Does History Repeat Itself? | How You Can Be Ready for Post-COVID Inflation

July 12, 2021 11 min read

inflation after 2020

In today’s episode of the Practicle Prepper Podcast, Schmitty takes a peek inside the history books and compares the events of the Spanish Flu Pandemic of 1918 to the Covid-19 Pandemic of today.

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If history supposedly repeats itself, then what can we possibly expect to see for the future of our economy and our society? How to prepare for civil unrest in the wake of the pandemic? 

Surprisingly enough, the events which occurred in 1918 are actually not so drastically different from what is occurring in the modern day.

We’re already beginning to see the effects of the economic fallout from closing down the country last year.

But what we want to know is if we will fare better than 1920’s America did after they closed down the country.

There are lessons can we learn from America’s past economic infrastructure.

Hopefully, we can expect to see a huge economic boom in growth just like the Roaring 20’s experienced.

Or, will we go in the other direction?

Jumping straight to 1929 to experience our own great depression.

These are the issues everyone wants to know so we can prepare ourselves for what’s around the corner.

History may repeat itself but no one can truly know what events the future may bring.

Nor can they know how the economy will fare as we return back to full operation.

However, by looking at today’s current events and comparing them to the past, we can tell that some safety measures will need to be taken to protect our finances.

The effects of inflation will undoubtedly raise the standard cost of living.

As the nation is in the process of bouncing back, we can expect to be charged more for the items we depend on. But, there are opportunities for you to take advantage of.

And in this podcast, Schmitt goes beyond long term food storage buckets and provides some financial insight into how you can protect your financial assets from the negative impacts of inflation.

Financial security should be a top priority for everyone, and Schmit has researched ways for you to guarantee your financial assets remain unaffected by the rising costs of inflation.

Transcript: 

As the philosophical saying goes, those who do not learn from the past are condemned to repeat it. History repeats itself. We are tethered to a sequence of events as if they were a path to occur, like the passing of time with hands on the clock. Hello, ladies and gentlemen, listeners and survivalists alike. Welcome to another episode of the Practical Prepper podcast. I'm your host, Schmidt, and today we're going to take a brief look at how history repeats itself. We're going to try to predict the future of the economy based on the events that have unfolded after the last great pandemic that took the world by storm over a century ago. And lastly, we'll look into some possible options that you could take that would provide you some much needed financial security against the inevitable inflation rates we can expect in these post covet times. We're already beginning to see prices for things like meat and travel skyrocket. Yesterday on the news I heard that a rental car costs more than the plane ticket you buy. Everyday items are going to go up in price. I've already noticed it, and I'm sure you have. And it leaves us wondering about the future, what we can expect now in order to predict the future. We're taking a look at the past because history repeats itself. It's baffling to see that us, despite having volumes of history books to learn so many valuable lessons from, we as a species, just seem to be reluctant to repeat the same courses of action that so many others have made before us. And despite the benefits or the consequences of the choices that we make, no matter what we do, it seems to replicate an event that has already occurred in the past. In fact, it's even crazier when you look at similar events that are completely out of our control with nature and just how the world reacts to us being here, repeating itself. We break out the tinfoil hats, because once you start looking in history, you see patterns everywhere. The events of the past unfold continuously to this day. It's kind of shocking. But if we are going to focus here, let's focus mainly on the events of last year. And let's draw some comparisons from the novel Coronavirus Coba 19 to the Spanish flu and the pandemic that shut the country down and disrupted the economy. Now, the Spanish flu was responsible for claiming an estimated 50 million lives worldwide. That's insane. And with 650,000 of those deaths occurring right here on American soil, if we adjust the population rates, that brings the death toll of American citizens to just shy of 2 million people. Now, I know the current pandemic is still ongoing, but thankfully, covid 19 has not delivered the same catastrophic number of deaths thus far. And even though we are beginning to return to a long awaited state or normality, unfortunately, that's probably the biggest difference between the two pandemics and the courses of action that we've taken. I mean, last year we were being told to wear masks, and surprisingly enough, that was the same thing they were telling people to do in 1918. We've come so far, yet we still rely on such simple practices. Well, even though COVID still hasn't disappeared from our lives, if we just look at how the pandemics affected the country, we can start to see how the nation reacted in similar ways. I mean, the nation was sent into a state of lockdown. People were left without jobs because businesses didn't have a source of income or revenue to sustain themselves. And with so much economic troubles occurring all at once, of course, in 1918 to 1920 saw panic and riots and protests demanding that the country reopened, demanding that jobs be brought back to our cities. Now, that's not too different from what occurred last year. In fact, in 1920, the Spanish flu sent the unemployment rate to a peak average of 11.7%. And if we take a look at the Bureau of Labor Statistics similarly enough, we find that last year's pandemics saw the unemployment rate peak at 14% during the initial days of Cobain taking the world by storm and the country shutting down. But then within a month's time, the average unemployment rate was coasting around 11.4%, similar to that 11.7% in 1920. If we look at what events unfolded afterwards, well, we would like to expect something similar to the economic growth and success that the Roaring 20s had. You had massive industrialization move across the country, jobs became available for everybody, and that lasted for a good time before, unfortunately, the nation was sent into an economic meltdown with the Great Depression. Now, we are fortunate enough to have learned from the bank's mistakes of the past and have several dozen different security measures in place to protect us from entering a similar state of depression. But unfortunately, if we look at other events that occurred, we can get a foreshadowing of what we can expect in our near future. Now, whether it's safe to say that these events will happen exactly as they did back in the 1920s, hopefully we will avoid things like stagnant wages or a faltering standard of living between the classes. We've already seen riots and uprising and political polarization, and we have elites competing for positions of power that are limited and co opting radical movements. And unfortunately, while all of those things did occur in the 1920s, going into the 1930s, hopefully we won't experience to the same level of degree in our own future. Now, of course, you can expect inflation rates to occur. Prices are going to skyrocket. Businesses and industries need to compensate for a year's worth of lost time. However, it's not something that we should be scared of. Inflation isn't exactly a good or a bad thing. It's just a tool that we use to measure the economic worth and the value of the dollar. Sure, things don't cost the same as they did a decade ago. But with more people on the planet, there's more money to go around. And if there's more money to go around, then of course prices are going to increase. And all depending on how it affects the value of the dollar. If the value of the dollar goes down, believe it or not, so does debt. Everything from our national debt to your own personal debt, depending on what financial assets you have in place. So after a quick word from our sponsor, we'll take a look at how you can protect yourself against inflation and prepare for the future. Because being prepared is always the best course of action to take. Today's episode is brought to you by Valley Food Storage. Valley Food Storage is by far my favorite survival food company. It's the food that I discovered, relied on, and turned to when 2020 started to go south and I couldn't find any food at my local grocery store. My kitchens were bare and I had no reserves as backup. Valley food storage came to my aid. And what I like most about Valley Food Storage is how healthy their food is. I value the nutrition that I put into my body. Other survival food companies, they put tons and tons of low quality calories in their food. Valley Food storage doesn't do that. They use simple and clean ingredients that are non GMO and use no artificial ingredients whatsoever. I can't recommend them enough. And if you're interested in starting or even continuing your Valley Food Storage journey, they are here to help. And they're offering you an amazing deal of 25% off your entire order. 25% off is the largest sale I think they've ever run. And it's only for the listeners of this podcast to thank you for your support and patronage to unlock your 25% off coupon for your entire order. Now, along with protecting yourself from starvation in the case of another pandemic shutting the world down, we're going to look at some different financial options and securities that you can protect yourself with against inflation. Now, one of the more popular options that people like to invest in is real estate. You see, your home's worth at the time of purchase will always increase with the economy's rate of inflation. This typically lends you to receive a much higher return on your investment the day that you decide to sell it. If you decide to invest in rental properties, that's a double bonus because not only do you own the property itself, but you also can collect money from the tenants that occupy the space. Now, there are real estate investment trusts that can protect you against inflation because they're investment funds that tie directly into the real estate's value and rents to protect you in case such a surge would occur. People also like to invest in commodities. Commodities are everywhere. They're physical items with inherent value. The price of these items adjust to supply and demand. What's also beautiful about commodities is that they can be sold anywhere the demand is needed. Say you're sitting on a stockpile of lumber or precious metals or sugar or whatever. These are all commodities that people fall back on when they need to sell to meet demand. You can take these anywhere, and you can often just set the price at what you want. Believe it or not, even high grade art and fabric command higher pricing values and times when the value of the dollar is lower. One big thing that people like to invest in is gold. Now, essential metals like gold has often been considered a hedge against inflation. In fact, many people have looked into gold as an alternative currency because it simply is. Gold has always had a value in people's eyes. That's the most precious metal in popular opinion. Now, countries tend to utilize gold or other strong currencies when their own currency has failed. And it's always something nice to have, plus it just looks good. Another option you can take is Treasury Inflation Protected securities. Now, the Treasury Department issues special types of bonds specifically designed to protect against inflation. Treasury Inflation securities, or Tips, adjust in value directly based on economic inflation. And unlike regular bonds, the reselling amount of these bonds change to reflect the inflation rate. So the value only increases as inflation increases and spreads across the country. You can also look into investing in growth oriented stocks because these are stocks that gain their appeal by adjusting to the price gains marked up by inflation. Unlike other stocks that are oriented based on income and also pay high dividends, these growth oriented stocks adjust their rates when companies hike their prices to compensate for the effects of inflation and their benefits for their profits are passed down to these stocks, they're always growing. Now, you can also purchase essential items with extended shelf life. If something at the grocery store costs $5 today, what's going to stop it from costing $25.02 years from now, because supplies are running low. If you buy a stockpile of, say, long lasting survival, food or other essential resources that will definitely be necessities in the future, it provides you a substantial backup alternative in moments when prices are soaring because supplies are scarce and the prices you pay for those items will stay at that price as long as you hold onto them. And most essential items with extended shelf life become valuable assets to sell off in the future. When other supplies are running low and they're scarce. One of the big things that you can choose to do is to convert your debt from variable to fixed. Now, your debt often relies on variable rates that adjust with income and inflation and will often increase the cost of your debts based on the state of the economy. But with a fixed interest rate, your debt remains the same and remains unaffected. When mass inflation occurs. You don't have to look at a higher debt just because prices are skyrocketing. Now, because the value of each debt payment shrinks along with the dollar value, you will actually wind up paying less because your total debt rate does not increase. And as always, speaking with financial advisors is a huge plus. Asking questions can lead to so many different benefits. And these are professionals who can take a look at your finances, your securities, and provide you some great options. Even if you're a business suffering greatly from last year, you have high levels of debt or a low credit score. You can even turn to something that's called a leveraged loan. I mean, there are loans that are made to companies that are suffering, especially after last year. These loans have a higher risk of defaulting, but because of their floating yield rates, it makes them a great hedge against being affected by inflation. You can protect your net assets and your expense ratios all at the same time based on the average daily trading volume. I mean, there's just so many different opportunities to take advantage of, to protect yourself and your finances from becoming impacted from last year's economic fallout and to protect yourself against the impending inflation that we're already beginning to see affecting the prices of everything that we use. And on that note, I would like to thank Valley Food Storage once again for sponsoring today's episode and generously offering a 25% off coupon that takes care of your entire order. I mean, everything from their dinner entrees to their breakfast to their freeze dried fruits and vegetables. I can't recommend the company enough. And I'd also like to personally thank you listeners for tuning in to another episode of the Practical Prepper podcast. I've been your host, Schmidt, and as always, take care and be prepared. Have a good, great day.