Fiat Currency Collapse

    Like all civilisations in all the ages, our civilisation has been debasing our currencies. I say currencies, rather than currency, because all of the separate Nations around the world have been participating in this practice.
     If you don't understand how modern Governments can be involved in such a shady practice without the People getting upset then you need to realise that they have changed the names to protect the guilty. In the modern world, we call currency debasement by a new name. We call it inflation.
     Inflation IS currency debasement. If you cannot buy as much with your currency unit today as you did yesterday then the currency is, obviously, worth less. If the price of the things you buy rises ... then the value of your currency has fallen. They are the same thing.
     Now, we are told by the Government (of whichever country you are in) that inflation is normal and we have to maintain a minimum level of inflation to encourage growth. This doesn't make much sense to me but, of course, I'm not an economist.
     (If I was attempting to encourage growth of the economy then I would attempt to lower prices so that more people could buy more things. However, if I was running the economy of a World Class economy, I think I would be more inclined to allow market forces to run things without interference.)
     However, leaving whether inflation is a good thing aside, the main thrust is that we are told that a 'small' amount of inflation is a good thing. The Governments of the world now tell us that we have, only, a nice small level of inflation. 2% - 3% percent is supposed to be the number that they aim for and this, they tell us, is exactly what they are achieving. Most Governments, of all persuasions, are generally stating that they have only a small inflation rate and that this is good.
     What, however, is our real inflation rate? Are the Governments telling us the truth about inflation (how badly they are debasing our currencies)?
     Well, as it is the Government who tell us what the 'official' rate of inflation is, we have no 'real' choice but to accept their word on what numbers they are seeing. Correct?
     Not necessarily. There are other ways to 'see' inflation and other ways to 'calculate' what the true inflation rate is.
     For example, as far as 'seeing' inflation goes, that is anecdotal from the people on the streets who are buying the things that they want / need to live. If you, as a consumer, are seeing prices rising a lot faster than 3% / year then, as you can imagine, that means that inflation is a lot higher than 3%. Now, the Government is measuring inflation across the Entire economy and this will make their inflation different to what you see. They are including things like aircraft purchasing by airlines, military purchases, etc. and these things may not be rising as fast as what you are seeing.
     However, average people make up, by far, the largest percentage of the population. We are the ones who have to survive, on a daily basis, to make aircraft and military purchases any sort of use at all. Without a population there would be no need for Armies, aircraft, etc. You would think, therefore, that they would weight normal purchases to increase their effect on the overall inflation rate.
     The truth, however, is far more shocking. A normal persons spending is taken up, to a great extent, by two main purchases. These would be food and energy. Everybody needs food and energy on a daily basis and cannot survive without them. These are the two main items that we base our view of inflation on. The Government, on the other hand, ignores food and energy completely when calculating overall inflation, Why do they do this? Not being an Economist, I really can't say what sort of excuse they give for ignoring the two most basic needs in human life. I do know, however, that it makes their inflation numbers look just the way they want them to.
     It gets worse, when they are calculating inflation they use a technique whereby they replace items, on a yearly basis, so that some items do not skew the calculations. The explanation works somewhat like this : If the cost of a 60 inch flat screen TV rises in price out of the range of normal consumers .. then the consumer will start to buy 58 inch TVs instead.
     Now, on the surface, this technique looks sensible. If consumers are no longer buying these items then they shouldn't be calculated in the inflation rate. That makes sense.
    Where it doesn't make any sense, however, is when people attempt to compare this years inflation rate against last years'. You cannot compare year-over-year inflation rates because they are, no longer, pricing the same things as they were, last year. This makes any decision as to whether inflation is rising, or falling, completely worthless.
     So, if the Government numbers are useless, and your anecdotal evidence only shows your 'private' inflation rate then is there anyway to calculate a fairly 'true' national inflation rate. Well, yes there is but it is too difficult for a single person to do but we do have a place where we can get access to a 'calculated' national inflation rate.
     If you go to the website for Shadow Government Statistics then you will get a more realistic picture of the US inflation rate .. along with a lot of other statistics that the Government likes to 'bend' to make their governance look more decent. (I am NOT affiliated with SGS but do find that they have useful graphs and statistics, however.)

     The main thrust of this post is that the Currencies are becoming worth less and less until they become worthless. This doesn't seem to be all that far away. WHY it is thought that it isn't too far away? That requires a lot more discussion, and I may go into it with another post but it is, in reality, a bit beyond the scope of this blog. This is supposed to be a preparations blog rather than an Economics blog.
     There are a LOT of other websites that discuss the exact reasons why we are, probably, a very short step from total Fiat collapse. Inflation run rampant to the point where your currency will buy nothing at all.

Ooops!

     Another quick post before bed.
I should have included reason number 4.

    Reason 4.  Peak oil.
          This really falls under reason 3 because it is part of the over-population problem but it is such a huge problem that it really should be looked at separately.

     There are other reasons, as well, but the main 4 tend to encompass all the others. They, also, tend to overshadow all of the others as well. We will be looking at them but, usually, as part of the other four or just a quick glimpse.

     Just to point out ... Yes! This is going to be a prepper site but without knowing what you are prepping FOR ... there is no way that you can work out HOW to prepare.

What are we preparing for??

     Well, I guess that, as a first post, I should be discussing what this blog will be concerned with.
O.K., I believe that we are headed towards TEOTWAWKI with all the speed, and inevitability, of a runaway freight train.  A lot of people are saying this but there are quite a few unreasoning posters out there who are just climbing on the hysteria bandwagon.
    For example, I do NOT believe that the 21st of December, 2012, is going to be the end of the world. The Mayan Calendar was never meant to represent the "End of the World." The end of the Mayan Calendar was only, ever, the end of an AGE and a mode of thought. As far as the Mayans were concerned, Mankind moves through a series of Ages with a certain mindset attached to each Age. I suppose that the mindset attached to the last Age must have been "expansionism."
     I do not believe that there is some planet hiding in our Solar System (call it Nibiru, Planet X, whatever) which has, somehow, evaded the sight of all the astronomers for the last 4000 years, or so. I, also, do not believe that a comet with a solidly computed orbit is going to, again somehow, veer off course and impact our planet.
     I do not believe that there are a "SECRET" cadre of Elitist Manipulators out there who are controlling all of the worlds affairs with all the subtlety of some God-like puppeteers. For a start, the whole premise of the Illuminati is that they are a "Super-SECRET" organisation which is so clever that nobody could possibly ever uncover. In which case, why does almost EVERYBODY "know" that they exist?

     O.K, so I guess, by now, you should have got the idea that I am not a "Conspiracy Theorist" and I do not believe in every conspiracy that someone suggests might be possible. Just because you can't prove that it doesn't exist does NOT meant that it DOES exist. It's almost impossible to prove a negative.
     The theory runs like this :
          a. The Illuminati are so clever that you could NEVER find evidence that they exist.
          b. I can not find evidence that they exist.
          c. Therefore, if I cannot find evidence, they must have covered it up and that proves that they exist.
     How about this for an explanation, the reason that you cannot find evidence that they exist ... is because ... they don't exist. It's a shocking thought, I know.

     So? Why do I, then, believe that we are heading for "The End Of The World As We Know It?"
It, actually, has quite a simple and straightforward explanation.
     Well, to be honest, it has a number of simple explanations. There are quite a few reasons why we are headed for catastrophe but each should have it's own post to explain what I'm talking about.
     Hence, in this post, I will give you the reasons (with a brief description) and I'll expand on each of the reasons in later posts.

     Reason 1.  The Collapse of Fiat currency.
          I should think that, by this point in time, almost everybody should know what this is and be able to see it approaching.
     Reason 2.  All Our Eggs in One Basket.
          The fact that EVERYTHING is controlled by computers.
                      (And, NO, this is not some SKYNET thing.)
     Reason 3.  We are SEVERELY overpopulated.
          This should be obvious to everyone with any sense.
                      (Have a quick read of Thomas Malthus and Malthusian Catastrophe before we get to the expansion post on this one.)

     O.K., this should be enough to be going on with this post and I'll get the first, real, post up here tomorrow night. (That's assuming that nothing gets in the way. I do have a family, as well, and go to school.)