(Daily Signal)—It has been no secret that America, Germany, Austria, and Europe in general are currently confronted with major economic problems. All are experiencing inflation and minimal economic growth. Purchasing power is decreasing, and the balances on accounts and savings books of average citizens are dwindling.
The problems started long ago and are political in nature. And the latest news also shows that political decisions attempting to quickly improve such situations can create even bigger problems in the medium or long term.
Let’s look at two news items from Germany that hold lessons for America. The first is that Germany, known as a high-savings country, is now entering a wave of “de-saving.” Between 10 and 15% of bank customers have overdrawn their accounts, 40% of Germans say they have had to draw on assets in the past year, and a third say they are no longer able to save for retirement as they used to. The savings rate has fallen from 11.3 to 10.6%.
Of course, this hits harder those whose real wages have fallen since 2019 and the middle class, which has had to spend more to maintain its existing living standard in the face of inflation. This is not yet an oppressive problem but should cause concern with regard to German citizens’ future financial independence.
The second news item concerns the German government’s response to what the loss of purchasing power has meant for the weakest in society. The “citizens’ basic income” (a basic, guaranteed income for the unemployed) is set to rise by 12% to 563 euros per month, irrespective of rent and heating cost subsidies or other transfers citizens already receive from the government.
This support, while politically helpful, creates a dangerous imbalance that could have a fatal effect on the economy. If the amount of the citizens’ basic income de facto equals or even exceeds a possible earned income, this could not only lead to false incentives to not seek work, it certainly would lead to social tensions. After all, as calculations show, an unemployed citizens’ basic income recipient will henceforth have almost the same income as a low-income earner with a job.
Former economist and West German Chancellor Ludwig Erhard’s social market economy policy enabled Germans to create property and private wealth after World War II. At the beginning of the 2000s, with the introduction of the low-interest rate policy, a downward spiral began, reinforced by negative interest rate policies and the so-called unconventional monetary policy of the European and other central banks. In 2008, the worldwide financial market crisis brought enormous national debts to light.
Small- and medium-sized enterprises, which shoulder the burden of taxes and duties with their employees, are further restricted by high taxes and regulations.
COVID-19 policies, with their disastrous lockdowns and home office regulations, put additional burdens on labor and business location.
They also brought another imbalance to light: Large corporations like Amazon had an enormous advantage in distorted competition and, therefore, made huge profits at the expense of the stagnating European economy. This was because money for private consumption was distributed by government generously and with little targeting.
And now, another burden is to be borne by the German taxpayer: skyrocketing energy prices, which are due to the centrally managed “Energiewende” (green energy transition) and the irrational phase-out of nuclear power.
The political response, however, amounts to the same “solution” as at the turn of the millennium: printing money.
Once again, policymakers are relying on an illusion of economic growth. In reality, however, this path must lead to economic upheaval or collapse and sharply rising prices. This is always the case when the central bank becomes too active. Anyone who artificially triggers a boom by printing money will also cause a crash.
Politicians in Europe and America want to improve people’s well-being. But that requires foresight and the courage to completely rethink and break new ground. More of the above measures are not the solution.
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Five Things New “Preppers” Forget When Getting Ready for Bad Times Ahead
The preparedness community is growing faster than it has in decades. Even during peak times such as Y2K, the economic downturn of 2008, and Covid, the vast majority of Americans made sure they had plenty of toilet paper but didn’t really stockpile anything else.
Things have changed. There’s a growing anxiety in this presidential election year that has prompted more Americans to get prepared for crazy events in the future. Some of it is being driven by fearmongers, but there are valid concerns with the economy, food supply, pharmaceuticals, the energy grid, and mass rioting that have pushed average Americans into “prepper” mode.
There are degrees of preparedness. One does not have to be a full-blown “doomsday prepper” living off-grid in a secure Montana bunker in order to be ahead of the curve. In many ways, preparedness isn’t about being able to perfectly handle every conceivable situation. It’s about being less dependent on government for as long as possible. Those who have proper “preps” will not be waiting for FEMA to distribute emergency supplies to the desperate masses.
Below are five things people new to preparedness (and sometimes even those with experience) often forget as they get ready. All five are common sense notions that do not rely on doomsday in order to be useful. It may be nice to own a tank during the apocalypse but there’s not much you can do with it until things get really crazy. The recommendations below can have places in the lives of average Americans whether doomsday comes or not.
Note: The information provided by this publication or any related communications is for informational purposes only and should not be considered as financial advice. We do not provide personalized investment, financial, or legal advice.
Secured Wealth
Whether in the bank or held in a retirement account, most Americans feel that their life’s savings is relatively secure. At least they did until the last couple of years when de-banking, geopolitical turmoil, and the threat of Central Bank Digital Currencies reared their ugly heads.
It behooves Americans to diversify their holdings. If there’s a triggering event or series of events that cripple the financial systems or devalue the U.S. Dollar, wealth can evaporate quickly. To hedge against potential turmoil, many Americans are looking in two directions: Crypto and physical precious metals.
There are huge advantages to cryptocurrencies, but there are also inherent risks because “virtual” money can become challenging to spend. Add in the push by central banks and governments to regulate or even replace cryptocurrencies with their own versions they control and the risks amplify. There’s nothing wrong with cryptocurrencies today but things can change rapidly.
As for physical precious metals, many Americans pay cash to keep plenty on hand in their safe. Rolling over or transferring retirement accounts into self-directed IRAs is also a popular option, but there are caveats. It can often take weeks or even months to get the gold and silver shipped if the owner chooses to close their account. This is why Genesis Gold Group stands out. Their relationship with the depositories allows for rapid closure and shipping, often in less than 10 days from the time the account holder makes their move. This can come in handy if things appear to be heading south.
Lots of Potable Water
One of the biggest shocks that hit new preppers is understanding how much potable water they need in order to survive. Experts claim one gallon of water per person per day is necessary. Even the most conservative estimates put it at over half-a-gallon. That means that for a family of four, they’ll need around 120 gallons of water to survive for a month if the taps turn off and the stores empty out.
Being near a fresh water source, whether it’s a river, lake, or well, is a best practice among experienced preppers. It’s necessary to have a water filter as well, even if the taps are still working. Many refuse to drink tap water even when there is no emergency. Berkey was our previous favorite but they’re under attack from regulators so the Alexapure systems are solid replacements.
For those in the city or away from fresh water sources, storage is the best option. This can be challenging because proper water storage containers take up a lot of room and are difficult to move if the need arises. For “bug in” situations, having a larger container that stores hundreds or even thousands of gallons is better than stacking 1-5 gallon containers. Unfortunately, they won’t be easily transportable and they can cost a lot to install.
Water is critical. If chaos erupts and water infrastructure is compromised, having a large backup supply can be lifesaving.
Pharmaceuticals and Medical Supplies
There are multiple threats specific to the medical supply chain. With Chinese and Indian imports accounting for over 90% of pharmaceutical ingredients in the United States, deteriorating relations could make it impossible to get the medicines and antibiotics many of us need.
Stocking up many prescription medications can be hard. Doctors generally do not like to prescribe large batches of drugs even if they are shelf-stable for extended periods of time. It is a best practice to ask your doctor if they can prescribe a larger amount. Today, some are sympathetic to concerns about pharmacies running out or becoming inaccessible. Tell them your concerns. It’s worth a shot. The worst they can do is say no.
If your doctor is unwilling to help you stock up on medicines, then Jase Medical is a good alternative. Through telehealth, they can prescribe daily meds or antibiotics that are shipped to your door. As proponents of medical freedom, they empathize with those who want to have enough medical supplies on hand in case things go wrong.
Energy Sources
The vast majority of Americans are locked into the grid. This has proven to be a massive liability when the grid goes down. Unfortunately, there are no inexpensive remedies.
Those living off-grid had to either spend a lot of money or effort (or both) to get their alternative energy sources like solar set up. For those who do not want to go so far, it’s still a best practice to have backup power sources. Diesel generators and portable solar panels are the two most popular, and while they’re not inexpensive they are not out of reach of most Americans who are concerned about being without power for extended periods of time.
Natural gas is another necessity for many, but that’s far more challenging to replace. Having alternatives for heating and cooking that can be powered if gas and electric grids go down is important. Have a backup for items that require power such as manual can openers. If you’re stuck eating canned foods for a while and all you have is an electric opener, you’ll have problems.
Don’t Forget the Protein
When most think about “prepping,” they think about their food supply. More Americans are turning to gardening and homesteading as ways to produce their own food. Others are working with local farmers and ranchers to purchase directly from the sources. This is a good idea whether doomsday comes or not, but it’s particularly important if the food supply chain is broken.
Most grocery stores have about one to two weeks worth of food, as do most American households. Grocers rely heavily on truckers to receive their ongoing shipments. In a crisis, the current process can fail. It behooves Americans for multiple reasons to localize their food purchases as much as possible.
Long-term storage is another popular option. Canned foods, MREs, and freeze dried meals are selling out quickly even as prices rise. But one component that is conspicuously absent in shelf-stable food is high-quality protein. Most survival food companies offer low quality “protein buckets” or cans of meat, but they are often barely edible.
Prepper All-Naturals offers premium cuts of steak that have been cooked sous vide and freeze dried to give them a 25-year shelf life. They offer Ribeye, NY Strip, and Tenderloin among others.
Having buckets of beans and rice is a good start, but keeping a solid supply of high-quality protein isn’t just healthier. It can help a family maintain normalcy through crises.
Prepare Without Fear
With all the challenges we face as Americans today, it can be emotionally draining. Citizens are scared and there’s nothing irrational about their concerns. Being prepared and making lifestyle changes to secure necessities can go a long way toward overcoming the fears that plague us. We should hope and pray for the best but prepare for the worst. And if the worst does come, then knowing we did what we could to be ready for it will help us face those challenges with confidence.