RPF0480-Hurricane_Irma_Edition
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00:00:14.500 | Coming at you live from Mania Central in Overcast, South Florida.
00:00:21.500 | It's Radical Personal Finance, a Hurricane Edition.
00:00:27.500 | [music]
00:00:54.500 | For those coming out a little bit late today, been busy the last couple of days doing some hurricane preparations.
00:00:59.500 | Getting ready for Hurricane Irma, which at the moment is barreling up from the Caribbean, passing over the Virgin Islands.
00:01:06.500 | And at the moment, all the best forecasts seem to indicate that sunny South Florida is directly in its line of sight.
00:01:12.500 | In fact, the current indication, as I record this at 4 o'clock PM on Wednesday, September 6, 2017,
00:01:20.500 | the current storm track has the eye of Hurricane Irma passing practically over my house.
00:01:27.500 | Still too far out to know with any certainty about that forecast track,
00:01:33.500 | but it is certainly a serious storm and certainly something that has to be paid attention to.
00:01:38.500 | So, been busy getting things buttoned up around the homestead, getting things wrapped up, finishing some hurricane preparations.
00:01:44.500 | Haven't decided what level of evacuation plan to implement at this point. Still a little bit early.
00:01:50.500 | And last week, I recorded a couple of shows on hurricanes, watching Hurricane Harvey.
00:01:57.500 | And of course, I wasn't expecting one week later, exactly one week later, to be facing a storm here in South Florida.
00:02:03.500 | Some people are cheering, saying Joshua serves you right for saying so many mean-spirited things.
00:02:07.500 | But here we are. So, that's life. That's life when you live in the tropics and it's hurricane season.
00:02:12.500 | We've had a decade of practically no hurricanes over a decade. So, it's been an easy decade.
00:02:18.500 | And this last year, we had one storm. And this year, we have one more that's affecting us.
00:02:23.500 | And who knows? Who knows if it could be more on the back end.
00:02:27.500 | So, on today's show, I am going to share with you not the previously scheduled content,
00:02:32.500 | but a few thoughts from what I've learned the last couple of days from this last week.
00:02:36.500 | So, specifically, I want to talk with you about the possibility of social collapse when facing interesting situations.
00:02:46.500 | This week, and I'll describe these situations in detail, I have become convinced that writers of post-apocalyptic fiction are not overstating things.
00:02:56.500 | And yet, I have become convinced that they are fundamentally overstating things.
00:03:01.500 | And I'll explain that in just a moment.
00:03:04.500 | I'll also share with you my own experience as it relates to prices around the disaster since I just did the show on price fixing and price gouging.
00:03:13.500 | And just a couple of thoughts that I didn't mention in that show.
00:03:16.500 | And then I'll describe just a few simple hurricane practical preparation tips that I was thinking about as I was going around working on things today.
00:03:24.500 | Just a few simple personal finance things of how to get a good deal with your money.
00:03:29.500 | So, I don't have any brilliant insight for you today on changes in the tax law.
00:03:34.500 | I had planned to do a show on emergency plans.
00:03:37.500 | I had planned to do a show on money in the family, et cetera, this week.
00:03:41.500 | And I may be able to get to those. It will depend on if we stay or if we go.
00:03:45.500 | So, let's get right to it.
00:03:46.500 | Let's talk about the end of the world as we know it and societal collapse, especially as it relates to money.
00:03:53.500 | I've mentioned frequently on this show I have a soft spot for post-apocalyptic fiction.
00:03:58.500 | I enjoy the genre of disaster fiction.
00:04:02.500 | I enjoy the genre of survivalist fiction, of prepper fiction.
00:04:07.500 | There's a variety of work being done.
00:04:10.500 | Some of my favorites, David Crawford's book Lights Out, really enjoyed that.
00:04:15.500 | The book by William Forshteyn called One Second After, I enjoyed that whole series.
00:04:21.500 | The first one is the best.
00:04:23.500 | One Second After and Lights Out are both basically about the prospect of an electromagnetic pulse event wherein the power grid in the United States is destroyed by a high altitude – the explosion of a high altitude nuclear bomb.
00:04:38.500 | It's a serious risk that would seriously undermine US-American society if it were to happen.
00:04:44.500 | Interestingly enough, Kim Jong-un is exactly what he threatened this past week.
00:04:49.500 | The dictator of North Korea was – he threatened to set up a bomb and try to set off an EMP.
00:04:56.500 | My one-sentence summary on EMP, the risks – based upon my research, the risk seems to be substantial.
00:05:02.500 | But it doesn't seem to be as substantial as many of these hardcore novels make it seem.
00:05:09.500 | So that – I've enjoyed that book.
00:05:11.500 | I've interviewed on this show both James Wesley Rawls.
00:05:14.500 | A couple of times I've interviewed James Wesley Rawls.
00:05:16.500 | I thoroughly enjoy his writing.
00:05:18.500 | If I were a fiction author, I would write like James Wesley Rawls does.
00:05:22.500 | In a sense, he puts a practical nonfiction manual into fiction stories.
00:05:29.500 | Of course, his first book, which is the most poorly written from a technical perspective and is my favorite, is a book called Patriots, a novel of the coming collapse.
00:05:38.500 | He built – somebody, I got to have him on the show to get him to share that story.
00:05:41.500 | But he built that story and published it for free online in the very early days of publishing.
00:05:48.500 | And then he basically crowdfunded it where he had people pay him a voluntary donation.
00:05:53.500 | Then over time, he developed such a fan base that he was able to get the novel published and it was published as Patriots.
00:06:00.500 | Because of the way that it was written, it's a little bit disjointed.
00:06:02.500 | But it's my favorite of his series just because it's so overwhelmingly – there's so much content in it.
00:06:09.500 | And so I have enjoyed Patriots and all of his follow-up books in that series.
00:06:13.500 | And then finally, authors like Matthew Bracken who I've also had on the show.
00:06:17.500 | I have the soft spot for this type of fiction.
00:06:19.500 | If I'm going to read fiction, I enjoy thrillers.
00:06:23.500 | Tom Clancy was always my favorite, Brad Thor, Vince Flynn, some of these guys if I ever make the time to read it.
00:06:30.500 | And then I've learned that the genre of this post-apocalyptic fiction I enjoy.
00:06:35.500 | So that's my soft spot.
00:06:36.500 | I want to lay that out there on the table.
00:06:38.500 | But I've always been skeptical of the scenarios and I remain skeptical of the hardcore scenarios.
00:06:47.500 | The fiction authors, in order to get a really good story, often stretch the bounds of the limits so to speak.
00:06:54.500 | In the same way that if you watch the latest Mission Impossible film, you're going to see things in the film that are simply not doable, not practical in real life.
00:07:05.500 | That's the way that you make a story compelling on screen or in a novel.
00:07:12.500 | But you read enough of the novels and you certainly wonder, well, do we lack this social cohesion to the point where society could break down for whatever reason?
00:07:21.500 | So let me describe to you this past Tuesday, yesterday, yesterday morning, the site that I saw.
00:07:29.500 | This past weekend, Hurricane Irma, it became clear, was going to threaten us here in South Florida.
00:07:35.500 | And so everybody went into overdrive on going and getting things and the stores started to be pulled dry and started to run out of things, et cetera.
00:07:44.500 | Well, of course, since stores don't affect their – don't change their pricing, i.e. that's the show that I did on price gouging.
00:07:50.500 | Since they don't bother to change their pricing, I figured, well, let me go and contribute to the shortages by buying a few things.
00:07:57.500 | At least that way I'll have more than I need.
00:07:59.500 | I don't really need anything but let me go and – let me go ahead and purchase a few things.
00:08:05.500 | And I also enjoy kind of being out in the hustle and bustle.
00:08:08.500 | It's a special event I like.
00:08:10.500 | I've always enjoyed disasters and disaster preparedness from the perspective of helping people and being of service.
00:08:16.500 | That's always been something that's been interesting to me.
00:08:19.500 | So I went to Costco and figured I'd pick up a few cases of water and see what else there was to be seen.
00:08:28.500 | Costco usually opens at 10 in the morning and I got there around 9.30.
00:08:32.500 | This was Tuesday, immediately after the Labor Day holiday.
00:08:36.500 | I had tried to go the previous day but it was closed for the holiday.
00:08:40.500 | When I got there 30 minutes before the open, the parking lot was packed.
00:08:46.500 | I had to park on the farthest of the available spaces all the way out at the edge of the parking lot.
00:08:53.500 | And there were 250 people or more lined up in the front of the Costco 30 minutes before the scheduled time of opening.
00:09:04.500 | I went and joined the line, figured I would at least go and see how it went.
00:09:10.500 | As I'm walking across the parking lot, I see people starting to panic because the lines are so long
00:09:15.500 | and starting to become worried that the water was going to run out there at the Costco.
00:09:22.500 | Now imagine the size of a Costco, a huge warehouse club.
00:09:26.500 | And from the front entrance all the way to the far side of the building, there is a line of people.
00:09:34.500 | Now of course by this time, all of the carts that were stored in front of the store are used up.
00:09:39.500 | So in order to get a cart to carry your cases of bottled water, you had to go around to the side of the store.
00:09:46.500 | And I watch not less than a dozen people start trotting across the parking lot to get a cart.
00:09:56.500 | And you can see the type of person that's trotting.
00:09:59.500 | You can see that they're doing so out of the fear of missing out, the fear of not being able to get the water that their family needs.
00:10:05.500 | And they're rushing to go and get this cart.
00:10:08.500 | And nobody was rude to one another.
00:10:10.500 | Nobody was pushing one another.
00:10:12.500 | Nobody was jostling one another.
00:10:14.500 | But there was that subtle "Let me move quickly so I can get ahead of everyone else" that was clearly expressed.
00:10:20.500 | I got a cart, joined the line, and very quickly that whole line of people went into the store.
00:10:28.500 | But everybody was heading for the bottled water.
00:10:31.500 | And it was bedlam.
00:10:32.500 | It was absolute bedlam to the point where 20 minutes after they opened the doors –
00:10:37.500 | they opened the doors early, 930 – at 950, every major up-and-down aisle in the Costco was at a complete standstill with two lines of carts.
00:10:51.500 | The cash registers were packed and the aisles were packed with everybody loading up on the same things.
00:10:58.500 | Now, while standing there, the mood was at that point in time perfectly fine and perfectly peaceful.
00:11:04.500 | I don't want to overstate the case.
00:11:06.500 | Nobody was upset with one another.
00:11:08.500 | But we all had bellies full of food.
00:11:11.500 | We had all come early in the morning on a day that we could.
00:11:14.500 | And nobody was in extreme or under extreme duress.
00:11:20.500 | And yet you could see the tension just underneath the surface.
00:11:25.500 | From now on, whenever I read post-apocalyptic fiction, I will always see in my mind the picture from yesterday of wealthy, middle-aged, successful people who are driving fancy cars,
00:11:45.500 | who are wearing very fine and fashionable clothing, kind of hurry walking and trotting across a parking lot to beat somebody else out for a $3.98 case of bottled water.
00:12:06.500 | Now, I don't want to overstate.
00:12:09.500 | Again, I want to be careful and be accurate with what I'm saying.
00:12:12.500 | I don't want to overstate the case.
00:12:14.500 | I know many of these people could have had plenty of bottled water at home.
00:12:17.500 | And they just like me kind of thought they would go and pick up a few extra.
00:12:21.500 | Just, you never know. It doesn't hurt anything.
00:12:23.500 | They'll use it anyway.
00:12:25.500 | Maybe they were just filling out some other stores that they already had.
00:12:30.500 | But when you look at the scenario wherein a simple hurricane can bring people to a place where they lose their dignity of running across a parking lot to beat somebody else out to get a cart so they can get into the store, I find that a little bit sobering.
00:12:47.500 | There are a few lessons from it.
00:12:49.500 | Lesson number one is there are times at which money doesn't help you.
00:12:55.500 | The patrons of Costco are, in general, pretty wealthy.
00:13:00.500 | I don't know their internal data, but I'm quite confident that if you ran the average income of a Costco member, it would be significantly higher than the average customer at the local Walmart.
00:13:14.500 | It would have to be because of the way Costco packages their things.
00:13:17.500 | You can't get out of there for less than a couple hundred bucks practically.
00:13:21.500 | But in that moment, a wealthy person's beautiful Mercedes-Benz, their beautiful clothes, those things didn't get them what they needed.
00:13:33.500 | And I find storms are always illustrative of this fact.
00:13:36.500 | You can go back and see a Houston flood just last week.
00:13:40.500 | Beautiful homes worth a lot of money destroyed just like everyone else's home.
00:13:48.500 | Remember seeing pictures of people being rescued off their front porch and beautiful clothing and getting into the boat just like everybody else.
00:13:56.500 | Or back in Hurricane Sandy up in New York City, wealthy people looking in a dumpster, pictures of people looking at a dumpster trying to find food to eat in just a couple of days.
00:14:06.500 | There are things that happen in life at which your money is not particularly useful.
00:14:13.500 | So think about those things and make sure that you're not depending on the money to get you what you need.
00:14:19.500 | That's lesson number one.
00:14:21.500 | If you're enjoying a beautiful day in Kansas right now or in Minnesota or in Washington State and there is no hurricane that's threatening your door,
00:14:33.500 | don't just look at the TV and see what other people are desperate for and think you'll escape because you won't.
00:14:41.500 | Yours won't be a hurricane.
00:14:43.500 | Yours will be a tsunami if you're on the coast of the upper Northwest.
00:14:49.500 | Yours will be a winter storm or a tornado just like we all know.
00:14:52.500 | We all have these events or it's a forest fire coming through or an earthquake or a volcano.
00:14:57.500 | All of these things are normal.
00:14:59.500 | Plan ahead and think ahead and make sure that you buy the things that you need when money is not worth as much as you would like it to be.
00:15:09.500 | I am increasingly convinced that the veneer of society is very thin.
00:15:15.500 | There was nothing but good experiences yesterday in the Costco.
00:15:19.500 | Everybody was polite to one another.
00:15:21.500 | Everybody was kind to one another.
00:15:23.500 | No one was pressing their way.
00:15:25.500 | But I think just back myself just a year or two when I was out filling up some gas cans before hurricane.
00:15:32.500 | I think it was Matthew last year.
00:15:34.500 | I had a few empty or I bought some new ones.
00:15:36.500 | I can't remember.
00:15:37.500 | And I had a trunk full of gas cans.
00:15:38.500 | A half dozen at least.
00:15:40.500 | And I was filling them up at the gas station and there was the line stretching back.
00:15:44.500 | And I could start to hear some of the angry words being exchanged.
00:15:50.500 | If we ever face locally or broadly a significant event that disrupts normal society, the thin veneer of civility can very quickly fade away.
00:16:06.500 | Especially if there's no sense of community cohesion.
00:16:10.500 | And unfortunately, at least where I live, it seems that community cohesion is steadily eroding.
00:16:17.500 | Now, in every event, we can focus on the negative or we can focus on the positive.
00:16:21.500 | For example, we can look at an event like just like last week, Hurricane Harvey, and see the tremendous pitching in, the tremendous community spirit of neighbors waiting in to help neighbors.
00:16:33.500 | And in just a moment, I'll talk to you about Costco today and how dramatically different today was than yesterday.
00:16:40.500 | But don't ignore the things that you see on TV and do nothing yourself.
00:16:49.500 | The fear that you start to feel when you start to see shortages is real.
00:16:54.500 | As I was walking across that Costco parking lot, I quickly felt those same emotions of deprivation and loss that other people felt.
00:17:05.500 | I didn't need to buy any more water. I have plenty of bottled water saved up.
00:17:09.500 | But I thought, "Well, it'll be fine. I'll go down and I'll get a little bit and it'll make me feel a little bit better."
00:17:13.500 | I didn't need it though.
00:17:15.500 | But my rational mind saying, "Joshua, you don't need it," was not nearly as strong as my fearful mind.
00:17:22.500 | And this stuff is an awful self-fulfilling prophecy because people start to see bad things and this has been very much exacerbated by seeing nothing but Hurricane Harvey coverage for the last week.
00:17:34.500 | That has everybody freaking out in South Florida.
00:17:37.500 | And then also, of course, the current storm heading our way is a powerful one.
00:17:44.500 | But the fear is real.
00:17:45.500 | I felt that fear just like other people.
00:17:47.500 | I had that fear of loss and it made me want to go and just get as much as possible.
00:17:53.500 | And so these things are self-fulfilling prophecies.
00:17:56.500 | People start to see the empty shelves and so that inspires more and more people to go out and get more.
00:18:02.500 | And then they would – inspire more people to go out and get more.
00:18:08.500 | And then that causes more shortages and then by seeing more shortages and the shortages are continuing, more people go back and it just continues again and again.
00:18:16.500 | So pay attention and prepare yourself.
00:18:19.500 | This is important financial planning for you.
00:18:22.500 | Now, let me tell you about the positive side.
00:18:25.500 | Let's flip to Costco today.
00:18:28.500 | Earlier this morning, I wanted to go and get a new battery.
00:18:34.500 | Since I sold my motorhome, I didn't have the deep cycle battery I had that was part of my kind of emergency backup power system.
00:18:42.500 | So I needed to go and buy a new deep cycle battery.
00:18:45.500 | So I went back to Costco to buy a new deep cycle battery.
00:18:48.500 | If you're not familiar, I use a deep cycle battery at home as part of just basic emergency preparedness to get through a power outage.
00:18:58.500 | I'll talk about that in a moment and give you a few practical tips and then refer you to some more shows I've already done on the topic.
00:19:04.500 | Costco today was dramatically different than yesterday.
00:19:08.500 | There was still a shortage of water.
00:19:11.500 | Because of course when the demand outstrips the supply, you have a shortage, which incidentally in line with my show on price gouging and price fixing,
00:19:20.500 | I was bemused to observe that even yesterday, Costco would limit the number of cases of water that you could buy.
00:19:29.500 | They would limit it to five per person.
00:19:31.500 | Today, the limit was two per person.
00:19:33.500 | It's interesting how the changing of prices is illegal during a time of emerging.
00:19:40.500 | And yet rationing is not.
00:19:43.500 | It doesn't make any sense to me why legally it's any different to tell the owner of goods and services, a merchant, why they can't change the price for their item.
00:19:54.500 | But they can legally restrict the sale of the item.
00:19:59.500 | It's a stupid law.
00:20:01.500 | All price fixing laws are stupid and should be done away with.
00:20:04.500 | But continuing on, the – so Costco today was radically different and I was so impressed to see how the staff at Costco had completely reoriented everything and how they were serving their customers.
00:20:17.500 | As I said in the end of the price gouging show, although ideologically I'm entirely opposed to any kind of price fixing laws, which is what the anti-price gouging laws are, it's a price fixing law.
00:20:31.500 | I'm ideologically opposed but I'm not practically opposed.
00:20:34.500 | A large retailer – if I were running a large retail store, cannot take the risk of alienating their customers by increasing prices dramatically during a time of emergency, especially or at least if that time of emergency is temporary.
00:20:50.500 | There is too much destruction of goodwill in that context for somebody to take the risk.
00:20:57.500 | Totally fine for someone to load up a pickup truck full of needed things and sell it off the back of the pickup truck.
00:21:02.500 | There's no price loyalty there.
00:21:04.500 | Sorry, there's no brand loyalty there.
00:21:06.500 | Someone is just trying to buy the item.
00:21:08.500 | But for a large retailer, the benefit of a few additional sales at a higher price is way, way less than the destruction to the goodwill that you've built with your customer base, the steady customer base.
00:21:21.500 | So big retailers and established stores and any kind of retailer shouldn't dramatically change prices when there is a short-term emergency event.
00:21:30.500 | So as I walked into the Costco today, I had a very different experience.
00:21:34.500 | Number one, they had reoriented the whole store around the sale of water.
00:21:39.500 | They had stretched out caution tape across some of the end caps and they were directing all traffic from the front who is going to water.
00:21:48.500 | Instead of having a free-for-all, they were directing all the traffic around a careful aisle through the back of the store to where the water was so that everybody could go in a nice orderly line and improve everybody's shopping experience.
00:22:00.500 | That was impressive to me.
00:22:02.500 | But it didn't stop there.
00:22:04.500 | They had their employees encouraging people along the way and putting out other emergency hurricane preparedness items, which were all discounted and rebated.
00:22:15.500 | Spare batteries for the cell phones, external backup batteries, inexpensive battery-operated lights, LED lights.
00:22:22.500 | All of these things were rebated down substantially at a very nice discount.
00:22:28.500 | And they were displaying carts full of them along the way and encouraging people, "Don't just think about water."
00:22:33.500 | But they were serving people with the other things that they might not have known about or might not have thought of.
00:22:39.500 | They had brought in massive shipments of the items that were in short supply.
00:22:45.500 | They brought in huge amounts of water.
00:22:47.500 | There were pallets and pallets of water and they had staff members working to load people's carts with the water.
00:22:53.500 | Of course, there was a cap of two per person and actually I came back later and they had run out a couple hours later, but even two per person.
00:23:01.500 | And they had staff members filling people's carts and they were serving their customers exactly what they wanted.
00:23:05.500 | And they had cut prices on those items that they had any margin and they'd cut prices to help serve their customer base.
00:23:14.500 | And that, my friends, is what business is about, what good business is about.
00:23:20.500 | Good business involves serving your customer with what they need at their time of need.
00:23:26.500 | That's how you build a quality business and that's what builds brand loyalty.
00:23:32.500 | And for all of the nightmare of shortages around an impending event, we are blessed to live in the best time in the history of the world for access to quality products in our retail system.
00:23:47.500 | The just-in-time inventory system that we all live under has significant shortfalls.
00:23:51.500 | It has significant dangers. Stores don't stock much of an inventory.
00:23:56.500 | But the shipping system that backs up the just-in-time inventory system is incredible.
00:24:02.500 | I read an article today that was posted on LinkedIn.
00:24:06.500 | The title was called "The Inside Story of What It Took to Keep a Texas Grocery Chain Running in the Chaos of Hurricane Harvey."
00:24:13.500 | I will link this article in the show notes today. I encourage you to read it.
00:24:17.500 | It's an interview with the CEO of the – I assume they say H-E-B grocery store chain there in Texas, one of the largest grocery store chains in Texas.
00:24:26.500 | And he describes what that company went through this last week in order to serve their customers what they needed and to be a source of the goods and services their customers need there in the local area.
00:24:41.500 | He moved heaven and earth to serve their customers.
00:24:45.500 | They had hundreds or thousands of employees that moved from here to there to go and serve.
00:24:51.500 | And they just changed their whole inventory system to get the items and the products there to their customers.
00:25:01.500 | It's one of the most beautiful stories of service that I've read in a long time.
00:25:07.500 | And it was very interesting to me because I saw exactly the same thing today at Costco.
00:25:11.500 | All of these big businesses and all of these big companies seeking to serve their customers effectively.
00:25:19.500 | And, friends, we are blessed to live in the most incredible time in human history, the most incredible economy that has the most resiliency and the most power and the best technological access of anything in the history of the world.
00:25:38.500 | Now, there are events that could knock our economic system flat on its back.
00:25:46.500 | Those things do exist.
00:25:50.500 | The probability of them happening, though, is pretty low.
00:25:56.500 | And I think we should all be thankful to live in the system that we live in.
00:26:01.500 | After reading the article about the HEB stores and then seeing the staff at Costco serve me today, it just re-inspired me towards service.
00:26:10.500 | And it said, "How can I serve you, my customers? How can I serve you more effectively?
00:26:14.500 | How can I make sure that you know that your well-being is always my number one goal?"
00:26:21.500 | I don't have great answers. It's just working through the answers of what can I improve.
00:26:27.500 | It's a process of constant improvement.
00:26:30.500 | Don't worry about where we start. We all start from where we are.
00:26:33.500 | But the goals get a little bit better.
00:26:35.500 | And these grocery chains have learned. They've learned how to get better.
00:26:39.500 | And they make massive investments into their redundancy so that they can improve things.
00:26:45.500 | They make investments into huge generators down here, big old generators that never get used, except once a decade when the hurricane actually does come through.
00:26:55.500 | And yet those stores do it to serve their customers.
00:27:00.500 | We live in a tremendous time, and you should be very encouraged and get in the game and participate and serve your customers.
00:27:08.500 | I hope that you can take both of these themes that I've shared with you to heart.
00:27:13.500 | Number one, there's a very thin veneer over society. Plan accordingly.
00:27:21.500 | Number two, we live in a tremendously resilient economic system. Be grateful for it and live accordingly.
00:27:34.500 | I think now – let me share with you – I will link in today's show some previous shows that I have done.
00:27:40.500 | And I'm just going to share with you just some simple suggestions, some additional practical simple suggestions for preparing for something like a hurricane.
00:27:49.500 | Three episodes back, I talked – episode 477 entitled "Practical Financial Planning for Large-Scale Disasters Like the Houston Floods."
00:27:56.500 | I gave you some simple practical suggestions for what to do in case you need to evacuate and leave.
00:28:02.500 | That was the theme of that show.
00:28:04.500 | In essence, usually, it's better to leave.
00:28:08.500 | And if you can leave and leave early and beat the crowds, you'll often be better off.
00:28:13.500 | So you should think through that in advance.
00:28:16.500 | Now, I don't know if – ironically, I am recording this from home and we have not yet decided to leave.
00:28:24.500 | I'm not unaware of my own advice. I'm very aware of it.
00:28:28.500 | We haven't decided if we're going to leave where we live or – and how far we're going to leave.
00:28:33.500 | The biggest challenge and the reason is that it's uncertain at this point which direction is good to go.
00:28:40.500 | There's so much change and variability with hurricanes that it's hard to know what direction to go.
00:28:45.500 | For those of you who are not familiar with hurricane country and what hurricanes are like, yes, powerful storms can do tremendous damage.
00:28:53.500 | But most of the damage in a hurricane is limited to a very small area, often less than 100 miles near the middle of the storm.
00:29:03.500 | Beyond that, you have some wind and some rain and often can knock out power just like a bad thunderstorm can.
00:29:09.500 | But most often, there's not a destructive element to the broader hurricane.
00:29:17.500 | So it's very possible that all of Florida will experience hurricane effects from Hurricane Irma as it comes and passes over us.
00:29:25.500 | A hurricane may affect multiple states at one time.
00:29:27.500 | But that doesn't mean that there is broad-scale devastation.
00:29:31.500 | And so you can't know exactly where in advance.
00:29:35.500 | You can't know exactly where those strongest winds are going to go.
00:29:38.500 | And so the question is, well, do I go west?
00:29:40.500 | Do I go north?
00:29:41.500 | And then how far west and how far north?
00:29:44.500 | So we're ready to go if that's the decision that seems most prudent.
00:29:47.500 | But that's why I haven't pulled the trigger and loaded up and gone yet.
00:29:52.500 | The other risk, of course, to hurricanes is water.
00:29:55.500 | And that water comes in two forms.
00:29:57.500 | Number one, it comes in the form of storm surge, which if you live near a waterway, is a significant factor that can result in flooding.
00:30:05.500 | I do not live near a waterway which faces storm surge danger.
00:30:10.500 | And whenever there is an evacuation, it's always an evacuation from those areas that are prone to storm surge here in south Florida.
00:30:17.500 | Storm surge is where the waves and the wind pushes the water up against – pushes it up high so that it comes up over the banks of the waterways.
00:30:27.500 | That's what storm surge is.
00:30:29.500 | The second risk, of course, is flooding and hurricanes can drop a lot of rain down on an area.
00:30:36.500 | And if they linger, they can dump a tremendous amount of rain.
00:30:39.500 | So this is why Hurricane Harvey was so destructive.
00:30:41.500 | It dumped a huge, huge amount of rain on a localized area and it lingered and that area was already prone to flooding.
00:30:54.500 | So those were all factors that were involved in Hurricane Harvey.
00:30:59.500 | Well, those factors don't seem to be applicable to the current storm, Hurricane Irma, headed in my direction.
00:31:06.500 | The final risk factor comes down to the quality of the structure that you are in.
00:31:11.500 | If you're in a high-risk structure such as a mobile home or old or poorly built wooden house, there is significant risk and you should get out of that house.
00:31:21.500 | Go to an official government shelter or go to a friend who has a more strongly built house.
00:31:27.500 | And we're ready with some of those options as well.
00:31:30.500 | But if you live in a stronger house, then in general, you're not going to face much of a risk.
00:31:36.500 | The only exception to that can be tornado risk.
00:31:38.500 | Of course, at any time, a hurricane can spawn a tornado and a tornado can rip through your beautifully built house just like anything else.
00:31:46.500 | So that is also a concern.
00:31:48.500 | My point is you have to have a good dose of common sense and that's what we're seeking to apply, a good dose of common sense and prudence.
00:31:58.500 | In a few minutes here, I'll check the 5 o'clock update and we'll see as things adjust and as things get close enough to figure out what direction to go in and which way is the right way and which plan is the best to pursue.
00:32:11.500 | So if you think you'll be affected by Hurricane Irma, perhaps you're a little bit to the north of me, here are just a few simple things that I hope may be useful to you.
00:32:21.500 | In order of priority, number one is generally shelter, to protect your shelter for yourself, especially if you're facing a severe weather event.
00:32:30.500 | You need to make sure that you are in the best shelter and the best structure that you can make happen.
00:32:37.500 | And then prepare that shelter to the best of your ability.
00:32:41.500 | So here in South Florida, that means you clean up all the stuff in your yard.
00:32:45.500 | Hopefully you did this before hurricane season, but you clean up all the stuff in your yard that could become a flying projectile and you put your shutters up or you board up your windows.
00:32:53.500 | That gives you a significant degree of protection and absent a direct hit from a flying missile and absent a direct hit from a high category tornado, generally if you do that, your structure is going to be fine.
00:33:06.500 | It's good of course to have layers of defense to prepare an interior room to protect yourself and perhaps consider sleeping in that interior room during the actual event.
00:33:16.500 | But generally with building codes and building standards and things like that, generally that's about as far as you need to go with shelter.
00:33:24.500 | The next thing you need to be connected with is communications and it's good to have multiple varieties of communications.
00:33:31.500 | Today we are hugely dependent upon our cell phones and the cell phone infrastructure and it has gotten so much better in many, many events.
00:33:41.500 | The cell phone infrastructure has proven to be very robust, very resilient.
00:33:47.500 | We can be thankful for that.
00:33:48.500 | That's again a good example of our various cell phone carriers doing a good job to serve us with giving much more reliable service than in the past.
00:33:57.500 | So for most of the time, the best thing to do is just make a plan to keep your cell phone charged.
00:34:01.500 | Run it on a low power mode and make sure that you have backup batteries.
00:34:05.500 | The simplest way is just buy some of these little backup batteries.
00:34:08.500 | At Costco this morning, they were selling little backup batteries that come in a little cradle that you can set them in and out.
00:34:14.500 | Some brand, I think it was called Tilt.
00:34:16.500 | The backup batteries were rated for about 5200 milliamp hours, which depending on the size of your phone may be about one and a half to three charges of your phone depending on the size of the battery.
00:34:29.500 | So with my phone, the larger iPhone, it's one and a half charges would be 5200 milliamp hours.
00:34:35.500 | For your phone, it may be one and a half to three charges.
00:34:38.500 | Well, they were selling those, came with two batteries, so a total of 10,000 milliamp hours of backup for $14.
00:34:45.500 | It comes out to seven and a half bucks each.
00:34:47.500 | Those are the best, most reliable, consistent way to keep your phone charged.
00:34:53.500 | Everybody should have a few small backup batteries and everybody should have at least one significant backup battery.
00:35:00.500 | You can purchase online.
00:35:02.500 | You can find a 10,000 or 20,000 milliamp hour battery.
00:35:05.500 | Those will be reliable and very, very effective.
00:35:09.500 | If you have a 20,000 milliamp hour battery, which you can probably order for 40, 50, 60 bucks depending on the brand, depending on the time, depending on the sales online, that will keep your cell phone charged and useful for you for a week or more.
00:35:24.500 | That should be your number one priority.
00:35:26.500 | Simple, cheap, effective.
00:35:28.500 | The great Achilles heel of cell phones is that they are dependent on a centralized infrastructure.
00:35:37.500 | If that infrastructure goes down, they stop working.
00:35:41.500 | There are lots of ways to solve that.
00:35:44.500 | You can use a variety of radio systems.
00:35:46.500 | If you are a licensed amateur radio operator, you know all about that.
00:35:51.500 | You can set up a network among the people that you need to communicate with.
00:35:54.500 | If you're not, then there are all kinds of unlicensed things that you can use as well.
00:36:00.500 | I don't want to get into that.
00:36:01.500 | Although if any of you are interested, I'd be happy to teach on that subject in the future.
00:36:05.500 | The next priority would be water and/or power.
00:36:09.500 | Let's go with power because it's most related to communications.
00:36:12.500 | There are two basic things that you can use when you lose power.
00:36:16.500 | One is battery systems.
00:36:18.500 | Two is generators.
00:36:20.500 | We're not talking here about anything beyond that.
00:36:23.500 | If you want to use a battery, you're already doing that with having a small battery for your cell phone.
00:36:29.500 | But one of the simplest and easiest ways to use a home power system is to use a 12-volt battery, basically a car battery.
00:36:37.500 | You can use the actual battery that's on your car or in your car.
00:36:42.500 | The way that you do that is park your car in the driveway.
00:36:45.500 | Buy an inverter that connects to the battery that will transform your direct current electrical content on the battery to alternating current.
00:36:54.500 | It's called an inverter.
00:36:56.500 | Get something 800 watts.
00:36:58.500 | You can get an 800-watt inverter for probably $40.
00:37:00.500 | You can go up to a 2,000-watt inverter.
00:37:02.500 | These types of inverters will connect directly to a 2,000-watt inverter, probably around $120, $130.
00:37:08.500 | These types of inverters will connect directly to the battery on your car and not through the cigarette lighter.
00:37:14.500 | You can only run about 150, 200 watts off of a cigarette lighter.
00:37:20.500 | So they'll connect directly to the battery.
00:37:22.500 | Then you can just take an extension cord and use that extension cord to run from your car into your house.
00:37:28.500 | If you need to keep your refrigerator cold or your freezer cold, just turn your car on and run the car for a little bit.
00:37:35.500 | Just keep the battery charged while you are taking a large current load off of it and use that to run the refrigerator, cool everything down, and then unplug it for a while, and you can turn the car off.
00:37:47.500 | Make sure that you have an understanding of the wattage requirements.
00:37:51.500 | You can usually read the label.
00:37:53.500 | And if you have a big enough generator, then you can do this with even a high-power inverter.
00:37:57.500 | If you have a big enough inverter, you can run higher current things.
00:38:03.500 | The biggest challenge if you're on well water, you want to be able to run a well pump.
00:38:06.500 | So check the wattage requirements of your well pump and size your system appropriately.
00:38:12.500 | That's the simplest way for you to have power inside of your house using what you already have.
00:38:17.500 | You don't have to buy a generator.
00:38:18.500 | You can just use that, and it'll work effectively for you.
00:38:22.500 | You don't have to run the car if you're just going to use some simple low-draw items.
00:38:29.500 | You can run a small TV.
00:38:31.500 | You can run your--charge your phones up.
00:38:34.500 | You can run a laptop, DVDs playing for the children, things like that.
00:38:39.500 | You can do all of that for a few hours, run some lights without needing to run your car.
00:38:44.500 | If you're going to run significant power-draw items, then go ahead and turn the car on.
00:38:51.500 | Way simpler for most of us than dealing with a generator, dealing with storage, and dealing with keeping the generator going.
00:38:58.500 | It's a better system.
00:39:00.500 | If you like or if you're planning ahead, you can even use--just have an extra battery.
00:39:05.500 | You can purchase or if you have one in your RV or in your boat, just use a deep cycle marine battery.
00:39:11.500 | Keep it in your house and hook it up to a battery charger.
00:39:14.500 | Keep it topped off, and then when the power goes off, you can hook right up to it,
00:39:19.500 | put a pair of alligator clips onto the terminals coming out to a female cigarette lighter end.
00:39:26.500 | Put in a USB adapter, male cigarette lighter plug into a USB adapter.
00:39:32.500 | You can pull power off of that.
00:39:34.500 | You can run some lights off of that, hook your inverter up, and you can run some simple lights.
00:39:39.500 | Just use some LED, low-wattage LED or CFL bulbs.
00:39:45.500 | LED are superior to CFL, but CFL is perfectly fine.
00:39:48.500 | Just don't run incandescent.
00:39:50.500 | They're too power-hungry.
00:39:52.500 | Set up a battery system for yourself before you get a generator.
00:39:55.500 | People run out and buy generators, and there are a couple problems with it.
00:39:58.500 | Number one, they buy generators that are really annoying, that are mis-sized for their appropriate application for their house.
00:40:05.500 | They usually buy the biggest one they can, which are usually loud and obnoxious, and nobody actually wants to run them.
00:40:11.500 | And then people don't have enough fuel on hand.
00:40:13.500 | So get a smaller generator and store more fuel or just simply store the fuel and use your car.
00:40:18.500 | For most people, you don't need to run your whole house.
00:40:21.500 | You can set that up if that's important to you, but you don't need to run your whole house for a few days after a hurricane.
00:40:27.500 | Silly.
00:40:28.500 | For lighting, the best thing, of course, is obviously to use a battery system that you have and a low-wattage LED bulb.
00:40:36.500 | Just put that in a lamp fixture that you have or use flashlights.
00:40:41.500 | Use the flashlights that you have.
00:40:42.500 | A couple tips on flashlights.
00:40:44.500 | One thing that I have learned is that I always try to standardize my lights on AA and D-cell batteries.
00:40:51.500 | So if you're interested in frugal thriftiness, there's a massive difference in the amount of power that's available between a AAA and a AA,
00:40:59.500 | even though there's only a small difference in the actual size of the battery.
00:41:04.500 | I forget. I did the calculations one time.
00:41:06.500 | It's something like 75% more power in a AA than a AAA.
00:41:10.500 | This is important because if you buy a bunch of batteries and then you don't use them and you store them,
00:41:15.500 | batteries will, over time, discharge little by little.
00:41:19.500 | So if you use a bigger battery, it'll still have more power in it down the road.
00:41:24.500 | So if you're going to buy flashlights, if you're looking for a small one, try to find a AA flashlight instead of a AAA flashlight.
00:41:30.500 | If you're going to use a larger one, go with a D-cell versus a C-cell.
00:41:34.500 | D-cell flashlights are going to be your best items for emergencies because D-cell batteries will have a very long shelf life.
00:41:41.500 | They can last for 10 years and still have useful current in them, and you can find them.
00:41:47.500 | They're inexpensive to buy.
00:41:48.500 | So your best financial option is D-cell flashlights and AA flashlights.
00:41:53.500 | That'll save you money in the long run.
00:41:56.500 | You do have to look, though.
00:41:57.500 | They seem like AAA flashlights are a dime a dozen, but they're not nearly as good as a AA one, and D-cells are harder to find than C-cells as well.
00:42:09.500 | Which brings me finally to food and water.
00:42:11.500 | Water is simple.
00:42:12.500 | Just have multiple methods.
00:42:16.500 | Store some water.
00:42:17.500 | I think it's smart and intelligent to store water in small packages.
00:42:21.500 | You cannot beat the trays of water that you buy.
00:42:24.500 | And if you have small half-liter bottles, they're cheap to buy, to store, and easy to do.
00:42:30.500 | And if you have half-liter bottles, you can parse them out either individually for drinking water or use a little bit for brushing your teeth or whatever you need to do.
00:42:37.500 | So for drinking water, that's fine as a first thing.
00:42:41.500 | So store some water that's purchased and packaged.
00:42:44.500 | Contain some water.
00:42:45.500 | Just use pots and pans and fill your bathtub up with water to flush the toilet with.
00:42:50.500 | Use pots and pans.
00:42:52.500 | Most of this stuff is relatively short-term.
00:42:54.500 | Power outages and things like that are relatively short-term.
00:42:57.500 | So if you get all your pots out of the cupboard and fill them up with water from the sink, you're going to have many days' worth of drinking water set right there.
00:43:05.500 | Or use old soda bottles or old milk jugs that have been cleaned out, things like that.
00:43:09.500 | You can have plenty of drinking water, and it's very inexpensive to do.
00:43:13.500 | You want to make sure that you contain some water for sanitation to flush the toilets, fill the bathtub up, tape it over if you have a leak, and fill some garbage cans up out back if you don't have any rain barrels or water barrels as part of your normal house system.
00:43:28.500 | Which brings me finally to food.
00:43:31.500 | Number one, use up the food that you have.
00:43:33.500 | Fire up the barbecue.
00:43:34.500 | Cook the meat.
00:43:35.500 | A lot easier and more fun to cook the meat and enjoy it than it is to have it go bad and just clean out the refrigerator and cook a bunch of food and have a big party with your neighbors.
00:43:44.500 | If you have much more than that, then of course keep it cold.
00:43:47.500 | With regard to cooking, the simple and obvious scenario that most people use is a barbecue grill, especially if you have a barbecue grill that has a side burner that you can use with a pot.
00:43:56.500 | Just store a couple of propane canisters on your deck, and you're good to go with ability to cook.
00:44:03.500 | Good to have a couple of backup options.
00:44:05.500 | You can purchase – the simplest solution is you can purchase a little propane – well, excuse me.
00:44:10.500 | First, a little butane stove, a little single burner butane stove for about 20 bucks.
00:44:15.500 | The two major brands are Camp Chef or Coleman down at your local sporting goods store.
00:44:20.500 | For about 20 bucks, a single burner butane stove, and those work great.
00:44:24.500 | You buy the little butane canisters.
00:44:26.500 | These are the ones that are throwaway.
00:44:28.500 | They're small, about the size of a bottle of hairspray or something – that basic small aerosol can like a rattled paint can.
00:44:36.500 | They're about that size, and you slide those butane cylinders in there.
00:44:39.500 | You can buy those pretty inexpensively, and those store forever.
00:44:43.500 | So you can put back a dozen of them, and you're well squared away.
00:44:46.500 | Those burners work really well.
00:44:48.500 | It's what you see if you go to an omelet station at a fancy hotel, something like that.
00:44:52.500 | You'll often see that the chef there will be cooking on one of those small butane stoves.
00:44:56.500 | So they're simple and easy to use and super, super portable.
00:45:00.500 | If you live in a small apartment, super portable, super simple to use.
00:45:04.500 | There are also the various versions of Coleman stoves.
00:45:10.500 | The two-burner stoves, of course, many manufacturers, Coleman, Camp Chef, et cetera, will make them.
00:45:14.500 | You can run most of these off of either a propane bottle, those small – I can't remember the poundage – one-pound propane bottles that you can purchase.
00:45:23.500 | Those are also inexpensive, easy to use, two-burner stoves.
00:45:26.500 | Or you can purchase the Coleman dual-fuel stoves that will run on the Coleman fuel, on white gas, or on gasoline.
00:45:34.500 | If you want reliable redundancy, just purchase one of the Coleman stoves that will run off of gasoline.
00:45:41.500 | That way, when you use the gasoline that you have stored for your generator or for your car, you can use exactly the same gasoline in your stove.
00:45:48.500 | And gasoline is often going to be one of your easiest fuels to find in a time of crisis or shortage.
00:45:55.500 | So those are just a few simple tips.
00:45:57.500 | I hope they're useful off the top of my head, but I hope those are just some simple and practical tips that will help you for those of you who have not thought a lot about this particular aspect of financial planning.
00:46:09.500 | And then as I close out today's show and get back to work here at my place, I would beg of you this.
00:46:16.500 | Most events are more about the cleanup than they are during the acute event.
00:46:24.500 | The cleanup is what's drudgery.
00:46:26.500 | The cleanup after the flood is drudgery because the adrenaline is gone, everyone's fine, and now you're just faced with a whole lot of work.
00:46:35.500 | So in that process, please, I beg of you, don't be stupid once the acute event has passed.
00:46:43.500 | If you're going to buy a chainsaw to chop up the tree that's in your yard, make sure that you have chainsaw shafts to wear as well to protect yourself.
00:46:51.500 | Cutting up the tree is not worth cutting off your leg.
00:46:55.500 | If you're going to go out and pull down the branches, wear gloves, wear protective gear.
00:47:00.500 | Don't wade around in the water unnecessarily.
00:47:03.500 | All that stuff applies.
00:47:05.500 | Just be careful and be safe.
00:47:07.500 | If you look at disasters around the world, you'll constantly find that in many poor countries, people die due to the lack of basic quality houses.
00:47:19.500 | As we here in the United States and in the West look at Hurricane Harvey and more in the devastation there, it's my guess right now.
00:47:30.500 | I think the loss of life is under around a dozen, maybe a dozen or two.
00:47:36.500 | I can't remember the current number.
00:47:38.500 | At the same time, in the past month, there have been over 1,200 people that have died from flooding in Bangladesh, Nepal, and India.
00:47:49.500 | The monsoon season has brought huge devastation affecting millions of people.
00:47:55.500 | I've heard estimates of up to 40 million people affected by the flooding there in Bangladesh, Nepal, and India and over 1,200 deaths.
00:48:07.500 | Be thankful that you don't live in Bangladesh, Nepal, and India.
00:48:11.500 | If you do live in Bangladesh, Nepal, and India, let me know how we can help.
00:48:15.500 | I wish I could do something.
00:48:17.500 | It just seems impossible on the other side of the world and I have no contacts there.
00:48:21.500 | In many of the storms and events here in the United States where we have good basic infrastructure, people die not from problems and flaws of infrastructure,
00:48:33.500 | but because of ill-considered actions.
00:48:38.500 | So please don't join them.
00:48:43.500 | With that, I need to go and check the 5 o'clock update and get back to work.
00:48:47.500 | I will be back with you all as soon as I'm able to be.
00:48:50.500 | Have a great day.
00:48:52.500 | This show is part of the Radical Life Media network of podcasts and resources.
00:48:57.500 | Find out more at RadicalLifeMedia.com
00:49:02.500 | Struggling with your electric bill?
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00:49:07.500 | You may qualify for an 18% discount.
00:49:11.500 | Visit SDG.com/FERA to find out more.
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