[Image Credit: A still from the 1959 Stanley Kramer/United Artists film On The Beach.]

Blame it on a Chinese buffet restaurant. According to the Chinese zodiac, 2025 is the “Year of the Snake.” It seems appropriate, as a number of insidious things are coming together. Will 2025 be a year of treachery and disaster? Will the economy collapse? I am not a prophet, but I can put together some interesting recent facts.

Most obviously, 2024 is an election year. Whatever your hopes about the upcoming election, I can almost guarantee that Trump will not be re-elected. The last election was rigged, so this one will be too. With all the charges being filed against Trump, I believe it is more likely that he will see the inside of a prison cell than the Oval Office. That means a second-term Democrat figurehead, and an administration with nothing to lose. Bad news! But they must wait until they have “won” the election. As controlled as the American media is, nobody will believe that a Herbert Hoover-equivalent president remains in office after an economic crisis. The powers-that-be will do everything they can this year to keep the house of cards standing, and every item in the national outhouse polished to a shine. My prediction is that for the next eight or nine months, we have a limited window of opportunity where we can expect relative stability.‘

After January, 2025, we may not be so fortunate. I am amazed that things have been propped up for this long, as many of us have been preparing for an economic collapse or some other major event since the 1990s. But signs are coming together in ways that mirror the 2008 crisis, but in possibly a bigger way. Economists and news writers have taken notice, but the general public doesn’t seem to be listening, although there are signs that is beginning to change.

Notice how the market is already responding. Gold has hit a record high. People are buying gold at Costco, and not even at good prices. Costco is selling out! Where I live, coin shops are running out of inventory. The price of silver and other metals are also increasing, although not at the same rate. I believe that silver is undervalued right now. Back in the old days, the dollar was made of 90% silver, with approximately .77 ounces of pure silver inside. The 20-dollar gold piece was made of 90% gold, with approximately .96 ounces of pure gold inside. Ounce-for-ounce, that makes an approximate trading ratio of 16 ounces of silver for every ounce of gold. At a gold price of $2,000 per ounce, silver would be $100 to $125 per ounce, not $25, at least according to the old currency ratio. As far as acquiring gold at “working man’s” prices, the train has left the station. Silver is still affordable, for now. But that is not going to last. Even the mainstream media is talking about silver investment, as these two articles show:

Generally, once the mainstream media is talking about it, your time to act is minimal at best. Are the masses listening? Do they have money to put into precious metals? Maybe not, but it is wise to assume that the window for acquiring precious metals at the current prices is closing.

Another sign of uncertain times is the price of real estate. Home prices are really high right now, comparable to the situation in 2008. Where I live, land is selling for amounts that seem insane to me, and it looks like everybody and their brother is building something. A home that would sell for $150,000 ten years ago is double that price today. That effectively prices younger buyers out of the market, and increased assessment values place an increased tax burden on current owners. This is not going to improve. Will the bubble burst? Economists do not agree on the issue, but some predict a collapse in the near future.  See: Kevin O’Leary Says a Coming Real Estate Collapse Will Lead to ‘Chaos’ — Here’s What You Need To Know.

While residential real estate is increasing in price, commercial real estate is upside-down. While the average citizen thinks mostly about residential costs, personal property taxes, and personal income tax, it is the corporate sphere that really drives the nation. Commercial property is a big source of income (or debt) to many financial institutions. Businesses succeed or fail due to the costs of purchasing and maintaining property. Corporate taxes generate more revenue for the federal system than personal income taxes. Right now, commercial properties in many cities are at record lows. Some are worth only 10% of their purchase cost just a few years ago. Foreclosures are everywhere – up 117% between March 2023 and March 2024. Eventually, the drop in commercial property value could exceed what we saw happening in 2008.

What do real estate prices mean for you? Well, it is obvious that now is not the time to buy. Costs are up, interest rates are up, and the bubble is likely to burst. If you absolutely must acquire property right now, be very, very careful about where and how you do it. If you have property you want to sell, NOW is the time. Do not wait! Then, when prices fall, you can keep your eyes open for good deals, if any are to be found.
The commercial real estate troubles are likely to destabilize many banks. In fact, it is already happening. The government doesn’t want to admit how likely these failures are, because they don’t want to destabilize a system that is already vulnerable. Here is a list of failed banks: FDIC Failed Bank List. The most recent failure was Republic First Bank.

Notice at the top of the page that it has not been updated since November 2023. Also, that list is only for banks that have failed already – a complete process. It doesn’t tell you if your bank is currently at risk. During the last banking crisis, the FDIC was able to cover people’s lost deposits, but that may not be the case this time. You will want to evaluate the stability of your current bank, and to do so, you need to know what assets your bank has and how they are held. The FDIC website can look up their balance:

BankFind Suite: Find Institution Financial & Regulatory Data

There is a separate tool from the National Credit Union Administration to check up on the financial health of credit unions.

In each case, you can download a PDF file of all the public documents on your bank. If you need some help understanding various financial terms, this PDF document from the Office of the Comptroller of the Currency can give some brief definitions: Categories of Risk.

When you access your bank’s information, you will want to take note of several categories. They divide their assets into cash and balances, federal and municipal securities, other securities (stock), real estate, and loans or leases. You want to make sure that your bank’s portfolio is relatively balanced, and isn’t overly invested in the stock market or in real estate. Check on the ratio of assets to liabilities. If the bank’s liabilities approach or exceed their assets, it is a clear sign of trouble. As long as fiat currency remains useful, government securities are a relatively safe thing for a bank to hold, at least compared to other choices. If you are unsure about leaving a large amount of your liquidity in a specific bank, you can spread your funds out between several banks. There is a tool called ICS/CEDARS that makes it easier.

Whatever method you use, now is the time to check up on your bank and adjust your position. Do not be lulled into complacency by recent stock market gains, or the lack of economic news. Do the work now, while there is time.

I believe that the real threat has just been revealed. Biden has proposed an increase in long term capital gains tax, up to 44.6%. To put that in perspective, it has been 15% until recently. Losing 15% of your stock market profits is bad enough when you are trying to invest, but losing almost half will be much worse. See:

While they mention the facts, the news articles do not discuss what could really happen. This move could crash the entire financial system as we know it today. Biden makes it sound like the measure is just to “tax the rich” but it will affect everybody, even if you are not invested in the market. Go back to the information about your bank, and look at the “other securities” category. Your bank is making money by investing. What happens if they lose that source of income? How much room do they have in their balance? The same pressure will be felt in other areas. For example, my electric company is a cooperative, and their reports are public. Nearly half of their holdings are in securities, as they are trying to make money on the market. What happens if they lose that source of income? The same thing applies to just about every other aspect of our system, every large company you deal with is invested in each other through the market. Those losses will get passed along to consumers.

But wait, there’s more! If it is no longer possible to make significant profits in the stock market due to the taxes, you can expect an exodus from the market. Think of 1929, and worse. Stocks could become worthless, whether at a rapid pace or in a slow slide over the course of a year or two. Companies that have a large portion of their funds in the market can go bankrupt. Those that survive will increase costs to cover their losses. Inflation will increase tremendously. The value of paper money and electronic money will drop, and tangible assets will be the only safe bet. More and more paper will be chasing less and less available goods. We have heard these predictions for a long time, but now we see a real possibility that they will come true in 2025.

There is still time to prepare this year. Evaluate the stability of your bank, your utility companies, your insurance providers, and your employer. Flee from any institution or company that is not financially stable enough to survive what is coming. Flee from the stock market – sell now while you have the opportunity! If you have retirement funds, shift them to more stable investments or try to pull them out completely. Continue your usual preparedness efforts – food, water, fuel, electricity, defense, and tangible assets. Make any planned purchases now, rather than waiting. Consider January 2025 as your deadline.