- Creating money out of thin air on a massive basis is all that stands
between the current state of hidden depression, and overt depression
with unemployment levels potentially rivaling those seen in the Great
Depression of the 1930s.
- It is the most effective way to not just pay down current crushing
debt levels using devalued dollars, but also to deal with the rapidly
approaching massive generational crisis of paying for Boomer retirement
promises.
- It creates a lucratively profitable $500 billion a year hidden tax
for the benefit of the US government — a tax which is not understood by
voters or debated in elections.
- It creates a second and quite different form of hidden taxation by
way of generating artificial market highs, which while non-existent in
inflation-adjusted terms, do create artificial investment profits that
are fully taxable and highly profitable for the US government.
- It is the weapon of choice being used to wage currency war and reboot US economic growth; and
- It is an essential component of political survival and enhanced power for incumbent politicians.
In this article we take a holistic
approach to understanding how individual short, medium and long-term
pressures all come together to leave the government with effectively no
choice but to create a significant rate of inflation that will steadily
destroy the value of the dollar over time.
If you have savings, if you rely on a
pension, if you are a retiree or Boomer with retirement accounts — any
one of these six fundamental motivations is by itself a grave peril to
your future standard of living. However, it is only when we put all six
together and see how the motivations reinforce each other, that we can
most effectively seek personal solutions.
Reason One: The Political Interests of Self-Serving Politicians
Even after the major tax increases of
about $400 billion a year that took effect at the end of 2012, almost 5%
of the US economy is still currently funded by deficit spending. From a
political perspective, this approximately $750 billion a year in
borrowed money is “free money” that politicians often get to disburse on
a political district and favored special interest group basis. In other
words, roughly $650 per month per above-poverty line American household
can be used to reward friends — and can be withheld from enemies — with
personal credit being taken by the benevolent politicians for this
never-ending largess.
In past decades, politicians were
restricted to spending perhaps $200 or $300 per month per household over
and above what the government was collecting in taxes, with the
difference being borrowed in the bond market. Anything above that would
require the unpleasantness of raising taxes, which might put individual
politicians in danger of actually losing their position and privileged
lifestyle if he or she weren’t in a “safe” district. However, in the
current climate all limitations are gone, the pork is rolling out on a
historically unprecedented basis, and the politicians are wielding
unprecedented power.
So why do the limitations usually exist
on at least some level, and why are they gone now? Historically, the US
government had directly created money out of thin air on a massive basis
to fund deficit spending during the Civil War, and also during the
Revolutionary War. There is a very good reason such governmental actions
are so rare: the value of the US dollar was rapidly destroyed in both
instances. So, this spending without limit would not ordinarily be a
sensible path. Unless, from the government’s perspective, there were
other dangers that were considered a greater threat, and that could be
addressed only through destroying the value of the dollar.
Reason Two: To Hide a Depression
(I have written numerous articles about
various aspects of Reasons Two through Six for some years now, and my
long-term readers and subscribers have been well aware of the building
pressures. While the emphasis of this article is on the interweaving of
the short, medium and long-term relationships between the six reasons,
we will first set the stage by taking a few paragraphs each to briefly
review the individual government motivation, with a link to a full
length article that covers the problem in more depth.)
While you wouldn’t know it from
government press releases or media headlines, there has been a gaping
hole in the US economy since 2008, as illustrated below:
During the first round of the Financial
Crisis in 2008 and 2009, the US private sector nearly collapsed,
threatening to send the US economy straight into deep depression. We’re
talking about a $1.3 trillion private sector collapse that was contained
only by the government fantastically increasing the money it spent,
even while tax revenues were falling. Indeed, the creation of huge
government deficits has been all that has maintained even a facade of
semi-normalcy. Remove that mechanism, and it is straight to official
Great Depression-level unemployment in months.
Even as the true gravity of the
situation is hidden from the general public, so too is the true cost of
the grossly irresponsible short-term “band-aid” that is being used to
cover the hole in the US economy. The destruction of the value of
savings in general, as well as the impoverishment of Boomers and
retirees in particular, is explained in my article linked below, “Hiding A Depression: How The US Government Does It.”
Reason Three: A Desperate Attempt to Escape Depression By Waging Currency War
The US government has been waging
currency war since September of 2010. Simply put, the US would have
great difficulty emerging from depression so long as the US dollar were
“strong”, because a strong dollar translates to “expensive” US workers
who have difficulty competing for market share even in the US economy,
let alone abroad. So one reason for a nation intentionally slashing the
value of its currency is that its workers become relatively cheaper,
enabling them to not only better defend their domestic market share, but
to begin to take market share in foreign economies as well. However,
when a major player goes on the currency offensive, many trading
partners will counterattack in the attempt to defend their own
economies, not by making their own currencies stronger, but by weakening
them — so that their domestic workers remain relatively inexpensive and
will be better able to compete for market share.
To successfully maintain and increase
the power of this currency offensive while negating attempted
counterattacks, the Federal Reserve chose a radical weapon in the form
of QE3 — which began with the public announcement that it would be
directly creating money on a massive scale equal to 6% of the US economy
indefinitely, with the proceeds going to purchase US government debt
and mortgage-backed securities in the secondary markets. Ultimately, the
only protections for a symbolic currency such as the US dollar are the
policies deployed by the Central Bank to maintain that value. And when
the nation’s chief central banker directly threatens to use his power to
destroy the symbol, rather than preserve it — the threat is
extraordinarily effective.
QE3 has been highly successful in
reducing the value of US currency relative to both Europe and China.
However, Japan has counterattacked with the new Abenomics, a
particularly potent form of quantitative easing which has been quite
successfully pushing down the value of the yen versus the rest of the
world, thereby ratcheting up Japanese export profits.
There is no free lunch, however. While
the US government is insisting to the world-at-large that it is not
engaged in currency warfare, in order to maintain the plausible
deniability that is essential to diplomatic doublespeak, it is also
hiding the heavy cost from its own citizens. The US standard of living
since the late 1990s has been based on having a “strong” dollar and huge
trade deficits — meaning we haven’t actually been able to pay for what
we consume for a long time. Therefore, even as jobs and the real economy
grow, there is a drop in the overall standard of living, which is not
evenly weighted, but is disproportionately borne by savers, Boomers and
retirees.
A deeper exploration of how this works,
including the specific ways that older citizens are — and will continue
to be — the primary victims, can be found in my article linked below, “Bullets In The Back: How Boomers & Retirees Will Become Stimulus, Bailout & Currency War Casualties”.
These second and third components of
hiding a depression and waging currency war are tightly interwoven, and
could even be called “killing two birds with one stone”. The money
doesn’t exist to keep the US from openly plunging into depression, it
simply isn’t there for a fiscally responsible government. And covering
the economic hole by creating money out of thin air at a rate equal to
6% of the total US economy is so fiscally irresponsible, that few
nations dare a counterattack of such magnitude. So for now, massive
monetary creation allows the US to not only cover over the current
hidden depression, but also to wage all-out currency war to try to
emerge from that depression.
While boosting employment is an
important motive behind currency warfare, to better understand the
agenda of the US government, we’ll next explore the greatest financial
problem of all, and how destroying the value of the dollar is the
intended solution.
Reason Four: Dodging National Bankruptcy
Sometimes households reach the
unfortunate point where when they add up the credit cards, mortgage
payments, and second mortgage payments — they realize that they will
never be able to pay their bills. They know they are bankrupt and there
is no way of dodging it. But instead of reducing their spending — they
may actually ratchet it up, until all the lines of credit are maxed out,
and the bills are all in arrears. Because once bankruptcy is inevitable
anyway, why slash your standard of living before you absolutely have
to? Partying it up for another few months won’t change the destination,
so why not?
Fortunately, relatively few ordinary
people are so irresponsible as to think that way. There is ample
evidence, however, that a good number of politicians hold that mindset
when it comes to budget deficits that appear impossible to repay, at
least in the conventional manner.
There is a pervasive myth that is being
frequently repeated, which is that our children and grandchildren will
be slaving away for decades to pay back the money that we’ve been
borrowing to fund this reckless deficit spending. The assumption behind
the myth is that were it not for the current spending, the nation would
be fine, and therefore increased taxes will be needed to pay back these
borrowings over the decades to come.
Except that the nation wouldn’t be fine.
For like most other major developed nations in the world, the United
States has been effectively bankrupt for quite some time, with a day of
reckoning that is approaching fast — with or without the current
outrageous level of deficit spending.
The graph below is from my article, “Six Layers Of Deficit Impossibilities Mean Retirement Catastrophe”.
As developed step by step in “Six Layers
“, when we add up current and future federal deficits, as well as
unfunded Social Security, Medicare and other unfunded government
promises, the total comes to over $785,000 per non-retired household
over the coming years that has an above-poverty line income.
And this actually isn’t even the total
cost — it is the excess cost over and above current estimated tax
receipts, with those estimated receipts being based on the assumption of
a healthy and growing economy. When we drop the assumption of an
economy growing at the same rates of the last 50 years, then the
shortfall goes far higher — perhaps to over $200 trillion for Social
Security and Medicare alone by some recent estimates. That would raise
the total shortfall to over $2 million per non-retired and
above-poverty-line household.
If taxes can’t pay (and it’s ludicrous
to think they can), and the US doesn’t declare bankruptcy, then just how
do we cover the gap?
Short answer: pay in full, but make the
dollar worth five cents. This drops the per household cost for
everything from almost $800,000 down to about $40,000. Painful, but
manageable over a period of 20-30 years.
Merely make a dollar worth five cents,
and those seemingly impossible government promises become quite payable.
The problem with this “solution”, however, is that it also requires
making most people’s life savings worth five cents on the dollar.
Reason Five: Create a Massive Hidden Tax
The Federal Reserve effectively controls
short, medium and long-term interest rates in the United States, and
this means that it controls the borrowing costs of the
United States government. As developed in my article linked below,
“Hiding
A $500 Billion Tax On Savings: How The Government Deceives Millions” ,
by forcing interest rates below the rate of inflation, the Federal
Reserve creates about a half trillion dollar per year “windfall” gain
for the federal government.
This is not “free money”, far from it —
for every dollar that the government takes in from interest rate
manipulations comes directly out of the pockets of savers. That is, for
the government to come out ahead by $500 billion per year requires
savers and pension funds to come up short by $500 billion per year. This
makes it a tax — in all but name. It is also essential to note that two
elements have to come together to make this hidden tax work: 1) there
have to be low interest rates, and 2) there also has to a substantive
real rate of inflation (which can be quite different from the official
rate).
From a politician’s perspective, this
massive tax — almost three times the size of federal corporate taxation —
is a “dream tax”. Half a trillion dollars a year is available to spend
without overtly raising taxes or increasing deficits! Sure, there is a
cost, which is the entirely deliberate destruction of retirement dreams
and promises for tens of millions of US workers and retirees —
particularly Boomers — as well as pushing forward the insolvency of
state and local government pension funds around the country. But the
deliberate bankrupting of a generation is a long-term problem with no
clear accountability and almost no voter understanding, which means it
is more or less irrelevant for how political decisions are made today.
Reason Six: Taxing Inflation As Income
Let’s consider three market scenarios when viewed from a governmental tax collection perspective.
1) Falling Markets. If investment markets such as the
stock market are falling — then on average, rather than generating taxes
for the government, they result in tax deductions, as investors write
off their losses. Falling asset values are disastrous for government
budgets, because falling investment markets act to reduce government tax
collections.
2) Level Markets. If markets are on average neither rising nor
falling but going sideways — then while tax deductions are not being
generated on a net basis, neither are total tax collections. While this
is a better scenario for the government than falling markets, it is
still quite problematic for tax collection in general, because one of
the primary sources of tax revenues — particularly from the more
affluent portion of the population — ceases to exist.
3) Rising Markets. There is nothing like a good bull market to
rapidly increase government tax collections. Investors all across the
country are ratcheting up their tax payments, and rising markets also
tend to generate frequent short-term trading, which means that many of
those tax collections will be at the lucrative (for the government)
short-term bracket level. It is no coincidence that the only US
government surpluses in recent decades occurred at the height of the
tech stock bubble, with the often frenetic short-term trading (at
short-term tax rates) that was a part of it.
If governments didn’t have a means for
turning level or falling markets into rising markets — this three-part
relationship could be a huge problem, particularly with a struggling
economy.
Fortunately for the government — and
very unfortunately for investors — there is a very powerful weapon which
can turn falling or level markets into rising markets, while radically
increasing investment tax revenues. This weapon is inflation, the
destruction of the value of the dollar, and it has generated enormous
hidden tax revenues for the US government ever since the United States
went off the gold standard in 1933.
While these hidden inflation taxes are
very well understood by governments and economists, the average voter
and investor is not even aware of their existence. To help address this
knowledge gap, I have prepared two resources, linked below.
“Could Misleading Theory And Jargon
Threaten Your Net Worth?” is an easy to follow, illustrated tutorial
which shows how the destruction of the value of money can be used to
cover over the destruction of the value of assets — even while
generating substantial false “income”, which is fully taxable even
though it doesn’t exist in after-inflation form.
As developed in the article, when it
comes to the largest components of household net worth for American
households, for the 22 out of 40 years analyzed — the destruction of the
purchasing power of assets was being (successfully) hidden from the
public.
As shown in the graph above, and developed in my article, “Stealth
Taxes Consume Stock Gains & Retirement Plans”, about 94% of taxes
paid on stock price gains held between 1997 and 2012 weren’t actually
paid on real income — but rather on inflation. That is, for every $1 of
taxes on “real” or after-inflation income, the government was collecting
$17 in taxes on phantom income — which had been created by the rate of
inflation.
It is difficult to overstate the
importance of inflation to the government when it comes to both the
level and the reliability of investment tax collections. With no
inflation in the mix, it all comes down to the economy and the luck of
the markets. And in any given year, falling markets could generate
increased tax deductions that could cripple government revenues.
Even a moderate annual rate of
inflation, then (whether included in official government inflation
estimates or not), is enough to skew investment tax returns strongly in
the government’s favor. And of course the higher the rate of inflation,
the more powerful the financial advantages to the government of this
long-standing tax, which as the US government knows quite well from
eight decades of experience — most voters don’t understand.
The Convergence of the Six Overwhelming Governmental Motivations
The Long Term
Let’s add our six powerful motivations
together and see how they interrelate. The truly big picture for both
the United States and most other major developed nations is that
population growth has been shrinking, while long-term promises to
current and future retirees will be enormously expensive to fund, and
for the most fundamental of demographic and economic reasons, the
nations simply can’t afford to pay for those promises.
On a global basis, governments are left
with a choice between breaking promises openly – reneging on their legal
commitments on a massive scale, possibly having to actually declare
bankruptcy in many cases (effectively) – or they can follow the
time-honored route that almost every nation which has found itself in
the situation and has had the ability do so has done: they can pay
their promises in form, but not in substance. They can inflate away the
value of their national currency, and pay everything in full, but that
currency will only be worth a fraction of what it is right now.
So the larger the future shortfall, the
more overwhelming the motivation to destroy the value of the currency,
and the greater the degree of destruction of the currency that is
necessary in order to turn impossible promises into possible promises.
This is particularly the case when
inflation not only reduces the real expenses (in after-inflation terms),
but also increases the real income. The higher the real rate of
inflation (which is not the same thing as the official rate), then not
only the lower the real size of the required payments to beneficiaries,
but the higher the collection of hidden taxes in the forms of both
Financial Repression and inflation taxes. Thus, the gap is closed from both directions.
The Short Term
Let’s look at the short term in the
United States. As previously discussed, there is currently a gaping hole
in the US economy that is equal to about 5% of its size if we look to
official deficits, and about 8% if we include the hidden $500 billion
tax on savings. This economic hole in the private sector is being
covered over by overt deficit spending and hidden taxation, which in
combination account for about one in every twelve dollars spent in the
nation this year. If this 1-2 combination of deficits and hidden
taxation were to cease abruptly, and taking into account the millions of
unemployed who are being effectively hidden by changes in workforce
participation rates, then the US risks going straight to a Great
Depression-level of unemployment.
So, if you’re in the political
establishment and you don’t want outright political revolution, then you
have enormous incentives to try to keep an appearance of normalcy in
the economy through spending vast sums of money that can’t be paid for
by taxes, and running up endless deficits to keep the facade of a
healthy economy, no matter how much damage you need to do to the
long-term value of your nation’s currency.
Tying Together Long Term & Short Term
Short term interests are served by
recklessly risking the long-term value of the nation’s currency, thereby
providing the funding to cover over the hole in the economy. Long-term
interests, in terms of impossible government promises that must be
inflated away, are served by the destruction of the value of the
nation’s currency. The more severe this destruction, the less the cost
of repaying impossible promises. Arguably then, the more risk that is
taken in “papering” over the hole in the current economy, and the more
severe the long-term consequences, the better off the government will be
in the future when it comes to its ability to cheaply repay debts that
are otherwise unpayable.
The Medium-Term & The Real Economy
Now, let’s go to the medium term and
consider the real world factor that bridges the current economic crisis
and the long-term economic crisis. That bridge is ultimately all that
really matters, and it is the real economy. Without a powerful and
rapidly growing real economy, there is no way out of the hidden
depression in which the United States currently finds itself. American
workers must be competitive if they are to regain both domestic and
international market share (a situation many other nations are in as
well).
Mixing Medium & Long Term
Nobody knows the true extent of the
trouble the US economy faces over the next ten, twenty and thirty years
as Boomer retirement promises come due in full. But we do know that:
1) It would take a historically unprecedented rate of
economic growth to meet the promises in current dollars without
bankrupting the nation; and
2) The financial devastation could be far, far worse than most
estimates if the US economy does not perform like it has historically,
but instead continues the downward spiral of a wounded empire that is
losing prominence and economic power on the world stage.
When we strip away the standard
assumption by the government when making budget projections of endlessly
compounded 3% real economic growth, and say that we are either losing
economic growth or just breaking even, then the future shortfalls grow
even more staggering. Indeed, when we include the academic evidence of
the growth-slowing effects of large government deficits, and then add in
the reduction in consumption expected for an aging population, then we
may already be in an effectively zero per capita growth mode, as covered
in my article linked below, title.
Bridging Medium, Long & Short Term
What the short term and long term both
have in common is that the only true solution is ultimately to grow the
real economy. The real economy has been hampered since the mid-1990s by a
short-sighted “strong dollar” policy that has enormously benefited
major international corporations and major banks, while creating a
debt-driven illusion of personal prosperity for many of the citizens of
the United States. It’s a standard of living that could never be paid
for, but rather was reliant on other nations lending the US the money to
fund that lifestyle, so long as we agreed to keep the dollar
“strong”. The effective terms were that certain other nations lent us
the money to live it up without our being able to pay for the goods that
delivered our subsidized standard of living, and in exchange we let
them take our industries and jobs.
To re-grow the real economy and regain
economic competitiveness, the US must remove the handcuffs on American
workers, which requires driving down the value of the US dollar. This
has to be done in a competitive world, where other nations want to
defend their own market share by driving down the value of their own
currencies. So for the US to be “successful”, it has chosen a strategy
of taking more radical actions – in the threat to destroy the value of
its currency – than other nations dare counter.
In other words, the other nations aren’t
as willing to recklessly and rapidly wipe out the value of their
citizen’s savings as the United States is, which gives the US a
temporary “advantage” in currency brinksmanship against most of the
world (other than Japan, who has taken the competitive currency
devaluation lead for now with Abenomics).
Most conveniently, the
otherwise-impossible cost of covering over the gaping hole in the US
economy can be paid for through open monetization on deliberate,
prominent display for the whole world to see. The strategy is to simply
manufacture the money out of nothingness, which then lets the rest of
the world know that the US dollar is in grave peril of swiftly diving in
value. This then drives down the value of the dollar, and reboots the
real economy and real American competitiveness, even as the hole in the
economy is temporarily covered over.
Perhaps most important of all, this
begins the rapid destruction of the value of the dollar as necessary to
avert formal US bankruptcy when it comes to paying the enormous
retirement and health care obligations that are coming due over the next
ten, twenty and thirty years. Even as this higher rate of inflation
increases tax collections year after year on a massive basis through
using the two distinct types of hidden taxes, which history shows that
average voters don’t understand. The equations are simple: 1) no
inflation means no hidden tax revenues from Financial Repression and
investment inflation taxes; and 2) the higher the rate of inflation, the
higher the receipts from hidden taxes which don’t have to be defended
in elections.
To understand the true extent of the
danger to your savings requires understanding how all three of these
levels work together: hiding the depression in the short term, rebooting
the real economy in the medium term, and the long-term destruction of
the value of the dollar so that tax revenues rise, even while impossible
promises are paid in form but not in substance. All three levels
effectively require the destruction of the value of the savings of older
Americans and retirees in particular. It is your future lifestyle that
must be sacrificed for all of these goals to happen together.
Adding In Short-Term Political Benefits
And finally, perhaps not quite as
fundamental as the other factors but still significant, there are
enormous political rewards for those currently in power when it comes to
pursuing this approach. As covered in my article, “Hiding A
Depression”, the government’s share of the US economy swiftly went (with
amazingly little commentary) from 35% of the total economy to 43% of
the total economy. In the real world of politics, this growth
translated to increased discretionary spending, that (usually) rare
commodity that is the currency of pure power. In normal circumstances,
between government transfer payments, the military, and the established
bureaucracy, there isn’t all that much discretionary money for
politicians to channel for their partisan desires. That has turned
upside down. Indeed, discretionary money was created so fast that
Congress and the Administration initially had trouble figuring out how
to spend it.
The government has enormously increased
its control over the day-to-day economic life of the nation – not on an
altruistic basis, but in the exercise of raw political power.
Politicians have the unprecedented ability, almost without limitation,
to take the ~$650 per month per above-poverty line American household in
money that is being created out of the void ($1,100 with the hidden
savings tax), and to use it to reward their friends and hurt their
enemies. And many are doing so.
The Personal Implications
These six powerful motivations all exist
simultaneously, they all wrap around each other in their numerous
interrelationships, and they all reinforce each other. Together they
constitute an overwhelming incentive to make sure that a dollar does not
remain worth a dollar.
The implications of these six powerful
motivations all coming together are that there are multiple compelling
reasons to believe that the value of the US dollar (and many other
currencies) will be mostly or near entirely destroyed in the coming
years and decades. Now, when paper wealth is wiped out for much of the
population, and real wealth (goods and services) for a nation has taken a
blow, but is not wiped out – then what we necessarily have is a massive
redistribution of wealth. And there is very good reason to believe
that the largest redistribution of wealth that has been seen in modern
times is likely to be occurring over the coming years.
Inherently, the older that you are – the
more likely it is that wealth will be redistributed away from you
instead of towards you. A giant “Reset Button” will likely be pressed
for the dollar, and with it – if you have been following the
conventional wisdom for retirement investing – the value of savings and
investments will likely evaporate. And if you’re nearing retirement,
you may not have that many working years left to recover from the
damage, with jobs being difficult to come by even if you want to work.
So the older compete against the
younger – not just for jobs, but for goods and services, where the
younger workers have the current income in inflation-adjusted terms to
buy these desirable goods – and the older don’t. Thus, the older
citizens become impoverished relative to the younger citizens. This is a
history that has been repeated time and again across nations and across
the centuries – it is the pensioners that get nailed when the currency
reset button gets pressed.
Making it even more difficult is that
the hidden savings tax acts as a giant anchor, making it near impossible
for fixed income savers to break even on an inflation-adjusted basis,
let alone compound their wealth like all the financial planning models
promised. Simultaneously, the likely reduced economic growth rate
associated with a heavily indebted and aging nation will likely slash
further stock returns, or even turn them negative in after-inflation and
after-tax terms when we consider hidden inflation taxes on investments.
Both of the pillars underlying
conventional financial planning have shattered and fallen, which leaves
traditional retirement investors with two negative return asset classes
(in inflation-adjusted and after-tax terms) that are steadily destroying
wealth over the long term rather than compounding it. Even as the
slick investment firm ads featuring vibrantly healthy and wealthy
retirees enjoying their active and prosperous retirements, continue to
fill the airwaves and financial media.
There are personal solutions. Indeed,
there are other schools of investment finance that can handle what is
coming, with methodologies that are used by the most sophisticated
investors in the world – but they are quite different from the
simplistic strategies that dominate both the mainstream and contrarian
flavors of personal finance.
The first step is to see what is
coming. Once you see how all six factors work together – you will be
able to do something that most people will never do, which is to take
personal responsibility for your own future in a deeply unfair world.
Neither the government nor Wall Street are going to bail you out of
the mess they have created, and the conventional financial “wisdom”
isn’t going to do it either. You’re on your own, and that means rolling
up your sleeves and taking individual actions to protect what you and
your family have.
Once you’ve decided to accept this
personal responsibility for your future, then you have to be open to
changing how you see money and your investments. To find personal
solutions, you have to be open to education leading to paradigm change.
When you have that education, and have changed the “lenses” through
which you view money and investments – then you can also start to see
the professional grade tools that can be used to handle the simultaneous
destruction of the value of money, and the value of assets. Surprising
tools found in places you never expected, often without even calling a
broker, that can be accessed by most people, and used in a dynamic
sequence for the stages of crisis – when we step outside the usual
personal finance boxes.
Your financial profile can’t look at all
like that of an ordinary older person – or you will share the fate of
most older people. To survive and even thrive in the very different
financial environment of this decade and the ones to come, requires
changing that profile so that inflation systematically redistributes
wealth to you, rather than away from you, and the more of the value of
the dollar that is destroyed – the better off you become on an
after-inflation basis.
