Important Economic Trends During Anarchy – Week 3

2020 – Something Big is Afoot. Are You Prepared?

The Dollar is the Only Important Global Currency… today.

The most famous question in history occurred when Pontius Pilate asked Jesus “What is Truth?” while facing Jesus, who is the Truth. Obviously, the theory that truth varies with circumstances predates Jesus and is extremely strong today. Totally false, that theory is the source of the confusion today. Truth is not “relative”. It is fact and sometimes called reality. Good decisions are based on the Truth, but The Truth can be painful to hear.

The global economy is in recession today because of the virus created in the Chinese bio-weapon lab in Wuhan. If it was naturally occurring, the bats in China would be quite sick. It spread because China discontinued domestic flights in China but allowed international flights to occur while denying the virus was transmitting from human to human. Our economic recovery will take years. It will occur only if we have good capitalistic business heads in charge.

In an effort to offset the economic effects of the Wuhan Virus Recession, our central bank (The Fed) has engaged their arsenal of monetary weapons so that our interest rates are the lowest in history. With inflation running about 1.5% the REAL interest rates today are a NEGATIVE 0.8% based on the 10-year Treasury. That is an important indication of The Fed’s stimuli.

Fiscal stimulus from the Federal government is also historic in scope. Congress has passed three Acts totaling Trillions of dollars the government cannot afford. A fourth bill is being discussed. This deficit spending means our national debt is skyrocketing at a rate that normally leaves countries in default. The U. S. debt being issued is being bought both by foreigners and The Fed, a mixed blessing.

Foreign investors are buying our debt because our low interest rates are still positive while most other countries’ debt carries a negative interest rate. They are chasing that positive spread. The U. S. stock market is booming not because of business fundamentals but because it is the only place where an investor has the opportunity to earn a return on their capital. This is a manifestation of the Greater Fool Theory – someone else is the greater fool that will buy your stock when you sell. Tears are coming.

Financial analysts are not discussing what happens when the market “Reverts to Mean” or average. When that happens, The Greater Fool Theory will prove false and the reaction will look like someone yelling “Fire” in a movie theater. That is when the tears will arrive.

Since the middle of March, I have witnessed some previously unimaginable things occur in the markets and in our cities. What is happening in our cities is not racial, it is anarchy. To understand it, one must face The Truth. To discern The Truth, let us look at two critical questions:

  1. When your media is delivering only their opinion and not the complete facts such that only product ads are anchored in truth, has that media become a propaganda machine?
  2. Since the Democratic Party, national and in Virginia –
    a. Has elected members of the Democratic Socialists of America (DSA) to public office and DSA is a self-described communist organization;
    b. Embraces the Movement for Black Lives (M4BL) which is behind Black Lives Matter (BLM) AND M4BL is a self-described Marxist organization;
    c. has the Democratic Party become the communist/Marxist party?

If you think I exaggerate, consider that AOC, a freshman in the House of Representatives is actually driving the conversion to Marxism nationally with Pelosi in a figure head position. In DC you have to “pay to play”. Money is everything. Apparently, AOC has an enormous amount of money to hand out to other Marxist candidates. During the primaries her candidates have largely won. What is the source of AOC’s money? She is an avowed Marxist. Is that Bingo?

The M4BL which is BLM and whose founders’ writings and Manifesto on the internet call for:

  • The replacement of capitalism with Marxism;
  • Eliminating the traditional family because they are opposed to fatherhood.
  • Having their own community, excluding whites who they consider biologically inferior.
  • Having their own M4BL armed “patrols” to combat police.
  • And eliminating “Karens” who they define as suburban, white, married, women.

Democratic Socialists of America (DSA) – is a self-described communist organization which is embraced by the Democratic Party. How many DSA legislators are there in the Virginia legislature? Several. Want to get scared, how many nationally? More are coming.

Watch the “war” going on between Antifa (the Marxist “Nazi Brownshirts” of 2020) vs the police in cities across our country. This is not a protest about race and statues, it is right out of the Marxist/communist play book. Highly organized, it is intentional. Is Obama’s “Organization for Action” involved, whose staff is 20 times the size of Trump’s re-election campaign staff?

While the current strength of the US Dollar is an enormous positive to our economy today, that foreign money is called “Hot Money”. It will follow the “spread” and exit just as fast as it came into the USA. And that ladies and gentlemen is one of the greatest sources of RISK we face in our economy. Hot money will exit. The two questions are “When?” and “What will be the impact on our economy and thus the land market?”

The impact is predictable – a rapid exit of capital would mean a rapid increase in interest rates. Increased interest rates reduce the amount of loan a buyer can obtain which reduces the price they can afford. In simple terms, real estate prices go down, the economy slows, and if it slows enough than we go into a severe recession or even a depression.

When could that exit occur? The Truth – the election on November 3, 2020, will determine whether:

  1. The U. S. Dollar remains strong because we elect leaders who are believers that capitalism and democracy are the vehicles for prosperity;
  2. Or the U. S. Dollar collapses because we elect leaders from the party that has become Marxist/communist.

In these perilous times, I believe land is the best long-term investment so long as we elect leaders that support capitalism and democracy. If you believe the Democrats are going to win, you want to own gold, hoard food, and buy guns along with ammo.

“Then Jesus said to the Jews who believed in him, “If you continue in my word, you are truly my disciples; and you will know the truth, and the truth will make you free.”

(John 8:31-32 New Revised Standard Version, Oxford University Press)

Capitalism builds wealth, socialism consumes it in self destruction. I serve an awesome God.

Stay healthy,