One of the major questions people of this generation have today is “where are all the good jobs?” Many people outside this generation have that same question too. I think people are getting tired of hearing how well we’ve recovered since 2008 and starting to see it as a lie. In actuality, it is much less a problem regarding our economy, and much more-so a problem of our banking system. I’ve spoke about this in another article and presented to you how when a depositor puts a dollar in a bank, the bank can loan that same dollar out 10 more times to 10 different people.
What’s worse is that the FDIC backs depositor accounts up to $250,000. That sounds good at first, but it isn’t, and here’s why:
Since the government backs every account up to a quarter million, banks can frivolously invest in anything they want to without regard to their investments. If they decide tomorrow to invest 99% of their deposits into, say, pencils, and then the pencil market fails, the banks and depositors just lost all that money. But “thanks” to the FDIC, the government just “replaces” it. If this happens too frequently, however, we have the tendency to create an inflationary scenario in which more money becomes available, thus removing a portion of its former purchasing power.
Let’s take a look at another scenario, shall we?
Suppose the banks decide to loan all the money out to their friends in business. The businesses then buy supplies, employees, materials, and whatever they want with your money. What ends up “trickling down” from this is inflation (removal of purchasing power) from you and you only, the average depositor. This is because the businesses were able to buy things with pre-inflated money. In other words, when they bought things, they had more purchasing power than you did / do by the time it gets back down to your account.
Of course this is somewhat simplified for explanation purposes, but this is very much how it works today. Banks and governments can borrow and create money indefinitely – or at least until the people don’t want to play by the “rules” anymore. In the mean-time, they buy up all the important primary and secondary wealth (land, food, and mining areas) while the ordinary person works him or herself half to death for tertiary wealth (claims on primary and secondary such as paper dollars).
The end result is the average person and small businesses become over-leveraged in debt that they believe they have to pay back, thus causing eventual lay-offs and shut-downs. Companies end up having to merge just to be able to look good on a balance or asset sheet, and then borrow again just to keep things going a little longer, all the while the employees who work for them are already destined for layoff.
The answer to all of this of course is that we the people compete by producing things of our own again. Rather than focusing on working for someone else as a career, it is better to focus energy on your own business and the production of highly polished ideas, services, and products that solve real problems. This is one way to increase total GDP if done correctly, but more importantly, your own business is far more secure in today’s world than an income which relies on another entity.
But how did we get here?
Greed begets debt, and debt begets war, and war begets more debt – until everything has been swallowed up in so much debt that countries have the choice to either default on their loans, which causes major economic depressions, or print more money and inflate the system with more, but less effective, dollars until the same outcome happens. Don’t believe this is already happening? Consider the penny.
It costs 2 cents to make a penny. Why then do we still make them? Well, quite simply, it is rooted in a lie – the lie that tells you everything is fine and not to worry about any of this. It’ll be good and it’s different this time.
The reason why we pay two times more money than a penny is worth is because the government doesn’t want to admit it has a massive spending problem. And as long as you believe that, you’ll believe much else too. Kind of like how the market is “picking up” and jobs are coming back. Manufacturing and Trump are here to stay again, right?
Well, I hope so dear reader. But I fear that hope has been deferred.