Swiss Francs to Safe guard your Savings? How it worked out in the Case of Argentina

I’ve read your book and I have a great respect for your opinion.
Having gone through the economic collapse that you experienced, what
do you think of holding money in Swiss francs or Canadian Dollars as a
safe guard?
Dan-


Hi Dan, I think both the Canadian Dollar and the Swiss Franc have been pretty stable in the last few years, the Swiss Franc clearly being the one sought after as a safe haven in complicated financial times. This actually caused the SF to be over-valuate and measures had to be taken so as to stop it from going up further.
It is worth reminding everyone that the Swiss Franc is no longer backed by gold as it once was. That stopped in May 2000 after a referendum.

In the case of Argentina it worked out the following way:
Knowing that our peso currency was weak, people saved in dollars, both cash stashed in home and USd accounts in banks. Back then the currency exchange rate was 1 to 1, so it made sense to save up on the much more reliable Usd than the unstable national currency. Besides, who were we kidding?  One dollar equals one peso with our country’s track record of  hyperinflation and devaluation? As soon as people saved up a bit of money, they turned it to USD and saved it in the bank. When the economy collapsed people rushed to the banks to close their accounts in USd, since all of a sudden those dollars where worth 3 pesos, then 4 the following day. The banks froze everyone’s accounts and closed their doors. Eventually going against the law and constitution they converted people’s accounts in dollars to pesos at a 1,4 exchange rate. Given that everything had gone up in price indirectly proportional to how the peso was being devaluated, you ended up loosing about 60% of your savings.  Just as the peso went from 1:1 to 1:4, prices had suddenly gone up 300% or more, somewhat keeping up with devaluation.

After the economy collapsed and people had to get by as best as they could what you did was again, save up little by little and convert your money to USD or Euros as soon as possible, and only digging into your cash stash if you had to. As years went by and learning from what happened with banks during the collapse, a lot of wealthy people stored the physical cash, mostly USD, Euros and gold, in bank safe deposit boxes. Eventually the word got around: Money was again in the banks, but not in the accounts! It got to a point where gov. officials wanted to start opening safe boxes so as to see who was hiding physical money and precious metals.  I suppose they never went ahead with that idea because many politicians had they money hidden that way themselves!

2013 Silver Eagle Dollar BU in Airtite Coin Capsule
If something like that ever happens to USA and the dollar goes through a process of devaluation, Swiss Francs will protect most of your purchasing value. In a more extreme case where the dollar devaluates harder or fully collapses, then the SF may get hit hard, in which case precious metals would be the safest haven for your savings.

FerFAL

5 Key Points: Preparedness for when Growing Older

Elderly Couple needs Advice

Dear Ferfal,
My husband and I originally read your book three years ago and it changed our lives. We even considered buying a Dogo Argentino but settled for a Labrador Retriever. We are now at a point where preparing for a societal decline conflicts with preparing for our personal decline due to advancing age. We are in our seventies. Our health is good but could change in an instant. We would greatly appreciate your advice about our imminent decision: (1) to stay in our current rural village; (2) to move to a town located twenty miles away; or (3) to move closer to our daughter and her family in a suburb of a large city.

Our first option is staying where we are (we like it here) and hoping we are physically able to deal with the rigors of rural life until we are truly incapacitated and ready for a nursing home — or dead. Twenty-five years ago we moved to this area of a Northeastern (USA) state for job reasons. We have no family here. The closest big city (210,000) is a little over an hour away. We chose to live in a village of 2,500. Our house is on five acres. We paid off our mortgage years ago.
Our house is relatively isolated. We can see two other houses but they’re not close. Our property is not generally suitable for crops because it’s heavily wooded.  We found the massive trees charming 25 years ago and never thought we may have to grow food. On the positive side we are able to heat with our own wood that we pay a neighbor to cut. We have a well and a creek and we’ve stored water barrels in our walk-out basement.  We have good neighbors.

We’re on friendly terms with the local business owners; however our village has few businesses and fewer services. There’s a doctor but the nearest hospital/emergency room is 20 miles away. We have a volunteer fire department but no village police. We’re served by the county sheriff’s office, head-quartered 20 miles away, and the state police pass through periodically. While fire response to 911 is fast, police response is slow. Crime is actually very low — probably because most home owners (including us) are also gun owners.
We’ve have been prepping since reading your book and have about 1-1/2 years of stored food for ourselves and our daughter and her family. We’ve also collected barter materials that would probably get us food from farmer neighbors. In addition to our stored water we’ve stockpiled several kinds of filters. We have a septic tank/septic field. In the event of a disaster, we had hoped to provide a safe haven for our daughter, son-in-law, and grandchildren but fear we may no longer be able to manage the day-to-day demands of rural living while awaiting the apocalypse.
Our second option is moving to a relatively prosperous, low-crime town of 10,500 that is 20 miles northwest of our current home — closer to our nearest big city.  We have no friends there but it has a wide range of stores, medical specialists (whom we’ve been using), a good hospital/ER and a police department. There are none of the gated communities you recommend. There are senior-living communities but their admission fees plus monthly fees are staggering. We would buy a house or townhouse with enough room for our daughter and her family if things go very bad. We’d move our prepping supplies but we’d have to deal with public water and sewers.

Our third option is moving closer to our daughter and her family who live in a small city of 120,000 about 2 hours due west of where we now live. They are both employed in highly skilled jobs that are not generally available. Our relationship is strong and we’ve regretted the long round trip has prevented us from seeing them more than once a month.
Their small city is contiguous with a rapidly declining major city of 270,000. The small city seems prosperous although real estate listings show lots of foreclosures. It has all the necessary businesses and services including a hospital/ER. We would have to use public water and sewers.
There are no gated communities and zoning severely limits the number of condos/townhouses. We would buy a small house and move our supplies. Our daughter argues she could help us with shopping/appointments as we grow even older, while her husband and children could help with grass mowing/snow shoveling/dog walking. They plan to stay where they are until the youngest child graduates high school — six years. It would be wonderful to see our family frequently, and a relief to have help on hand, but we dread not being able to offer the people we love a place of safety should a disaster strike.

With your experience of a country in collapse, would you recommend we stay where we are now or make one of the two possible moves? If we do move we should do it while we have our health/strength. We’re afraid we’re blind to an important consideration that’s obvious to someone like you. We will be grateful for any advice and apologize for the length of this letter. If it’s published please delete our email address. Thank you!
Sincerely,
H&H

Hi!
You bring up several important points.
A key aspect of sensible preparedness is preparing for those things that are likely to happen first. One of the few certainties in life is that time passes for all of us and (if lucky enough!)we all grow old. As that happens we’re more likely to need a hand from time to time.
My dear grandmother had to make a similar decision recently. Now almost 90 years old and being a very smart lady she understood that she would need a bit more help than before soon enough.  Moving with my aunt meant sacrificing some of her cherished independence but she understood that it was the best thing to do.

I would agree with your daughter about them begin able to help as needed. Also, it looks as if being close to them would mean seeing them more often, being close to your grandchildren as they grow older. That’s just priceless. I know I didn’t fully appreciate my grandparents as a teen, you could say I took them for granted, but luckily as I grew older I realized that I had to spend as much time as I could with them. It was great to drop by my grandparents and have dinner or lunch with them, or take them out for dinner or for tea to a café near by. I think your grandkids will appreciate that one day too.

Being closer to your doctor and hospital sure is an advantage. The same goes for being closer to your family so that they can help you and you help them when needed. From a practical point of view moving close to your daughter makes the most sense to me and it sounds as if you would enjoy seeing them more often. Having said that, its also important to live were we enjoy being. If you like your current home and enjoy your life there then that’s good enough reason to stay, so ultimately and choice you are happy with is ok.

I wouldn’t worry about not having a house out in the country for them to go to. You would still have a home for them to go to and the supplies you have would still be of great value. Besides, being closer means you can help on other less dramatic things like watching over your grandkids. That alone is a lot of help and saves your daughter from having to spend money on a nanny.  I know I would love to have my grandmother nearby. Just knowing that she’s keeping an eye on things is a lot of help.
Take care and I wish you both the best!
FerFAL

Russian Family Spends 40 years living isolated in Wilderness

Very interesting read here folks. As you can imagine, conditions were miserable and even these hardy people spent most of their lives fighting starvation. Makes you think about the “living off the land in the nearest national forest” approach.
FerFAL

For 40 Years, This Russian Family Was Cut Off From All Human Contact, Unaware of WWII

In 1978, Soviet geologists prospecting in the wilds of Siberia discovered a family of six, lost in the taiga

{extract, see link below for full article}….

Under the Soviets, isolated Old Believer communities that had fled to Siberia to escape persecution began to retreat ever further from civilization. During the purges of the 1930s, with Christianity itself under assault, a Communist patrol had shot Lykov’s brother on the outskirts of their village while Lykov knelt working beside him. He had responded by scooping up his family and bolting into forest.

 

The Lykovs lived in this hand-built log cabin, lit by a single window “the size of a backpack pocket” and warmed by a smoky wood-fired stove. 

 

Peter the Great’s attempts to modernize the Russia of the early 18th century found a focal point in a campaign to end the wearing of beards. Facial hair was taxed and non-payers were compulsorily shaved—anathema to Karp Lykov and the Old Believers. That was in 1936, and there were only four Lykovs then—Karp; his wife, Akulina; a son named Savin, 9 years old, and Natalia, a daughter who was only 2. Taking their possessions and some seeds, they had retreated ever deeper into the taiga, building themselves a succession of crude dwelling places, until at last they had fetched up in this desolate spot. Two more children had been born in the wild—Dmitry in 1940 and Agafia in 1943—and neither of the youngest Lykov children had ever seen a human being who was not a member of their family. All that Agafia and Dmitry knew of the outside world they learned entirely from their parents’ stories. The family’s principal entertainment, the Russian journalist Vasily Peskov noted, “was for everyone to recount their dreams.”
The Lykov children knew there were places called cities where humans lived crammed together in tall buildings. They had heard there were countries other than Russia. But such concepts were no more than abstractions to them. Their only reading matter was prayer books and an ancient family Bible. Akulina had used the gospels to teach her children to read and write, using sharpened birch sticks dipped into honeysuckle juice as pen and ink. When Agafia was shown a picture of a horse, she recognized it from her mother’s Bible stories. “Look, papa,” she exclaimed. “A steed!”
But if the family’s isolation was hard to grasp, the unmitigated harshness of their lives was not. Traveling to the Lykov homestead on foot was astonishingly arduous, even with the help of a boat along the Abakan. On his first visit to the Lykovs, Peskov—who would appoint himself the family’s chief chronicler—noted that “we traversed 250 kilometres [155 miles] without seeing a single human dwelling!”

Isolation made survival in the wilderness close to impossible. Dependent solely on their own resources, the Lykovs struggled to replace the few things they had brought into the taiga with them. They fashioned birch-bark galoshes in place of shoes. Clothes were patched and repatched until they fell apart, then replaced with hemp cloth grown from seed.

The Lykovs’ mountain home, seen from a Soviet helicopter.
The Lykovs had carried a crude spinning wheel and, incredibly, the components of a loom into the taiga with them—moving these from place to place as they gradually went further into the wilderness must have required many long and arduous journeys—but they had no technology for replacing metal. A couple of kettles served them well for many years, but when rust finally overcame them, the only replacements they could fashion came from birch bark. Since these could not be placed in a fire, it became far harder to cook. By the time the Lykovs were discovered, their staple diet was potato patties mixed with ground rye and hemp seeds.

In some respects, Peskov makes clear, the taiga did offer some abundance: “Beside the dwelling ran a clear, cold stream. Stands of larch, spruce, pine and birch yielded all that anyone could take…. Bilberries and raspberries were close to hand, firewood as well, and pine nuts fell right on the roof.”
Yet the Lykovs lived permanently on the edge of famine. It was not until the late 1950s, when Dmitry reached manhood, that they first trapped animals for their meat and skins. Lacking guns and even bows, they could hunt only by digging traps or pursuing prey across the mountains until the animals collapsed from exhaustion. Dmitry built up astonishing endurance, and could hunt barefoot in winter, sometimes returning to the hut after several days, having slept in the open in 40 degrees of frost, a young elk across his shoulders. More often than not, though, there was no meat, and their diet gradually became more monotonous. Wild animals destroyed their crop of carrots, and Agafia recalled the late 1950s as “the hungry years.” “We ate the rowanberry leaf,” she said,

roots, grass, mushrooms, potato tops, and bark, We were hungry all the time. Every year we held a council to decide whether to eat everything up or leave some for seed.

Famine was an ever-present danger in these circumstances, and in 1961 it snowed in June. The hard frost killed everything growing in their garden, and by spring the family had been reduced to eating shoes and bark. Akulina chose to see her children fed, and that year she died of starvation. The rest of the family were saved by what they regarded as a miracle: a single grain of rye sprouted in their pea patch. The Lykovs put up a fence around the shoot and guarded it zealously night and day to keep off mice and squirrels. At harvest time, the solitary spike yielded 18 grains, and from this they painstakingly rebuilt their rye crop.

Read more: http://www.smithsonianmag.com/history-archaeology/For-40-Years-This-Russian-Family-Was-Cut-Off-From-Human-Contact-Unaware-of-World-War-II-188843001.html#ixzz2KmcerPox
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Argentina Freezes Food Prices and Bans Advertising

Hey Ferfal,

Long time follower/reader. I'm shocked to see you haven't addressed

Kirchner's newly instituted price controls and ban on advertising.

What's going on in your old homeland!?!

Taylor G.