What role does money play in society? If you’re like most people, you’ll answer something like:
- For transacting commerce. Or…
- As a means of saving.
These are good answers… I give you my money, and you give me a product or service. Or I could save some portion of my money to use later.
Both are vital functions of money in any society. But money plays another role most people have never considered…
Money is also a communications system.
Prices for goods and services act like signals in a massive economy like ours. This price system is the most sophisticated “machine” ever built.
The prices of goods and services communicate information about the supply and demand of scarce resources to billions of individuals in real time all over the world.
When the price of something goes up, that’s a signal that it has become more scarce relative to demand – which prompts entrepreneurs and business owners to create more supply or offer alternatives to meet demand.
When the price of something goes down, that’s a signal that the item is abundant compared to consumer demand – leading firms to produce less of it… until the price rises again.
This price-signaling system allows millions to coordinate their productive efforts across time and space. It’s what Scottish philosopher, Adam Smith, called the “invisible hand”.
This is how individuals can make decisions based on self-interest – driving economic growth for all.
When the price system is left alone, labor and scarce resources can be allocated to their highest and best use.
Why am I telling you this? Because there is a problem…
One group of people have the power, means, and motivation to obliterate the price-signaling system…
I’m talking about those who pull the strings of monetary and fiscal policy. Monetary policy falls to central banks like the Federal Reserve (the Fed). And fiscal policies fall to legislatures and national Treasury departments.
The best way to destroy the valuable information conveyed by prices is to inflate the currency and manipulate interest rates.
When the central bank inflates the money supply and tinkers with interest rates, price signals become confusing. No one knows the real value of goods and services anymore.
And since 2020, the Fed and the US Treasury increased the supply of dollars by nearly 40%.
The US has never before debauched its currency so rapidly.
Inflating the currency by creating new money out of thin air reduces the purchasing power of all currency units in circulation. In other words…
The reason you are paying more at the pump for gas… for your groceries… and for just about everything else right now is because your money is “competing” with lots of other new currency units (dollars) for a limited number of goods and services.
Are the things you need rising in price because they have become scarce? Or is it just inflation doing its evil work?
There is no way to be sure.
This confusion leads to “malinvestment”. That’s where scarce resources get wasted on uneconomical ventures.
The bottom line is this:
Inflation wrecks everything. Your grocery bill is just one small piece of the problem.
But here’s the thing – you don’t have to be a victim of what’s happening.
You have the power to protect yourself and your family from the devastating effects of inflation and economic instability.
Because I created a new Mastermind I call Finance for Freedom.
It’s a unique training series with bi-monthly mastermind calls designed to help you master your finances – starting in just 30 days or less.
You’ll get personal one-on-one time with me and the opportunity to benefit from other people’s questions and comments – along with a series of video lessons to reinforce what you’re learning on the calls.
More importantly, you’ll gain the knowledge and skills to make the right moves so you can come out on top financially in the next decade.
Make no mistake about it… the rules of money are changing. And smart people are changing their thinking and habits to deal with this new reality.
Imagine no longer watching your hard-earned money being destroyed by inflation. Instead, you’ll have the confidence to make smart financial decisions that will safeguard your earnings and ensure a secure future for you and your loved ones.
If this all sounds overwhelming, don’t worry. That’s exactly why I created my Finance for Freedom Mastermind – to give regular people the skills and insights to survive and thrive through the coming financial reset.
I specialize in explaining highly technical concepts quickly and simply. I’ll guide you every step of the way, ensuring that you understand and can apply these strategies effectively.
Are you ready to master your financial future? The answer should be yes, because the changes coming to our financial and monetary systems will be unlike anything we’ve seen in our lifetimes.
Click this link to hear a special message from me and get started on your journey to financial freedom.
-Joe Withrow