looking for these specialty coins already, so the likelihood of finding any junk silver is next to nothing.  So, make sure it is from a private citizen.

Canada and the United Kingdom also has junk silver.  For a list of junk silver in these countries, click here.

Kevin, from the Neo Survivalist, states that, “ to protect your wealth, consider investing in precious metals.  Sure gold and silver will have volatile movements, but take a long term perspective with precious metals.  Also, consider it a way to store wealth versus getting rich.”

Large Investments for Your Future Livelihood

Assuming that major debts for a family are paid, any large investment should be made into things that can assist a family for long term self sustainability such as investing in farmland, tools, farm equipment or precious metals, even quality camping equipment can be a large (but necessary) investment.  During a depression, many find they can no longer live in the city.  There will be too many hungry and too many unemployed.  The only option will be to move out of the city in order to find a way to make money in order to care of their family.  Farmland used for long term survival, is a necessary long term investment.  Additionally, investing in non-gmo or heirloom variety seeds will give a major return on the original investment.  Many believe that seeds will hold more bartering power than precious metals in a long term disaster.

Investing each month into hard assets is an investment in securing one’s future.  The market is on it’s last breath.  The up and down swings will continue until eventually they will cease and the market will free fall with it’s dying breath.  No one knows for sure what the overall damage is going to be, but many are preparing for utter collapse and the destruction of the easy way of life.  It is time to invest in your future.  Doing it now, while prices are still relatively low is better than doing it when the prices increase.

There has been a sense in the gold market through the month of February that gold is going down, a sense of negativity and discouragement. Gold bugs are giving up and pulling out. The U.S. dollar index hit 81 on Friday. The Fed is tightening. “What more,” say the bears, “is there to say?”

Is this true? Is gold going down? Let us look at the chart.

Let us see. Gold has gone from a low of $254 (in 1999) and is currently at $1,123. This does not fit my definition of down. Of course, I am being facetious here. Gold bears are talking about the decline that began on Dec. 3, 2009.

I was not unaware of this decline. Indeed, on Dec. 2, 2009 I sent out a special bulletin in which I wrote, “I am giving a sell signal for all three of our gold stocks….Sell all shares and stand aside from the precious metals for a while.”

That while is now over, and my point is that the vast majority of speculators, in gold or any other good, are much too close to the market. They follow news items day-to-day. They get excited by little up and down moves. They rarely look at a long term chart.

Indeed, I challenge you. Go through the commodity web sites and try to find a chart of gold which goes back to the 1970s. Here we are in the second upswing of the commodity pendulum. Doesn’t it make sense to go back and look at what happened during the first upswing of the commodity pendulum? Wouldn’t it be likely that there would be parallels? Being an old timer I saved my charts from that period, but I feel bad for younger students who are brought up in a society which pressures them to only pay attention to the short term.

What did the chartists of the early 20 th century, the ones who were my teachers, say about this issue? Very simply, they said:

• “The trend is your friend.”
• “The big money is made in the big move.”

These chartists knew that the vast majority of traders are caught up in the present. They lose sight of the big picture, and their behavior becomes so irrational that it can hardly be believed. For example, take the events of August 15, 1971. Richard Nixon abolished the last link that the U.S. had to the gold standard. He also imposed price and wage controls. This paved the way for the Fed of the day to go wild printing money, and they continue to go wild today.

What was the long term reaction to this event? We know that over the decade the price of gold, then only a small amount above its $35/oz. low, rose to $875. What was the short term reaction? Gold sold off. After all, hadn’t the President said that he was going to take action against “inflation” by forbidding prices from rising? Since “inflation” was now as good as defeated, what need for gold? Such was the short term reasoning of the day. (Actually, the price controls of 1971 were such a blatant failure that they have discredited such a policy to the present day.)

But actually, it was precisely the fact that people thought that “inflation” had been defeated which led them to support the Government and the administration in power and which allowed the Fed to ease in 1971-72. This printing of money led to an 8.7% increase in prices in 1973 and a 12.3% increase in prices in 1974. This increase in prices was not totally caused by the money printed in 1971-72. Part of it was due to the rise in commodity prices, which was the result of the money printed during the 1960s. That is the tricky part of the commodity pendulum. It occurs over such a long period of time that the vast majority of the people cannot connect cause and effect. And, of course, we face the exact same situation today. There was massive printing of money over the ‘80s and ‘90s (16.9% in 1986, 14.3% in 1992). It did not have its price rising effect at the time. Essentially the losses (which corresponded to the gains of the paper aristocracy) were taken by commodity producers, and many of them had gone under by the late 1990s. (Real commodity prices fell by 2/3 from 1980 to 1999.). Now those commodity producers are no longer around. In this sense, there is a fundamental shortage of commodities. Thus commodity prices go up at the drop of a hat. This passes through into producer prices and then into consumer prices. For this reason, I was alarmed by the 1.4% increase in producer prices for January 2010. Over the past 6 months, the Producer Price Index has expanded at an annual rate of 9.8%. The establishment was too dumb to become alarmed. But a serious increase in consumer prices is around the next corner.

On top of the increase in consumer prices caused by the money created by Volcker and Greenspan in the 1980s and ‘90s, there is a massive increase in money due to Bernanke. The Fed started to lie about the nation’s money supply in 2008, reclassifying certain demand deposits as time deposits. That is, the owners of these deposits are being told that they have demand deposits (which can be withdrawn at any time and are counted in the money supply), and the Fed is telling the public that these are time deposits (which have limits on their withdrawal and are not counted in the money supply). It was my estimate that the money supply for 2008 rose by 70%.

This new money was created by the Fed mostly in the autumn of ’08. At that time, the “deflationist” school argued that this was being offset by a contraction in the portion of the money supply issued by the private banks. There was a partial truth here. Such contractions in the private bank portion of the money supply are common and occur in the latter part of each “recession.” However, the expansion by the Fed always overwhelms this small contraction, and we can have little doubt that it will do the same on this occasion.

So here we face two giant forces causing higher prices:

• the (second) upswing in the commodity pendulum, itself caused by the money created in the ‘80s and ‘90s;
• the massive amount of money created by Helicopter Ben Bernanke in 2008-09 and still continuing. (The Feb. 19 issue of the One-handed Economist contains an explanation why the Fed’s increase in the discount rate late Thursday should not actually be considered a tightening.)

As these two forces hit our economy, prices are going to skyrocket, and the “deflation” thesis will be decisively refuted (much as the price control thesis of 1971 was refuted in 1973-74).

At the same time that these fundamental forces are unfolding, we have one technical principle after another calling for a massive rise in gold. As I noted back in October, 2009, the $1,000 level, which resisted any price increases for a year-and-a-half, has now turned into a support level. Furthermore, it looks very much as though the pull back which started Dec. 3 did not make it all the way back to $1,000 but ended Feb. 5 at the $1,050 area. This leaves a gap of approximately $50 between the expected pull back and the actual point.

Such gaps are unusual. Most pull backs go right to their expected level. To create such a gap, the long term bullish force must be very powerful. It means that the bulls do not need any help from the support at $1,000. Such technical patterns are rare and are a chartist’s dream. (The fact that gold fought off two back to back bearish news items on Thursday and Friday, closing unchanged, shows the same kind of power.)

In short, the markets take a long time to discount important, grand cycle events. The trillion dollar deficits and massive increase in the money supply are coming on top of the phenomenon of the commodity pendulum. Everything is coming together.

At the same time, the media have turned most of the people in the country into a bearish mood. They have been brainwashed to think that everything is going down. This means that the very bullish situation in gold is not recognized and has not been discounted in advance. It is a rare opportunity and corresponds to the stock market in 1983. (People were still bearish because of the propaganda of 1982, but in reality the stock market was higher and in fact had turned up into the great grand cycle bull market of 1982-2007.)

There is one quality which marks a gold bug. All of the people with fancy titles are against him. So it was in the 1970s. All of the respected newspapers and magazines, all of the professors of economics, all of the high muck-a-mucks, laughed at the idea that gold could go up. All of these people were wrong.

We find this in many areas of society. The people who can do, who get it right, have no titles. The Wright Brothers, for example, never graduated high school. But they invented the airplane. The reason for this is that everyone who pursues knowledge comes to a point where he has to make a decision. Should he get knowledge, or should he get an impressive title which convinces people that he has knowledge. That used to be widely understood in our society.

Today, sad to say, the majority of the people are impressed with titles. They are the world’s losers. After all, by 1979 it was clear that the gold bugs had been right. What can be said about the younger economists of today, the ones who got their education after 1979? We know what these people did. They chose to study under the idiots in the establishment, the people who predicted, back circa 1970, that gold would go down to $6 or $8 per ounce. They valued the impressive title more than the truth. And so, now they have very impressive titles but no truth.

These people are all around in our society. From whom will you learn your economics, from a course at Harvard or from the gold bugs of the 1970s, from the New York Times or from the One-handed Economist? This is your life. You have to choose. If you make the right choice, you win. If you make the wrong choice, you lose.

To help you make the right choice, I publish a fortnightly economic letter called the One-handed Economist ($300/year). It features my theory of the commodity pendulum, Austrian theory economics and technical analysis. In 2002, I turned bullish on gold and gold stocks for the grand cycle, and I am in them for the big move.

To subscribe to the One-handed Economist, you may send $295 ($5 cash discount for using regular mail) to: The One-handed Economist, 614 Nashua St. #122, Milford, N.H. 03055. Or you may visit my web site, www.thegoldspeculator.com and send $300 via Paypal. Right now I am convinced that gold is ready for a big move, and I invite you to ride this move with me. Thank you for your interest.

The trend going forward during this economic depression is getting back to basics. We often discuss ‘prepping’ as a way to protect your family in the event of an unforeseen catastrophe (natural or man-made). Recently, we’ve seen more financial analysts and advisers recommend shifting from traditional investments like stocks, bonds, CD’s and money market accounts, to tangible assets that will gain value regardless of what stock and bond markets do.

Of course, we’re not saying you should go out and spend your entire 401k retirement account on 5 gallon buckets of rice, but diversifying into hard assets on a variety of levels could be a great investment. As the US Dollar continues its decline over the coming years, the price of essential consumer goods is likely to rise. Certain goods, however, like real estate, cars and anything that is driven primarily by credit expansion may experience a deflationary impact in real dollar terms, while others, like food and energy may see explosive price increases.

Paul Mladjenovic of SuperMoneyLinks.com discusses 3 Things Everyone Needs to Do with Money in 2010:

“OUR GOVERNMENT CAN NOT SPEND OUR COUNTRY INTO TRLLIONS OF DOLLARS OF DEBT WITHOUT CONSEQUENCE.

I am working on my next set of forecasts and seminars but before they are out, I want everyone (and I mean EVERYONE) to consider 3 simple things to gain greater financial peace of mind:

-Diversify away from paper assets.

-Accumulate essentials.

-Re-focus your portfolio with emphasis on “human need”.

[Read the full, expanded article]

In Buy Commodities at Today’s Lower Prices, Consume at Tomorrow’s Higher Prices we offered some ideas about how to be a ‘prepper’ and ‘investor’ simultaneously.

“If you are a prepper, for example, who is already stocking essentials foods and goods, you’re way ahead of the game. As commodity prices continue to rise for a variety of reasons, your “investment” is paying off in real terms. Buy 10 pounds of rice today for $10, and when that same bag of rice goes to $20 a year or two from now, you can say you earned a 100% return on your investment! And the great thing about your investment, is you don’t have any counter party risk, for the most part, meaning that you own the physical good and it is in your possession — you take delivery at any time!”

For those interested in investing some of their wealth into real, tangible assets, consider the following as food for thought:

• Precious metals
  Though gold and silver are no longer considered money by most “mainstream” economists, the fact is that central banks in China, India and Russia have been continuing to stockpile precious metals over the last decade, and they will likely continue to do so going forward. Why? Because as all or most of the paper currencies around the globe are debased, gold and silver will become the de facto monetary unit against which other currencies are valued. As Dr. Marc Faber has said on several occasions, “Own gold and become your own central bank.” Many contrarian financial advisers who lean towards the Austrian school of economics recommend allocating 10% to 20% of your current investment/retirement portfolio to gold. If you are banking on having that money when you retire, consider speaking within your financial adviser about purchasing precious metals in the form of mining companies or ETFs. If possible, a portion of your holdings should be in physical bullion like bars and coins, which will provide added security as you will have no counter party risk because you have it in your possession.
• Food
  As the US Dollar loses value and other countries become hesitant about fund our trillion dollar debts, the cost of food will continue to rise. Combine the dollar’s monetary issues with the fact the many farmers around the world are unable to gain access to loans to continue or expand operations, and you have the potential for prices increases no just because of dollar debasement, but supply problems. The other threat for food is that we may very well experience a perfect storm event, such as that experienced in the dust bowl of the 1930′s, meaning that heavy rains, or heat or cold may affect agricultural output, further straining supplies and pushing prices higher. Foods like rice, legumes, pastas, wheat, oats, and canned goods could be purchased today and stored, in some cases, for up to five years or longer. Consider the price increases that can happen in these food stuffs over the next five years and this investment may see significant gains. And again, you eliminate counter-party risk because you are holding the tangible assets yourself. (The following video shows how The Survival Mom has dedicated a room in her home for just this purpose)
• Sustainable Living
  Well known trend forecaster Gerald Celente has suggested that one of the mega-trends of this decade will be living on less and becoming more self sustaining. Individuality will return to America, and a push to distance oneself from the “grid” will take off for a variety of reasons. Rising food and energy costs are likely to be two of the major catalysts for this trend. How can you invest for yourself? First, consider investing your time and money into skills development like gardening, farming, sewing, woodworking, or hunting, as these skills can certainly be an investment that will pay off in the future. While it may not be feasible for most to become farmers in terms of commercial enterprise, it can be accomplished on a personal level by those who have a bit of desire and choose to expand their skills base. Urban gardens are already popping up all over America as the micro-farming trend continues to gain acceptance. Even in the suburbs, on a fifth of an acre of land, those with the ability to think outside the office cube can grow enough food to support their entire family for a year.

  For those concerned with rising energy costs, your options are basically limited to investing in energy stocks and ETFs, or, investing in yourself and create your own supply of energy. Learning how to develop and implement a power grid in the comfort of your own home will not only give you the skills to earn a living in the future, but to provide nearly unlimited energy for your household through use of solar, wind and hydro power. Investments into alternative energies for your home may seem costly, but not if you consider the rising cost of your electric and gas bills over the next couple of decades. Sustainable living investments are not one-off investments, say, like storing a bucket of beans, but rather, pay dividends forever.

• Clothing/Footwear
  Though not often considered as investments, extra clothing, especially things like socks, underwear, house shirts, shoes, sweat shirts and sweat pants, will likely move up in price as well. While adults may be able to stretch their close for several years without replenishing their closets, children are a whole different story. If you’ve got kids, this is one investment that can really pay off. Purchasing graduating sizes of clothing for your kids with a time horizon of 3 – 5 years can really save you money down the road. It is true that in America today, these items are readily available and imagining a scenario where these items will not be on store shelves is hard to do. But consider the East Block circa 1985, and you’ll have a different perspective. Because of isolationist policies, closed currency and price controls, these items were very difficult to come by. If the US experiences a currency crisis, it will have an immediate and significant impact on the USA’s ability to acquire goods from manufacturers around the world, as the price for goods will be difficult to determine because of the potential for massive currency fluctuations. If not for yourself, consider stocking some reserve clothing for your kids.
• Hard Assets in General
  Recently, President Chavez of Venezuela devalued the Bolivar, Venezuela’s currency, and within a few hours residents of the country flocked to stores to spend any physical cash they had on hand or in their bank accounts. When a currency is devalued, either over night or over a period of months and years, the purchasing power is destroyed. What you could buy today for $50 will cost $100 later. We’re not suggesting you spend all of the cash you have, but take into consideration some of the things you regularly spend money on daily, monthly or yearly. Can you purchase those items now and save them for later use? If so, wouldn’t you rather pay 10% or 20% or even 40% less now than three years from now?

It is important to be prudent with where one might invest their money, as it is impossible to say for certain that an inflationary environment is in our future, and which goods will be affected by increased prices. But all signs point to an eventual devaluation, officially or unofficially, of the US dollar. While the aforementioned “investments” are not traditionally accepted and your financial adviser might think you’ve gone off the deep end, they are worth considering and provide you with another option for protecting your wealth.

This article has been contributed by Mac Slavo of SHTF Plan.

Financial adviser Howard Ruff discusses wealth preservation during hard times in an interview with The Gold Report. Ruff, like Marc Faber, Jim Rogers and Howard Katz, has staked his reputation on the economic crisis eventually leading to inflation of the US Dollar. The money being printed for bailouts, stimulus and government programs will eventually be reflected on main street, and when this happens, your dollar will simply not buy as many goods as it did before. For a recent example, take a look at what happened in Venezuela when they devalued their currency by 50% – people flocked to stores almost immediately to convert their paper currency into physical, tangible goods like electronics and food. Here are some recommendations from Howard Ruff about Reprising (and Preparing for) Rough Times.

On what the average American can and should be doing:

“Whether they buy gold or silver or oil or oil service companies, I think one of the most important things the average American household can do with its money is prepare for the day when inflation will be generalized. If the store sells any commodity that you buy on a regular basis, and you find it on sale, buy a case and store it. Stock up on commodities that you use and get a storage unit or make sure you have a storage room for important commodities.

I’d like to have about six months worth of whatever I need, and I am not just talking about food. I’m talking about diapers or soap or whatever, and do everything you can to be self-sufficient. I think one day one of my prized possessions will be the garden in my backyard. That way you can buy at today’s relatively lower prices and consume at tomorrow’s higher prices. It’s not only a way to ensure you will have whatever commodity it is that you know you’re going to need, but it’s also a form of investment. So, that’s one of the first things to do.”

Self sufficiency is a phrase we have been hearing quite often in the last year. Trend forecaster Gerald Celente is an advocate of self sufficiency and the survival mentality. Marc Faber and Jim Rogers have suggested that buying farmland and learning to work that land will not only make you rich in the future, but help you to provide for yourself.

These economists, forecasters and financial advisors are not just blowing smoke and arbitrarely recommending you learn to be more self sufficient. They see a trend, globally, and that trend suggests an inflationary environment that will not only cause increased prices for essential goods, but the possibility that those essential goods you are used to acquiring with little effort today will be much more difficult to come by in the future.

In this interview, Mr. Ruff mentions an experience he had in Russia when it was still behind the Berlin Wall, and any time a store received any merchandise, the people rushed their to acquire any goods they could. Most of the time, people did not even know what goods the store had, but they went there anyway, hoping they could trade in their near worthless Rubles for something tangible they could trade later. Could this be our future as well in America?

A Different Way to Invest

Investing in the traditional sense involved purchasing stocks or bonds for your IRA or 401k.  While we don’t have anything against this type of investing, we’d suggest you look at some of the alternative investment strategies discussed by Mr. Ruff and others.

If you are a prepper, for example, who is already stocking essentials foods and goods, you’re way ahead of the game. As commodity prices continue to rise for a variety of reasons, your “investment” is paying off in real terms. Buy 10 pounds of rice today for $10, and when that same bag of rice goes to $20 a year or two from now, you can say you earned a 100% return on your investment! And the great thing about your investment, is you don’t have any counter party risk, for the most part, meaning that you own the physical good and it is in your possession — you take delivery at any time!

We’re not saying that you should go out and sell all the stocks in your 401k, pay the withdrawal penalties, and then spend that money on rice, pinto beans, corn and wheat, but diversifying a little bit might be in order.

As an investor, what would you trust more: Holding Citibank stock while the CEO is telling you that his bank is well capitalized, or the 50 pound bucket of rice sitting in your pantry?

Howard Ruff on Gold and Silver:

TGR: You recommend buying gold bullion and coins. How about silver?

HR: I like silver a lot better than gold. I think you will make two or three times more money in silver than gold.

TGR: Is that because of the price today or is it a general phenomenon?

HR: It’s general. The first time I recommended gold and silver was back in the ’70s, and we made twice or three times more money in silver than in gold. I want people to buy silver for several reasons. When people start trying to beat inflation by investing in precious metals, it’s a lot easier to buy silver because it’s a lot cheaper. The average investor can buy some of that rather than buying gold. Also, because gold is so much more expensive, it doesn’t have a lot of utility. It’s like buying $1,000 bills. So as a hedge against inflation, I think people are a lot better off in silver.

TGR: Do you follow the gold/silver ratio?

HR: I follow it as it’s an important measurement of relative money, but I am basing my decisions on history, and history tells me that silver will outperform gold. That may not be the case from day to day or over a particular short time period, but that’s where the money will be made over the long haul.

SHTF Plan strongly supports Mr. Ruff’s conclusions about investing in gold and silver. If you have a retirement account, CD’s or long-term US Treasuries, perhaps it’s time you consider diversifying some of your assets into gold, silver and other precious metals. Depending on your current wealth and portfolio, Mr. Ruff recommends bullion, numismatic coins, and precious metals producers in the form of stocks.

Our view is that gold and silver are not necessarily a hedge against inflation, as evidenced by rising inflation in the US Dollar in the late 80’s and throughout the 90’s, all the while gold stagnated. Gold, silver and other precious metals generally rise in value as a result of the private sector losing confidence in the public sector’s (government’s) ability to mitigate a crisis, enforce the rule of law (as in property rights), and to maintain general economic and political stability. Inflationary expansion of money supply is basically an effect, a symptom, of the disease of government mismangement and malfeasance.

It seems to us, that this exactly why the price of gold and silver are rising right now and will continue to do so in the future, along with most other commodities, especially essential and scarce goods.

For more details and thoughts from Howard Ruff, Read the Full Interview…

Tom Dyson discusses The Four Best Places to Keep Your Gold. For those who prefer owning the physical metal as opposed to gold ETF’s and other gold derivative products, this is an informative piece.

1. Bank Safety Deposit Box

A bank safety deposit box was the first solution Michael mentioned. It is the easiest. Boxes cost as little as $50 a year. If you’re already a customer of the bank, they may even offer it to you for free.

But I have a problem with banks. What if they go bankrupt? You don’t want to get stuck banging on a locked door when you need your coins in a hurry. Second, Michael says the Feds can force banks to divulge information about your security box. They can force the bank to tell them whether or not you own a box. Then the Feds can issue a subpoena and force the bank to open it.

2. Individual Retirement Account (IRA)

For those individuals who already have an IRA and want to diversify their holdings into precious metals, this solution may work well.

To qualify for inclusion in an IRA, the gold must by pure, 24-karat gold. The Feds make one exception to this rule: They allow you to put the U.S. Eagle, a 22-karat gold coin, in your IRA.

I see a couple of big problems with buying gold in your IRA. First, you can’t put coins you already own into an IRA. You have to make a fresh purchase. Secondly, you don’t have access to the coins. A qualified custodian must keep them on your behalf.

3. Private Security Vault

Private security vaults in this context are different from banks. The companies that operate private security vaults are generally not chartered as banks, but operate as independent businesses.

Another option is to send your gold overseas to a private security vault. I like this idea. You keep your gold where it’s out of reach of the U.S. government. These private vaults don’t qualify as financial institutions, so you don’t have to report them as foreign accounts when you file your taxes. Michael recommends Safes Fidelity in Geneva and Das Safe in Vienna. These are the two safest, most confidential vault businesses in the world. You can send them your gold through the mail. Just make sure you use registered insured mail. Or you can take it there yourself.

This is an excellent solution for those with the means to travel to and from the vault. But in a real SHTF where there is a complete breakdown in society, it will be difficult, if not impossible to leave the USA, go to another country, and then bring your gold back to the US safely. US. Gloom Boom & Doom publisher Marc Faber recommends that American citizens hold their gold outside of the USA because of the potential for a repeat of FDR’s 1933 gold confiscation. With an opposing view, Mr. Howard Katz, as outlined in his article Confiscation of Gold believes that the current situation will not lead to confiscation as it did in the 30′s.

4. Hide Your Gold at Home

But of all the places Michael suggested, hiding gold on your property was my favorite solution. You have instant 24-hour access to your gold, and you don’t pay any storage charges. The key is, it has to be safe.

One option is to install a safe or a gun locker in a discreet part of your house. Make sure you secure the safe to the floor so a thief can’t carry it out of your house. Or you can bury the gold in your backyard or a friend’s backyard. You can buy waterproof coin tubes online or go to Home Depot and buy a PVC tube and caps to seal the ends.

OPSEC, or operational security, would be critical if this is the method chosen. If it is TEOTWAWKI, having your precious metals on hand for immediate use could be a life saver. Home access to your PM’s will allow you to dig them up quickly, put them in your BOB (Bug Out Bag) and move them quickly to your BOL (Bug Out Location).

So, before you actually buy gold or silver, take how you will secure it into consideration.

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Gold Has Yet To Soar

Gold’s rally to a record means prices are still 53 percent below the 1980 inflation-adjusted peak.

While gold rose 19 percent this year to $1,072 an ounce on October 14, consumer prices almost tripled in the past three decades, eroding the metal’s value. Bullion hasn’t kept pace with the cost of bread, fuel or medical care. In 1980, gold hit a then-record $873 an ounce. In today’s dollars, that would be $2,287, according to the US Department of Labor’s inflation calculator.

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“Gold is not at any peak,” said Martin Murenbeeld, the chief economist at Toronto-based DundeeWealth Inc., which manages $58.5 billion in mutual funds and brokerage accounts.

“The world’s money supply has increased and gold hasn’t kept pace,” he said. “We’re now in a period where gold is catching up.”

Most mainstream economists suggest that the reason for the rise in the price of gold, especially in the last couple of years, can be attributed to fears of inflation as the US government spends and prints trillions of dollars. While inflation may be an effect of excessive money printing, investors should take notice that gold doesn’t necessarily rise during periods of inflation, with proof being the lows reached during the 1990′s, when inflation was rising and gold remained in the $300 range for the better part of the decade. During the great depression of the 1930′s, gold stocks rose exponentially while the US was in a period of rampant deflation and prices of other goods collapsed.

So what does drive the price of gold up and down? Contrarian economists often argue that inflation and deflation are simply an effect of deeper rooted problems, often arising from monetary, fiscal and political policies of the government. When investors begin to lose confidence in their governments, the price of gold benefits. As an example, the price of gold is not rising in just the United States, it is rising all over the globe, in every currency. This suggests that gold is responding not necessarily to inflationary pressures, but rather, to a continued deterioration in the confidence of governments around the world to mitigate the global economic crisis.

For those wishing to preserve wealth, this consideration should be made when looking at investments that protect the buying power of the US Dollar. If the Great Depression and the early 1980′s are a guide for where capital concentrates during economic collapse, then gold will be an excellent investment / wealth preservation tool.

Submitted by Mac Slavo

For more wealth preservation ideas, analysis and news, please visit SHTFplan.com

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