Tag: free market capitalism

Non-Profit Skepticism

submitted by jwithrow.501c3 Stamp

We think that the idea of non-profit organizations, as the 501(c) code exists, is un-American.

Hold on! Hear us out on this one before you call us heartless capitalists – we have a good reason. Actually several reasons.

The non-profit structure as it currently exists violates the equality under law principle upon which America was founded. 501(c) organizations receive favorable treatment by law relative to for-profit organizations.

But the American vision of limited government was such that it should protect equality under law rather than promote inequality by law. Equal opportunity as we used to say.

Additionally, the 501(c) structure reinforces Marxist principles in the minds of Americans in a very devious way. This we really don’t like.

The Marxist ideology is opposed to profit because it violates their “from each according to ability, to each according to need” credo.

In granting favorable status to non-profit organizations the government is actually supporting the belief that non-profits are more desirable than for-profit organizations. Think about it – why else would 501(c)’s be granted privileges if they weren’t seen as deserving of such favoritism? So in a sneaky kind of way this sows the seeds of Marxism by silently stating that the profit motive is not to be commended while the non-profit motive is superior ideology.

Which brings us to our last point:

The whole non-profit part of 501(c) organizations is fraudulent!

Sure, the organization itself does not show a profit but have you ever looked at the executive salaries at these “non-profit” organizations?

We have.

They are systematically much higher than average wages. MUCH higher.

Sure looks like profit to us.

Now there are some very good non-profit organizations out there. We have donated to some good ones that we knew were good because we knew the people running the show and we could see the charitable work being done. But most of the giant non-profits are frauds and we would steer clear of them. A good rule of thumb is that if a non-profit has a commercial on television then it is probably not worthy of your attention. Otherwise it wouldn’t need a commercial on television.

Also, don’t get us wrong, we like the fact that non-profits are tax-exempt. The less money appropriated by the Feds the better, in our opinion.

But we think that a much better idea would be to get rid of the corporate income tax altogether. Then you wouldn’t have a need for special non-profit treatment. And you might even notice some jobs sneaking back into America also – as long as the corporate income tax was repealed and replaced with nothing.

Of course this is just our humble opinion. Maybe the bureaucrats know better than we do.

Forget the Interest Rate – It’s the Quantity of Interest That Matters

submitted by jwithrow.Mastering Interest

Financial success is all about understanding and mastering interest. You see, there are only three choices when it comes to financial matters:

  • Pay interest
  • Receive interest
  • Forego interest

That’s it.

All you must do to get ahead financially is to arrange your financial affairs such that more interest is coming in than going out.

It is the quantity of interest that’s important. This concept is not often discussed so most folks focus exclusively on the rate of interest instead.

3.5% for a mortgage? This is a great rate!

2.87% for a vehicle loan? We’ll take two!

.05% on a savings account? Well, we suppose something is better than nothing.

So the average person pays interest for their house and their cars and they forego interest when they buy their groceries and pursue entertainment. The interest that they do receive is negligible in comparison because they offer whatever capital they have leftover after expenses for a pittance.

So what’s the common man to do?

CNBC will say that the stock market is the only way to go.

What they will not tell you is that the stock market is ripe with risk. Getting into the stock market requires you to give up control of your capital and place it 100% at risk. All the while you have the hedge fund high frequency trading machines and the Wall Street insiders chomping at the bit to take your capital from you.

These forces are focused on the stock market every minute of every day, not just during business hours.
If you have the same amount of time and energy as well as access to the same amount of information as the insiders then you may be able to play the stock market and come out ahead in real terms.

We think that it is much more likely that you will only come out ahead in nominal terms at best if you come out ahead at all.

We think it a far better strategy to capitalize an IBC policy and then focus on employing that capital to develop sustainable sources of income.

The IBC policy ensures that your capital is generating a little bit of interest no matter what happens and your employment of that capital can be used to significantly increase the amount of interest coming in.

After all, what good is a 3.5% mortgage if you are not generating at least 3.6% in interest income consistently?

You see, interest rates are not terribly important – it is mastering the control of interest in vs. interest out that is truly the name of the game.

A Report from Middle America

by Paul Rosenberg,

middle america

I was recently involved in a day of meetings with small business owners in the American Midwest. It was both encouraging and sad at the same time.

What I Found First

Overall, I found a large room full of productive human beings. It was uplifting. Most of these people were between thirty and seventy years old, more men than women, and they were all productive people, the kind who get up early every day, make sure that complex systems are producing properly, fix anything that is broken or near breaking, plan for the future, cooperate with large numbers of other people, and then go home at the end of the day and love their families.

If all the world lived like these people, we’d be halfway to a paradise by now. And that was a thought that made me sad.

Why? Because these people – by any standard of decency – should be left alone to create their better world. But instead, they are forcibly tied to wasteful, parasitic, and destructive systems. Half or more of their earnings are taken from them every year. Their actions are restricted by their moral inferiors. They live less than half the rewarding lives they should be enjoying, and for no defensible reason.

The Other Things

Beyond my overall happy/sad impressions, I found quite a few particular things:

  • These people would have preferred to discuss the practical particulars of their businesses – tools, materials, technical obstacles and solutions, and so on. But instead, they were forced to discuss government compliance. Almost every subject discussed from the front of the room dealt with government regulations. Most of the subjects discussed on the sides involved tools, equipment, business strategies and so on.
  • Dealing with employees is a major issue, especially involving the immigration police. These people are justifiably concerned with fines and indictments, just from hiring employees who are clearly long-time Americans. (That is, not Hispanics or other recent immigrants.) A few of the comments I heard:

“Good luck trying to explain that to an ICE agent.”

“Do NOT waive the 72 hour waiting period.”

“Do NOT allow them to enter your facility or inspect anything without authorization from counsel.”

  • Nearly all of these people agreed that government in America is out of control, abusive, and oppositional to their happiness. I think that’s a positive opinion, since it reflects reality, meaning that they have stopped looking at the world through myth-colored glasses. The sad part of that is…
  • These (good) people don’t know what to do about it. The system they grew up believing was their friend has turned against them. They’ve gathered the considerable courage required to face that, but they don’t know what to do next. They are working within the system as they can, trying to avoid its hazards, but don’t see any clear alternative – and no path of escape. They’d like to do other things, but they also need to feed their kids, and don’t know what to do about it all.
  • Bitcoin is spreading everywhere. One of these business owners, in a very rural area, has built a Bitcoin mining operation. And not only Bitcoin, he is also mining for the other crypto-currencies. And, he’s telling everyone else about it. I was surprised (and pleased) by this, since this meeting had absolutely nothing to do with computers, economics, or anything else that usually connects to crypto-currencies. This man simply saw a great opportunity and jumped on it.

All In All

All in all, I came away from the day more confident in the future than I had been the day before.

We are exposed to so many horror stories every day. The images thrust upon us show a world filled with danger and discouragement. The reality, however – once you remove yourself from the newsfeed – is that there are a lot of very decent people who are generally doing the right things.

Our job now is to define newer and better ways to live and to spread that information to as many good people as we can. And to remind them they DO have the right to live good, happy, prosperous lives.

Please do everything you can along these lines. Thanks.

Paul Rosenberg

[Editor’s Note: Paul Rosenberg is the outside-the-Matrix author of FreemansPerspective.com, a site dedicated to economic freedom, personal independence and privacy. He is also the author of The Great Calendar, a report that breaks down our complex world into an easy-to-understand model. Click here to get your free copy.]

Seven Reasons to Abolish the Federal Reserve System

submitted by jwithrow.

The following are seven reasons to abolish the Federal Reserve System.

This list is taken directly from G. Edward Griffin’s “The Creature from Jekyll Island”. If you are up to the task, read this tome for a thorough understanding of how the monetary system actually works.

1. It is incapable of accomplishing its stated objectives.
2. It is a cartel operating against the public interest.Creature from Jekyll Island
3. It is the supreme instrument of usury.
4. It generates our most unfair tax.
5. It encourages war.
6. It destabilizes the economy.
7. It is an instrument of totalitarianism.

The Wizards of Ozymandias

submitted by jwithrow.Central Planners

“The Wizards of Ozymandias” by Butler Shaffer is a must-read for anyone who appreciates Percy Bysshe Shelley’s “Ozymandias”. The book is also a must read for anyone with an interest in the history of western civilization, social philosophy, free-market economics, or critical thinking in general.

A paperback copy of the book costs $16.85 and the kindle version costs $3.99. We will provide a link to the book at the end of this post.

In a nutshell, Shaffer spends 310 powerful pages exposing the fallacy of central planning and he does so in a common sensical way. There are no ideological theories or assumptions, just critical thinking and common sense – imagine that!

Coincidentally, critical thinking and common sense are two of the most important victims of central planning.

By the way, when we talk about central planning we are talking about the systems of societal control that have been gradually implemented over the past one hundred years or so. We are talking about socialism in general and all manner of destructive socialist policies. We are talking about organizations like the United Nations, the World Bank, the IMF, the Council on Foreign Relations, the Federal Reserve, the IRS, the military-industrial complex (please, look this one up), the FDA, the EPA, all other alphabet soup governmental organizations, all other organizations whose name starts with “The Department of”, and countless other massive, unaccountable monsters of bureaucracy.

And yes dear friend, the Federal Reserve and the IRS are instruments of socialism (and fascism and perpetual war – nothing is ever cut and dry). They are the opposite of free market capitalism. In fact, the implementation of a central bank is one of the planks of the Communist Manifesto. We think it is the fifth plank but we are not sure exactly and we haven’t looked it up because we don’t want to send mixed signals to our friends at the NSA.

Anyway, the point is that human beings are not robots. Human interaction does not need to be scripted according to some jerk’s sociopathic ideals.

Governments are not people. Nations are not people. Corporations are not people. People are people. People are best when they are free from coercion to voluntarily interact with others for their own benefit as they see fit. The free market serves people in this fashion as long as they abide by two rules:

Do not infringe upon another person or his property (natural law). Do all that you have agreed to do and nothing that you have agreed not to do (contract law).

Mr. Shaffer is a little better written than we are so we highly recommend his book.

MyRA-QE Taper Connection

submitted by jwithrow.Government Help

We have a question for you:

Is it a coincidence that the government has introduced the “myRA” plans just as the Federal Reserve has begun to taper its quantitative easing programs?

Let’s think this thing through for a minute.

We know:

  • China is now a net-seller of U.S. Treasuries so the Federal Reserve has had to step in and purchase U.S. Treasury Bonds in increasing quantities to support government spending.
  • The average American saves for retirement in a qualified retirement plan focusing primarily on mutual funds, exchange traded funds, and stocks with bonds comprising a small portion of the allocation.
  • The proposed myRA plans are designed to focus on U.S. Treasury Bonds.
  • The Federal Reserve’s quantitative easing programs have pumped massive amounts of liquidity into the system which has resulted in a broad increase of stock prices across the board.
  • Tapering QE will withdraw liquidity from the system which will almost certainly result in a broad decrease of stock prices across the board and quite possibly a severe stock market crash.
  • A falling stock market would likely cause many Americans to seek investment options that they deem “safer”.
  • The government is already hard-selling their myRA plans stating that there is “no risk to lose what you put in”.

Hmm.

Maybe our benevolent bureaucrats really do think that myRA plans will help the common man.

But we hold dearly to a personal mantra:

Maximize Capital,
Minimize Crap,
Never Trust the Government.

With that mantra echoing in our mind, we can’t help but be a little suspicious – something funny seems to be afoot.

What do you think?

Sound Money

submitted by jwithrow.CurrenciesinGold100years

The most important facet of free market capitalism is sound money. If you don’t have sound money then you don’t have free market capitalism – you have something else.

Sound money is simply money that serves as a reliable store of value. Put another way, sound money is money that does not constantly lose its purchasing power. Sound money affords one a reasonable expectation that one unit of money today will buy the same amount of goods and services as one unit of money tomorrow. And next month. And ten years from now.

What a novel concept!

Anyone who has taken a finance course is familiar with the time value of money principle. In finance class, we learn to discount our money over time based on the inflation rate. We are taught, correctly, that present dollars are worth more than future dollars.

What we are not taught is that this is a deformation of free market capitalism!

The general market has chosen gold and silver to serve as money throughout most of history because the precious metals are particularly well suited for this purpose: they are limited in supply, they have functional utility outside of the monetary system, and, unlike our money today, they cannot be created from nothing.

Make no mistake about it, that’s where our money comes from today: nothing. It is created from nothing and then loaned into existence at interest. See the Hidden Secrets of Money video series for a more thorough examination of our money.

You see, money should not be a function of government nor should it be a function of a central bank behind closed doors. And it certainly shouldn’t be created from nothing. This is why the U.S. Constitution only authorizes gold and silver as legal tender; the Founders knew well the virtues of sound money and the dangers of fiat currency.

Did you know that the U.S. dollar was defined by the Coinage Act of 1792 to be 371.25 grains of fine silver? This act set the standard weight and measure of the dollar in terms of silver and individuals in the market were still free to accept or reject coins of differing weights and measures as they saw fit.

But we digress.

Here is why sound money is important to you:Thomas Jefferson Money Quote

Every dollar to your name is constantly losing value and there is no way for you to predict how much value your savings will lose over time.

This is a direct result of the monetary system that is in place whereby central banks create money from nothing and then lend that money to governments and to commercial banks at interest. That money then enters the economy when governments spend it and when commercial banks lend it out to customers. This is done constantly and it is why your money constantly loses value. Such a system has a profound impact on people from every walk of life.

How can we accurately plan for anything long-term if our money is constantly losing value? We can only guess.

What we do know from history is that sound money leads to a stable economy while fiat money leads to booms and busts.

The general market prefers the former while big government prefers the latter.

For more information on the sound money principle see the article links below. For a lot more information on sound money and monetary history see the book links below.

The Principle of Sound Money

The Simplicity of Sound Money

An Introduction to Sound Money

Real Estate for the Long Haul

submitted by jwithrow.Real Estate2

Did you know that the average real estate mortgage is in existence for less than seven years?

Wall Street does and that is why they are willing to purchase and package thirty year fixed rate mortgages into securities for retail. Which is why banks are willing to originate thirty year fixed rate mortgages to sell to Fannie Mae and Freddie Mac to then sell to Wall Street to package into securities to then sell to their “muppet” clients (ask Goldman Sachs).

This is also why mortgage contracts are front-loaded with interest. You see, fixing an interest rate for thirty years (or fifteen) would be a losing position for the bank if it had to keep the mortgage on its books for the contractual length of time. Fortunately, most people are not terribly disciplined so they either refinance or sell their home within seven years of purchase.

Let’s examine this process from a financial point of view. The bank collects a myriad of origination fees when real estate is purchased and it collects an un-proportional amount of interest in the early years of the mortgage contract. Then, within seven years, the homeowner either refinances or sells the home. When the homeowner re-finances, the bank collects a myriad of origination fees once again. When the homeowner sells the home, the bank also collects a myriad of origination fees again.

Now we don’t mean to vilify bank fees, We are simply pointing out that this revolving process results in a constant drain of private capital. Each time origination fees are paid that is a little bit of capital being drawn into the banking system that could have been used by the individual to build wealth instead. Once in the banking system, exponential debt will be pyramided on top of that small amount of capital.

The point is this:

We have been buying the same real estate over and over again for decades and we have been giving up small chunks of capital each and every time the same houses have been purchased.

Wouldn’t it make a lot more sense if we just bought our homes, paid off the mortgage, and then kept them within our control? Imagine the possibilities! Of course this wouldn’t make sense in every case, but the idea is worth considering…