Friday, 28 September 2018

Going for Broke, the American Way............from Rico



The Austrian School of Economics essentially says "if you can't pay for it, you can't buy it" which is oh-so-harsh for Keynesians who believe in systematic inflation, fractional-reserve banking, and credit-leverage.

- Simply put: access to credit is NOT access to wealth, it is access to debt; and debt = slavery.

 

Badly paraphrasing J.P. Morgan "credit is not money" [for government-educated types read: "Gold is money, everything else is credit."].

 

When the money you spend (credit) isn't your money, any money you acquire is 'owed' to someone else:

- If you don't owe it for a mortgage, you owe it to a car loan.

- If you don't owe it to a car loan, you owe it to a credit card(s).

- If you don't owe it to a credit card(s), you owe it to a line of credit (likely a HELOC).

+ Now pay your monthly bills, etc, and buy food.

= Zero left for you.

 

This idea is so simple it can even be taught in school, by otherwise incompetent teachers who have become political kommissars: A-L=E

- assets, minus liabilities equals equity [again, for graduates of government-run skrewels read: subtract what you owe from what you own, and that is your 'net worth'].

- Example: if A is $5,000 in cash savings, and L is $100,000 in debt owed, E is negative -$95,000. If you understand that you are paying someone else interest (%) on the money you owe them, with money that has been doubly squeezed by taxes and inflation, and are getting even poorer as a result...then you get bonus points...and are probably not among the almost half of Americans who don't have one cent saved.

 

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