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WhatdoesthismeanforGovernment?
TherehavebeenplentyofarticlesaskingwhetherCapitalismisnowdead.Theproblemisthequestion
alreadypresumesanoutcomeandfailstorealizethatwearestillinthemiddleofthegreatestEconomic
Transformationinthehistoryofmankind.Weareinfactnotseeingthecollapseofcapitalism,butarein
thefinalstageofthedeathofSocialism.
GovernmentswillrailagainstthecollapseofSocialismbecauseithasbeenthesourceoftheirpower
voteformeandyougetsomethingfornothing.Weareinthefinalphaseatransitionwhichistaking
theformofa"tsunamiofspending"totrytomakeitallbetter.
WehaveseenthiswithPresidentObamapromisingfreeorcheaphealthcareandmorerecently
BernieSandersofferingfreeeducation.
Hereismypredictionduringthispresidentialcampaign.Hillary,atsomepointwilloffertheforgiveness
ofstudentloansorsomederivativeofthis.Why?BecauseasDonaldTrumprevealshistruecolorsof
Saving,Building,andProtectinghishomecountryanditscitizens,shewillhavetopromisemoreand
more,thatswhatpoliticiansdointhefinalthrowsofsocialismasitdies.
Whatwemustbeconcernedaboutwillbewhogetsblamedwhenitfinallyfails?
Liftingthisrockallowsthescorpionstosurface.ItismoreakintoopeningPandora'sBoxandallowinga
swarmofevilstoescapeandtormentmankind.Wehavenochoicebuttospeakveryfrankly,forunless
wetrulyunderstandthenatureofevents,thereisnowaytoclosetheboxandmakeitallbetter.As
SaintJeromesaidofRare:"WhenRomefell,theRomanswerestilllaughing."Theyhadnoideaofwhat
wastakingplaceandjustassumedRomewasimpregnable.Wecanonlystopaneventifwerecognizeit
ishappening.
Ifweareafraidtoaskthecorrectquestion,thenperhapswearetoobiasedtocomprehendwhatwe
havedoneandtakeresponsibilityforourownactions?ToparaphraseEdwardGibboninhismemorable
epitaphonRome:Wewerethecapitolofdemocracy,thecitadeloftheearth,theterroroftyrants,
illustratedbythefootstepsofsomanytriumphs,enrichedbytheleadershipineconomicfreedomthat
wasthebeacontosomanynations.Thisspectacle,howisitfallen?
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TheGreatestEconomicTransformation
Itmayseemstrange,butwehavebeenundergoingabattleofeconomicphilosophythattranscendsso
manyconceptsthatunlesswestepback,wewillhavedifficultyunderstandingthetrend.Thisbattlehas
oftenbeenlacedwitheffortstocontrolmankind.Forwithinthisbattle,wewillfightreligion,politics,
scientificinnovationandprogressspanningtechnologyinallareas,butalsoissuesthatincludeboth
slaveryandlaborthatallcreatewhathasbecomeknownasoureconomy.
Sometimeswearetooclosetoaproblemthatitisjustimpossibletosee.Whenmanlandedonthe
moonandsentthefirstpicturesofEarthrising,onlythencouldweseewhatourworldtrulylookedlike.
Wearefacingtheverysameproblem.Thechangethatwenowseeandaredebating,isstillfromthe
viewofaflyonanelephant'sback.Wedonotknowweareevenonanelephantorwhatisanelephant.
Oursocietyisstillgrowingandchanging.Wearegoingthroughpubertywheretheyouthrebelsagainst
theparent.Theprofoundchange,theGreatEconomicTransformation,becamebluntlyvisiblebackin
1989wheretheworldeconomybegantochangewiththefallofCommunism.Thatfundamentalchange
wastrulyanEconomicTransformationwavewhichisnowcausingthecollapseofsocialisminthe
Westernnations.Whatwearefacingisconfusing.Nevertheless,ifwewanttoseetheelephant,itis
timetotakeflight.
Thereisaverycorestructuretotheeconomicsocietyofman.TheIndustrialRevolutionwasnotjusta
slogan.Itishardformodernmantolookbackfromwherehenowstandsandcomprehendthemeaning
of"revolution"asitwastrulyexpressed.ThewayoflifepriortotheIndustrialRevolutionremained
essentiallythesamefromGreektimes,Rome,middleages,andthebirthoftheUnitedStates.Theword
"Economics"wasanEnglishtranslationofabookwrittenbyagreatmindandadiversifiedmanof
tremendousexperienceXenophon(ea431350BC).Xenophonwasabrilliant,practicalman.Hebegan
lifeearlyonasthecommanderoftheeliteGreekforceknownasthe"TenThousand.Xenophon
admiredSocratesprofoundly,anddevelopedadislikeforextremedemocracyfortheverycrimeithad
committedbyorderingSocratestobeexecutedforhisideas.Xenophonwrotethreeworksonthe
subjectcastingSocratesinadifferentlightthanthatofPlatothe"Apology"Symposium
"Memorabilia."Yetinthefieldoffinanceandeconomics,hispoliticalworkiswhatthepowerful
committeeonCapitolHillisnamedafter"WaysandMeans"writtenaround351BCadvocatingpeace
ratherthanwarbetweentheGreekstates.ButweowetheverywordEconomics"tothetitleofhis
trulymasterwork"Oeconanicus"thatsimplymeantinancientGreekhowtoregulatethehousehold.
ItwasaHowToBookforGentlemenDummiesthatexplainedhowtomanageyourestatefromgrowing
crops,managingslaves,andyourwife.
WhatdoesthishavetodowiththeIndustrialRevolution?Everything!Lifeassocietyknewitwas
completelydifferentbeforethe19thcentury.Thesameeconomicmodelhadexistedforthousandsof
yearsaroundaselfcontainedfarmlikeenclave.TheRomanscalledthem"villa"andwecallthem
"plantations."Thisishowsocietyoperated.Villawereindependentestatesthatwerevirtuallyself
sufficient.Theworkforcewascomposedofslavespurchasedafterbattleinancienttimes,orserfsinthe
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middleages,orimportedAfricanslaves.TheKingofEnglandhadevenusedthecriminallawstocreate
labor.AnymisdemeanorallowedtheKingtosellsomeoneasalaborerforacertainperiod.Insteadof
prison,youweresent,atfirst,toAmerica.WhentheAmericanRevolutionbegan,thedestination
changedtoAustralia.
Duringthe3rdcenturyAD,moneybecamerarefollowingahyperinflation.Thiscausedtremendous
hoardingandaneconomiccontractionstrengtheningthevillamodel.TheRomanEmperorDiocletian
(284305AD)tried,torevivetheempirelikeRonaldReagan&MargaretThatcher,andcreatedmanyof
thepracticesstillemployedtoday.Tobeabletocollecttaxes,passportswerecreatedandpeoplecould
notmovewithoutpermission.Totackleinflation,hesubstitutedwageandpricecontrolsasdidRichard
Nixon.Heredesignedtheentiremonetarysystem,i.e.BrettonWoods1944.
WhenRomefellafter476AD,theconceptofthevillaprevailed.Lifesurvivedbecauseofthisself
containedeconomicmodel.Thisevolvedintofeudalismduringthe9thand15thcenturiesduetothe
increaseinpopulationandtheinabilitytoacquirewealthtoestablishavilla.Townswouldformandthe
landlordbecamethenobility.Castleswereconstructedbecauseofthelackofsecurity.Charlemagne
(742814)begantoreconstructtheoldRomanEmpire.Thiseconomicmodelreceiveditsfirstmajor
shockthatnoteventhefallofRomehadinflicted.TheBlackPlagueinthe13th14thCenturieskilled
about1/3rdofthepopulationmakinglaborscarceandcausinglandlordstostarttopaywagesin
additiontoapercentageofthecropandfreehousing.Yet,predominantly,theeconomywasstill
agrarianandthemodelwasstillthevilla.
InRussia,theseedsofthe1917RevolutionweresowedduringthereignofIvanIV(theTerrible)(1530
84),whenheconfiscatedlandsofhisenemiestogivetohissupporters.Ivanfoundthelandsworthless
oncetheserfsfled.Hethendecreedthattheserfswouldbeboundtothelandforlifeinorderto
maintainitsvalue.HeessentiallymadeallRussianslivingonfarmsslavesofthestate.Thiseventually
createdthepoolofdiscontentthatfueledintothebonfireofRevolutionyearslater.
OfcourseintheUnitedStates,theslaveryissuewasrecognizedaswrongandarealproblem,especially
afterthelanguagewrittenbyThomasJeffersonintheDeclarationofIndependence.Thisissue
dominatedearlypolitics,andperhapscametoaheadwhentheSupremeCourtshoweditwasindeed,
asJudgePosnerreferstoit,the"PoliticalCourt."In1857,theSupremeCourtheldthatblackswerejust
propertyinthecaseofDreadScott,whosuedforhisfreedomwhenhismastertraveledtoastatethat
didnotallowslavery.TheCivilWarwasnotfoughtoverracism.Itwasfoughtoverthecollapseofthe
economicsystemoflabor.RacismemergedmoresoasabitterresponsebytheSouthattachingblame
fortheirdemisetothefreedomoftheslaves.
WecanseethatslaverywasaveryancientpracticeasoutlinedbyXenophonin"Oeconanicus."Itwas
howthevillamodelmaintaineditseconomicviabilityforthousandsofyears.InRoman&Greektimes,
theeconomywas90%agrarian.However,thatdeclinedto70%inthe1870s,40%in1929,andfinally3%
by1980.IthasbeenthisvillamodelthatwasundergoingtheGreatEconomicTransformationtothe
IndustrialRevolution.
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TheGreatEconomicTransformationhasbeenthegrowthofsocietythroughprogressandtechnologies.
Wehavebeenevolvingeveninourunderstandingofeconomics,sincethenatureoftheeconomyisin
factchangingwitheachpassingyear.Wemustlookatthistransformationandunderstandthatasthe
changesinlaborhavetakenplace,everythingelseinourworldalsochanges.Haditnotbeenforthe
BlackDeath,therewouldneverhavebeenashortageinlaborgivingbirthtowagesthatledtopayroll
taxes.
TheBattleLines
Beforewewagefurther,wehavetoexplorewhatcausedthebattlebetweencommunismand
capitalism.WecanattributethistoKarlMarx(18181883)butthisdoesnotexplainwhyMarxcameto
theconclusionsthathedidandsetinmotiondecadesofgeopoliticalconflictsthathascostthelivesof
countlessmillions!
WemustunderstandthatfromtheschoolofPhysiocrats,whobelievedthatallwealthwascreatedonly
bynature,weendupwiththerunawayideathatmancancreateutopiatheimaginaryworldwhere
mancouldliveindefinitelyundertheperfectplan.ThisideawassparkedbySirThomasMorein1516
thatcreatedawholeclassofthinkerswhobelievedinthisUtopianworldwaspossible.SirThomasMore
(14781535)wasamajorinfluenceandcontributedtowhatwenowfacetodayunderSocialism.
Marxrailedagainstthechangefromtheagrariansocietytotheindustrialrevolution.Hedidnotseethe
Stateastheissue.Whathesawwasthatthisneweconomicmodelwouldleadtopaidworkersin
factorieswhowouldbeexploitedtomakeaprofitfortheemployer.Marxsawthis"new"economic
modelaschangingtheworldtakingpeoplefromthetraditionalfarmandturningthemintoconsumers
ofproductsmanufactured.However,hebelievedthattheiremployerswouldbesogreedy,theywould
declinetopaytheworker.Eventuallythisnewsystemwouldcollapsebecausethegreedofthe
employerwouldsuppresstheincomeofthelaborer,andthatwouldresultinthecollapseofthisnew
evilexperimentindustrialcapitalism.
ThebattlebegunbyMarxbetweenhisUtopianidealofcommunismvs.capitalismisnotover.The
Communisticsystemtransferspowertothestate,asdoesSocialism.Thishassanctionedthepowerofa
centralgovernmentattheexpenseoftheeconomicfreedomofCapitalism.Whatwearereallysaying
whenweaskwhetherCapitalismisdead,isshouldweabandonfreedomandrunbehindthewallsofthe
castlesincethestateisthemoderndaylandlord?DowereversethisGreatEconomicTransformation,or
understandwhatisgoingonforjustonce?
AmericanLabor
Marxbeganaclasswarfarethatcouldyettaretheveryfabricofoursocietytoshreds.Thebeginningof
theendofthelaborunionmovementwasmarkedseventytwoyearsafterthefirstreallaborriotthat
tookplaceonMay4th,1886knownastheHaymarketRiot.TheTaftHartleyLaborActof1947was
designedtotakeawaythepoweroftheunions.Bythe1960s,theunionswerecastinthelightasbeing
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evilandcontrolledbyorganizedcrimeaftertheJimmyHoffaincident.Thiscriticalshiftinperception
curtailedtheunionmovementafterjustone72yearpoliticalcycle.
ThecollapseofGeneralMotorsisthecollapseofthelastvestigeofMarxismthelaborunions.The
foreignautomanufacturershavesetupshopintheSouthwherethelaborlawswerefarmorefavorable
tocreatenonunionworkforcesthathavebeenquitesuccessful.Theforeigncarmanufacturershave
demonstratedthatunionsareabadidea.Theunionmovementshadtheirpointsfromtheoutset.But
workingconditionsshouldhavebeenattackedinapoliticalcontext(democracy).Unionsassumedthe
mantleofcommunismcreatingconfrontationandtransferredthepowerfrommanagementtolabor.It
didnotsolvetheproblemsandonlybecamelikeadrunkwhothenhadthekeystotheliquorstoreself
destructive.
Thereasonwhyunionswereabadexperimentwasbecausetheymerelyturnedtheemployerintoa
slaveandalteredthefreemarketsthatwascontrarytothenatureofmankind.Historically,whenthe
cropsfailedinanagrarianmodel,peoplesimplymigrated.ThePhilistinesoftheBibleweremostlikely
GreekswhomigratedduetocropfailuresattheFirstHeroicAge.InvasionsoftheGoths,Germans,and
evenAttilatheHunwereallcausedbythe"grassisgreener"ontheothersidebelief.Unionsjust
promotedincreasedwagesratherthanincreasedskills,diminishingtheindividualmotivationtolearn
newskillsandmigratebetweenjobs.Thisisthesamereasonwhycommunismdied.Creatingasystem
whereonesizefitsall,promotesadeclineinhumangrowththatisthenmanifestwithintheeconomic
decline.
Wehavetounderstand,thatthefatalflawinCommunismwastodiminishtheessenceofmankind.They
saynecessityisthemotherofallinvention.Thatissotrue.Ifwetrytocreateutopia,wedestroythe
veryenginethatcreatesprogress.Donotforoneminutethinkthatalaborunionisanydifferentthat
thecommunisticmodel.Itisnot.Whereinanormaleconomicmodel,toearnmoreoneimproveshis
skills,theCommunisticmodelpromotesadvancesincomewithoutimprovementinskills.
Thisunionlaborsystemstymiednaturaleconomicprogressandcreatedmuchdamagetothebenefitsof
theIndustrialRevolution.ThisisthefatalflawthathadledtothedestructionofAmericanjobs.Itfroze
thenaturaleconomicevolutionandbeganatrendtowardtransferringjobsoverseas.Thetrendwasonly
acceleratedbytheimpositionofthepayrolltaxthatessentiallyincreasedthecostoflabor.Historically,
mankindmigratedinanagrariansociety.Thisverysametrendstilltakesplacetoday.However,instead
oftheworkforcemigratingtobetterlands,thecommunisticmodelreversedtherolesandcausedthe
employertomigrate.Whatgovernmentdidnotnotice,wasthistrendwasnotcausedbythe"greed"of
theemployer,butbytheInvisibleHandofAdamSmith.Labordemandedthehighestwageswiththe
lowestproductivity,andconsumersdemandedthelowestpricewiththehighestreliability.The
employermigratedtosurvive.Throughouthistory,humannaturehasnevermigratedfornoreason.
Migrationstakeplacewhenproddedbytheficklefingerofnecessity.
Communism,whenimplementedasagovernmentpolicy,lastedonlyone72yearpoliticalcycle.In
1917,wefindtheRussianRevolutionandSunYatsensetuptherivalgovernmentinChinaat
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UnderstandingtheMississippiBubbleandtheFrenchBailoutthatsetinmotiontheAgeof
Revolution
Atfirst,youmightask:Whylookatsomethingfrom1720?Well,theanswerissimple.TheFrench
GovernmentwasinpartresponsiblefortheMississippiBubbleandcontributedtoitsexponentialriseat
theend.TheGovernmenthadtothenbailoutthemessand,topayforit,implementedhighertaxes.
Thisisnotsodifferentfromcurrentevents.
TheMississippiBubblewasafinancialschemenotsodifferentfromthewildunbackedderivatives
createdbyAIGandothers.TheschemewasatfirstengineeredbyJohnLaw,anearlyeconomictheorist,
whowasfriendwiththeDuked'Orleans.In1716,JohnLawfoundedBanqueGenerale,withthe
authoritytoissuenotesthatweretheearliestformofpapercurrency.Thefollowingyear,hefounded
Compagnied'Occident("CompanyoftheWest")withtheexclusivedealtodevelopthenewFrench
territoriesintheMississippiRivervalley.ThisenterprisebegantomonopolizethetobaccoandAfrican
slavetradeaswell.By1719,hethenformedthe"CompagniedesIndes"thatwasessentiallyjust
renamingthe"CompanyoftheWest"withacompletemonopolyoverallFrenchtrade.Thisnewentity
alsoassumedthepowersasifitwereaRomangovernorship,withthepowertobothcollecttaxesand
tocoinmoney.ThisoperationinessenceassumedcontrolofboththetradeandfinancesoftheFrench
government.
ItwasthislinkandexclusivepowerwiththeFrenchgovernmentandthevastexpansionofunlimited
profitsintheNewworld,thatcreatedtheimageofthebestpossibleinvestment.Thepublicwasnaive.
Buttheywerealsoexploringhowcapitalcouldbeusedtoactuallyworkandmakemoremoney.This
wasanovelideaforsincethefallofRome,duringtheMiddleAges,therewasnonationalorganized
statethatpromotedinternationalinvestment.ItwasakintothefallofCommunismandtheinterestin
investinginanewworldofprivateinvestmentinChinaandRussia.
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Itwasthisexpectationofpotentialprofitsthatcreatedperhapswhatmaystillremainasthewildest
speculativeboominhistory.BetweenthediscoveryofAmericain1492and1700,themajorityof
investmentwasprofessionalorsolelybythestate.Therewasnoopportunityforthepublictoget
involvedonaspeculativenature.Sothiswasthefirsttrueexperienceofallowingthepublicto
participateisthenewfrontier.Asthiscycleunfolded,itsdurationwouldbe224yearsfromthe
discoverytothebustthatsetinmotionRevolution.Thesharesoftheleadenterprise,Companiede
Indes,rosefrom500livresto18,000.By1719,625,000shareshadbeenissued.Thisboomgaveriseto
theterm"millionaire.Theboomwassoprofound,CompagniedeIndeswasmergedthereafterwith
BanqueGeIleraleandtheschemewasexpandedtoretirethenationaldebtofFrancebyexchanging
sharesforthebonds.
ThisledtoamonumentalspeculativebubblethatspreadthroughoutEurope.Asimilarthemeplayed
outinEnglandwiththeSouthSeaCompany.TheSouthSeaBubbletransformedintoaschemetoretire
thenationaldebtofEnglandinreturnforshares.Thatentireincidentoccurredbetweenlate1711and
lateAugust1720.Thelaststagesofthespeculativeboomsawthesharesrisefrom1281/2penceto
1,000betweenJanuaryandAugust1720.
BackinFrance,the"CompagniedeIndes"wassosuccessfulwithoutreallyproducingprofitsthatthe
Frenchgovernmentbegantogetinvolved.TheFrenchgovernmentbegantoissuepapermoneyitself.
Thiswasaformofderivativeforthemoneywaswidelyacceptedonlybecauseitwasconvertibleinto
sharesofthisnewcompany.Thevasteconomicexpansionwasfueledbytheunlimitedissueofpaper
currencybetweenlate1719andthefatefultimeoftheyearSeptember/October1720.
Thelinkagebetweenthespeculativesharesandthegovernmentfinancescreatedabustthatbecame
theclosestthingtoafinancialmushroomcloud.Thebearmarketcollapsewassosignificant,thatby
December1720,JohnLawhadtofleeFrance.Thecollapsewasfiercebecausetherewerenomarket
makers,middlemen,oramaturetwosidedmarket.Theconceptofputsandcallshaddevelopedinthe
earlierspeculativebubbleknownastheTulipmania(16341637)inNetherlands.Butthatpanicdidnot
involveadebtcrisisorthegovernmentissuingderivativeformsofmoneyconvertibleintostockshares.
ThelackofsophisticatedmarketfunctionsledtoaonesidedcollapseinboththeSouthSeaBubbleand
theMississippiBubblewithinthreemonths.TheEnglishsharescollapsedfrom1,000to124by
December1720thoughthecompanydidsurviveuntil1853.
Itwasthecollapseindebtthatdevastatedtheeconomy.TheFrenchgovernmentwasforcedintoa
bailoutassumingallthedebtsofthecompany,andthen,topayfortheirownfolly,begantoraisetaxes.
ThatsetinmotiontheresentmentthatledtotheFrenchRevolution.
TheFrenchBailoutTheRevolution(TheBonfireofDiscontent)
TheinvolvementoftheFrenchgovernmentinthespeculativeboom,alsoplacedthefocusof
responsibilityforitupontheKing.TheraisingoftaxestopayforthebailoutsetinmotiontheFrench
Revolutionfuelingthebonfireofdiscontent.TheRevolutionbeganwiththestormingofthejail,Bastille
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Day(7/14/1789)asitisrememberedtoday.ThisledthekingtofleetohispalaceatVersaillesinOctober
1789,whichthepeoplelaterstormedonJune20th,1792.Attrial,theyreferredtotheKingnowas
"CitizenCapet"andtriedhimfortreasononDecember1792.HewasexecutedonJanuary21,1793
followedlaterthatyearbyhiswife,MarieAntoinette.TheFirstRepublicwasdeclaredonSeptember21,
1792.ThiscitizengovernmentsimplyfaileduntilNapoleontookpowerin1799andeventuallycrowned
himselfemperorin1804.
Consequently,itwasthedirectinvolvementoftheFrenchCrownanditsverycostlybailoutthatresulted
inraisingtaxesandoppressingthepeoplethatledtothecollapseoftheFrencheconomyandended
withaRevolution.LookingatgovernmenttobailoutthefolliesoftheInvestmentBanksisadangerous
courseofaction.ItshiftstheburdentotheGovernmentandraisestheriskofpoliticalinstabilityinthe
longrunshouldtheGovernmentfailtoreversethetrend.Whatifweendinhyperinflation?The
massivemonetaryprintingandfundingofdebtscoulddriveinterestrateshigher,whichwillcompete
withthecommonmananddestroyhisabilitytosurviveeconomically.Ifwethenturntohighertaxesto
makethosewhodidnotcausethecrisispayforit(lettingtheinvestmentbankersoffthehookonce
again),howcanwejustifythisvasttransferofwealth?
ItIsAlwaysDebtThatDestroysTheBestPlansandFoundationsofMankind!
Thedebtcrisisisalwaysdistinguishedfromthemerespeculativebubble.TheTulipmaniadidnotchange
thecourseofhistoryasdidtheBubbleof1720.Likewise,theexcessiveborrowingbySpainandthe
desperateattempttoinvadeEnglandtopayoffthosedebtswithitsArmadain1588,resultedinthe
collapseofSpaintakingwithitItaly,whowasitsbanker.Intheend,SpainandItalylosttheirabilityto
beanysortofaworldpower.Itisalwaysdebtthatdestroysanation.ItdestroyedevenRome.
Whatwemustunderstandisthatwehavebeenevolvingasaneconomyforaverylongtime.
CommunismandSocialismareamerebliponascreen.Governmentssteppinguptobailoutthecrisis
raisesconcern.ForhadwejustlettheInvestmentBankersfailandstoodbehindthepublicdeposits
100%inCommercialBanks,wewouldhavebeenbetteroff.Sometimes,itishonestlybesttoletthefree
marketssortouttheweakfromthestrong,becauseitisquitefrankly,fartoocomplicatedtoanticipate
correctlythisiswhyCommunismalsofailed.
MarxrailedagainstthecomingoftheIndustrialRevolution.Hesawevilandwasblindtotheevolution
oftheeconomyasawhole.WearestillcaughtupinthephilosophyofMarx.PhaseOnewasthe
collapseofCommunism.PhaseTwo,willbethecollapseofsocialismstatepromisesthatareunfunded
yetseektostillcreatetheworldofMarxismtoalesserdegree.Thereisnotmuchdifferencebetween
thestatetakingtitletotheland,orallowingyoutokeepthetitlebutdictatehowitistobeused.Labor
cannolongermigrate,onlycapital.
TheCommunistic/SocialistictheoryofMarxiscollapsing.
ThisispreciselywhytheGreekCrisishasonlystarted.
ThisispreciselywhytheVenezuelaisdying.
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ThisispreciselywhyBrazilisintrouble.
ThisispreciselywhyPuertoRicoisintrouble.
ThisispreciselywhyBrexithappened.
ThisispreciselywhytheEUisdyingandtheEurowillcollapse.
Thisisjustthestart.
Oursocialisticlifemaybecomingtoanendbecauseourpromisesexceedourresources.
Ifwecannotseehowwemakethesamemistakesoverandoveragain,whathopedowehave?Wecan
surviveasasocietyonlywhenweopenoureyes.Ifwecannotdothat,thenwemaybeheadedintoa
newdarkageoffeudalismwiththebreakupoforganizedstates.Texasisalreadyconsideringitinthe
USAandBritainisnowstartingthepathtofreedomfromtheEU.
Wehavetostopthedebtandinsanetaxesbeforeitistoolateonceagain.Weareinthelastdeath
throesofMarxsideasofCommunism/Socialism.HerailedagainsttheGreatEconomicTransformation,
becauseheremainedjustaflyonanelephant'sback.
Today
Unfortunately,thefundamentaltransformationourcurrentpresidentstatedhewasgoingtodowas
reallyjustputtingthefinaltouchesonstartingthecollapseoftheonlyeconomicsystemthatcould
surviveandsavetheglobaleconomicsystem.
Fortunately,therearetwocountriesthathavetheknowledge,experience,andpowertoturnitaround
atthistime;BritainandtheUSA.
GreatBritainhasdonetheirparttostarttheturnaroundwithBrexit,buttheymustcontinueontheir
pathtocompletethetask.
TheUSAcanquicklyturnitaroundifwearerationalandobjectiveandthisispreciselywhytheDonald
Trumpphenomenonhasarisen.Believewhatyouwill,butthismanisbrilliantandunderstandsprecisely
whatisatstakeandknowshowtocorrectit.Ofcoursehewontdoithimself,butheknowswhatneeds
tobedoneandthepeoplethatcangetitdone.
Weneedtorestructureallagreement,eliminatesocialisticprogramsingovernment,andmakeall
departmentsprofitablewithoutsubsidy.
Thisisonlythebeginning.Wehavealongwaytogotogetbacktofreedom.
Letshopeitstartsnowandhelpitonitswayback.
Thealternativetofreedomis...is...
...wellletsjustsayitiseconomicdestructionandpoliticalslavery.
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TheS&P500marketisimmediatelyinaneutralpositionforrightnow.
Whilethismarkethasbeeninabearishconsolidationphaseoverallforthepast6months,thepast3
monthshaswitnessedarallyof15.84%percent.
Systemically,myexpandedviewrecognizesthatthecurrentbearishprogressioninS&P500CashIndex
reflectsonlyatemporaryreactionwithinabroaderbullmarkettrend.Thisiswhywepostedabuyalert
whenthefalloutfromBrexitoccurred,weboughtsomeemotionallydiscountedassets.
Resistanceconspicuouslystandsatlastyear'shighofasindicatedbythegreenbarinthechart.Sofar,
thismarkethasremainedinabearishtonesincethe2134.72majorhighestablishedbackin2015.
PleasefollowyourWealthPreserverarrowsandkeepreadingourprivatemarketalert;theyare
astoundinglyprofitable.
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Abodyofresearchinpositivepsychologysuggeststhatoptimismhasanumberofbenefits:social,
psychologicalandphysical(Schneider,Grumman,&Coutts,2011).Optimismhasbeencorrelatedwith
improvedmentalandphysicalhealth,betterworkandeducationaloutcomes,andrichersocial
relationships.
Whileoptimismappearstobeahealthyorientation,thingsarenotquitesosimple.Someresearchers
identifytwoclassesofoptimism:realisticandunrealistic(Weinstein,1980).Unrealisticoptimistsareat
riskforselfdeception,especiallyindomainssuchasriskassessment(Collingwood).Realisticoptimists,
ontheotherhand,moresuccessfullyincorporatedataaboutsituationsandevents,balancingthebest
ofoptimisticandpessimisticperspectives.Therealisticoptimistpointofviewcouldbesummedupby
theadage:"hopeforthebest,preparefortheworst".
Tomakemattersmorecomplex,theideaofoptimismandpessimismasdispositionalattributesisgiving
waytoamorenuancedviewoftheseconstructs(Paul,2011).Neitherperspectiveisinherentlygood
nor"bad",bothcanbeadoptedasneeded,bothmaybeconsideredhighlyfunctionaldependingonthe
situationalcontext.
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Insomesituations,"defensivepessimism"canbeapowerfulmotivatortomakebetterchoices.For
example,beingpessimisticabouttheeconomymaybeamotivatortoavoiddebtandmanageyour
moneymoreeffectively.
Personally,I'vealwaysconsideredmyselfsomethingofarealist.
Onascaleofhalfemptytohalffull,mostofthetimeIthink"oh,there'saglasswithsomewaterinit,
let'smeasureit".
Insomecontexts,I'mmoreoptimistic(e.g.,ifI'mworkingonthisnewsletterandIhaveasufficient
degreeofcontroloverit,I'musuallyreasonablyoptimisticthatitwillsucceed),inothercontexts,I'm
lessoptimistic(e.g.,ifI'moutfishingonaSundaymorning,andthetidesareallwrongandI'moutof
bait,I'mreasonablypessimisticaboutbringinghomedinner).
InsidersPower
Ibelievesocionomics,socialmood,andcapitalflowsdriveeconomiesincyclesglobally.Becauseofthe
WorldWideWebthereisnotimeinhistorythatallowsforeasierdatagatheringandtrackingbecause
allcountriesarenowhighlycorrelated.
ThisInsidersPowerNewsletterisacompilationofcurrenteconomicarticleswritten,notbyus,butby
globalauthorswithinthelast90days.Theyrepresentthecurrentglobalsocialmoodandcreatesa
globalPointofViewthathas,bytheway,beenextremelyaccuratefromancientGreeceandRometo
ourowncurrentsociety.
Itrepresentscurrenteconomicrealityonaglobalscalewhetheritspositiveornegative.Ultimately,Be
mindful,preparedandverydiversifiedandmostimportantly...watchyourWealthPreserver
SubscriptionGreenandRedArrowsontheequitymarkets.Itdeliverstheopportunityofanoptimistic,
positiveandprofitableoutcomeforyou.
Basedonthecriteriaalreadyoutlined,IbelieveInsidersPowertobeanextremelyREALISTICnewsletter
thatcarriesbothOPTIMISTICandPESSIMISTICcontentthatdeliversanOPPORTUNISTICoutcome.
Ultimately,Ijusthopeyouenjoyitscontentandprofithandsomely.
InsidersPowerhasreceivedbothpositiveandnegativecommentsbyreadersandweappreciatebothso
pleaseopineanytimetoInsidersPower@InterAnalyst.us.
Bytheway...whichpointofviewdominatesyourpersonality?Nowaskyourfriendorspousetosee
iftheyagree!
13
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