The “celebration” of the US going off the gold standard exactly 50 years ago (irony mode off) is the perfect opportunity to talk about the looming economic collapse that has all the ingredients to spark the biggest SHTF of our era. 

Many suspect August 15, 1971, will be one day officially considered the date the US dollar died. Some argue its demise started before, with the creation of the FED (a.k.a. The Creature Of Jekyll Island) in 1913. Others, with an even broader perspective of history (and a deeper understanding of the human psyche and behavior), may say it’d happen either way, for this is how nature works (in cycles). That’s how we are. That’s what we do: humankind loves a toxic relationship, and fiat money is just that. 

All excellent and valid points, but I’ll leave that debate to future historians and stick to the present reality. Exactly fifty years later, we’re starting to see and feel (hmmm, smell?) the effects of that process play out. The surging of COVID-19 gave bureaucrats and governing elites the perfect excuse cover-up to go into hyperdrive mode with failed policies and practices. Which not only make things worse but are visibly accelerating the deterioration of the economy and dangerously increasing the wealth gap.

Why do I care about the looming economic collapse?

Since I started collaborating with The Organic Prepper, I’ve been beating the drum of economy and its deep connection with the sh*t hitting the fan. This relationship’s various aspects and practical implications permeate many of my articles about strikes, homelessness, crime, thirdworldization, and others.

The US has been the dominating superpower for decades, and we live in a highly interconnected world. That’s 2+2=4. Crises and crashes in less important and influential countries or regions (or even specific market sectors) have caused planetary shocks and disturbances many times before. Imagine what a big-time crisis in the largest economy could bring to the entire system. Get the point?

I don’t want to sound alarmist, however

I live in a country that’s been through sixteen (that’s right, sixteen) “monetary stabilization” plans and five different currencies just between the mid-1980s and 1994. The current one finally got us out of the death spiral of inflationary insanity. 

I’m not saying that to add credibility to any theory or opinion I might have on the subject. It’s more a warning about the kind of slow-burning SHTF I’ve experienced during the first half of my life, living with economic instability and inflation in various degrees, from high to hyper.

Almost thirty years later, it feels like that happened in another incarnation. But the 2008 crash and consequent GFC (Great Financial Crisis) brought back memories of that period. I saw the destruction, the millions getting wiped, and this is what got me officially and definitely into prepping and survivalism. That’s what I have to share. Maybe it’ll help others stay alert and prepared.

Essentially, “the economy” means resources

As I postulated in my article about the crisis in South Africa and Cuba, the economic situation of a country plays a defining role in the unfolding of any SHTF scenario. Even when dealing with natural disasters, the economic condition will dictate how good or bad things will turn.

Specifically, when it comes to the social contract, if there’s growth, jobs, hope, the collective sense of purpose will prevent (or at least make a lot harder) incite division among the population. People are busy working, enjoying the present, and building the future to even care for differences in race, religion, ethnicity, or politics (much less issues about gender identity or sexual orientation). In other words, there will be no disposition nor spirit to fight or clash.

A stable and robust economy quickly rebounds from most disasters and vice-versa

Germany is already recovering from the recent series of floods that caused many deaths and lots of destruction. The population and authorities acted in unity, with solidarity, efficiency, and order. The nation will learn lessons and, as a whole, improve from this situation. 

Examples abound in both extremes of the spectrum. Countries with weak economies usually take years, if not decades, to recover from disasters (and usually, the number of casualties is much higher, too). In South Africa, the recent wave of violence in the eastern region ravaged critical infrastructure. It will take a lot to rebuild it, and the population will suffer for a long time.

Everything changes during and after an economic collapse

If the standard of living drops significantly, decadence quickly sets in. Life gets a lot harder for a more significant part of the population, which raises discontent. People start looking for culprits and reasons. “The other” becomes the enemy. What reasons? Any and every. Who’s the other? Everyone and anyone.

Everyday life becomes hell. Unemployment, inflation, shortages, hardship, and wealth gaps foster crime, violence, addiction, homelessness, and deeper-running issues of mental disorders, stress, disenfranchisement, hopelessness.

That creates an environment ripe for division and revolt. Hatred and intolerance lead to social unrest. These things can only be instilled and fomented among a population suffering from a bad economy for some time.

A divided society can be easily manipulated or subjugated

Divisiveness will cause social conflicts ranging from an explosion in crime and intra-violence to an all-out civil war. Phase One is already ongoing in the US and many other countries. Infighting is popping up here and there.

Governments can also see a solution in diversion, as in uniting people against an external enemy or other cause. When everything else fails, they take us to war. We can already see hints of this strategy in the discourse and actions of some governments. Are the tensions between the US and China just bickering, or will it escalate soon? 

Politicians and authorities can also become dictatorial and turn the screws on their own population, in an attempt to keep control of things or with other sinister intentions. We see this too, and what’s worrying: in countries with a longstanding tradition in democracy and freedom, this would be unthinkable not long ago. 

Propaganda is used to control the narrative and direct the people

Still, it’s hard to predict which way people will turn. It depends on too many factors. There’s no way to know how the population will respond to propaganda. (Or if some populist figure or party will rise to power.) These are common and play a role in changing direction or defining the course of events.  

People in Italy and France are taking action against totalitarian policies and propositions, an inspiring example. This initiative can spread, or it can dwindle. But it’s a promising new sign. I’m keeping an eye out for where this is going, how the powers will react, how much people will take. These might reveal the limits on each side are. Sometimes significant movements are born this way.

It’s not about predicting the future, but rather paying attention to the discourses, the propaganda, the war of narratives (and action). Questioning, following trends, policies, connecting the dots. And Selco is right: if the conditions are in place, any country can see the rise of radicalism that may lead to conflict.

Other misconceptions about economic collapse

The belief that an economic collapse will end in some Mad Max SHTF, with gangs roaming a devastated land, is common among some preppers. Though everything is possible in theory, it’s unlikely TEOTWAWKI will happen. I mean, it’s more likely to become a reality in sh*tholes around the world. 

But nothing this radical has happened to more developed countries and much less to fallen empires in modern history, which may support this theory. Take the UK, for instance: it hasn’t exactly turned into a dumpster after its demise as a world superpower. Neither has Russia, another global force of the 20th century when the Soviet Union collapsed.

There were prominent disturbances, ripples, and consequences for sure. No such process is smooth or entirely immune to turmoil. But I guess everyone will agree (and the data shows) both nations still wield a lot of power, influence, relative stability, and their populations enjoy a relatively decent standard of living.

What about radical regime changes?

Another common fear and something to be wary of are radical regime changes. A 180° in the political regime can drastically affect the outcome of a financial crisis and create the worst economic disasters (Venezuela and Cuba come to mind). 

There are some crucial nuances, though. Swings in politics are common and even necessary. They’re a display of a healthy democracy rather than a failing one. Above all, they’re inevitable, so in principle, they shouldn’t be feared but instead embraced, welcomed, and perhaps even celebrated.

There are more important things to heed than the political regime

For example, the solidity of institutions, the tradition in democracy and freedom, and the equilibrium of powers. Respect for the constitution, character, and stability of regulations, and the effectiveness of the checks-and-balances system are also determining factors. These will dictate the limits of intervention and actions any government can inflict one way or another. Which ultimately shapes the economy, and thus the standard of living of the population in a particular country.

That’s why political changes aren’t the same everywhere and also yield vastly different results. Meaning, a turn to left (or right) in the US or Canada isn’t the same as a turn to left (or right) in, say, almost any country in Latin America. Even between different Latin American countries, the outcome of similar regimes will differ to a great degree, based on the factors listed above. 

Can this happen to western developed nations? 

Admittedly, things are weird, and even the institutions of the most civilized countries are shaken to a significant degree. The fear is palpable, notably in the US, where I see people (and many friends) losing sleep over the possibility of America turning USSA. 

Again, it’s The Fourth Turning, so there’s always the possibility of things going awry. But as I tried to show in a previous article about the similarities of the 1930’s Great Depression and today, the US has flirted with socialism, and this fear has taken American society before, during similar circumstances. Yet, it hasn’t materialized. 

There’s perhaps something more worrying, which is the larger point of this article: serious threat of a looming economic collapse – the insurmountable level of debt, in particular – can bring massive blows, with unforeseeable social consequences and unintended political (and geopolitical) reflexes.

We’re now one or two shocks away from a catastrophic economic collapse

The reasons are too many and too complex to list, so for the sake of simplicity, let’s acknowledge an overhaul of the current social, economic and political orders is past due. Every few generations, the system crumbles under its own weight, complexity, and corruption. And another cycle begins anew. This dynamic repeats throughout history.

The thing is, never before has the system been so overblown: we’re living in the era of Big Money, Big Tech, Big Pharma, Big Corp, Big Government, Big Media, Big Consumption, Big Entertainment. This “Big Everything” system led inexorably to Big Debt, Big Lies, Big Corruption, Big Manipulation, Big Divisiveness, Big Wealth Gap.

Never before has it been this fragile, either – a Big F*cking Mirage. So what’s the logical, mathematical conclusion to that? 

Yes, this is about the Great Reset

Whatever you want to call it, whether you think it’s an evil plan by governments and politicians in conjunction with unelected officials and elites, or a natural cycle of history, doesn’t matter. The Great Reset will happen either way. Rest assured of that.

And here’s the rub: this kind of process has rarely happened peacefully or without serious turmoil. Which means bad days are coming. No one can do anything to prevent it. As I tried to show in the opening, this train has already left the station long ago. 

The time to dream about and prepare for Hollywood style SHTF is over

Please don’t take this the wrong way. I have no idea how big or ugly the looming economic collapse will be. Nor do I know exactly how it will unfold, or if this will cause a pile-up of SHTFs. Much less the timing, because that’s the most challenging variable to get right in everything.

But it won’t be a zombie apocalypse, a meteor or like the movies. However, it will directly affect the lifestyle of 99% of the population, perhaps on a global scale. And even though some places will be affected differently than others (as is always the case), there will be nowhere to go to escape when it hits. 

In part two, I’ll conclude and share some tips on preparing for what’s coming. 

Are you concerned about an economic collapse of epic proportions?

Is this a concern on your radar? Why or why not? If so, what ramifications do you foresee? How will you prepare for it? Let’s talk about it in the comments.

About Fabian

Fabian Ommar is a 50-year-old middle-class worker living in São Paulo, Brazil. Far from being the super-tactical or highly trained military survivor type, he is the average joe who since his youth has been involved with self-reliance and outdoor activities and the practical side of balancing life between a big city and rural/wilderness settings. Since the 2008 world economic crisis, he has been training and helping others in his area to become better prepared for the “constant, slow-burning SHTF” of living in a 3rd world country.

Fabian’s ebook, Street Survivalism: A Practical Training Guide To Life In The City, is a practical training method for common city dwellers based on the lifestyle of the homeless (real-life survivors) to be more psychologically, mentally, and physically prepared to deal with the harsh reality of the streets during normal or difficult times. 

You can follow Fabian on Instagram @stoicsurvivor

Image by pasja1000 from Pixabay. Article cross-posted from The Organic Prepper.