The Nation Is Not the State

submitted by jwithrow.nation

Journal of a Wayward Philosopher
The Nation Is Not the State

August 11, 2015
Hot Springs, VA

The S&P closed out Monday at $2,104. Gold closed at $1,104 per ounce. Oil closed out just under $46 per barrel, and the 10-year Treasury rate closed at 2.24%. Bitcoin is trading around $267 per BTC today.

Dear Journal,

Last week I suggested that the growth of the nation-state in the 20th century brought forth the rise of collectivism. I speculated that we may have reached peak collectivism and thus inferred the nation-state model may be ripe for decline, however. Today I will point out the troubling macroeconomic trends once again in support of this speculation.

The democratic nation-state model has grown so massive largely because the political class has bribed people with half-baked social insurance (welfare) programs across the board. This has led to a massive accumulation of debt throughout the entire western world. Simultaneously, the demographics of many western nation-states is such that there are more aged people drawing from pensions and national social insurance programs than there are younger workers to pay for them. This dynamic has resulted in an absolutely gargantuan accrual of unfunded liabilities.

What this means is most governments in the western world are already bankrupt. Many people remain unaware of this fact because governments have kicked the can down the road by manipulating interest rates ever lower (negative in places!) and creating huge amounts of national currency out of thin air via the central bank mechanism. More and more people are slowly waking up to reality, however, and this is leading to a loss of trust in the nation-state model. Continue reading “The Nation Is Not the State”

Peak Collectivism

submitted by jwithrow.Peak Collectivism

Journal of a Wayward Philosopher
Peak Collectivism

August 7, 2015
Hot Springs, VA

The S&P closed out Thursday at $2,079. Gold closed at $1,090 per ounce. Oil checked out just above $45 per barrel, and the 10-year Treasury rate closed at 2.27%. Bitcoin is trading around $281 per BTC today.

Dear Journal,

The Musings of a Wayward Philosopher launch has gone fairly well this week. The ebook is currently ranked #1 in Economics>Commerce and #1 in Education&Reference in Amazon’s Kindle store. The paperback ranked as high as #50 in Economics>Commerce but has faded back a bit since. I noticed a big spike in interest while it was ranked top-50. This trial-and-error learning process has been exciting!

What’s even more exciting is the fact that this wasn’t even possible just twenty short years ago. The gatekeepers have fallen!

The publishing arena was heavily guarded prior to the rise of the internet. The only way to publish a book and get it circulating beyond your immediate network was to work with a large publishing company. This meant that your book had to conform to their ideas, requirements, and biases. The dynamic was the exact same in the broadcast media realm. Apart from local newspapers you were only going to get “news” that had been sifted through a major media company’s filter. Continue reading “Peak Collectivism”

Musings of a Wayward Philosopher

submitted by jwithrow.Musings of a Wayward Philosopher

Journal of a Wayward Philosopher
Musings of a Wayward Philosopher

August 4, 2015
Hot Springs, VA

The S&P closed out Monday at $2,091. Gold closed at $1,089 per ounce. Oil checked out just under $46 per barrel, and the 10-year Treasury rate closed at 2.21%. Bitcoin is trading around $278 per BTC today.

Dear Journal,

We launched the inaugural volume of Musings of a Wayward Philosopher yesterday with relative success. The ebook is currently ranked #1 in Economics>Commerce and #3 in Education&Reference in Amazon’s Kindle store. The paperback is ranked #127 in Economics>Commerce after day 1.

I am slowly learning how to market online, and I must say it is extremely uncomfortable. I started day one of the book campaign off by running a Facebook Ad. I stopped using Facebook personally more than three years ago once I learned that their entire business model was to take your personal information and sell it to the highest bidder. Then I learned they may or may not be handing your personal information over to the Feds for free also. Needless to say, I don’t care much for Facebook and yesterday I paid them to run an ad for me. I’m not too proud about that, but I can’t dispute the fact that it is a medium for reaching a lot of people. Facebook told 7,688 people about my book for me. They may also tell the good folks in our intelligence agencies about my book at the end of this month, I’m not sure. I suppose they are welcome to pick up a copy also.

After setting up the Ad, I spent the better part of yesterday submitting my book to a multitude of online directories geared towards independent authors. I paid a handful of them a few bucks for a guaranteed spot on their feature list. Though tedious, I didn’t mind this method of marketing as much. These directories have built a following of people interested in self-published books and they promise to tell their following about your book for a small fee. That’s a win-win. Continue reading “Musings of a Wayward Philosopher”

The Beer Theory of Credit Quality

by Bill Bonner – Bonner and Partners.com:credit

Here’s a firsthand report directly from one of our dear readers:

Greetings from Greek islands. Although news seems bad from reading papers etc., life here is rolling along. I am vaca with family and pulled out 500 euro from ATM last night (Sunday, June 28) on island Hydra. Restaurant accepted Amex. So far so good.

Yes, so far, so good.

But the steamroller is still rolling.

Americans aren’t really interested in what happens to the Greeks – unless they happen to be on “vaca” there. But the chief obstacle in Greece is the same one in China and in the United States: too much debt.

The Germans and Greeks can blab, hondle, and bluff all they want. It won’t go away.

According to financial services company Credit Suisse, Greece has total debt – including households, businesses, and government – equal to 353% of GDP.

But U.S. debt is even higher at 370%. Germany, that supposed paragon of financial virtue, is at 302%. And China, with its state-controlled economy, is at 250%.

All are in good shape compared to Britain. It has total debt equal to 546% of GDP. Japan is in an even worse state. Its total-debt-to-GDP is 646%.

And if the Credit Suisse numbers are correct, Ireland is off the charts with total debt equal to more than 1,000 times GDP.

But the Greeks are feeling the heat because they can’t service their public sector debt right now. They can’t pay it for the very same reason they got it in the first place – false pretenses.

First, they claimed they met the guidelines for entry into the euro zone. Then they claimed they could afford to live in the style to which they became accustomed. Then they claimed they would pay back the money they borrowed to make payments on the debt they couldn’t afford.

None of it was true.

Now, with their backs to the euro wall, they can’t “print their way out” of their predicament. Their creditors expect them to pay up. The Germans, in particular, see it as a moral responsibility.

“That’s the difference between beer drinkers and wine drinkers,” says a friend. “The beer drinkers pay.”

 

The Beer Theory of Credit Quality

Bond investors believed the euro promised stability and security. It was backed not by the wine drinkers, but by the beer drinkers.

We’re not sure how Ireland – a big beer-drinking country – fits into this story. But our friend notes that the countries of Northern Europe – where they also drink mostly beer – tend to repay their debts. Southern Europe – Spain, Italy, and Greece – are bad credit risks.

On the streets of London at this time of year, people stand on the sidewalks with barrels of beer in their hands. And on the Fourth of July holiday, more Americans will raise glasses of beer than wine.

Still, we doubt the “Beer Theory of Credit Quality” will hold up under the pressure of a generalized credit contraction.

In Europe, the beer drinkers of the north sold automobiles, for example, to the wine drinkers of the south. Then, when the winos couldn’t pay, the beer swillers gave them more credit.

Now, when the Greeks still can’t pay, the Germans are getting huffy about it.

And everybody is nervous. If the Germans put the screws to the Greeks, they invite problems with the rest of the wine drinkers.

What the Greeks owe is peanuts compared to what the Italians and Spanish owe. And if the credit stops, who’s going to buy the Germans’ BMWs, Audis, and Mercedes?

Nobody wants the credit to stop.

 

Star-Crossed Debtors

That is also true of another pair of star-crossed debtors – the Chinese and the Americans.

Like the Greeks and Germans, the Chinese lent, and the Americans spent.

And now, what a surprise… it’s the Chinese who seem to be in trouble.

Wait, what do the Chinese drink?

We don’t know. But the Shanghai index fell 17% in the last 18 days. And it dropped another 5% yesterday. (More on that below in today’s Market Insight.)

According to the McKinsey Global Institute:

China’s debt has quadrupled since 2007. Fueled by real estate and shadow banking, China’s total debt has nearly quadrupled, rising to $28 trillion by mid-2014, from $7 trillion in 2007.
Three developments are potentially worrisome: half of all loans are linked, directly or indirectly, to China’s overheated real-estate market; unregulated shadow banking accounts for nearly half of new lending; and the debt of many local governments is probably unsustainable.”

McKinsey says total world debt is now more than three times global GDP.

That is a “macro obstacle” about as big as they get. It is a steamroller.

And it is headed for us all… no matter what we drink.

Article originally posted at Bonner and Partners.com

When Countries Go Bankrupt

submitted by jwithrow.bankrupt

Journal of a Wayward Philosopher
When Countries Go Bankrupt

June 30, 2015
Hot Springs, VA

The S&P closed out Monday at $2,058. Gold closed at $1,179 per ounce. Oil checked out at $58 per barrel, and the 10-year Treasury rate closed at 2.33%. Bitcoin is trading up around $262 per BTC as the Greek crisis continues to play out.

Dear Journal,

I have been musing on the modern credit system in my last few journal entries and, ‘lo and behold, Greece has presented us with a real-time example of what happens when the credit expansion hits the wall.

Panos Kammenos, head of the government’s coalition ally in Greece, appeared on local television this past Saturday. “Citizens should not be scared, there is no blackmail,”  Kammenos assured the Greek people. “The banks won’t shut, the ATMs will (have cash). All this is exaggeration.”

The very next day Prime Minister Alexis Tsipras announced that banks in Greece would not open on Monday. “In the coming days, what’s needed is patience and composure,”  Tsipras proclaimed. “The bank deposits of the Greek people are fully secure.”

Here are the details of the Greek government’s capital controls:

  • From Monday, June 29, 2015, banks will remain closed up to and including Monday, July 6
  • Deposits are fully safeguarded
  • The payment of pensions is exempted from the restrictions on banking transactions.
  • Management of credit institutions will announce how these will be paid
  • Electronic transactions within the country won’t be affected. All transactions with credit or debit cards and other electronic forms (web banking, phone banking) can be conducted as normal
  • Prepaid cards may be used to the limit existing before the beginning of the bank holiday
  • From midday June 29, ATMs will operate with a daily cash withdrawal limit of 60 euros per card, which is equivalent to 1,800 euros a month
  • Foreign tourists can make cash withdrawals from ATMs with their cards without restrictions provided these have been issued abroad
  • A special Committee to Approve Bank Transactions has been established at the State General Accounting Office in cooperation with the Finance Ministry, the Bank of Greece, the Union of Greek Banks and the Capital Markets Commission. This committee will deal with applications for urgent and imperative payments that can’t be satisfied through the cash withdrawal limits or by electronic transactions (e.g. payments abroad for health reasons). Wages paid electronically to bank accounts aren’t affected.

Continue reading “When Countries Go Bankrupt”

Economics in One Lesson

submitted by jwithrow.economics

Journal of a Wayward Philosopher
Economics in One Lesson

June 29, 2015
Hot Springs, VA

The S&P closed out Friday at $2,101. Gold closed at $1,175 per ounce. Oil checked out at $60 per barrel. The 10-year Treasury rate closed at 2.48%, and bitcoin is trading around $246 per BTC.

Dear Journal,

We are back in the mountains of Virginia after our annual family gathering in Emerald Isle, NC. Last week, in addition to enjoying the beautiful Crystal Coast, I thought about the modern credit system that has been in place since 1971.

Speaking of last week’s journal entry, I felt a little clarification was in order after re-reading it myself. Lest the reader think otherwise, I am no Luddite and I have nothing against commercial development. I simply believe very strongly in the old capitalist principle that said commercial development should be fueled by actual capital that was formed from production and savings. Instead of capital, the modern credit system fuels commercial development with credit created ex nihilo. No one forewent present consumption to build said credit, and this dynamic creates distortions and malinvestment that accumulate over time.

The capitalist sees a private beach and wonders if commercial development would be a worthwhile endeavor. Does the market want three story luxury homes by the beach and cheap surf shops on the island? Will these projects be profitable? Will they attract additional capital to the area? To the capitalist, the focus is on individual human action. Private capital is then heavily deployed if commercial development is pursued. Continue reading “Economics in One Lesson”

A Look at the Modern Credit System

submitted by jwithrow.credit system

Journal of a Wayward Philosopher
A Look at the Modern Credit System

June 22, 2015
Emerald Isle, NC

The S&P closed out Friday at $2,110. Gold closed at $1,202 per ounce. Oil checked out at $60 per barrel. The 10-year Treasury rate closed at 2.27%, and bitcoin is trading around $247 per BTC.

Dear Journal,

I am writing this entry from North Carolina’s glorious Crystal Coast. My family has been making a week-long trip to Emerald Isle every summer since the 1970’s. Back then the island consisted of a small convenience store, Clyde’s Shrimp Shack, and a few dinky cottages by the beach.

The Withrow clan still rents a couple beach-front cottages each summer but the cottages have magically transformed. In the early days, the luxury cottages had a spiral staircase leading up to a second floor with an extra bedroom. The average cottages offered a few bedrooms on the ground level with no spiral staircase. You now find three story luxury homes towering over the beach where the dinky cottages or empty lots once stood.

To most eyes this looks like progress. Maybe it is. However, my eyes only see evidence of the exponential credit expansion that has been taking place for more than forty years now. I feel slightly hypocritical as I enjoy a cold beverage from the the third story balcony watching the waves crash down upon the beach below. You see, I know how this all got here. I know how this went from a dinky little cottage to a three-story luxury home with a balcony overlooking the sea. Continue reading “A Look at the Modern Credit System”

There Will Never Be Enough Good Jobs Again

by Paul Rosenberg

goodjob

It’s over. Except for a short moment or a wild and self-exhausting governmental mandate (both of which are doubtful), there will never again be enough “good jobs” to go around. That model is gone and we need to root it out of our imaginations.

Sure, there will be some good jobs, but nowhere near enough.

About half of the Western world is already on the dole in one form or another. 93 million Americans lack a decent job and have no real hope of getting one. And so long as the current hierarchies remain, things won’t get substantially better.

I’m sorry to dump that on you, but it’s better to face it directly.

But please bear in mind that I’m a confirmed optimist. Just because there are no “good jobs” doesn’t mean that we’ll all languish in a meaningless existence. Far from it. Once we get over our addictions to status, hierarchy, and dominance, a glorious future awaits us.

Why It Won’t Get Better

The standard response to what I’ve noted above is to call it “the Luddite fallacy.” That line of argument says that in the past, innovation has not wiped out jobs, that new types of jobs were created and filled the gaps fairly well.

And that statement is true. Individual jobs were wiped out, but new jobs came along and (more or less) picked up the slack.

However, that is not happening this time, and for a very simple reason: Adaptation is now against the law. Previous rises in technology occurred while adaptation was still semi-legal.

Please take a look at this graph and remember a simple truth: Regulation forbids adaptation.

The US government is currently spending $60 billion, every year, to restrain business activity. (And the EU is worse.) On top of that, reasonable estimates show that US government regulations cost businesses nearly $2 trillion per year.

And let’s be honest about this: The primary purpose of regulation is to give the friends of congressmen a business advantage. Why else would they pay millions of dollars to lobbyists?

So, the new jobs that should be spawned, will not be. Mega-corps own Congress and they get the laws they pay for. And mega-corps do not like competition.

Furthermore, the political-corporate-bureaucratic complex will bite and claw to retain every scrap of power they have, and small businesses will be their first victims. (They already are.)

Trapped Between Hammer and Anvil

So, the people who are hoping and waiting for a “good job” to pop up are trapped between hammer and anvil. Robots are starting to roll into the workplace while the job creators (small entrepreneurs) are in regulatory and economic chains. They can’t come to the rescue.

In the 19th century, all sorts of possibilities were open to entrepreneurs. This remained at least partly true, even into the 1970s, when I watched the business heroes of my youth having a gas while making piles of money.

It used to be that a clever person could get ahead, independently, and have a ball doing so.

Those days, alas, are over.

These days, to get rich, one needs to take government as a partner. If one does not, regulation and legislation are likely to destroy your business. At this point, many of us (myself included) have had businesses – good businesses that benefited everyone involved – crushed by legislation.

To avoid being crushed these days, you have to be smarter and fleeter of foot than everyone else. Not many of us can survive in that situation, and as regulations continue to rise, even that number grows smaller and smaller.

For the generation before of mine, independent success required ambition, but it was reachable. For my generation, only those of us blessed with unusual talent had a chance at controlling our economic destinies. For the young generation of today, it’s nearly impossible. These days, if you want to jump ahead, you need to be part of something big… and you need to start as a sycophant.

So…

So, if you’re looking for the proverbial good job, stop waiting for “The Hierarchy That Is” to sort things out and get everything back to normal. Good jobs get fewer and fewer every year, and those that are lost won’t be coming back.

But… if and when you’re ready to change your thinking – to seriously change your thinking – this is good news too: You can reclaim the parts of yourself that you were ready to sacrifice to the “good job.”

You see, the “good job” was nearly as much a curse as it was a blessing. Yes, I know, steady wages and benefits are a very comfortable thing, but they also play right into a ridiculous, predatory script.

You know the one: where you struggle to display your status to all the other worker-bees. You feel like you have to do what the ads tell you: Get the new car, the bigger truck, the video player in the back seat, the gigantic TV, the most “amazing” holiday parties, the expensive shoes, the designer bags, the organic veggies, etc., etc., etc.

I would like you, please, to consider this quote from the boss of Lehman Brothers, just as the World War I production surge was failing:

We must shift America from a needs, to a desires culture. People must be trained to desire, to want new things, even before the old had been entirely consumed. We must shape a new mentality in America. Man’s desires must overshadow his needs.

Would you agree that their plan worked?

As long as you follow their script, you’ll remain in a permanent deficit mentality. No matter how much you have, you’ll always feel like you need more. It’s life on a shiny gerbil wheel. The “good job” kept us from knowing ourselves; it allowed us to sleep-walk through life. We got a “good job” and never developed ourselves any further. Work, retire, die, ho hum.

Then What?

So, if we forget about having a “good job,” what happens?

Well, it might very well mean that you do what you’re already doing, but you stop feeling bad about it. It means that you get over the endless grasping after status… of letting ridiculous ads define what “success” looks like… of letting other people define your self-opinion.

Letting go of the “good job” delusion means that you stop pining for the days when you could blow a third of your money on status crap. It means that you start taking pleasure in growing your own food, developing new ventures, and improving yourself.

It means that rather than begging politicians to ride in on a white horse and fix your world, you ignore them and start paying attention to your actual life.

Fundamentally, this means that we start using our own initiative, without seeking permission, and start building better things.

Rather than going on, I’ll leave you with two quotes, both from Erich Fromm. I think they are worth close consideration:

Our society is run by a managerial bureaucracy, by professional politicians; people are motivated by mass suggestion, their aim is producing more and consuming more, as purposes in themselves. All activities are subordinated to economic goals, means have become ends; man is an automaton – well fed, well clad, but without any ultimate concern for that which is his peculiarly human quality and function.

The quest for certainty blocks the search for meaning. Uncertainty is the very condition to impel man to unfold his powers.

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.]

How I Escaped the Rat-Race

submitted by jwithrow.rat-race

Journal of a Wayward Philosopher
How I Escaped the Rat-Race

May 28, 2015
Hot Springs, VA

The S&P closed out Wednesday at $2,123 – almost exactly where it was at the same time last week. Gold closed at $1,186 per ounce yesterday. Oil checked out at $57 per barrel. The 10-year Treasury rate closed at 2.13%, and bitcoin is trading around $238 per BTC.

Dear Journal,

We are back in the serene mountains of Virginia after a week spent on the gorgeous Carolina coast. Madison’s first beach trip was a success and we enjoyed five consecutive days of low 80’s with a cool breeze. Your editor even squeezed in a half-day fishing trip towards the end of the week after building up Dad points by handling Maddie’s late morning nap time indoors for the first several days so Momma could lay in the sand.

Last week I shared with you my view of the coming monetary crisis and I promised to expand upon what I have done to prepare for it and how I managed to escape the rat-race in the process.

Career is often one of the first items up for discussion when catching up with friends. You know the process: “What are you doing now? How’s that going? Do you like it?”

I find that very few friends tell me they like their job. Most say it is okay or tolerable. Some say they are miserable for one reason or another. Even the ones who say their job is tolerable express a certain sense of anxiety on Sunday afternoons as they look forward to the grind starting back up for another week.

Despite this, most people become addicted to their paycheck because they fashion their lifestyle accordingly. A couple things tend to happen when the paycheck gets bigger: the house gets bigger, the car gets nicer, and the hobbies become a little more luxurious. The problem is many of these things come with monthly payments. The big house comes with a big mortgage and strong HOA dues. The nice car comes with a big car payment and probably a satellite radio subscription. The luxury hobbies might include membership fees of various kinds: country clubs, golf courses, dinner clubs, mega-gyms, etc.

Now there is nothing wrong with any of this unless your goal is to escape the rat-race. If so, you need your paycheck to maximize capital rather than support your lifestyle. The following is the abbreviated version of how I went about maximizing capital so I could leave the rat-race in the dust.

My first step was mental: I crafted a vision of living outside the rat-race as I became more disillusioned with corporate America. I had been working in the corporate banking world for several years by this point and I had worked my way up to a comfortable salary relative to my circumstances. I was contributing the standard 3% match rate to my 401(k) and I was maxing out my self-driven IRA each year as I had been educated to do so I had a decent financial cushion to start with.

I created a spreadsheet to track my monthly expenses and pretty soon I was able to trim the fat and start saving 75% of my net income each month. I didn’t become cheap for its own sake – I still took my fiancé (now wife) out to dinner every Friday – but I did stop all frivolous spending. Though I couldn’t see far enough ahead to envision my day of liberation, I did know that I would be able to break the employment chains in the near future if I amassed a decent pool of working capital.

As my knowledge of Austrian economics grew, so did my appreciation for the precious metals. I began to make periodic trips to the local coin shop to redirect some of my monthly savings into gold and silver bullion. I didn’t originally have an asset allocation model in place so my purchases were somewhat sporadic but I did accumulate a (relatively speaking) decent precious metals base over the course of a year.

Austrian economics also helped me see how the housing bubble was being partially re-inflated by the Fed’s quantitative easing (QE) and zero interest rate policy (ZIRP). Private equity firms like Blackstone and American Homes 4 Rent (AH4R) were taking advantage of this easy money to buy up huge quantities of single family homes in the U.S. to build their rental real estate portfolios. These private equity companies were taking the Fed’s cheap credit at near-zero rates to buy middle class homes which they rented back out to the middle class with a huge profit margin built in. Now there is nothing wrong with reaping huge profits as long as they are honestly gained but there is a major problem with a system that distorts the market economy in favor of special interest groups.

I was bothered by what was going on in the housing market but I also understood that I was powerless to change it. Therefore I did the next best thing – I took advantage of the situation and sold my home to AH4R for a sizable gain. Some of that gain went to pay the real estate agent’s commission and I rolled the rest into a down payment on a 5-acre rural property at the end of a gravel road way up in the mountains which is where I reside today.

My goal for our mountain home was to make it as resilient as possible such that we could be totally self-sufficient for at least six months should hard times befall us. I don’t have room in this entry to go into the specifics, but we accomplished this by securing surplus water, food, provisions, and energy sources. The end result is that I am confident in my household’s ability to be self-sufficient for at least six months should the need arise which means our livelihood is not solely dependent upon consistent monthly income. The cost to maintain this self-sufficiency is pretty negligible after the initial purchases are made.

It took me roughly six months to complete these base self-sufficiency preparations and then it was time to hone in on my finances. I set up a spreadsheet to monitor my asset allocation model and I established the initial allocation ratios: 29.5% cash, 10% precious metals, 15% stocks, 0.5% bitcoin, and 45% real estate.

I was already in excess of my cash and real estate allocation because of my 75% savings habit and my 20% down payment on our 5-acre property so I used the excess cash outside of my IBC policy to bring the precious metals, stocks, and bitcoin allocations up to par.

All the while I was researching how to build location-independent income streams online in my spare time. There are more entrepreneurial opportunities today than ever before in modern history. Thanks to the internet anyone can reach millions of prospective customers with just the click of a button and there are very few barriers to entry. This means all you need to be an entrepreneur is a product that provides value to people in some capacity and a basic understanding of online marketing techniques. It requires very little capital to launch these types of products. More importantly, you can launch these products without needing to obtain permission from the government first in the form of certifications and licenses. In comparison, try to start a traditional brick & mortar business without government permission and see how that experience goes.

So to recap:

• I invested in my own education first by developing a strong understanding of Austrian free market economics.
• I purchased a rural 5 acre property with advantageous financing.
• I made ample water, food, energy, and provision preparations so as to be self-sufficient on this property for at least six months should the need arise.
• I shored up my asset allocation model to spread my capital across several asset classes: cash, precious metals, stocks, bitcoin, and real estate.
• I began to build location-independent income streams online.

I have an entire chapter dedicated to the specifics involved in this process in the 2nd edition of The Individual is Rising which I hope to launch later this summer. I will keep you posted as that progresses.

I will sum up this entry by repeating a common theme here at Zenconomics: life is meant to be lived.

It is up to you to make your life exciting and meaningful – no one else will do it for you. This requires a break from Modernity which emphasizes a fear & control mindset intended to put life in a box and stomp out any potential randomness before it happens. We are all conditioned to live within Modernity’s box so it is difficult to step outside and blaze your own path. But your life may depend on doing just that.

More to come,

Signature

 

 

 

 

 

Joe Withrow
Wayward Philosopher

For more of Joe’s thoughts on the “Great Reset” and creating diversified income streams please read “The Individual is Rising: 2nd addition” which will be available later this year. Please sign up for the notifications mailing list at http://www.theindividualisrising.com/.

Who is John Galt?

submitted by jwithrow.Who is John Galt?

Journal of a Wayward Philosopher
Who Is John Galt?

May 21, 2015
Topsail Island, NC

The S&P closed out Wednesday at $2,125. Gold closed at $1,209 per ounce. Oil checked out at $58 per barrel. The 10-year Treasury rate closed at 2.25%, and bitcoin is trading around $234 per BTC.

Dear Journal,

It has been two months since my previous entry… sorry about that. Little Madison is now seven months old and much of your editor’s time has been spent learning about life from her.

It is simply amazing to watch an infant’s development. One day she is completely immobile and then all of a sudden she is sitting up on her own. Then she is picking up her toys and banging them together. Then she is rolling from her back to her belly and back again while stretching to reach for a toy that is just out of her grasp. And those blue eyes shine with intelligence, curiosity, and love the entire time.

The first thing Madison does when she wakes up in the morning is smile a smile that lights up the room. She is so happy simply to have the opportunity to be here for another day. It’s a shame we adults do not often have that same outlook.

Along with learning from my daughter, I have also spent considerable time over the past two months preparing for the next step of my liberation plan.

As my bio states, I began a transformational journey a few years back in which I walked away from corporate America and moved to the mountains of rural Virginia. Somehow I managed to get wife Rachel to go along with this plan… I think wine must have been strategically involved in the negotiations.

The idea was to purchase a property with a little bit of land in a rural area with a low cost of living to create a higher overall quality of life with less exposure to the fragile monetary system as captained by the Federal Reserve which will one day explode and drastically reduce the quality of life for many Americans.

No one knows when this fraudulent monetary system will crash and burn but I have no doubt that the day is coming. You just can’t create trillions of dollars from thin air and then spend them like they are real money and expect this to work indefinitely. It is a basic principle of the Universe that all actions have opposing reactions in some capacity. Try as they might, the Ivy Leaguers at the Federal Reserve do not have the power to alter reality. They only have the power to kick the can down the road.

Many people are beginning to wake up to this central banking fraud that began in America in 1913 and really ramped up in 1971, and the initial reaction is to push for reform. Some want better people running the system. Others want rules-based policy. Still others want to transfer monetary authority from the Fed back to Congress. Those of us who study Austrian Economics say the answer is to let the free market reign and End the Fed altogether – in a responsible manner if possible.

Alas, the consequences of this reckless monetary policy are now unavoidable whether or not any real change actually occurs. The Federal Reserve’s credit expansion is exponential in nature, as I touched on back in January. More and more credit must be created from nothing just to keep the system afloat. The system teeters on the edge every time the credit slows. One day the system will fall and those who are most dependent upon easy credit, monetary expansion, and the government programs they finance will be in a very unfortunate situation. This is true of individuals dependent upon government programs and it is true of the industries that benefit most from this fraudulent monetary system. The social welfare system, the military-industrial complex, and the financial system will all be decimated as benefits evaporate and jobs go up in smoke. What does the economy look like if social welfare programs, including Social Security, dissipate just as the financial sector freezes up?

As bleak as this is, there are individual solutions available. For me, the solution began with a question: Who is John Galt?

The idea behind my personal exodus from corporate America in a major financial center stemmed from “Atlas Shrugged” by Ayn Rand. Though I fundamentally do not care for Rand’s “Objectivist” philosophy, her portrayal of John Galt in Atlas Shrugged really resonated with me.

A budding engineer in corporate America, John Galt began to see the corrupt political system for what it really was – naked force used against the population for the benefit of the politically connected. Rather than exhaust his energy fighting the corrupt system, John sidestepped it. He moved to a remote location and focused his creative energies on building a better system and he invited others of like mind to join him in this effort.

This idea jumped off the page (and screen) at me. We are all conditioned to fundamentally accept the current system as permanent and necessary therefore any dissent is directed towards either reforming or capturing the system via a political party. This has led to conflict, often violent, throughout modern history as opposing groups vie for political power.

John Galt had the wisdom to reject the use of force as a means of social order so he simply withdrew his consent from the system entirely. He didn’t try to fight the system. He didn’t try to change the system from within. He didn’t organize mass protests against the system. He worked to make the system obsolete by demonstrating a better way of engaging with others in society.

While “Atlas Shrugged” focused on big business tycoons, modern technology today can empower every individual to walk away from the System without necessarily sacrificing their quality of life. I am publishing this journal entry from the beach in Topsail Island, NC but it will be read by people in other parts of the U.S. as well as in other countries. That is a very powerful concept which is unprecedented in history. The internet enables individuals to trade goods, services, and information with anyone, anywhere, at any time. One can even use apolitical digital currency such as Bitcoin to facilitate these transactions. This opens up a whole new world for the enterprising individual!

We are currently at a crossroads where the old ways are transitioning into the new. We do not want to discard the valuable wisdom gained over the past century but we do want to move away from a system that treats individuals like milk cows.

Such a societal transformation can only be done on the individual level; it cannot be forced upon others. The Republicans thought they were leading a revolution back towards limited government in the 80’s when they got Ronald Reagan elected. Instead, deficits and debt skyrocketed under Reagan and the military-industrial complex managed to capture the Republican Party. Likewise, the Democrats thought they were leading a progressive revolution towards egalitarianism and transparency when they got Barack Obama elected in 2008. Instead, the Obama administration has expanded the wealth gap even further by catering to the special interests while being the least transparent administration in history – a very impressive feat considering George W. Bush had just set that record himself over the prior eight years.

The point is, the System is not going to reform or restrain itself. It is going to continue to engorge itself on the American middle class until it blows up. I don’t fault anyone who truly seeks to change the system via the political process, but I am convinced it cannot be done in any meaningful way. The political system can be used effectively as an educational platform, as Ron Paul demonstrated, but not as a tool to structurally restrain the System.

So, to come full circle, I advanced one more step in my personal liberation plan last Friday as I worked my final day as a W-2 employee. Then I took the next logical step – I took my family to the beach.

Next week I will expand upon how I was able to resign from my job and leave the rat race in the rear-view mirror.

Until then the Carolina coast calls…

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Joe Withrow
Wayward Philosopher

For more of Joe’s thoughts on the “Great Reset” and the paradigm shift currently in motion please read “The Individual is Rising” which is available at http://www.theindividualisrising.com/. The book is also available on Amazon in both paperback and Kindle editions.