Oct 302010

I’ve been following Chris Martenson’s list of recommendations on what individuals and families can do to increase their resilience in the face of an uncertain future. Protecting wealth is a controversial subject. The experts are divided into camps. Inflations and deflationists each have strong opinions about what might happen. All agree that the future will bring many challenges and that one best take steps to prepare.

Martenson’s approach is a middle of the road plan that is worth reading in detail. His first recommendation (Getting out of debt) is the key. It’s not an easy thing to accomplish but can be done.

This blogger tells his story of how he eliminated $125,000 of debt in two years.


  3 Responses to “Protecting Wealth”

  1. “My views on the matter have always been clear – protecting wealth is Job Number One. ”

    Chris Martenson

    I agree with Martenson….protecting wealth is the most important aspect of all of the steps. Without a sound financial base, nobody will buy electric cars, cisterns, pumps, tons of extra food, etc, etc. All energy and funds are and will continue to be devoted to surviving day to day life, so there is no time for taking part in serious community and personal preparedness. Without proper education and action, the Island community will deteriorate and stagnate in the face of this economic storm. Same goes for local and state governments. It’s happening right now as I type, as the County scrambles to survive, along with businesses in Bham and here on the Island, etc., etc.. The steps that Martenson outlines are practical and valid, but they are also daunting to the average person. Poor time management, discipline, and the ever present, hard to manage, legend in your own mind ego are all road blocks to seeing the big picture, and ultimately taking the proper action. Developing a strategy is difficult when one is dealing with a hard to understand, constantly moving target. Inflation is one thing, deflation is another. What about stagflation? Which one to prepare for? How does one follow the markets/economy and know they’re getting the right information? Where does one get the right information? What methods does one use to identify the warning signs? And on and on.

    I can only speak from experience and what works for me and my client. I visit numerous sites that have proven themselves to be right over the past decade. Analysts/commentators that have a successful track record over time, especially over the past 3-5 years, are the only ones to pay attention to, the rest is sales oriented noise. In the end, it is technical analysis that rules. Most money managers do not use charts, they are sales people. Anybody can learn to read a chart. It empowers the individual in the face of a system designed to render you powerless. If you visit Martenson’s “Money and Markets” link, you will find some very simple charts. Charting provides the road map to the economy. It is key to reality. Data…price and time….do not lie, unlike constantly revised government statistics, broke-rs, and MSM BS. One must be able to accurately track the direction of the footprints that big money makes, yesterday, today, and in the future. Bonds and currencies are the largest markets in the world, and they are the go to markets to track. The stock markets are casinos, but if one is to follow them, I suggest the SP500, Commodities, and the Russell 2000. Again, you cannot know where you’re going without a map….in this case a chart.

    If you are shopping for a financial advisor…just ask him/her one question….did they get hurt in the ’07/’08 debacle. If they didn’t, then proceed with the interview. If they were caught with the rest of the herd, then move on. You have to have a starting point, and a proven, successful track record is crucial. The real estate chart rolled over in ’05, the Dow rolled over in ’07, then the crash. We got out in December, ’07 because that’s what the charts said to do. No questions. What was the perspective financial advisor doing during those crucial years? What was the strategy in ’09/’10, and what is the strategy now? As many, many people have since found out, timing is everything. Those that bought the top of the housing market are now underwater, those that held onto stocks into the ’08 crash are still underwater….the consensus is that the herd buys the top, and sells the bottom. Seems to be true in millions of cases around the world. I suggest that nobody can escape the reality of this ongoing downturn….whether you’re on a pension/retired, working, college grad, or….?…it’s all about how you deal with the reality…..so please don’t dismiss on going financial education because you think you’re immune, you actually know what’s going on. An arrogant and fool hardy mindset that has led to elevated stress levels lately.

    So I urge everybody to get a handle on a subject you would probably like to avoid at all costs….financial planning and ongoing portfolio maintenance. There is no substitute for your personal involvement and hard work when it comes to growing, and most importantly, preserving your money. Those that thought they could make money by doing nothing have and are being fleeced on a continuous basis. Forget spending valuable time and money on politics and politicians. Focus on the money…the very thing that buys government. Learn how to follow the money….go where it goes….college was a long time ago for many….it’s time to go back to school…..a crash course….because time waits for no one, and if you haven’t noticed, this time is different.

  2. Protecting wealth is what got us into our current situation, financial markets manipulated by the elite for the elite. All your points are well taken but I’m afraid abit too late for the average Joe. Alot of the followers of this blog probably are sitting in a raft with abit more air in the boat. Most people I see are getting tight and have nothing to invest.
    An island is so unique and beautiful in that the poorest and the richest can rub elbows at a good jam. If you’ve got money to invest, isn’t it much better to hire out some projects you’ve been putting off and keep your fellow islanders dancing? Screw the DOW, BANK IN COMMUNITY!!! Zippy

  3. Zippy…..I agree with your “bank in the community” statement. There are many people, including you, that have money in 401Ks, IRA, HSAs, as well as retirement accounts. These funds are being directed by some 25 yo money manager who never saw a bear market in his/her life, or the funds are being directed by the individual. Teachers, hospital workers, you name it have funds that need to be managed by the individual. Leaving to the crooks who have screwed up continuously over the past years is insanity, and we all know the definition of that word. When I have projects that I can’t do, I call hire Islanders. After two decades of loose money, greed and everyone going hog wild spending on granite countertops, 5K sq ft houses for one couple, etc, etc….there just aren’t that many projects that got put off. I suggest the the folks sitting in leaking rafts grab a paddle, start reading this blog, stop looking to government/County to save them, and help in transitioning this community. There are solutions to all problems, but one first has to acknowledge, understand and embrace the change that is coming.

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