AFFLUABILITY

Thanks to my friend Kent I can show you this funny video from ABC about the global indebtedness:

http://www.abc.net.au/news/video/2010/05/20/2905304.htm

The cross-nations indebtedness is no issue: You just cancel each others debt, and end up with the net.

The real issue is the net. So, who is that owed to?

The most exact answer is: The taxpayers and their children!

Why is this the most exact answer?

Because no government has anything without the taxpayers giving it to them! What the taxpayers don’t give now, all in one go, they will have to give in future, and their children too.

That does not always mean rising taxes, don’t worry. History shows, in the long-term, it usually means hidden taxation too: Inflation, Currency reforms, Debt cancellations towards the population, and Wars.

Am I sarcastic? Yes, a bit.

Am I right? Unfortunately yes.

The best bit of ABC’s video was of course the sentence at the end.

JOHN CLARKE: Because the US economy is so much stronger than the European economy.

BRYAN DAWE: Correct. Why is that Roger?

JOHN CLARKE: Because it’s owned by China.

Yep! It’s what I mentioned in my recent book, to help people realize that they may be betting on the wrong horse: Up-to-date indebtedness figures show that, meanwhile, the US is owned by China. Indeed.

If China pulled out all assets from the US, the US would be sucked into the ground.

You don’t need to worry about this either, though. China wouldn’t do that.

Why?

Because, then China wouldn’t have people to buy their products at high dollar prices abroad … which keeps the Chinese economy booming.

So, what’s the essence of all this?

The same it has always been – for the few with REAL financial competence: Don’t ever put long-term reserves in debt instruments!

(Hundreds of millions of people still do. I fear they will bear the consequences before they die…)