The Single Most Important Weekend to Survive the Next Collapse Just Began
Issue #29 November 15th 2019-Wealth Matters Warning!!!!
It actually pains me to write this newsletter. It scares me that most of the 1251 people who subscribe to me will ignore it and that the billions of other humans out there will never see it. For the 312 (average subscribers who read these in full daily) I hope you pay the most attention and take the most action off of this issue, than any prior one.
But let’s start with some important facts about my motivation and what lies below:
1) I am not fear-mongering here and don’t believe in the practice of it.
2) I am not selling you anything at the end of this.
3) The only thing I am selling you is to invest (time) in your understanding of these macro forces, and take whatever action you can since I realize that the majority of you are not professional investors and wouldn’t overwhelm you with steps that required you become one.
Just read and watch the curated nuggets below, be willing to make yourself temporarily uncomfortable, “do your own research”, and most importantly “take action” that escapes you from the herd who will be financially slaughtered.
4) My motivation is purely out of the moral guilt I would feel for not at least trying to sound the alarm while there were precious days/months left.
My intent is merely to provide practical (in laymen’s terms) directional and generation-specific actions to be considered and illuminate the simple ugly truth tumors that underly (and ultimately undermine) the global financial system as we know it.
5) I WANT DESPERATELY TO BE WRONG!
Why this weekend is one for tough love & pragmatic planning and action
In Biblical lore, Noah didn’t build his ark when it was raining. You and I can’t afford to either. The next collapse won’t be a Category 5 Hurricane you see on the mainstream news coming for weeks with time to evacuate. It will be a 10.0 Magnitude Global earthquake on an otherwise sunny day, and followed by a Tsunami, and there are only a few vessels strong enough to survive that wave.
On the positive side, the opportunities (Golden Age) on the other side of that water finding its new level (which it always does) will be too numerous and incredible to count, but only if you are still in the game to benefit and have the awareness to recognize them and take action.
Symptoms that can’t be ignored
1) The global banking system is cracking internally/quietly under tremendous liquidity pressures in the overnight lending market (REPO) and is more vulnerable to collapse than this equivalent period of time in 2006 and beginning of 2007 (we all know what happened in the Fall of 2008).
Every established asset class of the last 50 years is beyond a bubble. In the last, 6 months alone 3 major U.S. banks (Bank of America, Wells Fargo, and earlier this month Capital One on Nov 1st, 8th, 12th) literally were down (no internet banking or mobile banking access) without explanation and if the REPO market is the only thing preventing a bank run between the banks, then what that could mean for the rest of the business world would be catastrophic.
Duestche Bank is comparable in size and importance to Lehman Bros in 2008, but the difference that makes it more important is the fact that it also has 600m everyday depositors around the world, (yes, it does retail banking too where Lehman did not). Roughly 8 percent of the world’s population are Deustche Bank depositors who trust their daily needs and “risk free” savings being held securely and readily available. Deustche Bank has multiple trillions of dollars of financial derivatives exposure (yeah those financial weapons of mass destruction Warren Buffett warned us about never got eliminated). If this domino was to follow any similar type of trajectory into bankruptcy as Lehman did, it would cause a crisis exponentially more threatening than 2008.
WHICH IS WHY I BELIEVE THE ECB WILL LIKELY NEVER LET IT HAPPEN. BUT….
Preventing this type of thing from happening and continuing the doom-loop of central bank printing, negative interest rate (Fed, and European Central Bank, etc) “free money” to prop Deutsche up and protect the rest of the banking system only further exacerbates the inevitable “judgment day” so that there is a little more time for those in the know to build their arks before the flood.
The Great Leveraging is at critical mass-The Great De-Leveraging must follow:
Questions you must ask yourself this weekend.
Since I promised to do my best to provide you a Laymen’s level understanding and practical things to consider I will stop nerding-out on the complexity of it there and give you the questions you need to answer for your family’s future this weekend below (along with 3 informative and brilliantly done easy to digest videos to rapidly encode “context” that I have curated from other thought leaders and experts I respect.
Based upon your demographic and current net worth I have provided some directional (action-causing) questions to ask yourself and your partner/spouse this weekend.
Questions that everyone reading this should ask before the socio-economic/demographic-specific suggestions below include:
1) Are all of our savings in cash or cash equivalents inside of a bank?
2) Do we own any physical gold or silver (1oz bars, gold coins, etc.)?
3) Do we store that precious metal in a bank deposit box or a private vault? (Hint: find a private vault/secure storage facility with anonymity and pay cash for the annual subscription of your locker and don’t use your actual name as the username)
4) Do we know how to buy, store, and secure Bitcoin?
5) Do we have 3-6 months of household income/overhead in cash on hand stored outside of an institutional bank?
6) Do we own illiquid (non-rentable) real estate that carries a mortgage?
WATCH THESE TWO VIDEOS (1 HR TOTAL) TO ENCODE CONTEXT BEFORE ANSWERING THE REST OF THE QUESTIONS BELOW:
Ray Dalio is the founder of the largest Hedge Fund in the world Bridgewater. Since retiring he has turned servant leader/economic system sense-maker for the masses in retirement with great books like Principles and Surviving The Big Debt Crisis. Watch this first to understand how the current system works in an incredibly clear and layperson’s explanation.
George Gammon is new to my awareness, but when I thought about shooting my own video this morning to explain the current dynamics, I stumbled across this video and he NAILS it powerfully and brilliantly simple enough for most people to follow, so I am endorsing this video as the November 14th, 2019 WARNING!
In Closing
Ultimately I describe myself in a handful of words and my mission with these questions and this “red pill” tough-to-swallow, and tougher-to-write issue are based upon me being a pragmatist, optimist, humanitarian, doer, communicator, and servant leader.
I hope you are encouraged to get uncomfortable and try on new paradigms for action and planning before you are forced into discomfort on someone else’s terms and don’t have a plan.
On Monday I will begin a series on how “Every Golden Age in History Has Followed a Major Crisis”, but first you need to prepare your family for this coming crisis. Add the suggested items below to the ones above this weekend based upon your situation:
If your current net worth is <$0 and you are in debt or disenfranchised
1) Why do I/we believe it is someone else’s job to take care of me/us?
2) How could the next economic system and people’s lack of understanding around the new skills needed provide me a chance to break through without permission and shift my family tree for the positive?
(Watch Hidden Figures this weekend and channel your inner Dorothy Vaughn (who ignored limitations and realized that learning Fortran (the language of supercomputers faster than anyone else in at N.A.S.A. (the language of supercomputers) was her chance to become indispensable in a white-male dominated and segregated world.
3) Do I buy stuff with money I don’t have to impress people I don’t even like to look like I have my life in order on social media?
If your current net worth is <$1m and you are under age 55
1) Do I/we have a career or business idea that is built for the next 100 years or the last 100 years?
2) Do we have the majority of our net worth in our personal residence today? If so, should we sell it now, rent something comparable or more efficient, and put the profits into liquid stores of value like Gold, Silver, and a little Bitcoin until the next crash
If your current net worth is <$1m and you are over age 55
1) Do we carry any consumer, medical, or mortgage debt?
2) Is the majority of our illiquid net worth in a house?
3) Do we own that house free and clear?
4) If we owe debt on that house does that subdivision have potentially risky limitations in a downturn? (i.e. Are our neighbors highly leveraged in their homes?-you can find this out by public title and grant deed records at the county library or title company, or are we in a suburb that has seen younger families moving away or moving in? Are the covenants of our neighborhood 55 and up only?
5) Are we on a fixed-income heavy portfolio and how solid are our health benefits?
6) Are we real estate rich and 1031 exchange tax-advantaged, but cash poor? If so can we divest out of the 1031 exchange mechanism into an Opportunity Zone fund to diversity our next 10 years into a multi-asset strategy while still mitigating near term capital gains taxes for 7 years and take the long term capital gains over the next decade tax-free?
If your current net worth is $1m-$49m and you are under age 55
1) Are you mitigating capital gains taxes with an election into qualified opportunity zone funds?
2) Are you allocating 5-10% of your liquid net worth into gold and silver ownership and another 5-10% into Bitcoin?
3) Are you looking for cash flow positive properties that provide affordable housing ($1k per month avg) and depreciation benefits to your taxable income, while also benefiting from any future inflation in rent as the FIATs get devalued over the next 10-15 years from now while your cost models and fixed mortgages stay the same?
If your current net worth is $1m-$49m and you are over age 55
Ask all of the questions in the prior section but also add
1) Is now a good time to expatriate from the U.S. U.K. (specifically) if we plan to get far wealthier and before the next two election cycles complete, because the confiscation of wealth is well underway regardless of who gets elected?
2) Do we plan to retire in the next 5 years or are we retired?
3) How much longer do we plan to live?
4) Do we have our personal assets in a Family Trust or Wyoming LLC for protection?
5) Do we have the proper trust-estate succession plan in place to shield our estate from probate and other confiscation?
If your current net worth is $50m+
You don’t need my advice but I appreciate you listening and would love to discuss, debate, or put thought exercises around these suggestions with you and how to help others learn from our collective intelligence.
Happy Friday! You’ve got some work to do this weekend on your Ark! ~Chris