Note: The following is the first installment of a series that represents a first-hand chronicle of a fictional economic collapse in the United States. No one can say with any certainty how such an event would unfold or the social impact it would have. This series is to be viewed as only one possible scenario.
October 14 – 9 days after Black Swan Day
My Dearest Children –
A couple of years ago Glen Beck suggested starting a chronicle to document the events in your life as things came apart that he predicted. I’ve never been a chronicler or a diary keeper. Until now. I make no illusions this will be a work heralded like the Diary of Anne Frank. And I pray that level of events doesn’t come true, thought Mr. Beck and a few others have been mostly right until now so who knows. But I feel it’s necessary for you my daughters to have an unbiased firsthand account of the events happening now. I am sure in years to come in whatever classes you are in (presuming there still is a school system) the Politically Correct crowd will have rewritten the history of today just as they have tried with September 11th, 2001.
Never in my life time did I believe the events I am living would happen. Until now the fall of great societies like the ancient Greeks and Romans was regaled only in history books to me. Even the fall of the Weimar Republic seemed ancient history to me. But now every time I turn on the TV or radio, check the net, or just go to work it seems beyond surreal. I survived 9/11 in downtown Manhattan. Maybe it’s the passage of years since that softens the view but this seems even more unbelievable if I were not living it myself.
“Black Swan Day” is what the media-at-large has dubbed it. “October Surprise” is another term often used. Probably will ultimately be called something else in future history books, no doubt implying the end of capitalism as if that was a good thing. But either way the end result is the same.
History rarely follows a script but this day did. It unfolded more or less as many predicted:
Nine days ago China and Russia both announced that, due to the continual devaluation of the U.S. dollar by the Federal Reserve printing money out thin air, both countries were imposing a “dollar premium surcharge” fee on transactions paid for in greenbacks. This they said was to make up for continuing fall of the value of the dollar. This announcement effectively made the Euro (as shaky as it was) and the Renminbi the new worlds’ reserve currency as transaction paid for with them were cheaper than paid in dollars. Several European countries and South American countries chimed in with in hours adding more fuel to the fire. As such the dollar index drop faster than a coin in a slot machine as central banks around the world sold dollars to buy Euros and Renminbi – and gold! Gold shot up over $200 an ounce with in the first 10 minutes of the Chinese/Russian announcement and hit $5,000 an ounce by week’s end (hanging at $5,726/oz as I write this).
Naturally the Wall Street markets dropped like a stone which forced the Federal Reserve to announce billions more funny money to be pumped into the market. But no one was buying it this time. I’m sure a lot of political pressure was put on Goldman Sachs and JP Morgan over that first weekend to come out with rosy forecasts on Monday. But by then even these guys had seen the writing in the wall and refused. Besides, they were so global by now so what if the Justice Department launched a witch hunt later. It would like giving out parking tickets while Godzilla tramples the street – who cares?!
But when the Dow fell to 9700 on the third day all the rhetoric in the world couldn’t stop mom&pop investor from calling their mutual fund and Etrade broker yelling “SELL!” When the dust settled the Dow held at just a little over 8400. Just think – it was nearly 14000 3 months ago!
That’s it for the history lesson. Now the today view.
Thankfully your mother and I still have our jobs. Either by Devine will or dumb luck our industries are still seen as “critical” for now. A lot people have already lost their jobs in a matter of days. The pink slips were probably already printed and this was just a good excuse. Going to be interesting to see the next unemployment figures if they stay below 10%. I’m sure someone will believe that, along with a bridge I have to sell. And our employers still offer a few good benefits that seem all that more valuable today.
MSNBC and CNBC are openly using the D-word “Depression” now. A little late to the game I think but at least it’s in the open. Naturally, the usual talking heads are saying they saw it coming (so why didn’t they sound the alarm long ago?!) and claim the markets have already factored that in. Damage control at best. Hope they are among the ones who lose their jobs soon!
When Black Swan Day came my first thought was “Thank G-d I have made some preps!” I am nowhere near as prepared as I should have been. Your mother has strong and often heated disagreements with me on prepping but I think she finally has accepted it could be useful. I hope her acceptance isn’t a harbinger of things to come. But I’m glad we just did a Costco run and filled the freezer with good stuff. The cabinets are full of canned stuff, plus what I have the prep pantry (your mother will blow a gasket when she sees my stock but I have a responsibility to you my daughters). Fresh milk seems still plentiful but I am noticing it’s taking longer to restock the supermarket shelves. I hope it’s just logistical issues. A lot of our friends and coworkers aren’t anything like as prepared as we are. I truly fear for them.
As of this moment the banks are still open with business as usual but I don’t expect that to last. The ATMs are almost continually empty and long lines inside indicating to me people are pulling their money out. Even to get into the vault takes a wait on a long line (I cleaned our out the second day). I did read a few online articles that claimed runs on smaller banks in some parts of the country but nothing in the media at large the one of the local S&Ls has shortened their hours. That seems odd.
So that’s where things stand as of tonight.
It’s a chilly night. Very appropriate. Which reminds me to check the oil burner. Going to be a cold winter.
You’re still way too young to understand what’s happening around you and for that I’m glad. I’ll do all the worrying for you. G-d bless my children. And grant me with wisdom to make the right decisions for you.
PS- MSNBC and Fox News just reported that OPEC has announced they will now value oil in gold only instead of U.S. dollars! Crude has already jumped over $20/barrel in overnight trading. Oh boy! And I thought $5/gallon gas was going to be bad. Glad I have a heating oil cap for this winter at least. Don’t know what the spot buyers like your Aunt Donna and Uncle Frank will do. Blankets are going to be a good seller this winter I think.