Nine Meals from Anarchy

Sprott Money's picture

 


Nine Meals from Anarchy

Written by Jeff Thomas (CLICK FOR ORIGINAL)

 

 

Nine Meals from Anarchy - Jeff Thomas

 

 

 

In 1906, Alfred Henry Lewis stated, “There are only nine meals between mankind and anarchy.” Since then, his observation has been echoed by people as disparate as Robert Heinlein and Leon Trotsky.

The key here is that, unlike all other commodities, food is the one essential that cannot be postponed. If there were a shortage of, say, shoes, we could make do for months or even years. A shortage of gasoline would be worse, but we could survive it, through mass transport, or even walking, if necessary.

But food is different. If there were an interruption in the supply of food, fear would set in immediately. And, if the resumption of the food supply were uncertain, the fear would become pronounced. After only nine missed meals, it’s not unlikely that we’d panic and be prepared to commit a crime to acquire food. If we were to see our neighbour with a loaf of bread, and we owned a gun, we might well say, “I’m sorry, you’re a good neighbour and we’ve been friends for years, but my children haven’t eaten today – I have to have that bread – even if I have to shoot you.”

But surely, there’s no need to speculate on this concern. There’s nothing on the evening news to suggest that such a problem even might be on the horizon. So, let’s have a closer look at the actual food distribution industry, compare it to the present direction of the economy and see whether there might be reason for concern.

The food industry typically operates on very small margins – often below 2%. Traditionally wholesalers and retailers have relied on a two-week turnaround of supply and anywhere up to a 30-day payment plan. But an increasing tightening of the economic system for the last eight years has resulted in a turnaround time of just three days for both supply and payment for many in the industry. This a system that’s still fully operative, but with no further wiggle room, should it take a significant further hit.

If there were a month where significant inflation took place (say, 3%), all profits would be lost for the month, for both suppliers and retailers, but goods could still be replaced and sold for a higher price next month. But, if there were three or more consecutive months of inflation, the industry would be unable to bridge the gap, even if better conditions were expected to develop in future months. A failure to pay in full for several months would mean smaller orders by those who could not pay. That would mean fewer goods on the shelves. The longer the inflationary trend continued, the more quickly prices would rise to hopefully offset the inflation. And ever-fewer items on the shelves.

From Germany in 1922, to Argentina in 2000, to Venezuela in 2016, this has been the pattern, whenever inflation has become systemic, rather than sporadic. Each month, some stores close, beginning with those that are the most poorly-capitalised.

In good economic times, this would mean more business for those stores that were still solvent, but, in an inflationary situation, they would be in no position to take on more unprofitable business. The result is that the volume of food on offer at retailers would decrease at a pace with the severity of the inflation.

However, the demand for food would not decrease by a single loaf of bread. Store closings would be felt most immediately in inner cities, when one closing would send customers to the next neighbourhood, seeking food. The real danger would come when that store had also closed and both neighbour hoods descended on a third store in yet another neighbourhood. That’s when one loaf of bread for every three potential purchasers would become worth killing over. Virtually no one would long tolerate seeing his children go without food because others had “invaded” his local supermarket.

In addition to retailers, the entire industry would be impacted and, as retailers disappeared, so would suppliers, and so on, up the food chain. This would not occur in an orderly fashion, or in one specific area. The problem would be a national one. Closures would be all over the map, seemingly at random, affecting all areas. Food riots would take place, first in the inner cities, then spread to other communities. Buyers, fearful of shortages, would clean out the shelves.

Importantly, it’s the very unpredictability of food delivery that increases fear, creating panic and violence. And, again, none of the above is speculation; it’s an historical pattern – a reaction based upon human nature whenever systemic inflation occurs.


Thenunfortunately… the cavalry arrives

At that point it would be very likely that the central government would step in and issue controls to the food industry that served political needs, rather than business needs, greatly exacerbating the problem. Suppliers would be ordered to deliver to those neighbourhoods where the riots were the worst, even if those retailers were unable to pay. This would increase the number of closings of suppliers.

Along the way, truckers would begin to refuse to enter troubled neighbourhoods and the military might well be brought in to force deliveries to take place.

But, why worry about the above? After all, inflation is contained at present and, although governments fudge the numbers, the present level of inflation is not sufficient to create the above scenario, as it has in so many other countries.

So what would it take for the above to occur? Well, historically, it has always begun with excessive debt. We know that the debt level is now the highest it has ever been in world history. In addition, the stock and bond markets are in bubbles of historic proportions. They will most certainly pop, but will that happen in a year? Six months? Next week?

With a crash in the markets, deflation always follows, as people try to unload assets to cover for their losses. The Federal Reserve (and other central banks) has stated that it will unquestionably print as much money as it takes to counter deflation. Unfortunately, inflation has a far greater effect on the price of commodities than assets. Therefore, the prices of commodities will rise dramatically, further squeezing the purchasing power of the consumer, thereby decreasing the likelihood that he will buy assets, even if they’re bargain-priced. Therefore, asset-holders will drop their prices repeatedly, as they become more desperate. The Fed then prints more to counter the deeper deflation and we enter a period when deflation and inflation are increasing concurrently.

Historically, when this point has been reached, no government has ever done the right thing. They have, instead, done the very opposite – keep printing. A bi-product of this conundrum is reflected in the photo above. Food still exists, but retailers shut down because they cannot pay for goods. Suppliers shut down because they’re not receiving payments from retailers. Producers cut production because sales are plummeting.

In every country that has passed through such a period, the government has eventually gotten out of the way, and the free market has prevailed, re-energizing the industry and creating a return to normal. The question is not whether civilization will come to an end. (It will not.) The question is the liveability of a society that is experiencing a food crisis, as even the best of people are likely to panic and become a potential threat to anyone who is known to store a case of soup in his cellar.

 

Fear of starvation is fundamentally different from other fears of shortages. Even good people panic. In such times, it’s advantageous to be living in a rural setting, as far from the centre of panic as possible. It’s also advantageous to store food in advance that will last for several months, if necessary. However, even these measures are no guarantee, as, today, modern highways and efficient cars make it easy for anyone to travel quickly to where the goods are. The ideal is to be prepared to sit out the crisis in a country that will be less likely to be impacted by dramatic inflation – where the likelihood of a food crisis is low and basic safety is more assured.


 

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Nine Meals from Anarchy

Written by Jeff Thomas (CLICK FOR ORIGINAL)

 

 

 

Jeff Thomas is British and resides in the Caribbean. The son of an economist and historian, he learned early to be distrustful of governments as a general principle. Although he spent his career creating and developing businesses, for eight years, he penned a weekly newspaper column on the theme of limiting government. He began his study of economics around 1990, learning initially from Sir John Templeton, then Harry Schulz and Doug Casey and later others of an Austrian persuasion. He is now a regular feature writer for Casey Research’s International Man and Strategic Wealth Preservation in the Cayman Islands.

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Colonel Klink's picture

You got it right when you typed "neighbor hood"

ToSoft4Truth's picture

When we allow government to make laws against gardens and collecting rain water, well, starving becomes a choice. 

 

We are surrounded by food. 

 

- Evidence reveals what the Donner Party ate during their final days of being snowbound in the Sierra Nevada. - After eating the family dogs and other animal meat, some members ate bones, hides, twigs and string. - Human bones were not recovered but researchers believe some Donner Party members resorted to cannibalism.

gaoptimize's picture

People will die from lack of clean water before they starve.  Please get yourself and your friends and family a couple bags of  Calcium Hypochlorite (pool shock).

sessinpo's picture

Another way to look at it is this. If the place is still able to have elections (even corrupt where voting doesn't matter), then it isn't a SHTF.

gmak's picture

What about Zimbabwe - It was extreme deprivation there.  Instead of violence and revolution, people took to the streams and rivers and were panning for gold. WTF???? 

Calmyourself's picture

How many of these people in Zimbabwe had lived on a teet for essentially their entire life and then had it yanked away...  Think of the social dynamics here and there and re-post...  Totally different situations.

sessinpo's picture

In other words, it wasn't a SHTF. It was a major disruption but there was still government and people made adjustments.

gmak's picture

So explain why no extreme violence in Venezuela. I'm sure that shortages there have led to enormous fear and loathing for the elites. And yet, there is no blowback after months and months of empty stores. Now they are rationing electricity. It just goes to show that if you boil the water slowly, the 99% will stay in until they are cooked.

BandGap's picture

You have to be fucking kidding. This has been part of the news for years now, and it is escalating. Turn off your fucking TV and read something. Venezuala is the mpost violent country on the planet that is not involved in a war.

http://www.businessinsider.com/venezuela-police-violence-and-killings-20...

sessinpo's picture

People don't seem to have the same definition of SHTF. As far as I'm concerned, no place has had a SHTF in our lifetime. Not Egypt, not Syria, not Iraq, not Libya, and not Venezuela yet. And certainly not the USA. For example, people like to use hurricane Katrina as an example. That was not a SHTF.

Those places have had extreme situations that were temporary. But they are hardly mad max or the road scenarios. When I refer to SHTF, it is WROL (meaning you have roving  mobs or gangs running rampant and going after anyone.) You have a downfall of government. You would have martial law, but there is no law enforcement to enforce it.

Basically, you on your own. No government help and no supplies. Commerce breaks down with all the chaos. Basic things like water and electricity are gone and so are food supplies. Not for just a week or a month. But for at least 6 months or longer. Mass deaths from murders, disease, starvation, etc.

That is SHTF. Not a situation where I can just sit on my ass eating cheetos while watching it on the news like some reality TV show, waiting it out.

css1971's picture

I disagree. For a typical American, and European these days, it's 3 months before they are 9 meals from anarchy.

Your average American can literally eat nothing for 3 months and they will only be down to a "normal" body weight.

I suppose you could think of it as prepping.

sessinpo's picture

No worries Sprott. According to some ZHs, starving people will to busy looking for and breaking into the bunkers to the elite.

Edit. Some may know I am not a big fan of Trump (or anyone else.) Trump is self serving and just as much a liar as the rest.

And it just dawned on me. Trump has said he wouldn't  want to be President when the SHTF. He has said we are in a bubble and things are going to get real bad. So we have a conflict here. So why is Trump running?

Answer. If Trump wins, he will have probably the best bunker to hide out in. Built on the slave taxes of a corrupt government.

New World Chaos's picture

Most starving people will turn on nearby neighbors who they think might have a bit extra.  Patriots will be few and distracted (at first).

Deleted some stuff about bunkers because I don't want to give the elites any ideas.  Bunkers are great.  You will be perfectly safe there (bwahahahah)

GoldIsMoney's picture

Anarchy is not about stealing it's about not being "ruled".

sessinpo's picture

GoldIsMoney Anarchy is not about stealing it's about not being "ruled".

----

If someone is stealing from you. you are being ruled.

GoldIsMoney's picture

Not that is not a true implicaton. You may get stolen from without being ruled. There are always men which can not or do not  want to separte mine and yours. Anyway if the theft is backed by government you're right. Taxes are the most prominent example for that.

Cautiously Pessimistic's picture

I am sitting here watching the local early morning news.  Other than the weather forecast, and a few minutes of what went on in the wide, wide world of sports, the ENTIRE broadcast is about shootings, murders, and high speed chases (as perpetrators flee police after committing some type of crime).  I leave it to the reader to guess the race involved more times than not, but my point is beyond that.  Right now, food is plentiful, everybody has access to healthcare, everybody has access to entertainment (teevee, iCrap, theaters, sporting events, etc), everybody has clean water and electricity, and on and on and on.  In other words, whether you are working hard and earning these benefits, or they are being given to you, life is easy today!  When you start removing/losing any of these items I have listed, then life will get hard real quick.  The 'wolves' will pounce on the 'sheep' without hesitation.  Don't be a sheep. 

tc06rtw's picture

   
 …  An even more obscure horror, which no one at all has even  CONTEMPLATED  is:
 Now that a plurality of the human race is on a diet of “maintenance drugs,”  what happens if/when the pharmaceutical companies are {forced into/take delight in} price rises?

MoHillbilly's picture
MoHillbilly (not verified) tc06rtw Apr 25, 2016 8:42 AM

Good observation, most of the populous is either sedated or medicated. Someone that is hungry will shoot you for your food. A drug addict will shoot you for your watch, to sale , to buy his drugs.Imagine what all these people hooked on Xanax etc.. are going to do when it's not paid for by insurance or the gov

ConfederateH's picture

The inflation really starts when sellers realize that they have to raise rates faster than the underlying price increases in order to make up for past inflation losses.

Frankie Carbone's picture

At this point I am discouraging the sheep from any prudent preparations. Why in the world would you want them to come out at the other end of the crisis, only to bring their stupid, unthoughtful mainstream dogma with them? 

If after the past 15 years, people have not figured out the real state of affairs of the nation, and the world, then they are never going to, until it is too late. Why give them false hope? I think that is cruel actually. 

Nope. Discourage them from preparing. Counterintuitively, The less physically, mentally, and strategically prepared they are, the less of a threat they will be when the collapse comes. Chew on that. I am right. "Blah blah blah blah... I'll just shoot you and take your food.". Yeah OK. I am well fed and spent years physically, mentally, emotionally, and strategically preparing for this one moment, when you are "going to shoot me and take my food". I am nourished, physically strong, in good spirits and moral, have clarity of thought, are well defended, and have a plan, plus plans B-F. 

You are starving, confused, don't know up from down, and desperate. Demoralized, weak from lack of nutrition. Sapped of energy from bad drinking water supplies, have not thought any of this out, and probably feeling very rash about then, and have always underestimated me as a "fringe kook".  Who has the advantage? 

Theonewhoknows's picture
Theonewhoknows (not verified) Frankie Carbone Apr 25, 2016 8:59 AM

At this point of time, with IQ taking a nose dive across the population it is only worth to educate oneself and seek others educated enough to understand that statism doesn't work. Making sure you have enough money to secure your family and ability to talk whatever you want - not being gagged by governments and from an economic point of view - not being dependent on anyone. 

Only when there will be enough people like that they can slowly get into power and while doing that shrink the government and make everyone responsible for themselves. A painful process but so much needed when whole generations would rather sacrifice freedom for security. How to make first step - education and making money. This video is really good at explaining this vision

conraddobler's picture

The only plan they need is to be in a bigger gang than you have.

The penultimate survival skill is the same it's always been and that's social skill.  There is no where to run, no where to hide except the very sparsely populated west where roving gangs won't venture much because there is no great likelyhood of stumbling onto an enclave they can rob.

If you grow food it will be for the biggest gang that comes through.

The biggest gang will form quickly around a leader that gets things done.

The one that gets things done will be great at finding people to rob.   Eventually they will figure it out just like on the Walking Dead that the best social model is not to kill people but to dominate and enslave them.

The longer it goes the more likely they won't shoot you for the food they will shoot or rape someone you care about so that you give them half your food.

And then they'll keep comming back.

 

OverTheHedge's picture

>>And then they'll keep comming back.

Until you run out of food. The Lucifer's Hammer scenario suggests that they will then eat YOU.

We are ALL descended from cannibals; where in the world you are from denotes when the last major cannibalism episode happened, but it did happen none the less. Actually a good survival strategy, especially if you combine it with robbery - keep the goodies, and put the murder evidence in the oven.

It all depends upon how badly the supply chain is interrupted, and what is happening world-wide. Also, if it is a slow deterioration of the system, where some food is available, but insufficient, I think cannibalism less likely. From what I understand, the Sudaneese don't eat each other, despite dying in droves every time there is a drought. If you just stopped supplying food to major cities, I think cannibalism within ten days, but I am a pessimist.

Still, the UN is good at providing emergency aid, so why worry?

Edit: having written my little contribution, it just struck me that your comment:

<<The one that gets things done will be great at finding people to rob.   Eventually they will figure it out just like on the Walking Dead that the best social model is not to kill people but to dominate and enslave them.The longer it goes the more likely they won't shoot you for the food they will shoot or rape someone you care about so that you give them half your food.And then they'll keep comming back>>

....isn't that a great definition of government :-))

 

New World Chaos's picture

Government:  Give us half, again and again, or we'll kill you

There's a reason why Negan said "We are the New World Order"

The Once-ler's picture

   
        Different Tyler…  Different day.

Manthong's picture

Anarchy or tyranny..

Take your pick.