[Eli]

I would like to hear what people have to say about this because we all see this storm cloud coming.

I know the general feeling for many people is to try and get out of debt as much as you can now. That is good advice but what do you do if that is just not possible?

Lets say you made the unfortunate choice to buy a McMansion some where outside of Phoenix. There is going to come a time when what was once an asset will become a huge liability.

How should people deal with this?

[Madpaddy]

This is a tricky question. We made a conscious decision to move house 2 years ago from a house in the city to a house on an acre in the country - closer to where I work. Moving involved upping our mortgage by about €70K from €210 to €280K. However, I am in a government job with steady, reliable income. We also have an apartment mortgage free in Hungary with a steady rental income. I am hoping to sell that property in 2 years which should knock €130K off my debt. I do wonder if A.) I have 2 years and B.) what the f..k to do about the €150K debt I will have left. I'm kinda hoping hyperinflation saves me. Anyway, they can't throw everyone out in the street and because of my job, I should be better able to pay my debts than most.

PS: I am proficient in the use of the Steyr AUG, the GPMG 7.62mm, the 9mm Browning Automatic Pistol, SRAAW (short range anti armour weapon), the Carl Gustav 84mm Anti tank weapon and the hand grenade.

[Eli]

This is a tricky question and one that requires action at the right time.

And I think two years is generous. What are the chances of a major hurricane in the GOM or KSA really is in decline, or some other major oil related event takes place in the next two years?

I really can see why when we enter into a depression the need will arise for the banks to make us all go to cashless transactions.

A lot of people are going to just walk away from homes and cars that have lost their value. People will try and walk away from debts of all kinds.

The banks will demand that to make the system stable again we need to go cashless. That way it will be impossible in the future to just walk away. The banks will know if you have made an income on anything.

This will give them a the ability to assign your debt to your cashcard they will take a hefty percentage of all you earn to pay off the debt.


My plan is to wait until the bottom drops out. When things look the worst I am going to buy a piece of property that is suitable for a small farm. There will be plenty of people who won't be able to make it out in the countryside and all real estate should come down.

It will not be evident until after the Banks make their move that self sufficiency and working in small communities independent of the banks is the only way to go.

[Twilight]

The UK government pulled an elegant trick with student debt.

University students were offered loans with an annual interest rate based on the Retail Price Index (ie broadly tracking inflation). Later they added on an extra percent, changed the repayment thresholds such that it takes over a century to clear, and sold it to some buyer in the financial service industry so what they're holding is a kind of bond with a low steady return.

What does this achieve? It means many parents no longer support their kids through university with real earned money. Negative money does it for them. It basically handed every family in the country £10-20k free cash sourced from 2130. The spending power created can be seen in any middle class stronghold.

Until a year ago, I entertained notions of repaying the whole thing with one cheque. Then I did the sums and found it was never meant to be repaid, by design. I've got the amount written down somewhere, but no longer care what it is.

I get the feeling this may be a problem later, though not for me personally, more like for the whole world. Until then, here's a toast to governments that give you free cash from a future they know doesn't exist.

[paimei01]

The bankers think they can own the world if they have a piece of paper that says so ! Silly

[Daculling]

$this->bbcode_second_pass_quote('paimei01', 'T')he bankers think they can own the world if they have a piece of paper that says so ! Silly

[The_Toecutter]

$this->bbcode_second_pass_quote('', 'W')hat to do if you have a lot of debt when PO hits?

[Ludi]

My only debt is my house, and if I haven't paid it off by the time...they will have to drag me bodily off'n my land. Seems like a lot of trouble to go to for them to take a worthless piece of land and cheap house.....

[frankthetank]

Can't we just default? Isn't it the Chinese's money anyways (atleast a lot of it, along with the Japs). Maybe they'll just make a law that says anyone related to you must repay the debt! I hate fucking bankers!

[I_Like_Plants]

$this->bbcode_second_pass_quote('The_Toecutter', '
')If it becomes so desperate that debtors are being shipped off to forced labor camps, shoot whomever tries to detain you. You'll probably wind up dead, but it's worth a shot. Honestly, I don't think that's happening within this generation. But could it? Yes.

[TITAN]

I don't believe financial institutions will be in any position to try and collect on a debt of dollars.

There's no contract in this country that says anything about indentured servitude, or having to actually work anything off that can't be paid in real money.

So I say "Don't worry about it."...

The dollar will be ruined if the peak hits hard, so who is going to figure out that mess?

People will have more important things to worry about than collecting on a bunch of debt that is rendered meaningless/useless. Even bankers; yes I think they may be people too...

[FourOfSwords]

What to do if you have a lot of debt when PO hits?
...Clap your hands, thank the Gods, and have a drink!
A.

[Newsseeker]

They're building camps near the Mexican border for the debtors that will result when TSHTF. Get used to taking communal showers and sleeping in tents.

[Madpaddy]

Newsseeker wrote,
$this->bbcode_second_pass_quote('', 'G')et used to taking communal showers and sleeping in tents.

[AlCzervik]

I am interested to hear the inflation v. deflation arguments. I am tempted to really start paying down my mortgage now, but if we get runaway inflation, paying off my fixed rate mortgage with a wheelbarrow full of worthless dollars would be sweet. On the other hand, if we get deflation, I am assuming that is when you want to be out of debt. Any thoughts on this?

[Twilight]

I doubt it'll be that bad. They can't get the stuff to work as advertised in Iraq, I doubt it'll work great in the US. The capability exists mostly on paper.

Good think Europe doesn't have any of that fancy technology anyway. The governments have all these fancy cameras and nothing to back them up.

[Roccland]

Seems odd...huh?

Well apparently I am not the only lunatic around...

Bison Survival Blog

$this->bbcode_second_pass_quote('', 'R')ight now is the perfect time to stock up. Nothing is going to get cheaper, supplies will start to get scarce, and in real purchasing terms your salary is going to shrink every year. Do not delay, buy today. Everything. Even if global oil supply is not as gloomy as stated, things are, in general, steadily going down hill. Things are only getting worse. Buy it now. Have an escape if your job is lost and the house is repoed. A small lot of junk land, an RV ( not a great strategy if gas goes up in price, but better than nothing ). Whatever. One example of price jumps was given by the writer at Survival Acres Blog. He sells freeze dried foods and his cost for powdered milk just went up 300%. Granted, feed prices are driving up milk costs. But such an increase may never see a corresponding drop, since more folks will start prepping. All prep foods are going to get insane. Ammo price increases are already that way. Wheat is up 50%. Prep now, buy now. If you do go into debt ( better a bad credit rating than no supplies ) to get it, draw cash advances to buy your preps. I know the interest is steep, but you don’t want Uncle Sam or the Banker you will owe money to even after the house repo ( you will be legally liable for the difference between the selling and debt price ) to know what tangible assets you have.

[emersonbiggins]

Done and done.

Oh wait, I was supposed to buy survival supplies with that debt?