Even after last week’s steep selloff in the commodities markets, the “Flight to Safety” trade is still on…big time. Gold may have retreated from its all-time high, but applications to purchase a handgun continue soaring to record levels.
According to the FBI, background-check applications for handgun buyers are on a record-setting pace so far this year. “In this year’s first quarter,” Bloomberg News reports, “the FBI’s Instant Criminal Background Check System processed 4.25 million requests on prospective gun buyers – up 16% from a year earlier.” If the current pace continues, the number of “gun checks” would hit a seventh straight annual record.
America’s gun-buying craze stands in stark contrast to the dismal trend of overall consumer spending. Bloomberg notes that spending on guns, ammo and other sporting equipment rose about 10% during the last 12 months – or more than four times the 2.5% increase in total consumer spending. Although spending on guns and ammo has been outpacing total consumer spending for more than a decade, the gun-buying trend has been accelerating during the last few months.
Meanwhile, Wal-Mart CEO, Mike Duke, observes that the retail giant’s “core shoppers” are “running out of money much faster than a year ago.” Since many of Wal-Mart’s core shoppers live paycheck to paycheck, they typically do most of their shopping at the beginning of the month…and less of it at the end. “Purchases are really dropping off by the end of the month, even more than last year,” Duke says. “This end-of-month [purchases] cycle is growing to be a concern.”
This troubling trend is not just a Wal-Mart thing. As a retailer that averages 140 million shoppers per week to its US stores, Wal-Mart’s “concern” is also the American economy’s concern. Wal-Mart is, as CNNMoney puts it, “a barometer of the health of the consumer and the economy. Wal-Mart has struggled with seven straight quarters of sales declines in its stores.”
Maybe that’s why Wal-Mart announced last week that it would resume selling guns and ammo in many of its stores – ending a five-year hiatus. (Handguns will not return to Wal-Mart shelves, but rifles and other “long guns” will, according to a recent press release).
Your California editor is not certain that America’s “gun boom” (pun only partially intended) means something, but he suspects it doesn’t mean nothing. Roughly 14 million Americans – about one in twenty – tried to buy a handgun last year. Another 16 million will shop for a sidearm this year. These 16 million folks certainly do not share identical motives for their purchases, but they do share an identical objective: to arm themselves. They are buying handguns in record numbers because they are feeling uneasy in record numbers.
It would be easy to dismiss the “gun boom” as an irrelevant cultural curiosity…if it wasn’t so seemingly relevant. Investors are also “arming themselves” in record numbers. They are buying gold and silver and oil and almost any other commodity under the sun. At the same time, they are also unloading US dollars in exchange for almost any other currency under the sun. The Norwegian kroner, Swiss franc, Aussie dollar and Canadian dollar are all trading near all-time highs against the US dollar.
Something serious is going on here. America’s economic recovery may be much weaker than advertised, while her economic vulnerability may be much greater than widely believed.
Confident citizens do not usually buy record amounts of guns and gold.
Eric Fryfor The Daily Reckoning
Eric J. Fry, Agora Financial's Editorial Director, has been a specialist in international equities for nearly two decades. He was a professional portfolio manager for more than 10 years, specializing in international investment strategies and short-selling. Following his successes in professional money management, Mr. Fry joined the Wall Street-based publishing operations of James Grant, editor of the prestigious Grant's Interest Rate Observer. Working alongside Grant, Mr. Fry produced Grant's International and Apogee Research, institutional research products dedicated to international investment opportunities and short selling.
Mr. Fry subsequently joined Agora Inc., as Editorial Director. In this role, Mr. Fry supervises the editorial and research processes of numerous investment letters and services. Mr. Fry also publishes investment insights and commentary under his own byline as Editor of The Daily Reckoning. Mr. Fry authored the first comprehensive guide to investing internationally with American Depository Receipts. His views and investment insights have appeared in numerous publications including Time, Barron's, Wall Street Journal, International Herald Tribune, Business Week, USA Today, Los Angeles Times and Money.
And here I thought those were but core elements of the Fabulous Mogambo Investment Plan (FMIP)!! Have I been doing it all wrong? There are those of us that have the utmost confidence that the evil, satanic, loathesome Federal Reserve will continue to QE us and our children and grandchildren into oblivion.
Confidence, gold, guns- there you have it.
And don’t forget Bill’s recommendation regarding retreat property.
What percentage of these gun and ammo buyers
are buying for financial security reasons
(such as a hedge against inflation)?
I put $3OK into ammo and guns a week before Obama was elected and if I ever considered seeling (highly unlikely) all of those purchases at this point in time I would currently give me a $27K gain. I also cashed out a 401K with several hundred thousand and put it into an 85/15 split of silver/gold which we all know have both done very nicely. Gold and silver are excellent investments for protecting from inflation, but subject to various market influences while quality guns hold their value well. Quality ammo never/never gets cheaper. Still buying all four, too!
Mr. Fry needs to buy more guns and ammo…
I posted something similar on my own blog yesterday. I really like your Trigger Happy chart.
It does not take a rocket scientist to see the end game of printing trillions of dollars by the Fed. The dollar is deflating in relation to other fiat money. The dollar will lose its place as the worlds reserve money. Thus we will have to buy our imports in Chinese or the new worlds reserve curreny. Prices will skyrocket since the dollar is worth less and less. We see it in Oil and food already. So get ready. Its predicted it could happen this year or next.
Have you ever seen a herd of cattle after they have been frightened…. Stampede!
I’m already on my retreat property…it’s the good life. place of refuge 2012 dot com
Hi Eric you said you don’t understand gun sales but my question is where did you come up with it is for handguns? You see back ground checks are required on all guns not just handguns. Let’s see we have a fiat currency that the whole world understand is worth less or in reality worthless we have high umeployment, housing market is still crashing, silver is back on the march to $50 oh yes and the big hiring news was for McDonalds. Time people learn real survival skills.
I got a shotgun, rifle and a four-wheel drive, and a country boy will survive.
We grow good ‘ol tomaters n’ our own smoke, too, ain’t too many things these ‘ol boys can’t do, and a country boy will survive.
I live back in the woods ya see, my woman n’ the kids n’ the dogs n’ me.
And a country boy will survive.
Nah, you ain’t gotta be born out in the sticks
With an F-150 and a 30-06,
Or have a bubba in the family tree
To get on down with me
Blake Shelton, Hillbilly Bone
Thanks for the wonderful article it has really helped me. Thank you for the article Eric.
The average American still has common sense even if their leaders seem to have lost theirs.
You can’t beat the basics when planning for rough times, and that includes guns, bullets, food and commodities.
Whether for actual use or for barter later on, it is the best hedge against deflation and devaluation of state currency.
Pingback: medicine Joshua Jacobi
Pingback: jazda konna
Pingback: plantacja lawendy
Pingback: come fare soldi facili
Pingback: working from home
Pingback: online poker spielen
Pingback: free roulette game play european roulette online
Pingback: How to sweat less
Pingback: click this
Pingback: Zalando Gutschein
Pingback: ageless man
Pingback: home inspector in staten island
Pingback: home inspection manhattan
Pingback: try ageless male
Pingback: new country music
Pingback: casino bonus senza deposito
Pingback: epromos printed items
Pingback: slot machine bar
Pingback: device master rts
Pingback: mlpTue3Htx mlpTue3Htx
Pingback: From this source
Pingback: logo flashlights
Pingback: makia julpo
Pingback: These Details
Pingback: buy facebook likes
Pingback: jalia parsnip
Pingback: chase bank
Pingback: handy orten
Pingback: view video
Pingback: dog videos
Pingback: bad robot surgery
Pingback: universal remote
Pingback: best online backup
Pingback: online backup companies
Pingback: Payday Loans
Pingback: ham radio3k
Pingback: apple ipad accessories australia
Pingback: free website listings
Pingback: website rankings
Pingback: affordable vps
Pingback: seo services ireland
Pingback: karen millen collection
Pingback: Entrepreneurs InTravel
Pingback: youtube videos music
Pingback: Garcinia Cambogia Extract
Pingback: kliknij i sprawdz
Pingback: wycinka drzew krakow
Pingback: FF11 ã‚®ãƒ«
Pingback: FF11 RMT
Pingback: austin personal injury
Pingback: tlumacz jezyka wloskiego grudziadz
Pingback: rs 3 gold
Pingback: How to make wine
Pingback: android answers
Pingback: WOT Power Leveling
Pingback: look at more info
Pingback: brave frontier gems
Pingback: Diablo 3 è‚²æˆä»£è¡Œ
Pingback: lon rosen dodgers
Pingback: FIFA 14 coins Xbox One
Pingback: buffalo web design
Pingback: neverwinter power leveling
Pingback: ãƒ©ã‚°ãƒŠãƒã‚¯ã‚ªãƒ³ãƒ©ã‚¤ãƒ³ RMT
Pingback: boundra RMT
Pingback: How To Get Your Ex Boyfriend Back - 3 Must-Know Tips
Pingback: ArcheAge RMT
Pingback: ãƒ¬ã‚¸ã‚§ãƒ³ãƒ‰ ã‚ªãƒ– ã‚½ã‚¦ãƒ«ã‚º RMT
Pingback: AION RMT
Pingback: How to Get Free Xbox Live 2 Day Trial Codes
Pingback: Blade And Soul Power Leveling
Pingback: Diablo 3 RMT
Pingback: lunatik promo code
Pingback: Herpes Cure
Pingback: path of exile Items
Pingback: Dragon Nest Power Leveling
Pingback: Neverwinter Astral Diamonds
Pingback: æˆ¦å›½ãƒ†ãƒ³ã‚«ãƒˆãƒªã‚¬ãƒ¼ è‚²æˆä»£è¡Œ
Pingback: Reiki Master
Pingback: Injury Attorney St Louis
Pingback: FUT 14 coins
Pingback: path of exile power leveling
Pingback: æˆ¦å›½ixa RMT
Pingback: Guild Wars 2 Power Leveling
Pingback: ESO Gold
Pingback: elektronisk cigaret forum
Pingback: Unlock iPhone Croatia
Pingback: temperature monitors
Pingback: Vickie Stagers
Pingback: FIFA 14 RMT
Pingback: click to read more
Pingback: Wizardry RMT
Pingback: FF14 ã‚®ãƒ«
Pingback: wifi cameras
Pingback: get more
Pingback: Cheats for Poptropica
Pingback: ipad accessories best selling
Pingback: Toowoomba Cladding
Pingback: top criminal attorneys wv
Pingback: how to get your ex back
Pingback: Cheap homeowner and autos insurance coverage
Pingback: you and me
Pingback: how to make your own beats
Pingback: laughing and drinking
Pingback: voyance amoureuse
Pingback: top viral videos
Pingback: MHF Zeny
Pingback: FF14 RMT
Pingback: FIFA 14 Coins XBOX ONE
Pingback: ãƒ‰ãƒ©ã‚¯ã‚¨10 RMT
Pingback: ã‚¨ãƒãƒ¼ãƒ—ãƒ©ãƒãƒƒãƒˆ RMT
Pingback: everquest next platinum
Pingback: cash for cars miami
Pingback: discover more
Pingback: buy instagram followers
Pingback: Love Letters For Him
Pingback: dog waste bags bulk
Pingback: Visit This Website
Pingback: ãƒ‰ãƒ©ã‚´ãƒ³ã‚¯ã‚¨ã‚¹ãƒˆX RMT
Pingback: BNS RMT
Pingback: AION ã‚®ãƒ¼ãƒŠ
Pingback: FF11 è‚²æˆä»£è¡Œ
Pingback: Cheap FIFA 14 Coins
Pingback: meds expensive
Pingback: Italy Chat Rooms
Pingback: home insurance quotes by zip code
Pingback: cheapest home owners insurance
Pingback: State farm quote
Pingback: Wildstar Power Leveling
Pingback: Wildstar Gold
Pingback: çœŸãƒ»ä¸‰åœ‹ç„¡åŒ RMT
Pingback: FFXIV Gil
Pingback: POE Items
Pingback: The Elder Scrolls Online Power Leveling
Pingback: beginner guitar lessons
Pingback: Karat Distributor
Pingback: canton ohio rapj-watty
Pingback: Car and home insurance quotes
Pingback: look what i found
Pingback: whirlpool washer repair atlanta
Pingback: for local ac repair in houston visit airbourne
Pingback: invertir en opciones binarias
Pingback: tam air conditioning
Pingback: apex appliance repair
Pingback: guide here
Pingback: Continue reading
Pingback: Discount auto insurance quotes
Pingback: compare auto quotes
Pingback: toledo wedding photographers
Pingback: Travel to Israel
Pingback: SEO Coburg
Our friend Richard Duncan believes the U.S. economy requires credit growth to survive. Here, you’ll see what he thinks will happen if the U.S. doesn’t continue expanding credit. You’ll also find exclusive footage we shot in the Daily Reckoning’s studio explaining how the U.S. could lose it’s global dominance… and how programs like Social Security or Medicare could go bust...
The hum of the printing presses and the steady drip of cheap credit over the past five years made it easy to believe the U.S. economy was in a true recovery. But what happens when the excess liquidity begins to dry up?
The Americans who voted for Obama were expecting some big changes. But, six years later, the government he acquired has only spied harder, the drones have flown lower, and the weapons have gotten bigger. But don’t blame Obama. Read on…
All paper currency has a shelf life. It could be 5 years or 500 years, but at some point, the value of any paper currency eventually reaches zero. That's why, for centuries, people have turned to one shiny metal to safeguard their personal store of wealth. And, as Jim Rickards explains, you still have that option. Read on...
Bad things have a funny way of happening in October. Remember October 1929? It raised the curtain on the Great Depression. Or maybe you recall the infamous Black Monday crash in 1987. The Dow tumbled 22%— the largest single day loss ever. Guess what? That was in October, too. The 19th to be exact. Notice a trend here? Fast forward to this October... You know what happened this month. And if all that wild market action kneeds you in the gut, here’s what you should do now. Greg Guenthner explains…