South America

Fernando ‘FerFAL’ Aguirre’s 2005 Essay: ‘Thoughts On Urban Survival’

I first brought up Fernando “FerFAL” Aguirre on Survival And Prosperity within days of launching the blog. I wrote on December 1, 2010:

Last week I mentioned that I follow a couple of blogs on a regular basis. Surviving In Argentina is one of those and is authored by an Argentine named Fernando “FerFAL” Aguirre who, like Orlov, has first-hand experience of what a financial collapse looks like. In his blog, Aguirre (who has lived in the U.S.) talks about how he and his young family survived the economic crisis in Argentina and how they’re coping now. It’s a rich source of information for surviving tough times, so much so FerFAL went ahead and wrote The Modern Survival Manual: Surviving the Economic Collapse in 2009.

I have a copy of The Modern Survival Manual. I’ve found it so relevant to my circumstances (living in Chicago and now its suburbs), I’ve referred back to it on a regular basis.

FerFAL has a new survival-themed book out. From an e-mail I received from him on June 29:

Hello Everyone!

My New Book, “Bugging Out and Relocating” is now available in Amazon!!

“Bugging Out & Relocating” is the “homework” I did for leaving Argentina. Unlike many prepper books floating around these days, this is about what I actually did, picking up a couple suitcases each, leaving everything behind and moving to a country I had never set foot on before. I basically did so by doing what I explain in this book…

Bugging Out and Relocating: When Staying Put is not an Option sounds real interesting. I can’t wait to read it.

Now, did any readers know that Fernando Aguirre also published a pretty lengthy essay on urban survival back in 2005? I discovered it while reading his blog. It’s long- divided into seven parts- and chock-full of information and lessons gleaned from actual experiences. Remember, Northern Ireland-based FerFAL lived through an economic collapse in modern times. Even though I read the essay some years back, there’s one part in Thoughts on Urban Survival that still blows my mind. Aguirre wrote:

It happened 4 years ago, almost a year after the December 2001 crisis. It was a social studies class and this teacher, don’t remember if it was a he or a she, was explaining the different kinds of social pyramids. God! Now I remember more! We even had a text book with those darn, cruel pyramids! The first pyramid explained the basic society. A pyramid with two horizontal lines, dividing those on top (high social class) those in the middle (middle class) and the bottom of the pyramid (the poor, proletarian). The teacher explained that the middle of the pyramid, the middle class, acted as a cushion between the rich and the poor, taking care of the social stress. The second pyramid had a big middle section, this was the pyramid that represents 1st world countries. I which the bottom is very thin and arrows show that there is a possibility to go from low to middle class, and from middle to the top of the social pyramid. Our teacher explained that this was the classic, democratic capitalist society, and that on countries such as Europeans one, socialists, the pyramid was very similar but a little more flat, meaning that here is a big middle section, middle class, and small high and low class. There is little difference between the three of them.

The third pyramid showed the communist society. Where arrows from the low and middle class tried to reach the top but they bounced off the line. A small high society and one big low society, cushioned by a minimal middle class section of pyramid. Then we turned the page and saw the darned fourth pyramid. This one had arrows from the middle class dropping to the low, poor class.

“What is this?” Some of us asked.

The teacher looked at us. “This is us”

“It’s the collapsed country, a country that turns into 3rd world country like in pyramid five where there is almost no middle class to speak, one huge low, poor class , and a very small, very rich, top class.”

“What are those arrows that go from the middle to the bottom of the pyramid?” Someone asked.

You could hear a pin drop. “That is middle class turning into poor”.

I won’t lie, no one cried, though people rubbed their faces, held their heads and their breath.

No one cried, but we all knew at that very moment that all we thought, all we took for granted, simply was not going to happen.

“You see, the income from the middle class is not enough to function as middle class any more. Some from the top class fall to middle class, but the vast majority of the middle class turns into poor” Said the teacher.

I don’t know how many people in that room suddenly understood that he/she was poor.

The teacher continued “You see, we have a middle class that suddenly turns to poor, creating a society of basically poor people, there is no more middle class to cushion tensions any more. Middle class suddenly discovers that they are overqualified for the jobs they can find and have to settle for anything they can obtain, there for unemployment sky rockets, too much to offer, too little demand. You see they prepare, study for a job they are not going to get. You kids, you are studying Architecture because you simply wish to do so. Only 3 or 4 percent of you will actually find a job related to architecture.”

We all sat there, letting it all sink in. After a few months, it all proved to be true. Even the amount of students that dropped out of college increased to at least 50%. They either so no point in studying something that would not make much of a difference in their future salaries, had no money to keep themselves in college, or simply had to drop college to work and support their families…

Any of this strike a chord with readers? I’m guessing it might.

Anyway, check out the rest of Fernando Aguirre’s Thoughts on Urban Survival on his Surviving In Argentina blog here.

Just be sure to set aside a large block of time- or several smaller ones- to read it and take it all in.

By Christopher E. Hill
Survival And Prosperity (www.survivalandprosperity.com)

(Editor’s note: Link added to “Resources” page)

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Sino-Russian Natural Gas Deal Blow To U.S. Dollar Supremacy?

“The Obama administration is playing down an increasingly warm relationship between its main global rivals, China and Russia, that it may have inadvertently encouraged.

U.S. officials maintain there is nothing to fear from the growing alliance between Moscow and Beijing, even as each throws its weight around in neighboring regions like Ukraine and the South China Sea and at international forums like the United Nations, where on Thursday they double-vetoed the latest in a series of Security Council resolutions on Syria.

Yet when coupled with growing cooperation between Russian President Vladimir Putin and his Chinese counterpart, Xi Jinping, in other areas- notably, a new $400 billion natural gas deal and apparent agreement on the crisis in Ukraine- many believe Russia and China may now or may soon represent a powerful new alliance challenging not only the United States, but also the Western democratic tradition that the U.S. has championed globally…”

-Associated Press, May 23, 2014

You may have heard about that $400 billion natural gas deal that was just struck between China and Russia. Or maybe you didn’t, as I’ve noticed the mainstream media hasn’t really been talking about it too much. Most of the outlets that did neglected to talk about the potential ramifications for the U.S. dollar.

There were exceptions. From the BBC News website on May 22:

Some papers are also analysing the impact of the deal on the world currency market.

A commentary in the Beijing Youth Daily says the deal will probably encourage more countries to not trade in US dollars if China and Russia decide to switch to clearing payments in Russian roubles and the yuan.

“The world economy and finance will then embark on a process to get rid of the US dollar, and the dominance of the dollar will gradually lose its support. The US will then face more challenges in its ability to control global economics and politics,” it says…

From Liam Halligan on The Telegraph (UK) website yesterday:

The real danger, in my view, is rather more abstract — but deadly important nevertheless. If Russia’s “pivot to Asia” results in Moscow and Beijing trading oil between them in a currency other than the dollar, that will represent a major change in how the global economy operates and a marked loss of power for the US and its allies.

With the dollar as the world’s petrocurrency, it also remains the reserve currency of choice for central banks globally. As such, the US is currently able to borrow with “exorbitant privilege”, as it has for decades, simply printing money to pay off foreign creditors.

With China now the world’s biggest oil importer and the US increasingly stressing domestic production, the days of dollar-priced energy, and therefore dollar-dominance, look numbered. Beijing has recently struck numerous agreements with major trading partners such as Brazil that bypass the dollar. Moscow and Beijing have also set up rouble-yuan swap facilities that push the greenback out of the picture.

If Russia and China now decide to drop dollar energy pricing totally, America’s reserve currency status could unravel fast, seriously undermining the US Treasury market and causing a world of pain for the West. This won’t happen tomorrow or next year. It’s unlikely even by 2020. But by announcing this deal, Russia and China turned the screw half a twist more…

(Editor’s note: Bold added for emphasis)

Then there’s this from Max Keiser, an American filmmaker and host of the Keiser Report, a financial show on RT. From The Washington Times website earlier today:

He said the $400 billion, 30-year deal will further the strategic goals of Moscow and Beijing to diminish the status of the U.S. dollar by conducting world trade in critical commodities such as oil and gas using other currencies.

Russia is the world’s biggest producer of commodities such as crude oil, gold and titanium. China is the world’s biggest consumer of these commodities.

Both countries have chafed for years at having to conduct purchases and sales in dollars, as is customary worldwide. The gas deal announced in Beijing on Wednesday would be the first major commodities contract to be settled in Russian rubles and Chinese yuan rather than dollars.

“This means the U.S. dollar’s days as the world reserve currency are numbered,” said Mr. Keiser, noting that Russia and China have been investing heavily in gold.

Many analysts question whether Moscow and Beijing can succeed in displacing the dollar as the world’s reserve currency. If that happens, however, it likely would usher in a period of global financial instability and force Americans to pay much more for the massive amounts of imported energy, Mr. Keiser said…

(Editor’s note: Bold added for emphasis)

According to the Economist Intelligence Unit- the research and analysis division of The Economist Group, the sister company to The Economist newspaper- on May 22, it has been reported payments for the gas will be made in Chinese yuan rather than U.S. dollars.

By Christopher E. Hill
Survival And Prosperity (www.survivalandprosperity.com)

Sources:

“China media: Russia gas deal.” BBC News. 22 May 2014. (http://www.bbc.com/news/world-asia-china-27514395). 25 May 2014.

Halligan, Liam. “Russia-China gas deal could ignite a shift in global trading.” The Telegraph. 24 May. 2014. (http://www.telegraph.co.uk/finance/comment/liamhalligan/10854595/Russia-China-gas-deal-could-ignite-a-shift-in-global-trading.html). 25 May 2014.

Hill, Patrice. “Russia’s Putin gains strategic victory with Chinese natural gas deal.” The Washington Times. 25 May 2014. (http://www.washingtontimes.com/news/2014/may/25/russias-putin-gains-strategic-victory-with-chinese/). 25 My 2014.

“The Sino-Russian gas deal.” Economist Intelligence Unit. 22 May 2014. (http://www.eiu.com/industry/article/431836627/the-sino-russian-gas-deal/2014-05-22) 25 May 2014.

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Video: SHTF In Venezuela

Henry Reich, creator of the MinutePhysics series of videos on YouTube.com, shows the chaos going on in Venezuela these days in his latest work. Apparently, an illustrator for MinuteEarth- Ever Salazar- has a ringside seat to the dire situation the South American country is in (I blogged about the food shortages back on April 3).

Watching the video, I couldn’t help but wonder if the United States might not suffer something similar once our financial “day of reckoning” arrives. And then I heard Salazar say this:

At least half the population ratifies the disaster by voting in favor of the 15-year-long revolution…

Sound familiar?


“When Insanity Becomes Normal- Venezuela”
YouTube Video

Note the shortages of food and other items being mentioned.

By Christopher E. Hill
Survival And Prosperity (www.survivalandprosperity.com)

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‘Criminals Are Victims Of The Evil Capitalist Society’

These days, there are lots of people out there speculating and writing about what a financial crash would be like- even though they’ve never lived through one.

On the other hand, some have and are actively sharing their experiences and lessons for surviving a similar event.

Once in a while on Survival And Prosperity I’ve mentioned Fernando “FerFAL” Aguirre, who lived through Argentina’s economic collapse last decade and released The Modern Survival Manual: Surviving the Economic Collapse in 2009. A big “fan” of the book and the accompanying blog- Surviving In Argentina- I happened to be listening to the fourth installment in a series of video posts FerFAL has produced recently about “prepper myths,” when he talked about the recent violent mugging of an American tourist in a nice part of Buenos Aires. Apparently, the mugger- who was on the verge of being lynched by a crowd- was booked by police yet released later on that day. FerFAL- now based in Northern Ireland- lamented in the April 9 post:

And that’s the key of the thing. It’s not considered a bad thing. And it’s not just mugging, robbing- even hurting, raping, murdering- it’s not considered a bad thing from the perspective of the Argentine government. They have this crappy, commie, anti-capitalist, bullshit thing going on which basically says- and I got tired of hearing this time and again- but the official government point of view is criminals are victims of the evil capitalist society that are just trying to provide for their families. And when you say, “Alright, what about a rapist or a murderer? What is he trying to do there?” “Well, he’s also a poor victim because he didn’t have the populist, socialist education that we’re trying to promote and he didn’t know any better.” They’re always justifying. And this isn’t just something I perceive. This is something I’ve been told by an actual district attorney. He’ll tell me, “That’s what we get from the top. We’re being told not to put people behind bars. Find any possible way, even if a cop drags one- this guy actually murdered someone in front of my eyes. Even if that happens, the official point of view of this is- release them as fast, as quickly as possible. We don’t want people behind bars.” That makes for a very chaotic society, and that’s what’s been going on in Argentina for over a decade now. That’s why it’s so violent…

Any of what FerFAL said ring a bell to some readers? It sure did for me, as I type this from the Chicago area this wintry April evening.

Plenty of bad guys who should be locked up behind bars are roaming the streets of Chicago and other parts of Cook County these days.

“That’s why it’s so violent.”

By the way, check out Fernando Aguirre’s other “prepper myth” video posts here if you have the time. I found them very insightful and thought-provoking.

By Christopher E. Hill
Survival And Prosperity (www.survivalandprosperity.com)

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Venezuela Food Shortages Give Rise To Registration

In the 2008 film The Hurt Locker, there’s a part where the main character, a U.S. Army Explosive Ordnance Disposal (EOD) specialist, returns home. While shopping for groceries, he becomes overwhelmed by the enormity of choices and amount available for purchase…


“The Hurt Locker- grocery store scene”
YouTube Video

It was a humorous yet sobering reminder of the abundance of food in our society.

At least for now.

Compare that to present-day Venezuela, where food shortages are becoming a serious problem. From the Associated Press on Tuesday:

Battling food shortages, the Venezuelan government is rolling out a new ID system that is either a grocery loyalty card with extra muscle or the most dramatic step yet towards rationing in Venezuela, depending on who is describing it.

President Nicolás Maduro’s administration says the cards to track families’ purchases will foil people who stock up on groceries at subsidised prices and then illegally resell them for several times the amount. Critics say it’s another sign the oil-rich Venezuelan economy is headed toward Cuba-style dysfunction.

Registration begins at more than 100 government-run supermarkets across the country on Tuesday and working-class shoppers – who sometimes endure hours-long queues at the stores to buy cut-price groceries – are welcoming the plan…

Rigid currency controls and a shortage of US dollars make it increasingly difficult for Venezuelans to find imported basic products such as milk, flour, toilet paper and cooking oil.

In January, more than a quarter of basic staples were out of stock in Venezuelan stores, according to the central bank’s scarcity index. The shortages are among the problems cited by Maduro’s opponents who have been staging protests since mid-February…

(Editor’s note: Bold added for emphasis)

I feel bad for the Venezuelans that these shortages are taking place.

At the same time, it’s a good reminder for Americans that prepping for hard times isn’t all about socking away just guns and gold.

By Christopher E. Hill
Survival And Prosperity (www.survivalandprosperity.com)

Source:

“Venezuela tackles food shortage with ID card system.” Associated Press. 1 Apr. 2014. (http://www.theguardian.com/world/2014/apr/01/venezuela-food-shortage-id-cards). 3 Apr. 2014.

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Jeremy Grantham’s Latest Investment Advice

It’s been a while since I’ve blogged about Jeremy Grantham, the co-founder and chief investment strategist of Grantham, Mayo, Van Otterloo & Co. (GMO). To be fair, the British-born investment advisor has been taking a break from his popular quarterly investment letter that’s published on the GMO website. For those of you who aren’t familiar with Mr. Grantham, he’s designated one of this blog’s “crash prophets” along with Marc Faber, Jim Rogers, and Peter Schiff due to his special talent for correctly-calling the direction of the financial markets. He so good that individual clients have included Secretary of State John Kerry and former Vice President Dick Cheney.

Grantham was the subject of a September 20 article in The Wall Street Journal in which Ian Salisbury asked him about investment-related topics, such as the depletion of natural resources on Earth. From the Q and A session:

Q: What are investors supposed to do?
A: The investment implications are, of course, own stock in the ground, own great resources, reserves of phosphorous, potash, oil, copper, tin, zinc—you name it. I’d be less enthusiastic about aluminum and iron ore just because there is so much. And I wouldn’t own coal, and I wouldn’t own tar sands. It’s hugely expensive to build coal utilities, and the plants they have to build for tar sands are massive, and before they get their money back I suspect that the price of solar and wind will have come down so much.

So I wouldn’t use that, but I think oil, the metals and particularly the fertilizers, I would own—and the most important of all is food. The pressures on food are worse than anything else, and therefore, what is the solution? Very good farming, which can be done. The emphasis from an investor’s point of view is on very good farmland. It’s had a big run. You can never afford to ignore price and value, but from time to time you can get good investments in farmland, and if you’re prepared to go abroad, you can do it today. I wouldn’t be too risky. I would stay with distinctly stable countries—Australia, New Zealand, Uruguay, Brazil, Canada, of course, and the U.S. But I would look around, in what I call the nooks and crannies. And forestry is the same. Forestry is not a bad bargain, a little overpriced maybe, but it’s in a world where everything is overpriced today, once again, courtesy of incredibly low interest rates that push people into investing. A wicked plot of the Federal Reserve.

Grantham also shared with Salisbury where he thought stocks were heading. Basically, not only does he think equities can go “a lot higher than this” with Fed backing, but they could even reach bubble territory.

It’s a really good, insightful interview, capped-off with a discussion about unbridled American optimism, which you can read in its entirety here on The Wall Street Journal website.

By Christopher E. Hill, Editor
Survival And Prosperity (www.survivalandprosperity.com)

Source:

Salisbury, Ian. “Our Chat With Jeremy Grantham.” The Wall Street Journal. 20 Sep. 2013. (http://online.wsj.com/article/SB10001424127887323665504579032934293143524.html). 24 Sep. 2013.

(Editor’s notes: Info added to “Crash Prophets” page; I am not responsible for any personal liability, loss, or risk incurred as a consequence of the use and application, either directly or indirectly, of any information presented herein.)

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Central Banks Continue To Stockpile Gold

Despite the price of gold getting pummeled recently, a number of the world’s central banks continue to acquire the precious metal. Sungwoo Park reported on the Bloomberg website yesterday:

The Bank of Korea added 20 metric tons in February, raising its gold reserves by 24 percent to 104.4 tons, it said in a statement today. Holdings rose about $1.03 billion by value to $4.79 billion at the end of last month, equivalent to 1.5 percent of total foreign exchange holdings, according to the statement. Prices advanced.

Russia and Kazakhstan expanded bullion reserves for a fourth straight month in January.

On February 11, I blogged that Russia is now the world’s biggest gold buyer, adding 570 metric tons of the precious metal to their holdings over the past decade.

Glenys Sim wrote on Bloomberg.com back on February 25:

Russian holdings climbed 12.2 metric tons to 970 tons last month after gaining 8.5 percent over 2012, according to International Monetary Fund data. Kazakhstan’s hoard grew 1.5 tons to 116.8 tons, following last year’s 41 percent expansion, data on the IMF website showed…

Central banks will again be strong buyers this year after they boosted purchases 17 percent to 534.6 tons last year, the most since 1964, according to the London-based World Gold Council.

The gold haters are out in full force these days. Yet, central banks keep stockpiling the yellow metal. Hmm.

Diversification? Or “something wicked this way comes?”

And there’s no shortage of stories in the American media of how poorly gold is doing. Even though it’s setting record highs in other countries. Brett Arends wrote on the MarketWatch website yesterday:

You won’t hear about it in the usual places. Everywhere you turn these days, all you hear is that gold is down, it’s finished, it’s heading for something called a “death cross,” which sounds terrifying. But away from the headlines, gold just rocketed to a new, all-time high.

In places like Argentina, Brazil, Iceland, India, and Japan.

Not bad for a “barbarous relic,” huh?

By Christopher E. Hill, Editor
Survival And Prosperity (www.survivalandprosperity.com)

(Editor’s note: I am not responsible for any personal liability, loss, or risk incurred as a consequence of the use and application, either directly or indirectly, of any information presented herein)

Sources:

Park, Sungwoo. “Korea Joins Russia, Kazakhstan in Boosting Gold Holdings.” Bloomberg. 6 Mar. 2013. (http://www.bloomberg.com/news/2013-03-05/bank-of-korea-boosts-gold-reserves-as-central-banks-buy.html). 6 Mar. 2013.

Sim, Glenys. “Russia, Kazakhstan Increase Bullion Reserves for Fourth Month.” Bloomberg. 25 Feb. 2013. (http://www.bloomberg.com/news/2013-02-25/russia-kazakhstan-expand-gold-reserves-for-fourth-month-1-.html). 6 Mar. 2013.

Arends, Brett. “The secret bull market in gold.” MarketWatch. 6 Mar. 2013. (http://www.marketwatch.com/story/the-secret-bull-market-in-gold-2013-03-06). 6 Mar. 2013.

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Massad Ayoob, Rob Pincus Defend Semi-Auto, Military-Pattern Rifles And “High-Capacity” Magazines

How many readers have heard this uttered during the latest push for more gun “control” in America?:

Americans don’t need “fast-firing” guns with “high-capacity” magazines to protect themselves. Stopping a bad guy doesn’t require all those bullets.

Such dribble often reveals two things:

1. The individual saying this watches way too much television and/or movies.

2. That person fails to comprehend that sometimes there’s more than one aggressor involved.

This last point has been made exceedingly-clear to me these past couple of years in my observations of crime “south of the border.”

Any readers remember my July 2011 post about a gang of criminals carrying out a violent home invasion against an American couple residing in Ixtapa, Mexico? Pretty graphic story, huh?

And then there’s Fernando Aguirre of Surviving In Argentina blog-fame, who has mentioned multiple incidents involving more than one aggressor in his home country of Argentina. One story in particular stands out in my mind. From his survival-themed book The Modern Survival Manual: Surviving The Economic Collapse:

I also remember a forensic doctor that used to live in my neighborhood, who got ambushed by five or six men when he exited a restaurant. They did kill him, but he managed to kill four of them and he severely wounded another.

This doctor used to practice with his Glock .40 S&W at my local shooting range. I don’t remember exactly how many rounds he fired during the attack, but I remember that it at least doubled the capacity of most revolvers.


“Home Invaders Shot in Self Defense”
(Security cameras catch armed Tucson resident thwarting home invasion)
YouTube Video

Recently, two well-known firearm and personal defense experts- Massad Ayoob and Rob Pincus- have come out in support of semi-automatic military-pattern rifles and so-called “high-capacity” ammunition magazines. Here are some comments from them in their defense of the guns and magazines which others are so desperately trying to ban/take away:

I can certainly imagine scenarios where I would need to have a lot of rounds. I can certainly imagine scenarios where I would need to have the capability of controlling those rounds through a semi-automatic rifle where I can fire those rounds quickly and accurately. Multiple person home invasions would be an easy example that could obviously happen to any home in any part of the country.

-Rob Pincus of I.C.E. Training, in an interview published on the WND.com website on February 27, 2013

In a world where the Good People With Guns often have to deliver several hits to neutralize even one Bad Person With Deadly Weapons, and in which there is often more than one attacker, anyone applying logical thinking can only end up shouting one three-word mantra:

DO THE MATH!!

-Massad Ayoob of Massad Ayoob Group, in a January 31, 2013, post on the Massad Ayoob on Guns blog on the website of Backwoods Home magazine

The cops are the experts on the current criminal trends. If they have determined that a “high capacity” semiautomatic pistol and a .223 semiautomatic rifle with 30-round magazines are the best firearms for them to use to protect people like me and my family, they are obviously the best things for us to use to protect ourselves and our families.

-Massad Ayoob again, in a December 29, 2012, post on the Massad Ayoob on Guns blog

When it comes to firearms and self-defense, these guys know what they’re talking about.

More so than others who would have you “just fire the shotgun through the door” in an ill-advised attempt at protecting the home.

By Christopher E. Hill, Editor
Survival And Prosperity (www.survivalandprosperity.com)

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Central Banks Keep Buying Gold

There’s been a lot of talk recently about the dip in the gold price.

Yet, so little chatter about the world’s central banks adding to their gold reserves.

Glenys Sim reported on Bloomberg.com tonight:

Brazil boosted gold reserves for a third month in November to double the country’s holdings since August as central banks from Russia to Belarus and South Korea add the metal to diversify their assets.

Brazilian holdings expanded 14.7 metric tons in November to 67.2 tons, the most since November 2000, according to data on the International Monetary Fund’s website. The country bought 17.2 tons in October after adding 1.7 tons in September, the first increase since 2008. Russia’s holdings increased 2.9 tons last month and Belarus’s reserves expanded 1.4 tons, the data show…

In Asia, the Bank of Korea increased gold reserves 20 percent last month to diversify investments, boosting holdings for the fourth time since June 2011, according to a statement Dec. 5. Gold is a physical, safe asset, the Bank of Korea said.

According to ArabianMoney.net editor/publisher Peter Cooper on the ResourceInvestor.com news site back on December 6:

Gold buying by the global central banks will hit a new high this year of more than 500 tons up from 465 tons in 2011, according to data compiled by the World Gold Council.

(Editor’s note: I am not responsible for any personal liability, loss, or risk incurred as a consequence of the use and application, either directly or indirectly, of any information presented herein)

Sources:

Sim, Glenys. “Brazil Doubles Gold Reserves as Central Banks Buy Bullion.” Bloomberg. 20 Dec. 2012. (http://www.bloomberg.com/news/2012-12-21/brazil-doubles-gold-reserves-with-third-purchase-as-banks-buy.html). 20 Dec. 2012.

Coopers, Peter. “Central Bank Gold Purchases to Top 500 Tons This Year.” ResourceInvestor.com. 6 Dec. 2012. (http://www.resourceinvestor.com/2012/12/06/central-bank-gold-purchases-to-top-500-tons-this-y?ref=hp). 20 Dec. 2012.

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Quotes For The Week

A two-fer for you this week.

1992 U.S. presidential candidate Ross Perot is back in the news. The billionaire is so concerned about the state of the nation’s finances, that according to Brendan James over at the Yahoo! News blog The Ticket this morning, Perot said in a recent USA TODAY interview:

If we are that weak, just think of who wants to come here first and take us over…

The last thing I ever want to see is our country taken over because we’re so financially weak, we can’t do anything.

Visions of Red Dawn are flooding through my mind right about now.


“Red Dawn Trailer (1984)”
YouTube Video

And talk about an endorsement no American politician from either of the two big national parties would want to receive at this point in the election cycle. The Associated Press reported last night:

Venezuelan President Hugo Chavez has weighed in on the U.S. presidential race, saying he prefers President Barack Obama.

“If I were American, I’d vote for Obama,” Chavez said in a televised interview that aired Sunday.

The Venezuelan leader called Obama “a good guy” and said if the U.S. president were a Venezuelan, “I think… he’d vote for Chavez.”

I’m sure President Obama is grateful for such a glowing endorsement so close to the election.

If Hugo was really that big a fan of the U.S. president, he should have said Mitt Romney would get his vote.

Sources:

James, Brendan. “America could be ‘taken over,’ warns Ross Perot.” The Ticket. 1 Oct. 2012. (http://news.yahoo.com/blogs/ticket/america-could-taken-over-warns-ross-perot-152428497.html). 1 Oct. 2012.

“Hugo Chavez says he’d vote for Obama.” Associated Press. 30 Sep. 2012. (http://news.yahoo.com/hugo-chavez-says-hed-vote-obama-172412142.html). 1 Oct. 2012.

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H1N1 Cases Reported In Asia, South America

President Barack Obama has declared the swine flu outbreak a national emergency, giving his health chief the power to let hospitals move emergency rooms offsite to speed treatment and protect noninfected patients.

The declaration, signed Friday night and announced Saturday, comes with the disease more prevalent than ever in the country…

-Associated Press, October 25, 2009

The global death toll from 2009’s H1N1 “swine flu” pandemic could be higher than initially reported. Simeon Bennett reported on the Bloomberg website yesterday:

The 2009 swine flu pandemic may have killed 15 times more people globally than reported at the time, according to the first study to estimate the death toll.

The H1N1 influenza virus probably killed about 284,500 people worldwide, compared with 18,500 deaths reported to the World Health Organization, researchers from the U.S. Centers for Disease Control and Prevention wrote in the journal Lancet Infectious Diseases today. More than half the deaths may have been in southeast Asia and Africa, compared with 12 percent of officially reported fatalities, the authors wrote.

The H1N1 virus was reported in more than 214 countries through August 2010, when the WHO declared an end to the pandemic. It’s since become one of three seasonal flu strains circulating worldwide, causing infections mostly during the winter months.

This year, H1N1 cases have been reported in both hemispheres, and in winter and summer. Loshana K. Shagar and Embun Majid reported on the Jakarta Post (Indonesia) website on June 16:

The Influenza A(H1N1) outbreak at the National Service (NS) camp is under control, said Health Minister Liow Tiong Lai.

He said there have been no new cases since Thursday.

Ninety NS trainees at Dusun Minda National Service training camp in Kuala Nerang, Kedah, were quarantined two days ago after coming down with A(H1N1).

Sumitra Deb Roy wrote on the Times of India website earlier today:

MUMBAI: The civic authorities are insistent that H1N1 cases in the city are sporadic and nothing to worry about. But statistics suggest otherwise. While 46 positive cases of H1N1 have been reported between April and June so far, there were zero cases in Mumbai during the corresponding period last year.

Prasit Tangpraset wrote on the AsiaOne website, an online news portal belonging to Singapore Press Holdings Ltd. Co., last Thursday:

Yesterday 41 persons were confirmed as infected with the 2009 influenza A (H1N1) at Nakhon Ratchasima Rajanagarindra Psychiatric Hospital in the Northeast…

Kamron Chaisiri, inspector-general of the Public Health Ministry, said the hospital found the first case on June 12 in the ward for alcoholics, who have weaker immune systems and are easily infected.

Six women and 35 men have been admitted, including six hospital staff. The patients are on the antiviral drug Tamiflu and none are severely ill.

And Latin American News Agency Prensa Latina published on its website last Friday:

The Bolivian Minister of Health and Sports, Juan Carlos Calvimontes, confirmed the record of 637 patients with influenza A (H1N1) and 2. 276 suspected cases.

According to Calvimontes epidemiological reports register five deaths, and he said that the department with more registered patients is La Paz, with more than 300 positive cases.

With all these reports coming in about H1N1 cases, here’s hoping this isn’t the beginning of another pandemic (or a “real” one, as some claim the 2009 event was a scam).

Stay healthy, my friends.

Sources:

Bennett, Simeon. “Swine Flu Deaths May Have Been 15 Times Higher Than Reported.” Bloomberg. 25 June 2012. (http://www.bloomberg.com/news/2012-06-25/swine-flu-deaths-may-have-been-15-times-higher-than-reported.html). 26 June 2012.

Shagar, Loshana K. and Majid, Embun. “‘No new H1N1 cases’ reported at Malaysia’s Kedah NS camp.” Jakarta Post. 16 June 2012. (http://www.thejakartapost.com/news/2012/06/16/no-new-h1n1-cases-reported-malaysia-s-kedah-ns-camp.html). 26 June 2012.

Deb Roy, Sumitra. “46 H1N1 cases ‘not worrisome': BMC.” Times of India. 26 June 2012. (http://timesofindia.indiatimes.com/city/mumbai/46-H1N1-cases-not-worrisome-BMC/articleshow/14396348.cms). 26 June 2012.

Tangprasert, Prasit. “41 swine flu cases confirmed in Thailand.” AsiaOne. 21 June 2012. (http://news.asiaone.com/News/AsiaOne%2BNews/Asia/Story/A1Story20120621-354262.html). 26 June 2012.

“Bolivia Reported 637 Confirmed Cases of Influenza A (H1N1).” Prensa Latina. 22 June 2012. (http://www.plenglish.com/index.php?option=com_content&task=view&id=519345&Itemid=1). 26 June 2012.

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Tuesday, June 26th, 2012 Asia, Health, Public Safety, South America No Comments

Argentina Plans On Using Nationalized Pension Funds For New Stimulus Program

“Don’t cry for me Argentina.”

That song has stuck with me ever since I first heard it sung in TV commercials for the musical Evita back in the early 80s.

But these days, I can’t help but wonder if Argentinians aren’t crying for themselves.

Or if Americans will soon follow.

Those Argentines who successfully-weathered the economic collapse the South American country experienced at the end of the 90s had the following to look forward to as the next decade drew to a close. From the BBC News website on October 21, 2008:

Argentina’s President Cristina Fernandez has signed a bill that will nationalise the country’s 10 private pension funds.

The move will put the government in control of almost $30bn (£18bn) of investments and is aimed at protecting them from the global market turmoil.

Shares slumped amid fears of the move’s impact and critics accused the government of trying to grab the funds.

(Editor’s note: Italics added for emphasis)

History has shown that when a government assumes control of something for their citizens’ “protection,” it might be time to get concerned.

Recently, it’s been suggested those formerly-private pensions have become a giant piggy bank for the Argentine government. On April 25, 2012, the newspaper Los Andes (Argentina) reported that Argentina’s Treasury had borrowed $342 million from the state pensions agency, Anses- and issued a one-year bond in its place.

And just this afternoon, the Associated Press reported about a new “stimulus” program in Argentina that’s using these pension funds once again. From the piece:

Argentina is rolling out a major economic stimulus plan, using pension and treasury funds to provide nearly cost-free housing loans of up to $77,000 each to 400,000 people who have been closed out of private-sector borrowing.

Buenos Aires Gov. Daniel Scioli on Wednesday ordered all “non-productive” government-owned land to be made available to the program President Cristina Fernandez announced hours earlier. The vast Buenos Aires province surrounding Argentina’s capital is plagued with slums and has by far the nation’s largest population in need of housing…

Argentina’s Supreme Court also took action: Six justices signed a resolution giving the pension agency, ANSES, 30 days to explain in detail where it is spending the retirement funds. Thousands of Argentine retirees have won court rulings for unpaid pensions, but have yet to see their money.

(Editor’s note: Italics added for emphasis)

So as it stands right now, it sounds like Argentina’s government plans to take money from nationalized, formerly-private pensions to fund this new stimulus program- while promising to pay the borrowed money back.

Anyone think those retirees will ever get all their pesos back?

Or that a good majority of those housing loans will be repaid, for that matter?

Claims of this stimulus actually being a progressive redistribution of wealth (rich to poor) are almost certain to be made.

We’ll just have to wait and see how this all ends up.

And seriously scrutinize any suggestion to nationalize our private pensions, especially if it’s under the claim of “protection.”

Sources:

“Argentina to take over pensions.” BBC News. 21 Oct. 2008. (http://news.bbc.co.uk/2/hi/7682877.stm). 13 June 2012.

“El Banco Nación prestará al Tesoro unos $ 12 mil millones.” Los Andes. 25 Apr. 2012. (http://www.losandes.com.ar/notas/2012/4/25/banco-nacion-prestara-tesoro-unos-millones-638373.asp). 13 June 2012.

Associated Press. “Argentina aims to ‘light fire’ to economy, using pension funds to provide generous home loans.” Washington Post. 13 June 2012. (http://www.washingtonpost.com/business/economy/argentina-aims-to-light-fire-to-economy-using-pension-funds-to-provide-generous-home-loans/2012/06/13/gJQAxS4TaV_story.html). 13 June 2012.

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Marc Faber Talks Again About Investing In Remote Farmland To Counter Growing Social Tension

Investment adviser and fund manager Dr. Marc Faber attended the CFA Institute’s Third Annual Middle East Investment Conference in Qatar these past two days. According to Ed Bace, the CFA’s head of education for the Europe, Middle East, and Africa (EMEA) regions, “Doctor Doom” (labeled that by the press for his contrarian investment style that is often interpreted as being bearish) told conference attendees that continuing growth in Asia and South America will put further pressure on the world’s resources, thereby leading to increased geopolitical tension. As such, the Swiss-born Faber shared the following investment recommendations. Bace wrote on the conference website earlier today:

So how should investors play this situation? Faber states that diversification is key alongside low leverage. His recommendations are as follows: cash and bonds are not hugely attractive, given negative real interest rates, but equity-like corporate bonds could form 25% of a portfolio. Another 25% could be made up of stocks, especially in emerging markets, with a further 25% in precious metals (which tend to be severely underweighted in a typical pension fund). Real estate in certain areas (such as Asia) could make up the remainder. He added that US house prices are looking decidedly cheap.

Faber closed his speech by emphasizing that the crucial question over the next decade is not “where will my returns be highest?” but “where will I lose the least money?” In fact, he believes that losses of 50% should be considered as a relative success. He advised that an investment in remote farmland could pay off, as growing social tensions could make urban life intolerable. In his view the welfare state has evolved from the many helping the few to the few helping the many and that the inevitable crash, or “rebooting the computer,” will simply have to be endured. Whether this crisis occurs soon, as further credit expansion is voluntarily abandoned, or occurs later, as the currency system meets final and total catastrophe, Faber cannot predict.

(Editor’s note: Italics added for emphasis)

The investment in remote farmland that Dr. Faber talked about reminds me of a piece I read on The Times (UK) website back on February 22, 2010. Leo Lewis wrote in that article:

The world’s most powerful investors have been advised to buy farmland, stock up on gold and prepare for a “dirty war” by Marc Faber, the notoriously bearish market pundit, who predicted the 1987 stock market crash…

Speaking today, Dr Faber said that investors, who control billions of dollars of assets, should start considering the effects of more disruptive events than mere market volatility.

“The next war will be a dirty war,” he told fund managers: “What are you going to do when your mobile phone gets shut down or the internet stops working or the city water supplies get poisoned?”

His investment advice, which was the first keynote speech of CLSA’s annual investment forum in Tokyo, included a suggestion that fund managers buy houses in the countryside because it was more likely that violence, biological attack and other acts of a “dirty war” would happen in cities.

(Editor’s note: Italics added for emphasis)

Sobering stuff. But I wouldn’t expect anything less from the publisher of The Gloom Boom & Doom Report.

(Editor’s notes: I am not responsible for any personal liability, loss, or risk incurred as a consequence of the use and application, either directly or indirectly, of any information presented herein; info added to “Crash Prophets” page)

Sources:

Bace, Ed. “Marc Faber: Continuing Financial Crisis Must Be Endured.” CFA Institute Middle East Investment Conference. 26 Mar. 2012. (http://meic.cfainstitute.org/2012/03/26/marc-faber-continuing-financial-crisis-must-be-endured/#comment-19). 26 Mar. 2012.

Lewis, Leo. “‘Buy farmland and gold,’ advises Dr Doom.” The Times. 22 Feb. 2010. (http://glocktalk.com/forums/showthread.php?t=1191724). 26 Mar. 2012.

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‘Shadow CIA’ Calls End Of Terrorism A ‘Myth’

One last post about terrorism this week. Scott Stewart of the global intelligence company Strategic Forecasting, Inc., or STRATFOR, has authored a series of Security Weekly reports entitled “Fundamentals of Terrorism.” The first of these, “The Myth of the End of Terrorism,” was released on February 23. It’s a good, informative read, and serves as a reminder that just because major terror attacks directed against the United States and its interests haven’t been too successful lately, the threat hasn’t gone away. Reprinted with permission of STRATFOR:

The Myth of the End of Terrorism

By Scott Stewart

In this week’s Geopolitical Weekly, George Friedman discussed the geopolitical cycles that change with each generation. Frequently, especially in recent years, those geopolitical cycles have intersected with changes in the way the tactic of terrorism is employed and in the actors employing it.

The Arab terrorism that began in the 1960s resulted from the Cold War and the Soviet decision to fund, train and otherwise encourage groups in the Middle East. The Soviet Union and its Middle Eastern proxies also sponsored Marxist terrorist groups in Europe and Latin America. They even backed the Japanese Red Army terrorist group. Places like South Yemen and Libya became havens where Marxist militants of many different nationalities gathered to learn terrorist tradecraft, often instructed by personnel from the Soviet KGB or the East German Stasi and from other militants.

The Cold War also spawned al Qaeda and the broader global jihadist movement as militants flocking to fight the Soviet troops who had invaded Afghanistan were trained in camps in northern Pakistan by instructors from the CIA’s Office of Technical Services and Pakistan’s Inter-Services Intelligence directorate. Emboldened by the Soviet withdrawal from Afghanistan, and claiming credit for the subsequent Soviet collapse, these militants decided to expand their efforts to other parts of the world.

The connection between state-sponsored terrorism and the Cold War ran so deep that when the Cold War ended with the Soviet Union’s collapse, many declared that terrorism had ended as well. I witnessed this phenomenon while serving in the counterterrorism Investigations Division of the Diplomatic Security Service (DSS) in the early 1990s. While I was in New York working as part of the interagency team investigating the 1993 World Trade Center bombing, a newly appointed assistant secretary of state abolished my office, declaring that the DSS did not need a Counterterrorism Investigations Division since terrorism was over.

Though terrorism obviously did not end when the Berlin Wall fell, the rosy sentiments to the contrary held by some at the State Department and elsewhere took away the impetus to mitigate the growing jihadist threat or to protect diplomatic facilities from it. The final report of the Crowe Commission, which was established to review the twin August 1998 bombing attacks against the U.S. embassies in Nairobi and Dar es Salaam, explicitly noted this neglect of counterterrorism and security programs, as did the 9/11 Commission report.

The 9/11 terrorist attacks triggered a shift in international geopolitics by leading the United States to concentrate the full weight of its national resources on al Qaeda and its supporters. Ironically, by the time the U.S. government was able to shift its massive bureaucracy to meet the new challenge, creating huge new organizations like the Department of Homeland Security, the efforts of the existing U.S. counterterrorism apparatus had already badly crippled the core al Qaeda group. Though some of these new organizations played important roles in helping the United States cope with the fallout of its decision to invade Iraq after Afghanistan, Washington spent billions of dollars to create organizations and fund programs that in hindsight were arguably not really necessary because the threats they were designed to counter, such as al Qaeda’s nuclear briefcase bombs, did not actually exist. As George Friedman noted in the Geopolitical Weekly, the sole global superpower was badly off-balance, which caused an imbalance in the entire global system.

With the continued diminution of the jihadist threat, underscored by the May 2011 death of Osama bin Laden and the fall in Libya of the Gadhafi regime (which had long employed terrorism), once again we appear on the brink of a cyclical change in the terrorism paradigm. These events could again lead some to pronounce the death of terrorism.

Several developments last week served to demonstrate that while the perpetrators and tactics of terrorism (what Stratfor calls the “who” and the “how”) may change in response to larger geopolitical cycles, such shifts will not signal the end of terrorism itself.

The Nature of Terrorism

There are many conflicting definitions of terrorism, but for our purposes we will loosely define it as politically motivated violence against noncombatants. Many terrorist acts have a religious element to them, but that element is normally related to a larger, political goal: Both a militant anti-abortion activist seeking to end legalized abortion and a jihadist seeking to end the U.S. military presence in Iraq may act according to religious principles, but they ultimately are pursuing a political objective.

Terrorism is a tactic, one employed by a wide array of actors. There is no single creed, ethnicity, political persuasion or nationality with a monopoly on terrorism. Individuals and groups of individuals from almost every conceivable background — from late Victorian-era anarchists to Klansmen to North Korean intelligence officers — have conducted terrorist attacks. Because of the impreciseness of the term, Stratfor normally does not refer to individuals as terrorists. In addition to being a poor descriptor, “terrorist” tends to be a politically loaded term.

Traditionally, terrorism has been a tactic of the weak, i.e., those who lack the power to impose their political will through ordinary political or military means. As Carl von Clausewitz noted, war is the continuation of politics by other means; terrorism is a type of warfare, making it also politics by other means. Because it is a tactic used by the weak, terrorism generally focuses on soft, civilian targets rather than more difficult-to-attack military targets.

The type of weapon used does not define terrorism. For example, using a vehicle-borne improvised explosive device against an International Security Assistance Force firebase in Afghanistan would be considered an act of irregular warfare, but using it in an attack on a hotel in Kabul would be considered an act of terrorism. This means that militant actors can employ conventional warfare tactics, unconventional warfare tactics and terrorism during the same campaign depending on the situation.

Terrorist attacks are relatively easy to conduct if they are directed against soft targets and if the assailant is not concerned with escaping after the attack, as was the case in the Mumbai attacks in 2008. While authorities in many countries have been quite successful in foiling attacks over the past couple of years, governments simply do not have the resources to guard everything. When even police states cannot protect everything, some terrorist attacks invariably will succeed in the open societies of the West.

Terrorist attacks tend to be theatrical, exerting a strange hold over the human imagination. They often create a unique sense of terror dwarfing reactions to natural disasters many times greater in magnitude. For example, more than 227,000 people died in the 2004 Asian tsunami versus fewer than 3,000 on 9/11, yet the 9/11 attacks produced a worldwide sense of terror and a geopolitical reaction that has had a profound and unparalleled impact on world events over the past decade.

Cycles and Shifts

A number of events last week illustrate the changes happening in the terrorism realm and demonstrate that, while terrorism may change, it is not going to end.

On Feb. 17, the FBI arrested a Moroccan man near the U.S. Capitol in Washington who allegedly sought to conduct a suicide attack on the building. The suspect, Amine el Khalifi, is a clear example of the shift in the jihadist threat from one based on the al Qaeda core group to one primarily deriving from grassroots jihadists. As Stratfor has noted for several years, while these grassroots jihadists pose a more diffuse threat because they are harder for national intelligence and law enforcement agencies to focus on than hierarchical groups, the threat they pose is less severe because they generally lack the terrorist tradecraft required to conduct a large-scale attack. Because they lack such tradecraft, these grassroots militants tend to seek assistance to conduct their plots. This assistance usually involves acquiring explosives or firearms, as in the el Khalifi case, where an FBI informant posing as a jihadist leader provided the suspect with an inert suicide vest and a submachine gun prior to the suspect’s arrest.

While many in the media tend to ridicule individuals like el Khalifi as inept, it is important to remember that had he succeeded in finding a real jihadist facilitator rather than a federal informant, he could have killed many people in an attack. Richard Reid, who many people refer to as the “Kramer of al Qaeda” after the bumbling character from the television show Seinfeld, came very close to taking down a jumbo jet full of people over the Atlantic because he had been equipped and dispatched by others.

Still, the fact remains that the jihadist threat now predominantly stems from unequipped grassroots wannabes rather than teams of highly trained operatives sent to the United States from overseas, like the team that executed the 9/11 attacks. This demonstrates how the jihadist threat has diminished in recent years, a trend we expect to continue. This will allow Washington to increasingly focus attention on things other than jihadism, such as the fragmentation of Europe, the transformation of global economic production and Iran’s growing regional power. It will mark the beginning of a new geopolitical cycle.

Last week also brought us a series of events highlighting how terrorism may manifest itself in the new cycle. On Feb. 13, Israeli diplomatic vehicles in New Delhi, India, and Tbilisi, Georgia, were targeted with explosive devices. In Tbilisi, a grenade hidden under a diplomatic vehicle was discovered before it could detonate. In New Delhi, a sticky bomb placed on the back of a diplomatic vehicle wounded the wife of the Israeli defense attache as she headed to pick up her children from school.

On Feb. 14, an Iranian man was arrested after being wounded in an explosion at a rented house in Bangkok. The blast reportedly occurred as a group was preparing improvised explosive devices for use against Israeli targets in Bangkok. Two other Iranians were later arrested (one in Malaysia), and Thai authorities are seeking three more Iranian citizens, two of whom have reportedly returned to Iran, alleged to have assisted in the plot.

While these recent Iranian plots failed, they nonetheless highlight how the Iranians are using terrorism as a tactic in retaliation for attacks Israel and Israeli surrogates have conducted against individuals associated with Iran’s nuclear program.

It is also important to bear in mind as this new geopolitical cycle begins that terrorism does not just emanate from foreign governments, major subnational actors or even transnational radical ideologies like jihadism. As we saw in the July 2011 attacks in Norway conducted by Anders Breivik and in older cases involving suspects like Eric Rudolph, Timothy McVeigh and Theodore Kaczynski in the United States, native-born individuals who have a variety of grievances with the government or society can carry out terrorist attacks. Such grievances will certainly persist.

Geopolitical cycles will change, and these changes may cause a shift in who employs terrorism and how it is employed. But as a tactic, terrorism will continue no matter what the next geopolitical cycle brings.

The Myth of the End of Terrorism is republished with permission of STRATFOR.

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TEOTWAWKI Theater: Contagion And Phase 7

(Editor’s note: Does not contain spoilers)

Recently, I had the opportunity to watch two movies that were about an influenza pandemic outbreak. The first one is 2011’s Contagionicon, starring Matt Damon, Jude Law, Gwyneth Paltrow (no, this isn’t The Talented Mr. Ripley), and other familiar faces including Laurence Fishburne, Elliott Gould, and Kate Winslet. From the IMDb website:

A thriller centered on the threat posed by a deadly disease and an international team of doctors contracted by the CDC to deal with the outbreak.


“Contagion (2011) Official Exclusive 1080p HD Trailer”
YouTube Video

Now, rather than break down the movie and critique it like I would in an “On TV” series post, I won’t go spoiling it for those who haven’t seen Contagion yet. That goes for the second film as well.

My thoughts about Contagion:

Because the movie did center on an international team of doctors tackling a pandemic threat, it comes as no surprise that this was going to be a big budget production (estimated $60 million) shot all around the world (a good deal of it in the Chicagoland area) and having a sizable cast.

Speaking of the cast, the acting was good. Really good in a number of cases- but what would you expect with names like the ones above? Personally, I thought Kate Winslet was phenomenal in her role as a disease detective.

There are a number of sub-plots going on simultaneously involving the doctors, administrators, individuals, families, and so on. It’s not as confusing as it sounds, though. But with all the side stories going on and familiar Hollywood faces, Contagion started to remind me of 1970s disaster genre films like The Poseidon Adventure and The Towering Inferno.

Like the title suggest, Contagion depicts what the impact of a deadly influenza virus spreading around the world might look like in this day and age, especially in the United States. Dismal to be sure, and no one can be certain just how a modern-day killer pandemic would actually play out, but I just couldn’t shake the feeling while watching the film that what was being portrayed was sanitized. Sure, there’s plenty of illness, death, and heartbreak going on- as one would suspect. But several weeks into the outbreak utilities were still on, vehicles had fuel and were being driven, survivors looked well-fed, hygiene didn’t seem to be a problem, and society looked like it was more or less still functioning- save the large amounts of trash strewn about. The violence that one might think would erupt during such an event was hardly evident (save one scene). Even more so the preparations for protecting against such acts. Perhaps this was done intentionally to obtain the PG-13 rating the film was eventually assigned.

Overall, a good film with good acting. But I suspect that everyday life would be a whole lot grittier should a pandemic like the one portrayed in Contagion take place.

Intermission.

The next pandemic flick I watched was the 2010 Argentinian film Phase 7
icon
, or Fase 7, starring Yayo Guridi, Daniel Hendler, Federico Luppi, and Jazmin Stuart (hat tip Surviving In Argentina blog). From the IMDb website:

Inside a quarantined apartment building a man must protect his pregnant wife from his new neighbors.


“Phase 7- Official US Trailer”
YouTube Video

My thoughts about Phase 7:

Most of the film is in Spanish, so subtitles are used. As with Contagion, I watched the movie on a Netflix DVD, and the subtitles were big and clear, which worked out just fine.

Phase 7 cost 2.5 million Argentine pesos to make- or the equivalent of around $575,000 U.S. dollars. This can be attributed to the film being set mostly in a single apartment building as opposed to all over the world. Furthermore, internationally-acclaimed movie stars weren’t used, although the South American cast of Guridi, Hendler, Luppi, and Stuart proved to be just as talented and were real good in their roles.

The term “phase 7” is related to the World Health Organization’s six pandemic phases. From the WHO website:

Phase 6, the pandemic phase, is characterized by community level outbreaks in at least one other country in a different WHO region in addition to the criteria defined in Phase 5. Designation of this phase will indicate that a global pandemic is under way.

The meaning of “phase 7″ becomes more clear as the film progresses.

The movie focuses on a young Argentine couple, Coco and his pregnant wife Pipi, who live in an apartment building in Buenos Aires. An influenza pandemic strikes, and authorities quarantine everyone in the dwelling when one of the residents is suspected of having caught the virus. Isolated from the outside world, Coco, Pipi, their survivalist/conspiracy theorist neighbor Horacio, and other building residents must fend for themselves amidst internal/external threats.

Phase 7 was a real good movie. It painted a gritty picture of what bugging-in in an urban environment could look like should a killer pandemic strike- and then some. I would classify it as part-science fiction, part-horror, with a dash of humor thrown in, believe it or not. I really appreciated the John Carpenter-esque background music. There were plenty of obscenities tossed around, and seeing them spelled out in the subtitles was kind of funny. The film also got gory at times, but it wasn’t overwhelming. It ended up being given an R-rating.

Overall, I liked both Contagion and Phase 7. However, there’s no mistaking Contagion for anything other than a Hollywood production. So much so it seemed a little sanitized for what I would envision society looking like during a pandemic event of that magnitude. Phase 7 is more low-budget, but actually more believable in many ways, if that makes sense. I think Phase 7 would speak to preppers/survivalists more than Contagion.

FIN

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Christopher E. Hill, Editor
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