So here is the future as I see it: Central banks are now committed to printing unlimited amounts of fiat money to artificially prop up various asset prices forever and maintain illusions of stability. Governments will use their legislative and regulatory power to make sure that your bank, your insurance company and your pension fund keep funding the state, and will make it difficult for you to disengage from these institutions. Taxes will rise on trend, and it will be more and more difficult to keep your savings in cash or move them abroad.
Now you may not consider yourself to be rich. You may not own or live in a house that Nick Clegg would consider a ‘mansion’. You may not want to ever bank in Switzerland or hold assets abroad. You may only have a small pension fund and not care much how many government bonds it holds. You may even be one those people who regularly stand in front of me in the line at Starbucks and pay for their semi-skinned, decaf latte with their credit or debit card, so you may not care about restrictions on using cash. But if you care about living in a free society you should be concerned. And I sure believe you should care about living in a functioning market economy.
But, the - as he puts it - “astutely spread myth that the financial crisis resulted from ‘unregulated markets’ rather than constant expansion of state fiat money and artificially cheap credit from state central banks” has resulted in electorates who don’t think they need care about living in a functioning, free, market economy. And that should worry all of us who understand why it’s vitally important.
Read, as they say, the whole thing.
By the way, his statement that “allegedly a staggering 90 percent of households” in Scotland are in receipt of state largesse is shocking, but when I think about the people I know, not particularly surprising. Yet one of the Nationalists’ cheif reasons for “independence” is the securing of “free” university places, “free” care for the elderly, “free” bus passes, “free” prescriptions, “free” eye tests*, etc., etc. They give no indication as to how these are to be paid for without their longed-for Scottish state ending up in a worse situation than Greece by the end of its first Parliament. Even more than the other major parties - which is saying something - they seem to be living in a mid-20th-Century Keynesian dreamworld.
*Because you need a state to provide those. I swear to [insert preferred deity or otherwise] that when I heard the announcment this policy on the radio I was actually looking right at a giant “Free Eye Tests All This Month!” poster in Specsavers’ window. And the thing is, those promotions are more genuinely free than the NHS scheme. Opticians may well make the loss up on other charges, but there’s every chance that they’re actually taking the hit - last time I paid for one it was only £15 - in order to get people in the door. (Competition, see? Something socialists have never been able to get their simple little minds around.) But here in Scotland, it’s all charged to the taxpayer - in full. Plus, of course, you have to add in all the administrative costs that go into such a scheme. Bureaucrats have to eat. Our “free” tests almost certainly cost more than the ones we used to pay for. Don’t get me started on the corruption in the “free” bus-pass scheme.
Bugger. Wordpress seems to have hosed the link to Schlichter’s post (yeah, blame the software…). Since I can’t be arsed logging in again to fix it, here it is.
He’s dead right in his prognosis, but I believe the collapse when it comes will to some extent be the liquidation of malinvestments that the Austrians amongst us seek. Also it will bust the government and without cash, they can’t do much.
Zimbabwe went through a nightmare but is now growing nicely albeit without a functioning currency, and ours won’t be pleasant. But this is all predictable and quite possibly unavoidable now, so simply position yourself accordingly. There are gains to be made when blood is on the streets and whilst this will destroy people who have not bothered to learn the reality, it could be the making of others.
Things are not good.
In some ways worse than Zimbabwe - where family structues had not bee destroyed by a Welfare State, so a collapse of the formal economy did not leave (most) people without another way to survive.
And yet…….
The young people of this land appear capable - they are even evolving new traditons.
For example they live electronically (especially the young women who seem to be able to communicate with their on-line communities, even while crossing the road and so on).
And they are also quite elegant (well the females anyway) - they are evolving new styles and ways to live.
I suspect that most of them will survive the comming economic collapse - and prosper inthe post collapse world.
Okay, not financial advice, think for yourself, always seek financial advice on the basis of your individual circumstances, blah, blah.
1. Get your assets out of the financial system directly. You are most likely underwater now in real returns and you may have them seized, frozen or rendered worth less or worthless. I’ve been more or less entirely in gold for ages, but chose any real asset as long as it is relatively homogenous, sort after, rare and durable.
2. But do get fixed rate debts to purchase real assets. When interest rates climb, it will be far and fast and way outside the B of E clowns ability to do anything about. This will allow you to protect asset value since money is really only a store (and a measure) of wealth and when fiat paper is made a poor/ineffective store of wealth, you must look elsewhere or go bust.
3. If you can keep assets abroad, do so. I do. Outside any UK bilateral arrangements to boot.
4. If you really think it’s gonna get bad in terms of supply disruption (imagine the petrol strike for a few weeks for example) get some supplies.
Well the rest of the commentary gets into Mad Max territory. Just recall when a few thousand kicked off in Tottenham it took the whole Met (and others) three days to get it straight. Imagine that country wide if they were all hungry.
Do the maths.
This is like fire insurance, you hope never to use it, you probably won’t. You hope its money down the drain, but you are dumb not to have it, just in case.
Let the free market reign. I’ll be providing for my own pension - with a small property portfolio that I shall expand as opportunity allows. Trust in bricks and mortar. Fuck the banks.
Trust in bricks and mortar. Fuck the banks.
Which is all very well, but the “Bricks and Mortar” are fixed, illiquid assets that are subject to bubbles and pricing misallocations as much as anything else in a fiat currency based economy. All very well when prices are rising, but what about when prices are falling (especially in real terms when inflation kicks off).
Equally, houses are subject to there own taxation (council tax and capital gains for non-primary residences). The rates of these are controlled by politicians and although these are not currently at “burdensome” levels, they could very easily be when Labour gets elected again in 2015 and decides to kick the middle class bourgeoisie buy-to-let class by turning up the screws or re-introducing rent controls.
Although I’m not a gold-bug, possession of gold coins as a hedge against inflation is a sensible and pragmatic solution. Just don’t let the government know you have them in your possession as they are often made illegal when inflation turns the heat up.
JG - at which point I think it will be time to quit these benighted shores and move outside the EU.
I’ve just watched a fascinating video on YouTube: The Money Masters ( Rothchilds Exposed ). It’s 3 1/2 hrs & dated (1996), but is an eye opener.
I’d like to get some comments.
The last member of the Rothschild family to run the bank was more interested in his steam train in Hampshire, than he was in ruling the world.
He was also interested in music - he both played and sang himself.
I fully understand the above is not as interesting as the Rothschilds rule the world - but the truth is often less interesting than fiction.
As for past generations of the Rothschild family….
See Paul Johnson (a Roman Catholic) “A History of the Jews”.
Again the facts are less exciting than the conspiracy stuff.