On the other side of the fence, The Old Testament is about the re-enactment of misery for the many years a People wandered the desert. Passing on the story of hardships and their plight of sufferance. The meal isn’t something you would want to eat every day but I will say that Matza bread with cream cheese and jelly is pretty tasty. Nonetheless, faith in beliefs is key, maintaining traditions to pass from generation to generation. 

Speaking of traditions, money referred to as the root of all evil has been a necessity in our societies by maintaining a purpose in developing economic systems over time. A person’s productivity is measured by the amount of money earned for their effort. Money allows people freedom and in today’s world also status. People are considered Rich or Poor while the Middle Class is slowly disintegrating from the face of the earth.

There have been many revolutions in how monetary systems have evolved through human interactions. Examples are a  barter system by exchanging one’s profession for another’s or a feudal system working the land owned by an individual and paying part of the production in a form of rent or tax.  Traditionally, the basis of money was based on the value of Precious Metals, specifically Gold and Silver which became the basis of currency because of their scarcity. 

Today, the distribution and money supply are controlled by Central Bankers. Many think Governments own the Central Banks but in fact, they are independently owned by shareholders and controlled by specific families, the most prominent being the Rothchilds. Government policies direct spending and when they don’t have enough money they borrow, the taxpayer is on the hook and the profits generated are the bankers’ sweet reward. Their influence and wealth are probably the greatest on earth taking the rest of the world to equal their net worth. But Elon Musk could start reducing the gap?

At one point, the issuance of money was based on the Gold Standard. Meaning that the Central Bank could only produce as much currency as there was Gold held within the vaults of the Treasury. This balance maintained the value of money to remain significant. Then when fractional lending was introduced, the act of printing more money for society than there was Gold available, the Bankers would lend it out at an interest rate and in turn, consumerism was born. People could borrow to invest and the market set the tone of value.  I believe it was President Nixon is who abandoned the Gold Standard and Allan Greenspan, former Chairman of The Federal Reserve, allowed the Bankers to Police themselves. This opened the door to unmeasurable temptations for corruption, ultimately becoming the responsibility of the trusted Taxpayer.

Not only has the value of currency become diluted over time but the purchasing power has since eroded.  Individuals with more money have an advantage over those with less. A divergence inequity between Rich and Poor continues to widen.  When there is less money in the system, they simply print more. The act of infusing money into economies causes the inflationary pressures that exist today. A detriment to people’s ability to remain solvent when prices of everything rise but income doesn’t. As a result, creating a vicious circle of debt in which many become caught up by living to work rather than working to live.

Traditionally, the method incorporated in fighting inflation has been to increase interest rates by reducing the money supply. The reasoning is that it slows down investment and spending but also has the effect of killing jobs.  Consequently,  more debt accumulates for those without work making life harder,  thus causing individuals to be driven toward acts of desperation or more dependent on the Government for assistance.

In previous years, deflation was considered a threat to economies of the world because borrowing was linked to the valuation of assets. If you borrowed money and the asset was worthless, the individual would be forced to sell their asset acting as collateral. Remember, for every seller, there is a buyer.  Owning a home has become the nest egg of stability. A source of equity especially in troubled times.  In recent years, even after the SubPrime lending fiasco in 2007/2008, investors had abandoned investments for a property because the asset was visible, tangible and real. Home equity loans became the cash cow to draw untapped equity. The stock markets regained confidence making those with money make more and those without, envious.

Rising valuations in assets provided the means while wages remained stagnant. The solution, refinance the home in an escalating market to sustain an investment or lifestyle. Living above one’s means is simple if the assets you maintain continue to appreciate.

Fast forward to today, the spending by Governments has been out of control. In my opinion, I believe deliberate under the guise of a pandemic without accountability or transparency. The printing of money to support Government spending has been the main cause of the inflationary pressures we are presently witnessing. For the masses who earn a minimum wage, the cost of living is quickly eroding their purchasing power while debt loads increase. Decisions will be made out of necessity rather than convenience. Food, shelter and water will become a priority as survival is the name of the game in life.

Distractions are simply that, be it war or pandemic. Control what you can control. The number one priority is reducing debt and living within one’s means. Challenges lay ahead, especially with the price of energy skyrocketing.  The price of Oil had dipped toward the $95/barrel level this week but quickly rose toward the $103/barrel this morning. The USD Index has continued to rise unabated surpassing the 103.0 level but I do strongly believe this charade of unprecedented USD strength will come to an end and a reversal is in the cards. Fear of an escalating war and a more than 2% plunge in the equity markets globally has created a flight to safety. I don’t believe this is sustainable. The Euro has plunged versus the USD as the ECB does what they do best, take a wait-and-see approach and hope divine intervention occurs to save the people. Precious Metals have been trounced as Gold dips below the $1900/oz Level and Silver below $24/oz.

Better to feast than experience famine.