Friday, December 6, 2013

Why Prepping For A January Collapse Is The Smart Move

James Smith
Activist Post

Imagine that it is late August, and the storm clouds have been hanging around for days.

The wind has been blowing, giving you the indication – this storm is going to be a Category 5 hurricane. Truly one for the record books.

Are you prepared?

And then the rain drops begin.

As most people in hurricane country will tell you, you prepare for bad weather months in advance. Weeks if you must, but you need to take action as soon as possible.

But bad weather is a disaster that is “in your face”. You can’t escape it.

However, the disaster that is looming of all of America is subtle one. And will have far-reaching consequences for those that don’t prepare. Renown technical analyst Tom DeMark has discovered that the market activity prior to the 1929 Stock Market crash is incredibly similar to the Stock Market of today.

His calculations suggest that the market will crash on or around 14 January 2014. And this is one storm you can’t fully prepare for, but you can take some action.

His calculations are not the only ones out there.

Stan Harley, a former Navy pilot and author of the Harley Market Letter, figures that January 10th will mark the top of the market, before it plunges into darkness.

Ed Carlson, the current living expert on the works of the late George Lindsay, has calculated the first half of January is the likely drop date.

For years, the signs have been there like rain drops hitting a tin roof. The Baltic Dry Index (BDI) has been abysmally low. Unemployment and inflation numbers have been massaged and reworked to tell the American taxpayers lie after lie. Stock prices have been grossly inflated without any form of justification, and companies have been buying their own stock in order to prop up share prices.

But the media and stock traders have provided only soft breezes of easy money and good times ahead.

All they’ve done is made this storm possibly the worst one in American history. On a tornado scale, this promises to be an 8 out of 5, an 11 out of a 10 scale.

Financially – it will be hell on earth.

There are only a few possibilities how this will play out.
  1. Nothing will happen
  2. A collapse greater than the 1929 collapse
  3. Somewhere in the middle
Assuming the worst, as is the best option for prepping for disaster – the threats that the American people face are daunting, but livable. After all, our grandparents and parents lived through it. But it was a kinder generation – one that had God taught in the schools and human decency was the rule, not the exception.

What is the worst-case scenario?
  1. Civil unrest and riots (remember when the SNAP cards went offline?)
  2. Martial Law to quell the riots
  3. FEMA camps for the homeless (don’t laugh – there is precedence).
    While it’s great to theorize the absolute worst, the worst is not necessarily possible, but it is plausible. After the 1987 crash, “circuit breakers” were placed on the Dow Jones trading activity to prevent another 1929/1987 crash. These breakers force all trading to be suspended along the following parameters:
    • A 10% drop before 2:00 pm EST would cause the market to stop for one hour. Between 2:00 to 2:30 pm and the trading would stop for 30 minutes. Between 2:30 and 4:00, no trading will stop.
    • A 20% drop before 1:00 pm EST and the market would be closed for 2 hours. If it happens between 1:00 to 2:00 pm, the trading stops for 1 hour. All trading would stop for the day if it happens after 2:00 pm
    • A 30% drop, which would put the DJIA at just above 11,000 from 15,800, would shut the market for the day, regardless of the time.
    As a general rule, anytime you see a boat taking on water – it’s generally a great idea to avoid getting on, or at best, make a bee line off the boat. And that’s what investors will do – abandon the ship to cut their losses and come back another day to invest.

    The problem that most people aren’t prepared for is a long and protracted collapse of the stock market. In the crashes before the breakers, the markets took a short and severe strike, severing prime values in a matter of hours. However, the breakers will provide many the opportunity to liquidate their portfolios and the crash may take days to complete, and not hours.

    In short, if it starts on a Monday, the Dow could hit about 2,500 in as little as 5 days. And that’s with all the brakes applied.

    A word of advice to the Prepping Community: When you hear that the circuit breakers have been applied for the day – get your money out of the bank, except for those bills you need to pay within the next day or so. Having cash on hand will help prevent being caught in a bank run or being out of cash on a bank holiday. You can always deposit the money if the market does a correction.

    Whatever you do, plan now so you are acting with common sense and purpose. Everyone else will be reacting like a cornered animal.

    And that’s what makes us Preppers.

    This article first appeared at Prepper Podcast Radio Network.

    James is a father of four and grandfather to four. He and his wife of almost 30 years have been prepping since 2003. They live in a small town, with neighbors as close as 10 feet away and have raised chickens for 2 years covertly on less than 1/5 of an acre. He is a former corrections officer, insurance fraud investigator, and he served in the Navy for 6 years. He currently works for a corporation dealing with the disabled population and their benefits. He is the host of The Covert Prepper show and the Prepper Podcast Radio Network News, both heard on Blogtalk Radio.

    This article may be re-posted in full with attribution.


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    Anonymous said...

    creepy graph....they didn't have QE back then, so I don't could go higher and will fall when and only when the designed fail of the USA is given the go ahead by TPTB. to that end, we need to look at external factors...see when the next 'king of the world' is fully prepared to step into the recently vacated seat....China, with all the currency moves lately, is that country....I think when they finally declare they are completely done buying, selling, trading in the dollar...that is when the seat will be vacated by us and sat in by them. Jan 10th, or close? Perhaps so....this beast we have is big, and will take alot to topple.

    Renard Moreau said...

    [ Smiles ] Well, being prepared is a good thing. But, is it truly possible to be fully prepared for the collapse of the entire economy?

    Anonymous said...

    Why do you think the Boy King has never dealt with the debt? Or an intelligent jobs program? Keeps adding 1 Trillion+ to the deficit each year?

    We're not coming back from this folks, they got plans with probably a World digital currency and looting of all pensions, 401K's, bank accounts, etc.....

    Anonymous said...

    anonymous, you make some very good points. china has billions of $ invested in u.s bonds. a repeat "1929 depression" in u.s. could give china a chance to establish a strong presence here----------u.s. huge debt will continue to make u.s. continually weaker. add a huge depression and u.s. might be receptive to some help.>>>Dale G

    tomas rader said...

    Is this another reason to tax deposits by the crooks? I'm prepd to accept metals in trade but getting fuel to get to the site might be an issue.

    Anonymous said...

    This will coincide with the new world trade agreement, hailed as the saving grace, no doubt. Once more, problem - reaction - solution.

    Anonymous said...

    " But it was a kinder generation – one that had God taught in the schools and human decency was the rule" - what about discrimination against blacks and gays back in the 1920's and 30's, was that kinder? Please don't mix religion in with economics, James Smith.

    Anonymous said...

    The owners of the Fed is done with the USA, so now China is their next play ground, look as they rape a nation & leave the toxic waste for the people foot the bills to clean up. Asia & China will be next until the MONEY CHANGERS ARE THROWN FROM GOD:S LAND TO THE DEPTS OF HELL WHERE THEY CAME FROM!
    You have to believe & Trust in GOD & his SON or live in hell forever!

    Anonymous said...

    If our money is not safe in a bank checking account, where do we put it?

    Seen2013 said...

    "There are only a few possibilities how this will play out.
    Nothing will happen
    A collapse greater than the 1929 collapse
    Somewhere in the middle"

    I'm not banking on 1 as the Bismarkianist's desire paper currencies to be destroyed and replaced with cashless fiat that will eventually become the new Greenback but as the world's currency.

    With the domestic political environment and geopolitical environment, I believe number 2 is the most likely candidate regardless if the estimated date is accurate.

    The problem is with the third option is that the rest of the transition and political 'I breakie, I fixie' losses its appeal particularly in the present environment. Consider, 9/11 has been used to get here, and it's not working very well anymore. The next one would have to be so severe that most people simply would not believe that it was designed or desired.

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