It Makes Good Cents To Save Nickels; How to survive the collapse of the dollar. Part 2
May 9, 2012 in Uncategorized
It’s quite a mess. However, there is a solution. The solution is to end our debt based monetary system and return to sound money.
If you have already read the accompanying document about the Federal Reserve System, you know that the Federal Reserve is a private corporation that is allowed to print money (albeit using an electronic printing press). Whenever it does this, it dilutes the value and reduces the purchasing power of all previously existing currency. Thus, it is the root cause of the price inflation we are experience.
The only way to get our financial house back in order is to abolish the Federal Reserve System and return the power to create money back to the Treasury Department. Then, direct the Treasury to issue U.S. Notes (like Lincoln’s Greenbacks) to pay off the National debt. Simultaneously, the reserve requirement for banks would be increased from 10% to 100% thereby eliminating their ability to create money. This would also absorb the funds created to retire the national debt and avoid any significant amount of inflation that would otherwise result from this issuance of new U.S. Notes. In addition, the government must be restricted with a Constitutional amendment from any future borrowing except in times of a declared war, and from the creation of additional currency in excess of the growth of our Gross Domestic Product.
Unfortunately, there is little chance this solution will be adopted because there are too many powerful vested interests that derive their wealth and power from our debt based monetary system. However, if enough citizens become sufficiently knowledgeable about the Federal Reserve System and demand an end to it,Washingtonwill be forced to act. That’s one of the reasons I’ve written this article and the accompanying article about why the Federal Reserve System must be abolished. I am hoping that you will do your part by forwarding this information to others and asking them to do the same.
The Threat To Our Nation’s Sovereignty
Another reason I wrote this article is to alert you to the threat to our nation’s sovereignty if/when our economy spirals into hyperinflation. Here’s what I mean;
If/when our economy spirals into hyperinflation, the price of food, along with everything else, will skyrocket. Although wages will increase, they will not increase nearly enough to offset the higher prices. This will result in people being unable to afford to buy enough food to feed their families. When this happens, they will demand that the government do something.
Initially, the government will respond by issuing food stamps to everyone. However, food prices will be rising so fast that the food stamps will be virtually worthless by the time the people receive them. To solve this problem, the government will impose price controls on food. Unfortunately, it has been proven time and again throughout modern history that price
controls will result in empty grocery store shelves because it is impossible to force someone to sell something for less than his cost to produce it.
When the American people are faced with starvation, they are likely to agree to anything that promises them relief. Unfortunately, it is likely that a false promise of relief will be offered: A North American Union withCanadaandMexico, and a common currency called the Amero.
I believe that the American people will be told that it is necessary to join withCanadaandMexicobecause we do not have any gold with which to back a new currency. In 1980, Ronald Regan appointed the Gold Commission to assess the possibility of returning to the gold standard. The Commission discovered that there was no longer any gold inFortKnox. That the gold was sitting in the vault of the Federal Reserve Bank inNew Yorkas security for the national debt. There is evidence that, over the decades, the Federal Reserve has sold and leased this gold and it is no longer there.
If you watch The Money Masters video recommended at the end of my essay about the Federal Reserve, you will learn that gold is not necessary to back a nation’s currency. It is only necessary that the people have faith that the government will not print large amounts of additional currency thereby devaluing the currency they are already holding. (In fact, in 1923, after a hyperinflationary collapse, the government of Weimar Germany issued a new currency backed by federally owned land and industry.) However, the lie that it is necessary to have gold to back a new currency will be promoted to persuade Americans to give up our sovereignty. If this happens, theUnited States of America, as we know it, will cease to exist.
Becoming a part of a North American Union will strip us of the ability to make our own decisions regarding the way we run our economy and conduct international trade. With the loss of these tools, we will be unable to rebuild our economy, and our impoverishment will be permanent.
As part of a North American Union, we will be at the mercy of the central banksters who will have complete power over what happens in the economy. This will translate into political power and their ability to ultimately merge the North American Union into a one world government. Their New World Order will have arrived and will be governed by a small group of ruling elite. Everyone else will be reduced to a condition of impoverished serfdom.
This ultimate result is my real concern. If the only thing to be concerned about was hyperinflation, it could actually be viewed as a wonderful business opportunity. All you have to do is load up with as much precious
metal as can get your hands on so you will be on the right side the biggest transfer of wealth in the history of the world. But even if you wind up with millions of dollars worth of gold and silver, if we ultimately lose our freedom and sovereignty to a one world government, your new found wealth will not do you any good because we will be living in a cashless society and the ruling elite will have absolute power over us.
The period of time when grocery store shelves are empty will last anywhere from a few weeks to six months. To prepare for this, everyone should stock up on six months worth of food even if it’s just sacks of rice, pasta, and beans. Even if you don’t have any sauce to put on your rice or pasta, you’ll be surprised by how good they will taste when there’s nothing else to eat.
Another thing you’ll need is a way to convince others that it would be a bad idea to attempt to take your food away from you. You can be sure that if you have food when people are starving, they will not hesitate to take your food unless you have a way to deter them. If you don’t believe that people will forcibly take your food, bear in mind that, when faced with starvation, people have even resorted to cannibalism. You must have a way to protect yourself and your family.
Of course, when the grocery store shelves are empty, people will still be able to buy food on the black market. Anytime a government tries to artificially lower prices, a black market fills the void by providing the needed goods at the true market price. However, in order to purchase something on the black market, you need something of value to barter with if currency is worthless. Gold and silver are ideal for this purpose. In fact, for a couple of reasons, it probably will not require very much gold or silver to get through this period of empty store shelves; First, it will probably not last longer than a few months until the government issues a new currency that will have some purchasing power because it will be backed by something that has intrinsic value. (WeimarGermanybacked its’ new currency with a combination of
gold and federally owned land.)
The second reason is that, during periods of hyperinflation, precious metals increase in value 20 to 500 times more than the increase in prices generally. For example, at the peak of the Weimarhyperinflation, 25 ounces of gold was enough to purchase an entire city block of buildings.
At today’s price of $1,800 per ounce, 25 ounces of gold purchased today for $45,000 could be worth enough to buy an entire city block after a hyperinflationary collapse of the dollar. Looked at another way, in 1913, an ounce of gold could be purchased for 87 German marks. In November, 1923,
the price for an ounce of gold was 87 trillion marks! Because of this kind or meteoric rise in the value of precious metals during periods of hyperinflation, a purchase of as little as two thousand dollars of gold or silver at today’s prices would probably be enough to buy food and other essentials for a few months.
For the specific purpose of making small purchases on the black market,
“junk silver” coins are ideal. Junk silver coins areU.S.coins that were minted before 1965. These coins contain 90% silver. Because of this silver content, a dime minted prior to 1965 is currently worth more than two
dollars and a pre-1965 quarter is worth more than five dollars. (You can check the current daily value of these coins at CoinFlation.com.)
As I said above, during periods of hyperinflation, you can expect the value of gold and silver to increase 20 to 500 times more than the increase in prices generally. This means that if the price for a loaf of bread increases from $2 to $4, the value of a pre-1965 dime would increase from $2 to
anywhere from $40 (a 20 fold increase) to $1,000 (a 500 fold increase). This
is why it will not take very much gold and/or silver to get through a few months of having to buy what you need on the black market. And, of course, if we only experience ordinary double digit inflation, junk silver
coins will maintain their value while paper dollars have their purchasing power eroded.
Precious metals dealers sell junk silver in bags of $1,000 face value. Based on the 715 troy ounces of silver in these bags, at today’s $35 per ounce price of silver, each bag will cost $25,025. The commission added to this should not be more that 1 ¾ % for one bag and should be less for larger orders.
You can buy junk silver in smaller amounts from most coin shops. However, coin shops will probably charge you a stiff premium over the spot price of silver. For small amounts, you will probably find your best deal by looking on Craigslist.org and finding someone with junk silver to sell. With a private party, you can purchase the coins at the silver spot price because you both save dealer commissions and markups. However, if you buy from a private party, bring a digital scale with you in order to weigh the coins to make sure they are not counterfeit. After visually comparing the diameter and thickness to a genuine dime or quarter, weigh the coin. A quarter should weigh 6.25 grams (.22 ounces, .014 lbs.), and a dime should weigh 2.5 grams (.088 ounces, .006 lbs.). (You can buy a good mini digital pocket scale from Amazon for under $20. I purchased an American Weigh Black Blade digital pocket scale for $12 and a 500 gram calibration weight for $9.)
The 7 Cent Nickel
Unfortunately, these days it is a fact of life that the average person lives paycheck to paycheck and doesn’t have extra money to invest in gold and silver. However, just about anyone can afford to take their spare change at the end of each day, convert it into nickels, and save them. This is another way to prepare for the economic catastrophe of hyperinflation.
As I pointed out at the beginning of this article, nickels contain 75% copper.
And, based on the present price of copper, nickels are currently worth more than 7 cents each. In light of the inflation we can expect, the price of copper is not likely to go down. If anything, it will go up. But even if the price of copper does go down, a nickel will never be worth less than five cents or one twentieth of a dollar. And, if the economy goes into hyperinflation, the price of copper will skyrocket along with everything else.
In fact, like gold and silver, the price of copper is likely to increase more
than the general increase in prices overall. This is due to the fact that, like gold and silver, nickels have intrinsic value that is suitable for bartering.
Copper lacks the scarcity of gold and silver. Therefore, it will not increase 20 to 500 times more than the general increase in prices. However, it could very well increase2 to 10times the general increase in prices. In other words, each time prices double, the value of nickels could have a 4 to 10 fold increase. It’s been said that silver is the poor man’s gold. Well, it turns out that copper is the even poorer man’s silver.
If, by the grace of God, we do not have hyperinflation, your nickels will still be a terrific investment. It will not be too much longer before the government stops using copper to make nickels just as it stopped using copper to make pennies in 1982. When this happens, you will be able to sell your nickels for a price based on their copper content. In fact, pre-1982 pennies are currently being sold on EBay for 2 cents each. (The day when this happens is already on the horizon. In August, 2011, United States Mint awarded a contract to Concurrent Technologies Corp. to research alternative metals for U.S.coinage.) http://www.coinworld.com/articles/mint-awards-firm-contract-to-research-alterna/
As I write this, the melt value of nickels is 7.3 cents. Therefore, buying them for 5 cents gives you an immediate profit of almost 50%. And, as inflation pushes the price of copper higher, your nickels will become more valuable. In addition, saving nickels is a risk free investment. Although you will have to wait until the government stops using copper to make nickels in order to sell your nickels at a profit, your nickels will never be worth less than five cents while you are waiting for this to happen.
When Will This Happen?
First, you should understand that a hyperinflationary collapse of any currency happens when people lose faith in that the currency will retain its value. Therefore, there is an emotional component in this equation. As a result, the collapse starts slowly and then accelerates to a point where there is concern, but then the actual collapse comes suddenly. If you look chart of the Wholesale Price Index fromWeimarGermanyyou will see that of all the inflation that occurred over a nine year period, 99.99% of it happened in 1923. Of this 99.99%, it’s my guess that 99% occurred during the last two or three months as it did duringZimbabwe’s currency collapse just a few years ago.
Another thing to keep in mind is that the beginning of the collapse will probably happen as the result of some sort of triggering event. Perhaps OPEC will announce that it will no longer accept dollars for the purchase of oil. Or,Chinacould announce that it will no longer buy any of our debt. Or, it could be something else that acts as a trigger. Whatever the actual trigger is, it will cause a sudden and dramatic shock to the economy. You will go to bed with the price of gasoline at $4 a gallon, and wake up with the price at $20 a gallon. That day, grocery stores will be emptied in a matter of hours and they will remain empty for a period of time lasting up to six months.
It’s impossible to predict the exact day that this will happen. However, economist John Williams of ShadowStats.com, in his 2012 annual report for the hyperinflation outlook) predicts that this will happen no later than the end of 2014. http://www.shadowstats.com/article/no-414-hyperinflation-special-report-2012
There are two things that can be drawn from this information: first, there’s not much time left until the collapse and, second, prepare now because you will not have time to prepare after the collapse begins.
Spread The Word
If enough Americans have saved enough nickels to survive hyperinflation, we will never agree to relinquish our nation’s sovereignty. So, tell as many people as you can about nickels and what a good idea it is to save them. Tell
them to check out CoinFlation.com and see for themselves what nickels are worth. Tell them it makes good cents to save nickels.
by An American
The document you have just read is merely a summary. The information resources that follow will enable you to gain a full understanding of these issues. At a minimum, you should read and watch the “must watch” and “must read” resources.
To see the information sources, please see Part 3 of this article which has been posted separately due to word count limitations for posts.