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First a note: This Preparedness Manual chapter in addition to identifying Risk and Solutions, presents a brief overview of the full text found in the full length MMC book. A link to the full ebook is found on the right side of the home page. Due to extremely dynamic conditions which morph daily, updates captioned as 2007 were discontinued in 2008. They were replaced with a subscriber based weekly "MMC's Risk Assessment Report", click here for details.

My friends who are reading these words, let me state as strongly as I can: "We as a nation are in a war for survival, economic survival no less important than a nuclear war. To the victor/s belong the spoils (economic prosperity) and the losers, economic defeat and social disaster. If you don't think we can lose, I don't know how to help you. I plead with you though for your own welfare and that of you loved one, subscribe to this service. It is one of a kind.

Let's take a brief look at a few issues effecting our success or lack there-of on the global economic battlefield.

We're Losing The Battle For Jobs And Manufacturing
Our saga starts with a brief assessment of the sorrowful success we are experiencing as an economic super power, competing in a global economic war.

As Ross Perot, former candidate for Presidency predicted economic warfare years ago. He predicted we would hear a giant wooshing sound as our industries and jobs raced out the back door on their way to other industrialized nations (predators). In the last 10 or so years, we have heard a constant wooshing sound as he predicted. Our recent assent from a minor recession has been heralded as a "Jobless Recovery". Hey, let's face it. Our industrialized manufacturing era is over. So is our high tech service sector.

Folks, we're in a global economy now. We're no longer the world's Top-Dog in manufacturing. We as a nation need to develop a plan very soon, on how to reinvent ourselves with new industries. The plan should also include retraining programs for a major portion of our work force. Failure to do so will relegate our middle class workforce into a third world stature. If that happens, we're cooked as a nation.

Trade Deficit "A Risky Tactical Strategy"
Our nation is bleeding to death with a mammoth Trade Deficit, which gets bigger and bigger each year. A continuous trade deficit as we have experienced is not sustainable. It's shackling the U.S. with the chains of a third world nations debt. A trade deficit are polished words, translated they mean "Money Is Owed". Combined with all the other debt building skills we've acquired as a nation, a pretty dark picture is painted for us economically. If we don't find a way of competing on the world market, while bringing our trade deficit into a balance, we're cooked as a nation.

The US Dollar Is At Risk
As we shall see in the next subchapter, the U.S. Dollar has been very strong for a long while. In recent years, it has flirted with decline. Currencies fluctuate up and down constantly. Decline does not suggest trouble, unless you add the term "Precipitous". Now you have trouble. Throughout 2004, murmurs could be heard around economic and banking circles worldwide, that a "precipitous decline" was gaining in probability. Occasionally, shouts and screams could be heard among the murmurs.

There is an acceleration of diversification away from the dollar by foreign central banks, governments and members of the private sectors globally. This is a very ominous signal, that the dollar as a global reserve currency is under attack worldwide. Another way to look at the issue is: there is a deceleration in the rate of accumulation of dollars as a reserve currency by major global players. Yes major players such as China and Russia continue to accumulate billions of dollars, while slowly diversifying a portion of their excess dollars into other currencies.

Updated 2007
The dollar is at risk of losing it's hegemony as the default global reserve currency.
The US has experienced a significant reduction by foreign banks and institutions in purchasing US debt in the form of US Treasury instruments. This is a very ominous sign. The US counters the foreign countries strategy by discontinuing publishing M3 [report of dollars in circulation]. The objective is to make US purchases of it's own US debt, through off-shore banks as stealth as possible. Hence no M3 to show the explosion of dollars in circulation [digitally]. OK, let's paint the picture one more time. It's that important. Historically trading partners accumulate dollars as payment from the US for their goods, they in turn purchase US debt in order to keep the scam of a global economy healthy and happy. Otherwise if they did not, the US would be busted, the global economy would collapse along with most of the economies of countries around the world. You might say we had the rest of the world by the short hairs. They really dislike us for putting them in such a bad position. Foreign trading partners have decided it's time to take a portion of their trade revenue dollars and invest in other instruments than US Treasury instruments. The move initiated in 2006 was planned to send a strong message to Washington, that it's trading partners are not happy with their current state of affairs with the US. To counter the decrease in purchases of US debt, the US just printed more dollars in the digital world and used the dollars to buy it's own debt [in secrecy]. Nice isn't it? The band plays on. Sooner or later though, the global game of musical chairs must end with a big problem. Strong indicators suggest the game is about to end, that's why the dollar diversification is occurring in order to bring the dollar hegemony and hence reserve currency status to a soft ending. Maybe the end will be soft, it's somewhat a throw of the dice.

A nation whose currency is the Standard carries enormous power and prestige. The U.S. has enjoyed this position for half a century or so. Today, there are forces on the attack, bent on knocking the dollar off it's position of hierarchy. These forces are as calculating, insidious, cunning and unrelenting as any army fired up to win a battle.

Leading the assault against the dollar is the European Union, whose efforts are backed by finance ministers and central banks around the globe. Capturing the Dollar's thrown, is merely a single step in a much grander and sinister plot. The plot required Europe to unit under one flag as a union and they have. The next stage is to topple the dollar as one of the many cards, in the collapse of the U.S. economy. Once the Euro is Top-Dog, further plans are implemented to give birth to a Worldwide Government. While the U.S. holds an overwhelming position of economic and military power, the take-over plan cannot be unveiled. If this scenario sounds bazaar, I agree, it is. President Bush senior, in his farewell address leaving office, mentioned the term "New World Order"? Does it sound less bazaar now?

Household debt is primarily made up of mortgage debt and credit (credit cards, auto loans, etc.). In 2003 household debt was up 11% over the prior year to $9.4 trillion, incl. $6.8 trillion mortgage debt and $2 trillion credit debt.⁽⁴³⁾

According to the Cambridge Consumer Credit Index in March 2004, only 42% of Americans are making minimum payments or no payments on their credit card balances.

House-hold personal debt service represents 18%, on average, of the disposable income for every household in the U.S.. This indicates an unsustainable level of debt by consumer house-holds.

In 2003 a record of 1.6 million households filed for bankruptcy protection. That's 1.6 million, it's just incredible.

As rising interest rates, the decline of the dollar, the rise in costs of goods due to higher energy cost, the U.S. consumer will be in a terrible fix. Bankruptcies would no doubt soar.

Updated 2007
Increasing instability of private sector debt.
Burdened with an ever increasing debt-load, households are being forced further into debt just to keep up with serving of their existing debt. It's a slow act of financial suicide.

As bankruptcies and loss of tax generating jobs fully manifest, federal taxes will suffer greatly, thus further burdening the debt-load of the US treasury. During the years 2001 to 2007 US Treasury debt has gone totally out of control - ballistic - bonkers!

Recent to this writing, the Federal government has amassed a huge debt of over SEVEN TRILLION DOLLARS. That number looks like this: $7,300,000,000,000.00 (rounded off).

Of the twenty five sectors in the Federal budget the top three sectors are:

Health and Human Services spent over a whopping 500 BILLION in 2003.
In case you are not aware, this is the agency responsible for redistribution of wealth from those who have to those who want to have. It includes all the "ENTITLEMENTS", such as housing, medicare, farm subsidies, food stamps etc.. Get the picture? Talk about creeping socialism, this smells more like galloping socialism.

National Defence spent over 450 BILLION in 2003.
We had better get used to this big number. I don't think there is much of a chance of it being reduced. For example, according to estimates there are 1.5 BILLION Muslim (Islamics) in the world today. Now for the scary part. Most knowledgeable observers of Islam believe approximately 10% (a relatively small number) of the Muslim population are considered by definition to be "Radical Islamics" or "Fundamentalists". OK, 10% doesn't seem too much, until you do the math. That small figure emerges as 150,000,000, that's 150 MILLION folks around the world, who really dislike the U.S. a lot. Look's like we need a bigger defence budget.

Treasury Department spent about 375 BILLION in 2003.
Guess what? That 375 BILLION dollar figure is interest on 7+ TRILLION our Federal government owes our creditors. I think the last sentence says it all.

In this very brief introduction on the subject, the myriad of inter-woven ramifications regarding this level of debt cannot be discussed. If you are as concerned as others including our creditors, I would remind you that a full expose along with monthly appendage updates is available to our subscribers.

Author's comment: Sorry to interrupt but there is an important message at the end of this section, which I encourage you to read.

By mid 2004 the total debt had grown to over $37 trillion, which translates into $128,560 per man, woman and child in the US. Think about a families portion of the debt. A family of 4 would owe $514,240 as their family's share of the debt.

The debt so far in 2004 is already UP 2.6 TRILLION from the 2003 figure of 34.4 TRILLION. The title of this sub-chapter is "Out Of Control Total U.S. Debt". If you agree and are as concerned as many of your fellow American, then I suggest you become a subscriber. AS whole bunch of additional material is available on the subject along with monthly appendage updates.

Throughout 2004, increasingly the housing market is giving new and scary meaning to the metaphor "Boom". Billions of dollars in the mortgage market, are either on shaky ground or will be soon. As the dollar retreats against the Euro dollar, interest rates will push much higher. The higher rates will become too much of a burden for the marginal borrowers. The shakiness could increase abruptly and become a rout. Leading the onslaught of foreclosures will be in the Variable Rate Mortgage (VRM) and especially those borrowers with little personal equity at stake. The value of homes will decline on a scale from 15% to the least expensive to well over 50% on houses valued over $500,000. The rout will be from sea to sea and will effect many other nations around the globe who have similar shaky housing issues. Already, in certain geographic areas there are indicators of a downturn in housing. With reference to the Refi market, by the end of 2004, the Refi market share is forecasted to be only 15% of it's peak. That is a rout.

Updated 2007
Collapse of the Housing Bubble
At this writing in May of 2007, the collapse of the Housing Bubble which seemingly began in late 2005 and gained momentum in 2006, is well one it's way down the backside of the curve and the curve seems to be steepening. Lead initially by the so-called Sub-Prime market, the trend is spreading to all markets at lightening speed.

Just this week, the author had a chance conversation with a home owner in the Carolinas. It was the first really strong evidence that I have witnessed, indicating the bubble has also burst for the high end on-the-water real estate market in the SE US. The party on the other end of the phone was relating to me that they had their million plus house which they moved into less than two years ago, on the market for over six months and with nearly no activity. That is truly astounding, as everyone in the region felt the market was maintaining it's strength as late as the summer of 06.

There is an upside to the deficit. An abundance of strong US dollars were available and sought after by our creditors; to hoard, use to purchase oil, which is paid in dollars, or to buy our Federal debt via financial securities and other advantages. In some respects it is not bad. It even verges on being good.

The degree of trade deficit is alleged to be a function of the Fed's economic tactical strategy of building a strong US dollar. Presumably, the Fed built a strong dollar for a purpose, and when appropriate, the Fed can begin to rain-in the dollar.

Well, for two years, the Fed has been raining-in the dollar as it has dropped markedly across the board and almost precipitously again the EURO. Yet, the trade deficit continues to grow. It's not supposed to continue, Why does it?

It is the writers contention that there are two reasons, neither are good: First, as discussed at length in our subscriber section, the trade deficit is not as out of control as is the US consumer. We as consumers seem to be driven want more and more regardless of cost. Heck, money is still cheap to borrow, a let's get it mentality is controlling the consumer.
Second, the cost of oil effects just about everything we make in the use and of course is the fuel for our gazillion cars and trucks. More and more fuel is purchased at an ever increasing price per gallon. At this writing, it just topped $50/gal.

I believe these two factors are the force maintaining an unhealthy Trade Deficit.

Updated 2007
US Trade Deficit literally transfers the wealth of our nation to others around the globe.
For a decade or so, the US trade deficit has been increasing steadily. Literally, the wealth of a nation is slowly being transferred to others around the globe. China it turns out is the major benefactor of the trade deficit. Presently, if my recollection is correct, China holds reserve currency of nearly one and a half trillion dollars as a result of our trade deficit with that single nation. NOW who do you think holds who by the short hairs? Think of it. What would happen if China started to liquidate it's dollar holdings onto the open market? Forget about it, you don't want to think about it, the picture is tooooo gruesome to imagine. Suffice it to say, the US would no longer be a super power, we would be as third world nation. That's the danger an out of control, yet uncontrollable trade deficit has created to a global community economy. The reason they have not done it is - "the great game would end", all the global players would lose, no one would win. The global game of musical chairs must be kept going at all costs. The end of the game would result in global economic and social changes which are not acceptable to the global players [nations].

“I have warned for a long time that the Federal Reserve is planning to destroy the U.S. economy by: printing the U.S. dollar in exponentially riskier quantities until it blows off the charts and crashes, and by easing credit and rates until the average individual and corporate debt loads are so enormous that the resulting massive distortions in the economy suddenly bring on an economic heart attack, leaving no possibility of a short or even medium-term recovery. That day is here!”

Updated 2007
"As of March 23, 2006, information regarding M3 will no longer be published by the Federal Reserve" the Fed announced
The M3 is a cumulative value summarizing M0, M1, M2 and other monetary aggregates for M3. It basically reflects all dollars in circulation. By hiding the M3, the Fed signals monitization is planned which always will results in high Inflation. Measuring the rate of increase of the M3 reflects a fairly accurate picture of current inflation.

So when the Fed announces on a regular basis, that inflation is under control and floats somewhere in the 2% range, ya just know they are lying. Some purest economists take the time regularly to back into the M3 and come up with figures that strongly suggest inflation is much higher than 2% - surprise - surprise. They have also calculated that during the first half of 2007, true inflation floats between 10% and 12%.

But then, that's no surprise to my readers is it? Hey, I saw regular gas yesterday at $3.28ish in the SE US. By summer it is predicted to be in the high 4s. How about that grocery bill for last week? Yep, you saw it being higher as well. I guess it's obvious why so many of us don't believe our gov officials.

Every aspect of the earlier sub-chapters worst case scenarios; where an economic collapse occurs, is deeply embedded in the principles of a "Fractionalized Fiat Money Banking" system.

The following article presents an exceptionally clear and succinct view of the "house-of-cards", referred to as the Federal Reserve Bank and or commercial banking at-large. Indeed, the entire banking system worldwide is basically a "house-of-cards". Topple one, and the entire system collapses, bank after bank, card after card.

Richard Russell the Dow Theorist
Russell voiced his concerns early in 2004. Referencing the stock market he commented: "I'm afraid we are coming into one of the worst bear markets in history".[8]

Senator Tim Ferguson [2]
Senator Ferguson held office from 1995 to 2003.

Elitist Belkin: prepare for sickening plunge
As a note of significant interest regarding Belkin; he charges $35,000 a year to subscribe to his newsletter.

GSE's wobbling, staff bailing out
GSE stands for Government Sponsored Enterprise and under it's very large economic umbrella, we find; Freddie Mac, Fannie Mae, Federal Home Loan,.

This section is being added in 2007

North American Union and Currency Change
As discussed in Chapter III, there is a massive movement at work globally, to bring about a single global government within the coming years.

One of the strategies is to divide the globe into trade zones. That is the driving force behind the open borders here in the US. We are being desensitized for change. Within a mater of a few years, if resistance fails, a trading zone named the North American Union will be birthed, per an official agreement between the three nations signed in 2005. The initial members will be Mexico, the US and Canada. More members will be added over time as were in the EU and the plan is already well under way to bring more countries aboard in the central Americas.

The economy of the US will be permanently changed, as a new currency will be introduced forcibly to replace the currencies of the three members. The new currency will be named the Amero, much as the European Union's currency carries the name Euro. Got the picture yet folks??

Summation Of Dangers Plus Preparedness Options

Economic Dangers To You And Your Family

Industry Is Moving Abroad And Jobs Are Going With Them.

• Service sector is out sources to the far east.
  
• Industrial Sector has lost thousands of businesses to the far east and millions of jobs were lost by American workers.
• Manufacturing Sector has lost thousands of businesses to the far east and millions of jobs were lost by American workers.

Our middle class is struggling as it's standard of living is eroding.

• No member of our American middle class is totally immune.
• As our middle class is gutted, the ranks of poverty increases.
• As our American working class suffers through an ongoing struggle to hang on, Social Services must expand to meet the increasing needs of our besieged middle class.
• Reports indicate a shocking rise in personal and business bankruptcies in recent years and an upward trend is accelerating.

• The US will no longer be viewed as a wealthy nation.
• The US will no longer be privileged to have a world class standard of living.
• The US will no longer be considered to be the only super power, others will rise.
• The US will no longer be considered the global financial leader.
• The US will no longer be a world class trading partner.
• The US will no longer be supported by global powers purchasing our excessive debt.

Private Sector debt loads will not be sustainable

• Personal debt is at an all time high.
• Personal bankruptcies are exploding.
• Personal savings is at an all time low - in the negative column.
• Credit card debt is exploding in the first quarter of 2007.
• Home equity extraction to maintain the good-life is ending.
• Ease of borrowing is ending.
• Options in servicing personal debt are tapped out.

There are rumors that the banking system will in the near future, lobby for legislation that will allow debt to be automatically transferred to heirs, upon the death of a family member. Offspring will inherit their parents debt load. It will be the final strategy in casting our citizenry into a life of serfdom.

Inflation is on the rise - eating away at purchasing power

• All home utility expenses are rising.
• All forms of food costs are on the rise.
• All consumer hard goods costs are on the rise.
• All forms of medical expenses are rising.
• All forms of insurance costs are rising.
• All forms of services expenses are rising.
• All forms of educational costs are rising.

North American Union and Currency Change

• You will be forced to convert your cash into Ameros.
• All three member nation's assets will be revalued in Ameros.
• All non declared assets will be difficult to keep private.

Options in Preparing for Economic Problems

Debt Reduction

One simple statement offers the best option: Get out of debt as much as possible.

Credit Cards

• Close all but one credit card - when possible.
• Wean yourself away from over use of credit cards.
• Pay off cards totally every month - very high interest rates.

Mortgages and Homes

• Reduce principal of loan when possible.
• Pay off the mortgage is at all possible.
• Sell rather than pay high mortgage.
• Rent rather than carry a high mortgage.
• If on a VAR, refinance into a long term fixed mortgage.
• DO NOT remove any equity from your home!!!!!

The prospect of taking a heavy tax hit is much better than losing all or nearly all in a collapse. If your assets not in your possession - you don't have them.

Bartering
During a time when enormous social, economic and political chaos is occurring, as well as during a post crisis period, bartering is an essential option to have skills in. It is also very wise to project into the future what types of items would be useful to have for bartering purposes. Here are a few items to consider:

• All sorts of repair equipment and tools - not electric.
• All sorts of gardening equipment and tools - not electric.
• Foods considered essential and which have a long shelf life.
• Heirloom seeds for growing fruits and vegetables - no GM or Hybrid seeds
• All sorts of over the count medical supplies and medicines
• Alcoholic drinks will be in heavy demand
• Ammo for weapons

Stock Market
It's hard to convince folks at a time when the market is hitting new highs nearly every day. Just remember, in 1929 when the market was also reaching new highs nearly everyday, events occurred that began one of the darkest times in our nations short history. Do you want to be in or out if it happens again, as some many wise folks are forecasting???

Banks - Banking and Cash Banks will be the first to close or make restrictions.

• Move all your non working cash out of your bank and into your hands. Keep only working capital in your accounts to pay bills.
• See options of where to place cash.
• Remove any valuable assets, cash, gold, jewelry etc. out of any bank safe deposit box and into your hands.
• Research your banks rating. If not high close accounts and move to a bank with high ratings
• Convert cash on hand into small denominations such as 10 and 20 dollar bills. In a time of crisis, high denominations 50s and 100s will be hard to use.
• Have enough cash on hand to pay bills and buy food and gas etc. for 3 months or more.

A flight from dollars to hard asserts has started

• If you get into gold or silver, TAKE possession.
• Stocks hold great potential but also have risks.
• Collectible coins hold less risk of confiscation than other bullion.
• Silver costs a lot less than gold and is easier to get started building a nest-egg.
• Junk pre 1964 silver coins offers appreciation as well as a barter factor.
• Silver typically out performs gold and is easier and safer to hold - albeit it is heavy and bulky.

Last edited on ... March 15, 2007
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