The Great Paradigm Shift Has Arrived
[The following post is by TDV Chief Editor, Jeff Berwick, and is a select portion from the March TDV Newsletter]
Many people locked into backward-looking mainstream media have no idea of the changes that are already in process. It is truly a time of extreme change but for those not paying attention everything still looks “
the same”
. Normalcy bias still keeps many totally unaware of what is happening and what is about to happen.
To put it bluntly, everything that you have accepted as being normal during prior decades is going to change — dramatically!
Looking back on the last few hundred years you could have also said the same thing in the 1800s. Back then there really wasn’
t much of what we would consider “
normal”
life today. Near the end of the 1800s electrical power had really just begun to be used and still wasn’
t widely available in most homes. Telegraphs were the only way to transmit information over long distances. There was no telephone, radio, TV nor internet. There were no cars and certainly no airplanes.
Essentially, the world looked nothing like how it looks today, all in the short span of less than 200 years.
And, even in the last decade the changes have been dramatic. Today, as TechCrunch pointed out, "
Uber, the world’
s largest taxi company, owns no vehicles. Facebook, the world’
s most popular media owner, creates no content. Alibaba, the most valuable retailer, has no inventory. And Airbnb, the world’
s largest accommodation provider, owns no real estate”
. And none of them even existed more than a decade ago.
While technological change will be a big part of the next decades and century the major changes that we are going to see in the coming decade are going to come from a massive change in the systems that have been built up over the last century.
This is important both as an investor and as a human being who would like to survive the coming collapse to witness the potential great future of peace and prosperity once these archaic systems collapse.
In short, whatever has been working for the last 50 years is unlikely to work in the near future.
THE COLLAPSE
The entire Western world has been subject to ever increasing fasco-communist government interventions into every aspect of life and Keynesian centrally planning of the economy via central banks for decades now.
All of these systems been have so intertwined into our lives that there is simply no way to know what things would look like without them, but we will soon find out.
I’
ve spent the last five years making the case for why these systems are reaching the end of their rope so I won’
t rehash that too much here. But, here are just a few hockey stick charts as a reminder.
The US government is reaching near terminal velocity on debt. And this leaves out at least $85 trillion in liabilities which cannot be paid for via any means except money printing.
That money printing went into full effect in 2008 and has resulted in a quadrupling of the US monetary base in only a seven year period.
Further below I’
ll get into how this will play out resulting in hyperinflation.
We’
ve also now been in a Zero Interest Rate Policy (ZIRP) for an unprecedented 7 year period. Even the thought of increasing rates by 0.25% is so risky to the global economy that the Federal Reserve still can’
t bring itself to do it and even talking about doing it can nearly shake down the entire economy in this highly tenuous state. And, consider that the Federal Reserve keeps printing money and keeps interest rates at 0% while the stock market is at all-time nominal highs. This is also completely unprecedented.
The reason they do keep rates at 0% is due to the massive increase in debt in the economy.
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Total debt has doubled since 2000. An increase in interest rates will implode everything. Not only can they not increase rates if they want anything resembling an economy left but many countries have already resorted to going to negative interest rates. The European Central Bank (ECB) was the first major central bank to venture into negative territory and its deposit rate reached minus 0.2 percent in September of last year. Since, Sweden, Denmark, Switzerland and Germany have followed suit with negative interest rates.
Interest rates near 0% is unprecedented in 5,000 years of human history.
The entire Western economic, financial and monetary systems are backed into a corner and there is no way out.
Here are my predictions on what happens next and how to protect yourself.
[Editor'
s Note: This is just a portion of TDV Chief Editor Jeff Berwick'
s blog for the March TDV Newsletter. This week the TDV Team takes you on a whirlwind tour around the world of finance, Bitcoin, expatriation and more. With news from the TDV Portfolio, an interview from Buenos Aires, as well as a note from Redmond Weissenberger, this month'
s Newsletter is another "
can'
t miss"
. Join us here.]