Only 43 Shopping Days Until Economic Collapse!

A Myriad of Threats Loom in

Barcode Dominos Falling Towards Man
Barcode Falling Like Dominos. Tang Yau Hoong

Will 2016 hold some negative economic surprises?  Maybe... but either way, consistently profiting from your investments involves being prepared for whatever wind blows past, good or bad.

The economy may boom, taking the stock market with it, or it may suffer bursting bubble after bursting bubble.  The latter possibility should at least be considered, in order to be prepared in such an eventuality.  

If the dark times never come, that's great, and even if you prepared, you probably didn't risk your entire net worth in the process.  On the other hand, in a worst case scenario, even slight preparations done now may go a long way to landing on your feet.

So what happens in 43 days?  Nothing specifically - the title was an attempt to make a point.  The number could have been 5 or 86 or 111 days, or an even better possibility would be that the world never suffers a meltdown in currency confidence.

The message I'm trying to give is that we are poised at a very unique time, and any one of a whole myriad of concerns may spark a fire.  Maybe we just keep kicking the debt can down the road, while home and stock market prices just keep rising up and up forever, and we never lose purchasing power of our dollars.

That would be wonderful.  While we're at it, let's suggest that America is not bankrupt, and imagine that Social Security and pensions will be paid.

The enters the math - that awful, unforgiving, cold bunch of ugly numbers.  The National debt and unfunded liabilities are so extreme, that even discussing the actual numbers would be preposterous, like arguing about the existence of Mexico's chupacabra.

Here is what could set the global economies afire:

Federal election - I'm not sure why the candidates are fighting so hard to win the Presidency.  Whichever figurehead takes over the leadership of the country will be sitting in office through what will likely be one of the darkest times of our economic lives.

Reserve currency - At the end of September, China's renminbi joins the Yen, Pound, Euro, and U.S. dollar as an official reserve currency.  I explain why this is an issue for you and the U.S. dollar in this video.

Desperate economies - Many nations are heavily reliant on oil prices to support their economies.  Rapidly falling prices (despite only 53 years of supply left) for the commodity have put pressure on countries from Canada to Russia to Saudi Arabia.  Venezuela for example is already facing major troubles, from food shortages to crushing debts, while many other nations are beginning to follow in their footsteps. 

Deflation - The dreaded "D" is looking more likely by the week.

Inflation - With unprecedented amounts of new money being printed worldwide, from Canada to Switzerland to America to Japan, inflation is a given.  It just hasn't shown up quite yet, except in the Ukraine and some South American countries.

Interest rates - The Federal Reserve keeps teasing us that they might raise rates.

 The eventually will, but many are calling for higher rates to absolutely derail the economy, here and globally.

Military tensions - The recent downing of the Russian fighter jet may just be the beginning of increased military clashes, reminiscent of Vietnam and Korean battles between Russian and American planes, however unlikely.  There is also the consideration of the U.S. sending more ground forces to the Middle East, as they most recently announced they would do a few hours before I wrote this.

Of course, this is just a partial list of potential concerns.  Truly a slowdown in China, a stock market meltdown, or any of an endless list of black swan events could be the spark that ushers in a new economic paradigm.

The good news is that, as much as it might keep your interest, all of these doomsaying comments are each meant as one possible path which you should keep an eye upon.

 The scary stuff will hopefully not happen at all.

The other good news is that it will be simple to prepare for the bad possibilities, so that you don't have to get caught by surprise if they do happen.  For example, I don't care who wins the election - rather I just prepare to respond to the policies of the victorious party, by picking out specific penny stocks which would do well based on the final result.

Here are some ways to prepare:

  • Specific stocks will benefit - I choose penny stocks which are risky, but can really balloon if they solve a problem, or save money for people or businesses
  • The original insurance - Physical gold and silver does well in times of inflation, global chaos, and war.  The same holds true during times of loss of confidence in the currency.
  • Lower expenses to the necessities, pay down debts, and keep cash on hand to take advantage of bargains that might crop up.
  • Delay major purchases - Many of the items you are looking to buy now could be trading for a third of the price in the future.
  • Rebalance your portfolio - If you believe that deflation or global chaos might emerge, you probably will not have a high expectation for cruise lines or high-end jewelry.  Maybe you lean more towards military technologies or local vacation resorts.
  • Keep an eye on the economy - Read what you can, and watch the relevant news each day.  You will almost certainly do very well if you don't get blindsided by some unexpected event.

Long story short, there are many concerning events coming together in 2016.  However, the fewer who might get surprised by them, the less likely these outcomes will arrive at all.