Free Learner

How bad is it?

On the one hand there's CNBC, well known for its cheer-leading and Pollyanna optimism, and the equally cheerful CNN.com.  CNN quotes experts who believe many stocks are "bargains" that will soon attract buying, that "global imbalances are getting corrected," and that the selloff in stocks is encouraging. 

And then, on the other hand, there's this piece in the UK Telegraph:

We face extreme danger. Unless there is immediate intervention on every front by all the major powers acting in concert, we risk a disintegration of global finance within days. Nobody will be spared, unless they own gold bars.

. . .

During the past week, we have tipped over the edge, into the middle of the abyss. Systemic collapse is in full train. The Netherlands has just rushed through a second, more sweeping nationalisation of Fortis. Ireland and Greece have had to rescue all their banks. Iceland is facing an Argentine denouement.

The US commercial paper market is closed. It shrank $95bn last week, and has lost $208bn in three weeks. The interbank lending market has seized up. There are almost no bids. It is a ghost market. Healthy companies cannot roll over debt. Some will have to sack staff today to stave off default.

As the unflappable Warren Buffett puts it, the credit freeze is “sucking blood” out of the economy. “In my adult lifetime, I don’t think I’ve ever seen people as fearful,” he said.

We are fast approaching the point of no return. The only way out of this calamitous descent is “shock and awe” on a global scale, and even that may not be enough.

In the less mainstream media, the guy who founded the popular website 321gold.com is predicting a bank holiday very soon.  [Note that this is separate from the rumor about Bank of America preparing for a one-week holiday.]  Bob Moriarty was interviewed on the Korelin Economics Report on Saturday, and I've roughly transcribed the relevant bits:

Bob Moriarty: The banking system is frozen... banks simply will not loan to each other.  We are a few days away from a bank holiday.  The banks will either have a run on the banks, or the government will step in and close all the banks down.  It will go worldwide within 24 hours....

Now the bank holiday gets extremely dangerous because most Americans don't have two days' food and don't have two days' money.  So, unless the government starts coming up with real solutions real quick, we could have a total catastrophe.

Al Korelin: Okay, now what about those folks-- and you talk about a bank holiday-- what about the folks... that utilize debit cards -- not credit cards, debit cards -- as opposed to currency?  Are they out of luck?

Bob Moriarty: I think those will be frozen too.  I think that if you go down to your ATM, if you have a debit card, if you have a credit card, [they will not work]....  This is it!  I mean if you don't have some gold, if you don't have some spare cash handy, you're gonna have a problem.

Al Korelin: Do you think credit cards are going to be frozen too?

Bob Moriarty: Yes.

Al Korelin: You do.  If that happens, things are going to be more than just a little bit ugly.  And you're giving it what kind of a probability, Bob?

Bob Moriarty: Something above 95%, within the next 10 days.

Al Korelin: How long do you think that crisis would last?

Bob Moriarty: And again-- that's a really good question.  It's gonna last until the government comes up with a real solution.

Oh good, I'm sure the government will handle things nicely and we'll all get back to normal by the next morning, eh?  Oy vey. 

Another well-known trader and commentator, Jim Sinclair, had this to say last Thursday:

Dear Extended Family,

Unless the LIBOR rate drops sharply we are facing a planetary financial crisis next week.

For God's sake protect yourself.

Gold and gold related items will be the only true storehouses of wealth. The bailout bill is powerless to reverse what is now happening.

This is a modern day Weimar happening right before our eyes.

Respectfully yours,
Jim

The LIBOR is the London Inter-Bank Offered Rate, meaning the interest rate that one bank charges another bank which needs to borrow some quick cash.  When the interest rate goes way up, it's because banks do not want to lend to each other.  When the LIBOR is very high, it indicates a freeze-up, where funds don't move around, no one can get credit, loans are nearly nonexistent.  The LIBOR came down a tiny smidge today, but is still very close to its all-time high, set last week.  Money is not moving.

Consider for a moment what it means when a small company cannot get a short-term loan for a few months or a year.  Suppose you're a large bakery and you buy your wheat just once in the fall, using credit.  Or suppose you own a grain elevator and fill it up in the fall, then make back the money as you sell grain over the course of the next year.  Or suppose you do 70% of your retail business in the Christmas season and you need to order a huge amount of merchandise right about now, using credit.

By and large, you can't do it.  Often, no one will give you the credit.  Just as homeowners have lost their home equity lines, businesses have lost their commercial loans.  The owner of a grain elevator near my parents actually had this happen to him.  He couldn't fill his giant silos with corn and wheat, even though he has gotten an autumn loan from the same bank for decades, and never once been late on a payment.  He was forced to sell his business due to lack of funding.  I also heard an anecdote about grocery chains in southern California not being able to place large orders for food items, which, if things got bad enough, could lead to empty shelves.

Now imagine that a state-- say, California-- used to be able to borrow money, partly through what used to be called the municipal bonds market (may it rest in peace).  Now they can't.  How do they make payroll?  Well... they beg and plead with Hanky Panky Paulson to spend a mere $7 billion rescuing the largest state economy in the country.  You would think Hank would've already come through for them-- after all, the Fed gives $250 billion to US and foreign banks every single day, so what's $7 billion?  (No, I didn't type that wrong.  It's well over a trillion a week they give to banks.)

It looks pretty dire to me.  I am inclined to believe the people in the "gloom and doom" camp, rather than the smiling sexpots on CNBC.

After all, the reporting in 1929 was all very reassuring.  Here's a snippet from a November 1, 1929 New York Times article titled "British Foresee Benefits in Crash":

LONDON, Nov. 1 -- The material prosperity of the United States is too firmly based, in the opinion of The Economist, one of the foremost economic journals in England, for a revival of industrial activity to be long delayed.

Here's another from the same day, titled "Sees Prosperity Unhurt":

Stuart Chase, economist, who completed recently a six-month survey of the structure of prosperity in the United States, said here yesterday that the present stock market will not affect the prosperity of the country.

There are other well-known quotes from the time, in which the famous or the erudite claimed that everything was just fine.  Maybe it's unfair to hold the ignorance and poor predictive ability of the mainstream media of 1929 against the mainstream media of today, but it tends to make me side with the doom and gloomers.  It might not be as bad as they say, but it doesn't have to get THAT bad before a lot of people will suffer.

In short, if you aren't scared, you don't understand what's happening.

States can't make payroll

Let the money printing begin!

ATLANTA (CNN) -- California may need a $7 billion emergency loan from the Federal government for day-to-day operations and to pay teachers' salaries, nursing homes, law enforcement and every other State-funded service this month, Gov. Arnold Schwarzenegger warned in a letter sent Thursday to the U.S. Treasury secretary.

Back in March I had this suggestion for states: Fire School Administrators.  It's more applicable now than ever.

BOSTON (AP) -- The treasurer of Massachusetts has asked the federal government about lending Massachusetts money under the same favorable terms it has given banks and firms during the financial crisis.

Treasurer Timothy Cahill's requests to the U.S. Treasury and Federal Reserve Bank of Boston this week were prompted by the state's inability to borrow from the short-term debt markets, The Boston Globe reported Saturday. The financial turmoil has caused credit markets to stop lending, or to charge prohibitive rates.

. . .

Massachusetts has enough money to cover its expenses for the coming weeks, Cahill said. But a low-rate loan would ease a cash shortfall if the credit problems persist.

Massachusetts has enough money for... weeks.  Not months.  And "...if the credit problems persist" is a joke.  It's the Much Greater Depression, folks.  There is no "if" as to whether credit problems persist.

New York will be next.

The carnage continues

A lot has been happening in the financial world, but the news comes so fast I hardly know what to blog about.

Ireland, Greece, and Germany are guaranteeing all bank deposits, with no upper limits, while in the UK and the US the upper limits are being raised.  This may sound good for the citizenry, but it indicates that bank runs are feared in these nations. 

In the US, there is a lack of physical cash.  If too many people start hoarding cash under the mattress, we could have a bottleneck during which physical cash can't be printed up fast enough.  Sure, everyone has credit cards, but those are about to go the way of the home equity line: banks will soon begin canceling them.  People will need real hard cash again, and there won't be enough.  Moreover, banks have about 70 cents of cash on hand (mostly 0's and 1's, not paper) for every $100 their customers have deposited.  I don't pretend to know what will happen when credit cards dry up... I don't.  I can't imagine it.  I guess the Fed will print new money as fast as it can and people will all be assigned debit cards in lieu of paper cash, but there are a lot of people who depend on credit to help them squeak by.

Iceland, which got heavily involved in international finance, is in a bad way.  I mean a really bad way-- the UN better start drawing up plans for a food relief program.

Iceland is on the brink of collapse. Inflation and interest rates are raging upwards. The krona, Iceland's currency, is in freefall and is rated just above those of Zimbabwe and Turkmenistan. One of the country's three independent banks has been nationalised, another is asking customers for money, and the discredited government and officials from the central bank have been huddled behind closed doors for three days with still no sign of a plan. International banks won't send any more money and supplies of foreign currency are running out. [source]

They have had panic buying at grocery stores because there aren't going to be any more food imports, since no one will take Iceland's currency.  People should watch what happens in Iceland, because this nightmare will happen one day in the United States.  Thankfully, it is much easier to grow food in the US than in Iceland, but on the other hand we are heavily dependent on imported crude oil and we don't make any shoes or clothing.  Economist John Williams, who runs the well-known and much-cited Shadow Stats website, has predicted that hyperinflation might hit the US as early as 2010.  Mr. Williams defines "hyperinflation" as a time when what used to be the largest bill in circulation (the $100 bill, in our case) becomes "more useful as toilet paper" than as currency.

The EU banks turn out to be in even worse shape than US banks, unbelievably.  They have massively more liabilities (loans to be repaid, depositors who need their funds back, etc) than they have capital.  Germany's second largest real estate lender is going down, and the government is in emergency talks with other banks to try to salvage the situation.  If they cannot save this major lender, it will cause large financial ripple effects in Germany.

That said, Germany is one of the healthiest of EU countries, fiscally speaking.  France wants an EU bailout of many EU banks, and Germany (the main country with a lot of savings) is saying No.  The southern nations (Spain, Italy, Greece) are not doing as well as northern ones, and Germany is refusing to funnel their own wealth into these poorer economies.  I do not think the Eurozone will be able to stay intact as this financial disaster continues.  Already, German citizens are hoarding Euros printed in Germany (there is some sort of number or symbol that indicates which country they were printed in).  They do not trust any currency printed in Italy or Spain, even if they are, ostensibly, all Euros.

In other news, I went to a coin shop and asked about silver.  The guy had two 5-ounce bars ($95 each) and two 10-ounce bars ($180 each).  That was it!  He was getting 20 or more calls per day asking about his available silver, including from Ohio.  He had received several hundred silver bullion coins one day last week, and they sold out in just 90 minutes.  All this silver was going for about $18/ounce, on days when the ostensible price of silver (the spot price) was around $11.  You always pay a little bit more for minted silver (coins or bars), but not 64% more!  The paper "spot" price just doesn't mean anything nowadays.  It has disconnected from the real world and is an imaginary value.  The same goes for gold.  There are extreme shortages of both metals and it is very hard to obtain coins in either metal.

Never mind, though-- most people should, at this point, be buying long-term storable food, shoes and boots, clothes for their kids in the coming years... in other words, tangible goods.  Other ideas, off the top of my head, include: camp stoves, rechargeable batteries, flashlights & LED lanterns, firewood (if applicable), very heavy blankets & sleeping bags, home insulation, Polartec hats, canning jars, a pressure cooker/canner, cases of cheap wine or whiskey, vegetable seeds, gardening implements, escapist fiction (try your library for cheap used novels), basic medicines, knitting / crocheting / sewing materials, a solar cell phone charger, a solar battery charger, and a wind-up radio.

Bail us out... or else

Stock markets were falling today well before the US House voted not to give $700 billion to the banks.  There was not much incentive to keep the markets up, as you'd usually see from the Plunge Protection Team or its banker allies.  Instead, the message was: You vote no, and the Dow gets it.

And, indeed, the Dow had its single worst day ever, crashing 778 points (or 7%).  Emerging markets, European markets, Asian markets-- they've all been trashed.  The FTSE (the London Dow) fell below 5,000 points, which was a psychological blow.  We'll soon be seeing Dow numbers below 10,000, ourselves. 

There is to be another vote later in the week.  The motto is: "We'll just keep voting on this sucker until we get a Yes."  In the meantime, stock markets will continue to falter.

If the bailout does pass (which I expect it will), this $700 billion will morph over time into more like $5 trillion.  Five trillion for Fannie & Freddie, 5 trillion to banks (foreign and domestic) who bought junk mortgages, a trillion a week in fresh new money "injected" into banks by the Fed, and pretty soon we'll be knee-deep in worthless dollars.

I have to say, I do not understand at all why they are bothering with this bailout, when banks can already give worthless mortgage securities to the Fed in exchange for cash.  In other words, WE ALREADY HAVE THIS RESCUE MECHANISM IN PLACE, to a large extent.  The difference is, the bailout bill makes US taxpayers cough up $700 billion, instead of the Fed simply printing up $700 billion in brand new money.  Of course, taxpayers haven't got $700 billion.  The money will have to be borrowed, at interest, from the Fed*.

Ohhhhh... now I get it.  Either way, the Fed is printing the cash to be given to banks, but this way they're getting interest on it.  Mystery solved.

You can understand why someone would go to Wall Street and hold up this sign:

  

*That is, we print brand-new Treasuries which the Fed buys from us using brand-new cash; it costs them nothing to magic the money into existence, but we still have to pay the interest on the Treasuries.  It's egregious state-sanctioned theft, is what it is-- and it has been since it was illegally signed into law in 1913.

California court reverses decision; allows homeschooling

I had put up a post here stating that a California court had banned homeschooling, referring to a September 23 Natural News article.  I knew that we were waiting for another court decision, and I thought that was it.

In fact, the Natural News article referred to the original court decision to ban homeschooling, from way back in March-- but reported on it as if it were breaking news.

Actually, on August 8, the appeals court reversed itself and re-instated the freedom to homeschool which has existed for 30 years in California.  I was camping when this happened, and missed the good news.  As I say, I thought we were still waiting for the next decision.

Many thanks to Hawksbill for pointing this out to me!

In a Washington Times article on the court's reversal, I thought this was interesting:

[T]he Court of Appeal agreed to rehear the case. Interested organizations on both sides of the issue were urged to file friend-of-court briefs. The governor, attorney general, superintendent of public instruction and the California Department of Education all filed briefs supporting the view that parents could home-school under the private school exemption in California [emphasis mine].

According to a friend from California, homeschoolers there can apply for and receive funds from the state, in some cases as much as $1,500 per year.  This is available (at least in some areas) through some sort of school choice or school voucher program, and it represents an economic loss for public schools.  So it's a pleasant surprise that the Dept of Education supported families' rights to homeschool.

RIP HBOS

The Bank of Scotland just disappeared, consumed by a London entity.  It's a little sad.  They had been in existence since 1695.

For that matter, Lehman had been around for 158 years, surviving the Civil War, the World Wars, and the Great Depression.

This should give you some idea of just how serious the current crisis is.

Bailout nation

It's been quite a week already on Wall Street.  On Monday, Lehman Brothers went belly up, and the stock market crashed the most since the 9/11 attacks.  Yesterday, the Fed gave away $70 billion to the banks (referred to as a "liquidity injection" so that most people won't understand that the banks are getting free money).  That $70 billion was on top of the $20 billion on Monday.  And then the country's largest insurance company, AIG, went off the rails, and -- unbelievably -- has been nationalized, as if to prove we are a Banana Republic.

That's right,the taxpayers are now the nation's largest insurance company, and it cost us $85 billion for the honor of being on the hook for all that insurance.  We are also by far the largest, and frankly almost the sole remaining mortgage lender, thanks to the nationalization of Fannie and Freddie.  As foreclosures continue to spiral out of control, just remember that we are the ones taking the hit.  The national debt has just gone up by trillions.

Economics professor Nouriel Roubini now refers to our country as the USSRA, the United Socialist State Republic of America.  He points out:

This latest action on AIG follows a variety of many other policy actions that imply a massive - and often flawed - government intervention in the financial markets and the economy: the bailout of the Bear Stearns creditors; the bailout of Fannie and Freddie; the use of the Fed balance sheet (hundreds of billions of safe US Treasuries swapped for junk toxic illiquid private securities); the use of the other GSEs (the Federal Home Loan Bank system) to provide hundreds of billions of dollars of “liquidity” to distressed, illiquid and insolvent mortgage lenders; the use of the SEC to manipulate the stock market (restrictions on short sales); the use of the US Treasury to manipulate the mortgage market (Treasury will now for the first time outright buy agency MBS to manipulate and prop up this market); the creation of a whole host of new bailout facilities (TAF, TSLF, PDCF) to prop and rescue banks and, for the first time since the Great Depression, to bail out non-bank financial institutions....

This is not capitalism.  I am not even necessarily criticizing the government attempts to keep the US economy from shattering, I am just saying: let's not hear any more crap about capitalism and the free market.  When you're rich and you screw up, you get bailed out, and it's the little guy who pays for it.  When you hear the word "welfare," remember that the vast majority of money spent on welfare is given to banks and corporations, not to individuals.

The media are trying to portray the failure of Lehman as a tough, stern decision by Paulson and the Fed, in refusing to bail them out.  But, in fact, JP Morgan Chase stepped up and has doled out $138 billion to settle Lehman's obligations to other banks and investors.  That's how they prevented a disastrous domino effect when Lehman went under.  Chase is acting on behalf of the Fed, in my opinion. They pay $138 billion and it looks like a private sector solution, and when they run short on cash, the Fed will dole out whatever they need (say, perhaps, $138 billion).  And the Fed and Paulson get to pretend that they stood back and let the chips fall where they may, like good capitalists.  Yeah, well, I suspect things would have been very different had Paulson been the former CEO of Lehman, instead of the former CEO of Goldman Sachs.  How nice for Goldman that they have their man at the Treasury, who was able to arrange for the failure of one of Goldman's strongest competitors.  The amount of money Chase paid to keep everyone calm and settle Lehman's accounts would have been enough to save Lehman, a week or two ago.  But the boys up top didn't want to save Lehman, because they'd worked it all out with Goldman Sachs.

[UPDATE: Yep, the Fed paid Chase back every red cent of that $138 billion.  In short, the Fed bailed out Lehman's clients, though they refused to bail out Lehman itself, which would only have cost them half as much.]

All of these shenanigans mean we'll be printing up loads of brand new money.  Both the Fed and the FDIC are running mighty low on cash.  The FDIC alone will require hundreds of billions in new money... their remaining reserves amount to maybe $30 billion, which is a pittance.

There is $6.84 trillion on deposit in US banks; but banks have only $273.7 billion cash on hand. The banks cannot possibly pay back depositors all their money as only 4% of depositors’ funds are actually available. [source]

Well, THAT can't be good!!  Either they will have to renounce FDIC protections and let bank customers' money evaporate, or they will have to print new money out of thin air.  Likely, they will choose to print.

All that printing means more inflation, as existing dollars get diluted by the new dollars, and dollars decline in value.  We already have 13% price inflation per year; I hate to see what it will look like in another couple of years.

Oh, and by the way, keep your gas tanks full.  It remains to be seen if they can get the Texas refineries up and running fast enough to avoid fuel shortages.  We won't know until next week, or possibly even the week after.

Garden warning

If you grow any kind of hot pepper in your garden and you have kids, make sure to frequently remind them which peppers NOT TO EAT.  Tristan bit off the end of a fire-engine red cayenne this evening.  He is okay, but I feel like I've been through one of those Poison Control Center directions: Flush with cool water for 15 minutes.

On the positive side, he didn't throw up, and I didn't panic even though he was panicking.  Poor little guy.

This is why I am loathe to grow medicinal herbs that can be poisonous or simply make you ill, like pennyroyal or lobelia.  I've watched Tristan eat purslane from the edge of the driveway, and seen Anya rub lemon balm between her fingers to inhale the scent, and seen both of them collect catnip for the kitties.  And I had resolved only to grow safe plants, because of the kids.  But the problem with this rule was made apparent to me tonight: I like spicy food, but cayenne peppers cannot be considered "safe" in a household containing small children.  Usually Tristan only picks veggies when I'm out there, with some guidance... but not so this evening.  A ripe cayenne, after all, is a gorgeous thing.

Perhaps next year I'll tie tinsel on the "dangerous" plants.

Already, a gun fired at school

It wasn't a usual school shooting, but a boy in Ohio did fire a gun twice in a school hallway yesterday.  He was apparently intending to kill himself, and was maybe practicing firing the gun.  The principal and assistant principal talked him into dropping the gun.

What struck me was this:

"He did put the gun to his head numerous times," Lombardo said. "He never really said why he was doing it. He did say it wasn't like him to do this, and he was fearful that he had ruined his life."

In a local news video, the principal reiterated: "He was basically saying it wasn't him, he doesn't know why he's doing this."

Yeah, that's called dissociation.  "I'm not me," the kid is saying; "this is not real."  In his case, his own existence did not seem quite real to him.  In other cases, neither the other students and adults in the school nor their own existence seems real, which makes it easy to both murder others and commit suicide.  This disconnection from reality can be a side effect of common psychiatric medications, as discussed in this article on psychiatric drugs and school violence.

Whenever there is a school shooting, I assume a priori that anti-depressants, anti-psychotics, and/or ADHD stimulants were involved.  So far I do not know of any school shooting where the kid was not medicated.  Columbine happened a few days after Eric Harris's Luvox dosage was doubled; Kip Kinkel was taking both Prozac and Ritalin; the Virginia Tech murderer was on anti-depressants.  Doctors prescribe these drugs but fail to monitor kids afterward, even though we know that suicide, violent thoughts, and psychosis are more common side effects in adolescents than in adults.

The argument that these kids were crazy to begin with, so of course they were on meds, does not stand up.  In most cases newspaper reports suggest the shooters were fairly normal until recently, and/or did normal and everyday things just prior to the incident.  Eric Harris and Dylan Klebold, as we all remember thanks to Michael Moore's film, attended their 1st hour bowling class before going on to murder classmates.  And in the days just before their rampage, they had flirted with girls and talked about prom.

If parents want safer schools, they need to mount campaigns to reduce the percentage of students taking psychiatric drugs in their communities.

The road to hyperinflation

I was just listening to an interview of James Turk, a prominent economics guy, and he says that previous estimates of total US debt did not include our future Medicare and Medicaid costs.  That is, the previous estimate of current debts and "future unfunded obligations" (such as Social Security, which we have ZERO money laid aside for), was way too small.  The old estimate was $53 trillion.  Including future Medicare and Medicaid costs, which again we have ZERO money saved up for, we ought to have $106 trillion more than we have.

We're in hock for $106,000,000,000,000.

It goes without saying that we cannot pay this.  Now, true, they will slash Social Security and Medicare and other social welfare programs.  Still, though, we have a lot of debt we will never be able to pay back.

When countries get into a situation where they have absurdly huge debts that are unpayable, they have historically used some combination of these 5 methods to deal with their debt:

1) Just announce you aren't repaying it.  Screw the people who loaned you the money in the first place.

2) Tax the hell out of the population.

3) Sell everything you've got: rail lines, water, natural gas, oil, minerals-- whatever.

4) Plunder other nations.  Steal someone's else resources and use those to make payments.

5) Hyperinflate: cut the value of your currency, or destroy it altogether.

None of these are pleasant, obviously.  If you take option #1 and repudiate your debt, giving the finger to all who bought US Treasury bonds, then trade between the US and the rest of the world largely ceases and we become a Mad Max-like hellhole in which no one has shoes and tens of thousands of people starve to death.

Okaaayyyy... option #2, then.  What about taxes?  Well, our debt is too big for option #2.  They could take every single cent earned by any person or corporation in the US, i.e. they could have a 100% income tax rate for every form of income, and even if they did this for a solid decade it would not pay off the debt.

So, option #3-- sell everything at fire sale prices.  This basically only works for small nations with IMF debt.  It is, in fact, the whole point of the IMF giving them unpayable loans in the first place-- it's so we can come in later and say "Well, all right, you haven't got the money, but you have got oil fields-- we'll take those."  The US debt, however, is on a much, much, much huger scale.  We haven't got $106 trillion worth of stuff to sell, even if we were willing to become the property of Dubai, Abu Dhabi, and China.

Option #4 has been tried in Iraq.  Didn't go so well.

So, you see, we arrive at option #5, running the printing presses full speed and creating money out of thin air, making the dollar worthless in the process.  I imagine governments and bankers always believe they can pull this off in a controlled manner.  "Well," they say to themselves, "what say we go for a 30% inflation rate for 5 years, then get things back on track?"  But it never works, of course.  Next thing you know, you're using bills labeled "TEN MILLION DOLLARS" as kindling.

Here I am at the end of the post where I should say something positive, right?  Hard to find the silver lining in this one, though.  On the plus side, many people in the future will NOT be kicked out of their houses even though they cannot pay the mortgage.  At some point government will call a halt to such evictions, since homeless people are harder to control than housed ones.  In the meantime, while we wait to see how it all goes down, just... get along with your family, stockpile some food, and some ragwool socks would be a good idea.