Feel like the S is HTF in slow motion... - Page 3 - Mothering Forums

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#61 of 85 Old 09-27-2008, 09:27 PM
 
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So what can I do? DH has a good job. I have a good part-time job. We have some money saved, but it's mostly in stocks (I figured because we're young, it was okay to put it in higher risk funds, and that we would move to more conservative funds right before our kids go to college or before retirement, etc). We haven't stockpiled, but we have a generally full pantry. Our cars are paid off. We have a mortgage, but that's it. Do we just wait and see? Or is there something useful we can do?
There is lots you can do! Action helps me feel better.

*save up a small emergency fund ($500-1k in cash). Keep it liquid, in a fire-proof home safe or in a safe bank. Check out www.bankrate.com for your bank's current rating.

* invest in reusable everything. Cloth dishtowels, napkins, rags, leftover food storage, etc. Yard sales and thrift stores are great sources for these things right now, but might not be in the future. As energy prices go up, the cost to make and transport disposable goods is going up.

* invest in energy efficiency - winterize the house, caulk is your friend, make window quilts, string a clothesline, install LED or CFLs, etc. If you can, when something breaks, replace it with the most durable, high-quality, energy efficient version possible. Energy prices over the medium and long term are only going up.

* stockpile food/toiletries/meds etc. Since food prices are going up much faster than wages, savings account interest rates or inflation this is the ultimate in buying low and "selling" (i.e. eating) high. When something is on sale, buy two. Or, in my case 20. Do you want to see my stash of free oatmeal?

* delay all non-essential purchases.

* learn how to do practical, useful stuff. Garden, can, sew, wire and plumb.

* save up 3-6 months worths of expenses. Keep it liquid to semi-liquid in cash or other FDIC-insured account: high interest savings account, CDs, money market account (which is different than money market funds that are in trouble now).

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#62 of 85 Old 09-27-2008, 10:58 PM
 
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I'm incentivized to pay off my CC debt because for me, this mess is local. I know about 30 people who worked/work at Lehman Bro's, Merrill, and AIG. I expect about 100 homes to go on the market in my area in the next six months due to people losing their jobs at those three companies, thus further driving down the value of my own home.

My husand works for a large CC company that has been forecasting laying off 15,000 people by the end of the year. If he is one of them, and we are down to one income, I don't want to be sending ANY of my income to off to my credit cards each month. I want my money available to cover necessities.
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#63 of 85 Old 09-27-2008, 11:52 PM
 
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I would like to stockpile because I'm worried about inflation, but we have a small house. I am not a disaster fetishist.

On the other hand, I can walk to anything I need, and we can both take a very short bus ride to our work, so we can lower our gas costs to nearly nothing if we need it. I think in some ways you trade off when you're urban. Small house and walkability (so very low gas costs) versus big house with room to stockpile and garden but much higher gas costs.

We're not pulling everything out of the market. We're young enough to ride out 10 or even 20 years of market losses. But we did move some of our investments to more liquid form over the past year, because we did not want to ever be in a situation where we'd have to sell if we needed more liquid assets.

Historically, people who have ridden out stock market crashes have done fairly well, because when recoveries come, they tend to come relatively quickly, so it can be easy to miss the gains.
This is me too. Plus I can't afford a chest freezer right now .
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#64 of 85 Old 09-29-2008, 02:13 AM
 
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reasons to go debt-free?

debtors prisons........if the s really htf a real possibility. (thanks paranoid bloggers out there)

although after reading paranoid blog entries all day i'm really worried about my student loan debt
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#65 of 85 Old 09-29-2008, 10:48 AM
 
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Yikes, I turned on the news today to hear that Wachovia is the next to fall and is in the process of being taken over by another bank (citi I think?). It seems like a new bank is failing every 3 days or so. I'm hoping that when the bailout is passed there is a bit of a boost in our economy but I really don't have high hopes.

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#66 of 85 Old 09-29-2008, 10:55 AM
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I've felt that this was coming for a long time. Watching everything, didn't make sense that it could go on forever.

not of the LE camp; am of the no debt camp. Including mortgage if you can pay it off. For this exact scenario...
when the SHTF, with no debt, you only need to cover your basics... food and utilities and taxes. And esp b/c most homes cost at least several hundred K, there is no regret about the market dipping/tanking.

the vast bulk of our investments has not been in the market. I felt very old fogie-ish, but to me the market didn't make sense.

Our tax sheltered retirement accounts are reasonably allocated according to our age, have declined like others. Long term over 30 y, probably won't matter. But still... if i would have listened to my brother and guts, instead of all the other voices OL, and moved it over to treasuries last fall, we would be ahead even farther.

the big picture is where you stand against the stock market and your peer group.

this is my first experience with a market like this. the big lesson: (FOR ME) to enjoy life a little more. ... shoulda, coulda. Yes, in 30 y it won't matter, but still.
Also, with cash or liquid holdings, where do you put it? dollars? euro? other currency?
And inflation?

? slight recovery when this bailout bill passes (after more stink and dance)...until elections .... I think that's when we'll convert retirement account to completely conservative hold. guess is things will get alot worse next year.
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#67 of 85 Old 09-29-2008, 09:45 PM
 
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That only works with traditional inflation where you income goes up, as well. Under stagflation, which we're very likely seeing, you'll have inflationary prices but incomes will not go up, or not go up significantly. Increased unemployment is a very real possibility, as well. And you're not taking into account interest on what you owe, which obviously increases what you have to pay back.
There is some truth to that. On the other hand, there are also market fundamentals at work -- at some point, either prices have to go down or incomes have to go up, otherwise there are no buyers, which creates another downward spiral. The 1970's period of stagflation worked (for some twisted value of worked) because people were using credit to pay the bills. That won't be an option this time due to the tightening of credit markets, so I think stagflation will be minimal.

(I can't believe I just made an argument that amounts to "The market will sort it out". They're going to take my credentials as a liberal away any moment now...)

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CC companies can sue you in court, too.
Yep. But I believe the term of art for a person in that situation is "judgment proof". Yes, the court can issue a judgment against you, but there is a limited amount they can do to collect a judgment against people with limited income and low assets. Which, apparently, we're all about to become.

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reasons to go debt-free?

debtors prisons........if the s really htf a real possibility. (thanks paranoid bloggers out there)

although after reading paranoid blog entries all day i'm really worried about my student loan debt
I don't get this... what possible reason would there be for people to reinstitute debtor's prisons?
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#68 of 85 Old 09-29-2008, 10:22 PM
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(I can't believe I just made an argument that amounts to "The market will sort it out". They're going to take my credentials as a liberal away any moment now...)










The factor I think you're forgetting is peak oil, which plays into supply and demand. Yes, stagflation (I actually hate that term) would work itself out if peak oil weren't messing with our ability to increase the supply of goods. Coupled with increased demand from India and China, prices will stay high and wages will not follow.

Unless, the monetary system as we know it is completely wiped out and we all go to bartering/looting/whatever.

I've got to stop thinking about this! MUST GET SOME SLEEP!!

"Our task is not to see the future, but to enable it."
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#69 of 85 Old 11-18-2008, 10:19 PM
 
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I know this thread is a little old, but are pp still feeling like the SHTF? No other major banks have failed, although Citi is looking mighty shaky and GM is in the pits.

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#70 of 85 Old 11-18-2008, 10:38 PM
 
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Yes, I'm still feeling like SHTF, still in slow motion. I don't see any easy ways out of the mess(es) with the economy, and I sincerely believe a recession may cover a good part of the next several years. JMHO, but I do think that it won't come overnight, and it won't disappear overnight. At this point, I am taking advantage of the calm before the eye of the storm. Now that food prices have come down a little bit, my pantry has never looked more stocked!!
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#71 of 85 Old 11-18-2008, 11:06 PM
 
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I'm right there with ya!

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#72 of 85 Old 11-18-2008, 11:17 PM
 
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I absolutely still feel like the shit is hitting the fan. So, apparently, does the treasury secretary, so at least I've got good company. It was pretty lonely when it was just me and Nouriel Roubini.

(Yeah, that's a little econ-geek humor for ya'll. Nouriel Roubini is the guy they call "Dr. Doom" for his outlook on the financial crisis. The thing is, what he says kinda makes a lot of sense.)
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#73 of 85 Old 11-18-2008, 11:40 PM
 
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I think the other shoe hasn't dropped yet. Right now people are somewhat calmed due to the bailout. The thing is, throwing money at such a huge problem doesn't make it go away. It's like taking over the counter (aka Nyquil) cold medicine when you are sick. You can keep going longer in your normal activities, but it doesn't make the cold go away. In the end, you will be forced to crash & recuperate IF you don't fix the problem.

Also, the job market is INCREDIBLY tight. People who are hiring are holding back, wondering if it's a good idea. The average American has hit the proverbial wall--tight credit makes it impossible to 'borrow' to keep going. All the major stores are reporting much lower crowds than they expect. This all is an indication that the average American doesn't have much extra income, even in the form of borrowing, to keep 'consuming' and keep the economy afloat. And there are major layoffs being announced left & right.

The difference between now & September is that in September, everything was crashing. Right now it's a slow slide down. It's slow enough that people are getting used to it and going with the flow. It's much easier to cut back in steps than it is to suddenly go cold turkey.

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#74 of 85 Old 11-19-2008, 12:29 AM
 
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Yes, I haven't seen any signs that this is lessening. I still believe this is going to be a severe recession/depression.
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#75 of 85 Old 11-19-2008, 06:02 AM
 
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yep, still think so. Still think the bailout was a HUGE mistake, hoping the same isn't done for the auto industry.

Go Green I don't vax either, why mess with perfect?
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#76 of 85 Old 11-19-2008, 06:32 AM - Thread Starter
 
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I do still think we are sliding into a long, deep recession, if not depression. Some of what scares me is what is *not* said about what is going on. The government doesn't start throwing 750 billion dollars at something if they are not afraid. They've never panicked over a recession before, even the deep and short recession of the early 80's. I remember that things were tight, but nobody was really *scared* and there were no bailouts then. They now say that recession was the worst since the Great Depression. This recession, they predict, will be even worse. So, it will be more like the Great Depression than any economic downturn most of us remember even if it does not become a full-blown "Depression". I was a teen during the recession of the 80's, so I remember it pretty well and things were really, really tight. If we have a deeper and longer recession than that, there will be some very hard times for a lot of people.

And it's not going to happen over night. And it won't happen to everyone.
Batten down the hatches.
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#77 of 85 Old 11-19-2008, 03:30 PM
 
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if you want to hear/see doomer, check out Peter Schiff at http://www.europac.net/dominterquotes.asp - both the videos and the weekly radio archive (or listen live every Wednesday) are good. you can also check out a compilation of his "predictions" from 2006 and 2007 on youtube at http://www.youtube.com/watch?v=2I0QN-FYkpw. it's called "Peter Schiff Was Right 2006 - 2007 (2nd Edition)" in case the link doesn't work.
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#78 of 85 Old 11-20-2008, 01:05 AM
 
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still feeling it. especially w/ this auto industry deal.........
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#79 of 85 Old 11-20-2008, 08:35 PM
 
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I am trying to be optimistic about this. I feel that America is due for a big old change- we were in need of a good cleaning, anyway and some things could probably stand to be replaced.. I want to state now that the rest of this post is overgeneralizing America, the country in which I live, and I am not trying to say that all people live like this..

i link frugality and sustainability closely together. I think overall, America has been pretty greedy for a long time, and now like the op says, it's hitting the fan.. the problem with saying that we're in or due for a big recession/depression, is that Americans link poor with tightening belts and "not having"- this is when they'll consider cloth diapers and cloth napkins trying to save gas, reusing or buying second hand, etc. then they link good times with frivolous spending and wastefulness. We need something big to happen to help more Americans see that we live on a finite planet and we have to be more sustainable if we are going to have anything left for our children- no matter what's going on with the economy.

I think "change" is what scares most people. We have a lot of brilliant people on this planet who have a lot of history to draw from, and I'm certain that we have the resources to avoid catastrophic depression and starvation.. as long as people are willing to change.

I also have a strong suspicion that the poorer people in this country are going to fare better overall than the wealthy in whatever it is that we are approaching. I think they'll be okay with living frugally, and I don't think they tie as much of their self-worth into what they have as the wealthy do. I think wealthy people are going to have a big adjustment to make, and like I said, no one likes change..
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#80 of 85 Old 11-20-2008, 08:50 PM
 
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I still feel like TS is HTF. Even w/the great depression, it was like 3 years before it bottomed out. Today, the dow hit a new low (since 2001?)... I think it's gonna continue on down. I have really been impressed with what [www.chrismartenson.com] Chris Martenson [/url] has to say... and really... with the drops in global oil production, i'm thinking all TS is going to HTF at the same time and we're going to have a REAL mess.

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#81 of 85 Old 11-21-2008, 09:38 AM
 
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I absolutely believe that we are at the beginning of a long, slow slide. My gut sense is that we're headed into a Depression, and just when we feel like we're coming through (i.e., the housing bubble corrects itself, the credit bubble corrects itself, we start to breathe a sigh of relief...and...), the reality of Peak Oil will become more painfully evident and we'll find ourselves feeling like we're being held underwater again for a number of years while we experience the changes necessitated by that situation. Those two things together, either back-to-back or overlapping, are going to feel like a very long and challenging time.

I'm really, really hoping no one bails out the auto industry. My apologies to anyone whose family would be affected by that, but I truly think that an auto industry bailout will hold us back from critical industry changes that need to happen now.

I'm another Chris Martenson follower, FWIW. I highly recommend his Crash Course and the self-assessment that goes along with Chapter 20. (Both are free on his site).

I believe we cannot afford NOT to think about preparing for what likely lies ahead. For me this means reducing/eliminating debt, keeping a reasonable amount of cash out of the bank in case of a bank holiday, gold/silver (a tiny bit - not that I can afford much at all, and not that it's even very easy to come by these days), keeping the gas tank topped off in the short-term, keeping a full pantry, developing strategies for greater self-sufficiency, building and supporting community, realigning my expectations (and my family's), considering alternative sources of income in case our jobs fail, thinking about stocking up on durable goods before a) inflation rises and b) cheap imports become a thing of the past, and learning to take advantage of frugal resources of all kinds. We don't have investments to manage, not even 401K or any kind of retirement, which keeps it simple. Our plan was to sell our house and buy land and build (relatively) mortgage-free, but with the housing market correcting, our plan may have to change (no longer enough equity to extract for a down payment). There are so many things to think about. I'd rather prepare and find out later that it was unnecessary, than NOT PREPARE and find out later that I should have.

Anyway, I will stop there...

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#82 of 85 Old 11-21-2008, 05:14 PM
 
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I'm not an investor, no mortage, only student loan debt really, and regular monthly bills, but the economy is killing me because no one as the money to hire me

The dow just shot up 211 after Obama's treasurer pick but it'll just go back down...starting to mentally bet with myself (yes I'm nuts) how low it will go....6000? 5000?

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#83 of 85 Old 11-21-2008, 06:16 PM
 
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I'm of the mind that things are going to get a whole lot worse before they are going to get better.

No one seems to realize what a blow to the national economy it would be if the Big 3 automakers go under. It's not just the car industry, it's all the services and parts that support it. It will be a cascading effect that will decimate the economy and take hundreds of small and large businesses with it. Then the housing market will continue to plunge as more people foreclose after loosing their jobs. Things could get really ugly if Washington doesn't get off the bums and DO SOMETHING!
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#84 of 85 Old 11-21-2008, 06:19 PM
 
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I also have a strong suspicion that the poorer people in this country are going to fare better overall than the wealthy in whatever it is that we are approaching. I think they'll be okay with living frugally, and I don't think they tie as much of their self-worth into what they have as the wealthy do. I think wealthy people are going to have a big adjustment to make, and like I said, no one likes change..
I totally agree with you here. To be honest, I never saw the "good times" of the 1990s that supposedly the rest of the country enjoyed. I grew up poor in the late 1970s and 1980s and I'm still poor now. The advantage is, I know how to deal with being poor and living frugally and I never had enough money to risk loosing it in the market.
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#85 of 85 Old 11-21-2008, 06:21 PM
 
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yep, still think so. Still think the bailout was a HUGE mistake, hoping the same isn't done for the auto industry.
The mistake was giving the money to the banks (who hold it greedily and won't get it into the credit market) rather than using the money to buy up toxic mortgages.
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