Austrian School of Economic Thought

[Mercer]

 

This is what happens when public schools fail to teach even the most basics in economic theory to students. Then this influencer (economically illiterate himself) with 350,000 plus followers, now has a grip of people thinking legalized government counterfeiting is the solution. I mean wouldn't it be nice if people could just print their own cash at home, as much, and often as they need it?

 

If you try to explain to someone who's woke (not fully awake) that encouraging an abundance of goods, and services to be produced is what you really want to do, and that printing up a wheel-barrels full of cash to trade for a single roll of toilet-paper is a bad thing, they somehow don't believe you. Many of them think you're intentionally trying to "trick" them. Instead of analyzing the sound logic you present, they either get mad, or measure your credibility against this familiar face's and go with the emotional reflex of discrediting your statement before any actual logical analysis ever takes place.

 

Fact: The Average age of a Fiat currency is just over 50 years before the people in power hyper-inflate (counterfeit) it into worthlessness.

Fact: We finished off getting rid of any semblance of the gold standard in the 70's under Nixon, making us just about due for for hyper inflation right about now.

 

Will the economic IQ of the voting public  finally be the straw that broke the camels back?

 

Stay tuned...

 

 

[Dark_Knight]

So I wouldn’t say I’m economically literate by any means, but I have been thinking about this a lot based off of what I do know...

 

Do you think it would be smart to store my savings in another country that has a more stable currency than we currently do? I don’t want my money to depreciate because of the inevitable 

[Mercer]

2 hours ago, Dark_Knight said:

So I wouldn’t say I’m economically literate by any means, but I have been thinking about this a lot based off of what I do know...

 

Do you think it would be smart to store my savings in another country that has a more stable currency than we currently do? I don’t want my money to depreciate because of the inevitable 

 

No, the worlds current “reserve currency” is the US dollar. So another country either has a treaty with the US/Fed to inflate at the same rate as the Fed, as to not throw off the exchange price, or they’re most likely inflating (counterfeiting) their own (USD unattached) currency, most governments are even worse at this than the US believe it or not..

 

If you plan on long term savings (more than a few months) getting out of government Fiat altogether is the best move IMO. This means owning real estate, or commercial property, durable goods like industrial machinery that hold value, and are easily sold. Basically anything that can’t be artificially inflated in supply via government decree.
 

I’ve moved most of my savings into cryptocurrency, as it’s consistently provided profit. This comes at some risk as cryptocurrency has such a small market cap compared to USD, this means it’s very volition for now. The big plus is Bitcoin is actually deflationary, in that the supply of it is by default decreasing as people loose access to their funds etc. There are much more advanced options for long term savings, and investing available on Ethereum because of its it’s decentralized finance options.

 

Regardless, point being that the current state of the economy demands the FED continues to inflate the supply of cash just to provide liquidity for the economy to function. Think of liquidity as confidence you’ll be able to sell an asset, with money being the most liquid as it can be traded for anything basically. If the Fed stops printing new money, assets will become non-liquid meaning investors (the people who finance campaigns who you don’t want to loose support from) will be stuck holding assets they can’t sell, making them virtually worthless.

 

Holding government fiat, and the assets like stock that are being artificially pumped up in price by the Federal Reserve counterfeiting, then buying the assets  with the counterfeit to keep them liquid is probably the worst move.

 

Land, Crypto, even precious metals that have a somewhat fixed supply is the move IMO. Even if you’re purchasing collectibles, or anything else you can make a profit on is better than holding any assets in a savings account right now.

 

Inflation reaches a point where the government cannot stop “printing” (the stage were in now) the money itself is devaluing fairly quickly, and for the most part crashes all of a sudden eventually, without warning (except this one). It’s just all of a sudden your shit is worthless, and people are using the most “liquid” items they have access to, as a substitute for moneylike foreign currency, precious metals, even items with actual consumption use cases like candy bars, gasoline, ammunition, toilet paper, etc. in the absence of usable currency, these items become money. People will continue improvising ways to sell what they don’t need, and get what they do need  via barter, until they reach a consensus as an economy as to what the best money, or money alternative is, which then becomes the new currency. Normally The government just steps in and says OK this is the new currency and we promise we won’t hyper inflate this time. The next big one I think people will move directly into crypto. In fact, this is exactly what Satoshi Nakimoto invented Bitcoin to accomplish, it was never intended as a get rich quick scheme.

[KILZ FILLZ]

[Dirty_habiT]

I'm glad you said industrial equipment @Mercer- that's like what i'm pouring all of my money into right now so that I can build a home, develop the land I bought, and do jobs in my free time.  If you work on and transport your own equipment you can make ridiculous amounts of profit doing jobs for other people.  Also, this will enable me to do other shit besides just work on computers.

[Dark_Knight]

I should probably do more research on crypto... is Bitcoin the safest one to invest in? 
 

Are you able to pull out sums easily if needed?

I get scared of putting a lot in because I feel like there’s nothing regulating it beyond trust. Which I guess usd is also falling on right now. But a lot more people ‘trust’ usd at the moment. This assumption is based off of no actual knowledge. 
 

@Dirty_habiTwhat kind of industrial equipment are you investing in? That’s another sector I’m worried about in fear that technology will phase it out. Also no next to nothing about the industry tho.

 

I have been stressing about what to do with my money though. I don’t have enough to buy a house cash but I do have a fairly large sum. And investing in property won’t be possible for me until live production comes back. 

[Dirty_habiT]

Finance a 30k dollar skidsteer, a trailer to pull it with ($6-8k), and a truck to pull all of this with ($65k if you go with 'new') and you effectively have the swiss army knife of construction equipment.  There is no shortage of jobs you could do that will put cash right in your pocket.... and not a little cash, a lot of cash.

 

I say owning a construction company and investing in land is the best thing you could do w/ your money.... that and invest it in other ways that Mercer is much more familiar with than I am.

 

The stuff I have now is:

 

3x tractors: Kubota L355SS w/ L1720 Front End Loader, Kubota B5100e 2WD diesel "garden tractor", Kubota KX-41 Mini Excavator.

1x trailer: Big Tex 14 OA (2x 7k lb axles can carry 14k total)  Trailer weighs ~4k and that means you can carry about 10k on it.

1x Wood splitter

4x 3d printers

1x complete USA made HVLP compressor/spray gun.... this is used to create FINE surface finishes and it sprays urethanes no problem.  This is what they use to paint cars and the same kind of equipment cars are painted with in a factory by a robot.

 

The list of things to buy next are:

 

1x Kubota side by side for hauling groceries between the parking pad and the house.  I don't intend to be parking cars next to my house.

1x dump truck... preferably a Ford F800 w/ a Cummins 12v engine in it.

1x skid steer ... Kubota SVL-75.  I'd buy a Takeuchi.  These things are FUCKING expensive but they do not lose their value really.  Clapped out broken ones that will cost thousands to get running again go for ~$4k all day long online.

1x saw mill for milling boards out of trees.

1x lathe for working on metal stuff or wood stuff.

1x complete wood shop

1x complete metal shop

1x gantry crane

1x 2 post lift

1x hub dyno for tuning race vehicles.

 

I can get most of that stuff for way less than what people pay for a "small" house.  Much of it may need repair and I will buy it for cheap for that reason....  Having tractors is very liberating in terms of being able to say "ok fuck it i'm going to go be my own boss now."

[Mercer]

@Dirty_habiTI've got a fuck ton of concrete demo work I'd like to do on my property and looked into buying a track steer used, on the cheap then reselling it when I'm done. It would realistically take me less than a week with a jackhammer and track/skid steer and would be less exposure to risk to just rent one. Besides, realistically I can't afford one right now. I'd say a skid steer is a good asset, pretty easy to sell if need be. Endless attachments. I wanted to mini killdozer one with proof glass and an air conditioned cab.

 

 

Quick look at Hyperinflation in Zimbabwe

 

 

[Mercer]

 

 

 

Back to the point of inflation. Where is all this freshly minted money going? Like all the extra money the Fed is printing, or, more accurately creating as bank deposits on their ledger, what happens to this legally counterfeited currency? I mean we know the value is drained from lowering the value of existing money in circulation, and in savings, but where does all this lost value go?

 

Obviously common people aren't just buying more goods/service under this pandemic. There' really isn't much worth spending money on. Restaurants are shutdown, stadiums are empty, no concerts. People aren't even buying fly threads these days as much with no place to go. So where the fuck is all this money being injected into the economy going?

 

It goes towards inflating the price of investment class assets mostly. Like stock prices hitting all time highs in industries that are obviously losing income. Stocks have really done well all year. Those bonds that under normal circumstances aren't worth the risk, well with the fed basically paying people to buy them they're suddenly gaining enough value to be a good investment again.

 

The value of Stocks/Bonds isn't really going up, in fact, it's tanking. It's just that currently, the powers that be have intentionally "inflated" their value by devaluing the State's official currency. This inflation works it way out through the market slowly, like if they inject half a trillion into the economy through a counterfeit bank deposit of money that didn't really exist, you don't instantly start paying more at the pump so to speak. It slowly trickles through, transaction by transaction so you don't even feel it. Death to your saving's value by a million paper cuts, not one single slash of the sword.

 

 

[Mercer]

[Mercer]