How To Short The US Dollar And Inflation Hedge Right Now For Dirt Cheap, With Zero Downside Risk Or Counterparty Risk

I know, right? It sounds too good to be true, but it’s not. And here’s a little spoiler: It’s also not silver, or gold, or even copper…

*****

SPECIAL NOTE: THIS IS NOT INVESTMENT ADVICE. THIS IS JUST SOME BABBLING IDIOT SHOUTING “THE DOLLAR’S FALLING, THE DOLLAR’S FALLING”, AND AS SUCH, DO NOT LISTEN TO HIM.

*****

(by Half Dollar) I had one of those “I’ve gotta do something about this” moments.

Do you ever get those?

You know the ones.

The ones that drive your wife crazy because you get into something way over your head again with some crazy idea only to say sometime down the line, after apologizing, of course, “geez honey, you were right.”?

Um, yeah.

This is kinda like that.

You see, I don’t trust the banks, I don’t trust the prying hands or zapping software of those regulating the banks, I don’t trust those of those regulating the regulators, I don’t trust the US dollar, and I sure as heck don’t trust keeping US dollars in the banks for any length of time longer than only what is absolutely necessary.

Yeah, I’ve got trust issues.

It happens.

Stay on track.

So the other day I went down to my favorite retail wildlands for some field observation, for nothing says “Zombie Apocalypse” quite like “Walmart”, you know, and nowadays, it’s extra interesting in that you never know what you’re not going to find!

What?

Don’t judge.

I do it for the research.

So the other day I was converting some of my unbacked, debt-based fiat currency dependent on exponential, unsustainable growth into something real, and see if you can spot what caused such a pucker:

That’s right folks, this time around, I was getting 40% more!

And I immediately began to think of the chocolate ration (from George Orwell’s 1984, bold added for emphasis):

Winston was smoking a Victory Cigarette which he held carefully horizontal. The new ration did not start till tomorrow and he had only four cigarettes left. For the moment he had shut his ears to the remoter noises and was listening to the stuff that streamed out of the telescreen. It appeared that there had even been demonstrations to thank Big Brother for raising the chocolate ration to twenty grammes a week. And only yesterday, he reflected, it had been announced that the ration was to be REDUCED to twenty grammes a week. Was it possible that they could swallow that, after only twenty-four hours? Yes, they swallowed it. Parsons swallowed it easily, with the stupidity of an animal. The eyeless creature at the other table swallowed it fanatically, passionately, with a furious desire to track down, denounce, and vaporize anyone who should suggest that last week the ration had been thirty grammes

Because it may be “40% More”, but this new size actually contains a lot less ounces than the previous large size did, the price of this new size is higher, and this new size doesn’t even have the freakin’ OxiClean!

I mean, what in the heck is going on here?

What kind of a scam is this?

And then it hit me: I’ve got to start spending some of my excess dollars, and fast, because stuff is going up in price every time I go to Walmart, and to give an example of that, I’m pretty sure my favorite hot sauce used to cost $1, but I literally just paid $1.97 for the same exact size glass bottle!

Yikes!

In wondering how in the heck I was going to hedge some laundry detergent, I wasn’t really motivated with the thought of lugging around 140 loads of concentrated liquid goodness, nor was I very enthused about the space needed to store the extra jugs, so I did what any lazy, wannabe prepper would do, and I fired up the trusty old giddy-up pick ‘em up truck and went back out into the savage suburban jungle to brave the Walmart landscape once more, with my sights honed in on the household products region specifically.

And then it happened, again!

That’s right folks, for now, it wasn’t just one moment but an “I’ve gotta do something about this” 2-for-1 moment.

Because to my eyes’ delight, I spotted something that only a six-foot-one (and a half) person could spot near the back of the tallest shelf in the laundry detergent isle:

I know, right?

My inner-stacker was jumping up and down in isle fourteen!

My inner-gray man was trying to play it cool, however, and when I saw a little old lady snatch a box of dryer sheets from the second-to-top shelf using only her cane as a grabber, you’re dang right there was no way that cane, that little old lady, or whatever was going to make its way between me and my newfound value investment!

Sure, it takes a whole lot more room to stack Zote than it does to stack ounces of silver:

But we also must not forget that some people may not be able to afford an ounce of silver, but I’m pretty sure anybody can afford $1.06 for a bar of laundry soap!

Heck, it’s even got a weight and purity on it!

It’s 400 grams, and I guess we could call the “fatty acid” content the purity.

In other words, what we’ve got here is a 400 gram, .660 fine, pink laundry bar!

Oh good grief.

I sound like a stark raving mad lunatic.

But guess what, everybody needs to think differently in the coming year, or years, but not likely that long, because we’re talking about living through the US dollar hyperinflation.

And stick with me, because I think I just came across a totally valid way to accomplish two things:

  • Short the US dollar
  • Hedge against US dollar inflation

Let me explain.

First and foremost, the US dollar strength has absolutely been crushing the Mexican Peso over the last six years:

The pain really began in earnest about midway through 2014.

But wait, there’s more, and see if you can spot it:

Hecho en Mexico!

Woot!

That means the bars of Zote that are on Walmart’s shelves right now are pretty much dirt cheap at $1.06 per bar, and don’t “investing gurus” always talk about “diversifying” that portfolio anyway?

Here’s the question: How much are those bars of laundry detergent soap going to cost going forward, if the company even exists anymore?

The company’s website is down:

So that’s not good, but let’s assume the company still exists.

Again, the question, because it is important: How much are those bars, currently priced at Walmart at $1.06, going to cost going forward?

And no cheating, for supply chain disruptions, rising crude oil prices, logistics nightmares, increased Covid regulatory burden, and other factors such as those must all be considered when calculating what those bars will cost going forward!

On second thought, and ignoring the fact that Walmart still has these laundry detergent bars readily available in the stores (I imagine), let’s see what these bars are selling for on Ebay:

Yes, those are essentially what would be the “last” price, because those are “sold” bars on Ebay, so I’d say this investment is already paying off!

OK, “Hey Half Dollar, what, are you going to start pumping coin-operated laundry mats now, and besides, I thought you said there was zero downside risk Mr I’m-Too-Good-To-Wash-My-Own-Clothes-So-I-Just-Pretend-I-Don’t-Know-How-To-Get-My-Wife-To-Do-It?”.

Well, I suppose if one never washes clothes, then sure, for it would just be a useless bar of laundry detergent, but then again, surely, somehow, and somewhere, people are washing clothes, so while I’m not the brightest tool in the shed, I’m pretty sure that washing clothes will still be a thing for quite some time to come, so where one person may not find value in a bar of laundry detergent, others may!

OK, “Hey Half Dollar, are you tryin’ to weasel your way out of the question by saying you could use it for barter you big doofus!”.

Why, yes.

Indeed I am.

Now, I know what you’re thinking, but if you’re not, let me go ahead and spell it out for you: Nobody wants some stupid bar of laundry detergent soap, so that’s why it’s so dang cheap in the first place!

And if you’re thinking that, you’d be wrong!

Because, first and foremost, over 215,000 people watched “The Many Uses Of ZOTE SOAP”:

And secondly, when all else fails, as in a possible buyer, well, there are a whole heck of a lot of Mexican and Mexican-American women in the United States, aren’t there?

And furthermore, even though the product is Mexican, the use of this type of laundry detergent may be cultural in that it’s not just a Mexican thing but a Latino thing in general.

And if so, according to the Census Bureau, Hispanics/Latinos make up 18.5% of the estimated population of 328 million people, meaning there are over 60 million potential buyers if we go off of a potential target demographic alone!

And in the end, it’s still laundry soap!

So there you have it: This is one dirt cheap way to both short the US dollar and hedge against inflation, and the key takeaway here is that I’m essentially talking about something imported from an “emerging” market that’s already been imported and is on store shelves, right now, during this time of relative US dollar strength, and moreover, I’m talking about something cheap today, something not easily replaced, something portable, something easy to store, something that won’t go bad, and some of all of that stuff, also like the dried shrimp some of the prettier girls from Guam like to munch on, but not like the Vegemite some of the peculiar Aussies chow down on, because you should just leave that stuff alone, but with all that said, and with all things considered, and so on, and so forth, if one finds him or her self interested in real things of value, that are currently probably stupidly mispriced, If I lived in, or near, or whatever, a city with multiple Walmart stores (and the woman in the video above displays a list of other retailers that may have Zote too), I would be driving to every last one of them and buying up every last bar that I could, and well, I kinda sorta did.

You mileage may vary.

Mine’s not that great.

But what can I say?

I bought it last summer, and it still has less than 1,000 miles on it?

Reclaim control over your savings.

That one penny interest in that savings account is only the smallest currency unit possible to give.

Oh, how fortunate.

Silver didn’t reclaim $25:

Don’t worry, for we’ll get there, and multiples of there eventually.

Parity is my ultimate call:

What?

You’ve never seen those two-tone coins before?

If your outlook is more traditional than mine, however, there’s still free gold to be had at the end of the cycle:

Who said there was no such thing as a free lunch?

Palladium, however, is not free:

It’s actually kind of rich right now considering the other three precious metals, so I’d expect more of the same, which is exactly as we’ve been expecting for quite some time.

Platinum has been a whipsaw to kick off the new year:

How surprising.

Copper is surprising people by refusing to crash:

One more time: The Era of Hyperinflation is here.

Here come higher prices at the pump:

Being hedged against inflation is more important now than ever.

The stock market just keeps on going:

Because “price discovery” is so last century!

Fear of a stock market crash is also so last century:

Of course, when every market crash or correction is for the most part immediately backstopped by the Fed, why would fear not be gone from the market?

Here’s one thing that is not an inflation hedge:

It’s an inflation farce.

The problem is that the money is no good:

I wouldn’t count on the people understanding what is happening before it’s too late, however.

There is no hope in the Proles.

Thanks for reading,

Paul “Half Dollar” Eberhart