Do You Want to Survive This Current Recession? I Can Help You. by Andrew Molchan (This article first ran in the February 2008 issue of American Firearms Industry Magazine.)

(January 24, 2008) American Firearms Industry (AFI) has been, and will be, in and the top 1% of America's 6,000 monthly magazines for accurately predicting major economic and social trends. AFI consistently gives its readers highly accurate and valuable advice. Now that we are into a significant recession the advice in AFI will be even more valuable.

AFI rotates through the FFL list and covers all 58,000 FFL holders. However, you must be reading all 12 issues per year, and only subscribers, and/or Professional Gun Retailer Association (PGRA) members, receive all the issues. If you're not already a regular subscriber, or PGRA member, the forms are on the back protective cover of this issue. Call in your subscription today (954-467-9994), and don't miss any issues,

This year, 2008, plus 2009 are definitely NOT going to unfold in the manner that the majority of people believe. The popular viewpoints are dangerously wrong, and following those views will cost you a lot of money. I will tell you what's really happening, why it's happening, and where things are going.

Last month's January 2008 "How To Survive:" column, (written December 21st 2007), said, "American's have 14 very hard years in front of them, 2008 to 2022." Just a few of the comments in that article:

1. The housing boom is history for the next 14 years.

2.The unwinding of the sub-prime credit bubble is only the start.

3. Commodity prices, oil, copper, gold, etc. will trend downward. Commodity prices will whiplash around, but a year from now they will be 10% to 20% lower.

4.The overall economy will stagnate for several years.

5.There will be higher unemployment and lower consumer spending.

6. "The stock markets of Asian countries will go down." (That call was made December 21st when all of the Asian stock markets were still setting new all time highs).

7.The American and the Asian stock markets will crash, but the Asian markets will recover before America's.

8. "Many of America's local governments will go into financial crisis because of reduced tax revenue.

9. America, in the next ten years, will have some similarities to Japan in the 1990's, especially in the area of real estate and bank failures.

Jumping back over four years, to mid 2003, I made the totally accurate prediction of exactly what was going to happen with the Iraq war. My prediction was 99% better than all of the Generals in the Pentagon, President Bush, and the CIA's. Four years ago I said the CIA had been conned. In 2007, the CIA finally figured out that it had in fact been conned, and it has worked towards sucker proofing itself. Let's pray that the CIA continues to succeed, and let's pray that the Pentagon has the courage and imagination to learn from the CIA.

I'm writing this article after the Federal Reserve, in a surprise move, lowered the interest rate by 3/4 of a percent. However, a month ago, in the above mentioned January issue article, on page 24, I wrote in regards to the Fed's future lowering of rates, "The Japanese Federal Reserve brought interest rates down to 1/2 of 1% and still Japanese real estate did NOT move for years." The core cause of American's downturn is the bursting of a massive credit bubble. The Fed is fighting a problem of excess credit by creating more credit. It's like a person owing on a credit card, and they paying that credit card with another credit card.The Fed's cuts are irresponsible ass kissing, long-term they will make our problems worse, and are short-term moves to get the Congressional incumbents past the November 5th election.

In the November 2006 issue of AFI, I said a recession would start in 2007. I was ONE YEAR ahead of events, and in 2008 my predictions will continue to be one month to five years ahead of history. The valuable insights in AFI will be vital and valuable information you must know in these troubled times.

I'm not a politician, I never tell my readers where they've been, like yesterday's news was some brilliant discovery that only I had the genius to find. Hillary Clinton stands up and says, "America has a health care cost problem," and the crowds go wild with cheers and adulation. I guess nobody in the crowds knew that medical costs are too the courage and imagination to learn from the CIA.

I'm writing this article after the Federal Reserve, in a surprise move, high? I won't tell you what everyone already knows. I'll tell you where you're going and what YOU should be doing for your family's survival, and why.

A PGRA firearms dealer member called me late in the day and said, "Andy, what the hell is happening with the markets?" I summarized what I've been saying in the pages of AFI for the last three years. "A real estate and credit excess bubble was growing even before 9/11.After 9/11 the Fed lowered interest rates too much, and kept them too low for too long. The excess credit mania went to ridiculous heights and has now collapsed into real estate deflation. We also have credit bubbles for credit cards, auto loans, and corporate loans. They too will start to unwind in 2008 with more downward pressure on stocks and business in general. The Fed's current lowering of interest rates is a strategic mistake. The Fed is fighting the downturn caused by a bubble of excess credit by creating even more credit. Markets will spike upwards, but long term it will only make the downturn worse."

Americans are looking at a period of real estate and commodity deflation that will last one to three years. However, the Fed's ass kissing is laying the groundwork for a future dollar collapse. In the short term (one year) the markets will be highly volatile, but overall they will wobble downwards for things like gold and oil. However, a critical turning point will arrive (one to seven years from now) when buying hard goods like gold will keep you from being financially wiped out. I have my eyes open and I'm looking for that turning point. The popular press and TV news will continue to be late, and behind events, like they always have been. However, I'll tell you when trouble is close so you can avoid the dollar collapse avalanche that will financially destroy most Americans.

The SHOT Show. Is it Really Worth the Money, Time and Effort Now That A Recession is Here? Answer: "NO!"

 I'm writing this article a few days before the 2008 SHOT Show starts. However, I've been to every SHOT Show since they started in 1979, and for the past ten years The SHOT Shows have been too crowded and chaotic, and this one isn't going to be any different.

With the economy in recession, most managers are looking for things to cut. I'd put the SHOT Show's bubble priced real estate at the top of the list of things to cut. For only 5,000 FFL holders, the SHOT Show's real estate prices are insane. It's okay to have one or two booths for dealers who want to talk, and to have a directory listing, but thinking of the SHOT Show's real estate as golden is a total triumph of delusion over reality.

For 2008 sales, I'm projecting that 9,500,000 firearms will be sold by America's 57,000 FFL holders. The 9.5 million guns will drag through a lot of ammo, optics and accessory sales through the retailing stores. Unfortunately, for those spending a fortune on SHOT Show real estate, 52,000 of the 58,000 FFL's will NOT attend this year's SHOT Show, and as I see it they will not be at any future SHOT Show.

A Revolution Betrayed

Before the SHOT Show started in 1979, our gun industry's big show was the NSGA, the National Sporting Goods Association convention that was always held in Chicago. I went to eleven NSGA shows (1967 to 1978) before our gun industry transferred over to the SHOT Show.

The catalyst for the SHOT Show was a revolution against the NSGA. Our firearms Industry had been a significant industry going back to the 1850's. However, "sports" in general became a big money business starting in the late 1950's when the forward edge of the baby boomers became teenagers. Starting in the 1960's, firearms and gun ownership became more politically incorrect with the left wing Democrats.

The Democratic Party was slowly being taken over by leftwing fascists. The NSGA's board of directors started to become top heavy with people who were "fashionably" anti-firearms. With the NSGA, we firearms industry people started to feel like we were all of a sudden at the back of the bus.

At the time, I worked very hard for a firearms show that was independent of the NSGA. I gave AFI's and my total support to the SHOT Show idea. Breaking away from the NSGA and becoming our own master was the correct objective.

An independent firearms show was NOT that popular in the beginning. Our industry has always been very slow to change. However, there were many excellent things that could be financed with the cash flow from an independent show.

I was at the beginning of the revolution for the SHOT Show.The promises and dreams of an independent show with the cash under our control was the ability to finance:

(1) A lobbying office for our gun industry in Washington D.C.

(2) A firearms industry full time public relations office in Hollywood.

(3) An overseas program to expand the idea of the Second Amendment worldwide

(4) A Firearms Anti- Defamation League, so when people like Sara Brady called ALL gun dealers criminals, who will sell a gun to any crook for money, we'd have the organization to sue.

None of the above dreams ever happened. All the programs to defend the collected rights of firearms retailers never happened. Somehow, in the dead of night, a British conglomerate that is not especially pro-firearms, became the de facto master of the SHOT Show.

Unfortunately, most revolutions in history turned out to be revolutions that were betrayed. The Russian revolution was betrayed. The Cuban revolution was betrayed. The French revolution deposed a wasteful king, and ended up with an emperor, Napoleon, who destroyed France. And so forth through history. The American Revolution is one of the few revolutions that wasn't betrayed within a few years of it's happening.

At the end of a long march to nowhere, our firearms industry went from being on the NSGA plantation to being on the Reed plantation. In my view, the revolution turned out to be a step backwards. For me, it was like the Russian revolution that preached economic freedom and social justice, and then you wake up one morning and a Stalin is running everything.

Reed is part of the group that is America's biggest supplier of information to liability and tort lawyers. For me, that was NOT what the revolution against the NSGA was supposed to turn into.

I do not know who sold out what, to who, and when. I don't know who doubled crossed our industry, when, or how much money they got. However, I was there at the very start, and what we have today is profoundly different from the original dreams and promises. In my opinion, the SHOT Show was a revolution betrayed.

The old NSGA used to be one of the biggest shows in the world. For years it was the biggest sporting goods show, and today it's GONE.The NSGA exhibitors got smart, and saw that the ridiculous costs and general chaos of the show made it a very bad place to do business. It's time for the SHOT Show exhibitors to get smart.

I used to go to the Comdex Show in Las Vegas. Comdex started the same year as the SHOT Show, 1979. In 1999 Comdex had 200,000 attendees, and more than a million square feet in Las Vegas.Then the exhibitors realized that it had become too expensive, too crowed, too big, too much crap on the convention floor, and it had turned into a bad place to do business. The exhibitors came to the conclusion that Comdex was expensive real estate that wasn't doing them much good. Today, Comdex is gone. Someday the SHOT Show will be gone.

Rather than give Reed an interest free loan for a year by signing up one year in advance, and thus risk getting your money caught in the collapse. My advice is to wait until three months before the next SHOT Show and say, "Hey, give me two booths for the price of one and I'll be there." If they say, "No," you haven't really lost anything.

During the past five excellent business years there were only 5,000 FFL holders at SHOT. Now that we are going into protracted economic tightening I'm sure that already small number of FFL holders going to the SHOT Show will decline.

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