So the trick right now is to buy items that after a reset can be taken to a market place and be sold and bought for with a new currency.
I guess you have traditional items like gold and silver, which have physical properties that do not change when national currencies and money systems change.
We also have crypto, which SAFECoin to me makes most sense - as it provides access to raw functionality. In a data economy/world, having direct access to computing resources even while a banking collapse is in progress will keep wheels spinning.
In an extreme case, land and food production is what you really need to own for a total collapse but I really donât think that will happen.
If I can exchange 1 safecoin for a loaf of bread I think I would have done well to preserve some purchasing power.
Iâm not sure we didnât see that deflationary âcollapseâ back in March. Some oil futures even went significantly negative. Was short-lived, but the money printing since then has been insane. Add yesterdayâs EU bailout deal and silver is off to the races. I think we may have bypassed the deflationary stage for now. May be inflation as far as the eye can see for the next 5 - 10 years. As much as it doesnât really make sense to me fundamentally, the price signals are all full speed ahead for inflation.
@Antifragile Genuinely curious when I ask these questions. Why would the digital 1âs and 0âs in peoples bank accounts disappear? Do you believe there will be some great debt reset and if so why and how would that play out? Would those most in debt be the winners or losers? Eg. if people have loans do the loans get wiped and people keep their property or do the banks take everything away like after 2008-9?
Personally Iâm expecting a head fake in the stock market before another serious drop. But that also might not happen.
Where do you read up on this stuff? Iâve been trying to really tune into this.
My guess is inflation will be much higher soon and maybe debt is something you would want until the can canât be kicked down the road anymore (maybe 2030?) and then deflation will devastate us all and youâd want your debt gone by then.
The Great Reset | World Economic Forum not an answer to your general questions @Nigel, looking forward to seeing what @Antifragile has to say about that, but this is interesting reading on âThe Great Resetâ
I agree completely. I think covid has been used as the cover to print money like crazy not only to compensate for the virus impact but offset the other problems/imbalances. The only question is whether we âseeâ deflation before inflation takes off. The PM moves would indicate that unlike 2008 that the answer is ânoâ. Perhaps the money printers are ahead of the curve this time. But maybe there will be another down wave first. Probably depends on how soon a vaccine comes out and whether further stimulus is rolled out.
Thatâs why I see them killing cash. If no one can use cash or pull cash out, then the shenanigans can go on infinitely, even infinitely negative interest rates.
@Antifragile what you are describing here is what is making me wonder if it is possibly one of the best times to use debt as leverage in say buying multiple properties. Once inflation really kicks in and your payments are locked in and prices and wages increase across the board, those payments just continually shrink down to almost nothing. As long as you are solvent before the inevitable deflation bubble pop in likely a few to several years, youâve done quite well. Assuming it plays out that way.
Way too much fear being tossed around here. Whether we like it or not we have been living on digital money for a long time already. It doesnât matter that we do or do not print actual cash. The only reason fractional reserves mean anything is if people 100% need cash to pay for things. They donât. If you want to use âcashâ use a debit card and banks in the US will not collapse because the argument being posed here is really which form of money, physical cash or numbers in a bank account has more qualities that make it fiat. Inflation may occur, credit markets may go upside down but at the end of it if no one trust the USD, then we donât have a financial system. Reading some of this stuff reminded me of total doom and gloom guys on financial TV. Letâs pump the breaks.
If the financial system goes pop, it will make covid-19 and the 2007 great recession look like a walk in the park. Stashing a few gold and silver coins wonât be much use until long after a recovery. Keeping a job and feeding yourself would be a much greater concern.
Fortunately, as covid-19 isnât the end of the world, it is highly unlikely that the entire financial system will collapse. It is possible, but highly unlikely. I donât think this era is done yet by a long chalk.
Doom mongers are just that. Planning for today and tomorrow is much better than planning on Armageddon coming, IMO.
I agree with your point, the only thing I see as a thread now is the USA and especially the EU slipping towards communism (or facism), which would leave everyone holding the empty bag.
You think we will see 2 decades of suppressed housing asset prices in tertiary cities as well as suburbs of primary and secondary cities? Your statement needs to be met with a qualifier that if you believe what you wrote (some of it plausible) that the majority of falling real estate will be in primary cities as well as all class level of commercial property, primarily class A office space. Your Japan example doesnât make sense in the US in relation to rental properties or what has been low inventory for nearly 2 years only exacerbated by COVID. It is more likely we see a reset in major cities like NY, San Fran, Seattle ect. rather than blanket real estate stagnation. People also keep forgetting that while the generation with the greatest wealth in the history of the world will pass on and are the current sellers, that estimated 50 trillion dollars in wealth is being passed to their heirs to invest, some of which will be real estate.
In the US you can get a 30 year fixed rate home loan for 3% or less. Not very inflationary. But it will be inflationary on hard assets down the track. The CPIâs will all say no inflation because they are rigged anyway
Right. Rural properties are on the rise because of this so is a decent market, at the moment at least.
Japan really is the poster child of the effects of deflation. Much of it becomes psychological and hard to break out of deflation if it really takes hold, so I do expect any response from the FED to be quick and generous.
Thanks