These distinctions are important to everyone because history is nothing but change usually unexpected and often calamitous and reliance on the permanent stability of any economic system is absurd, as is the expectation that economic forces won't toss YOU around like a paper cup in the surf.
Unemployment in the U.S. remains at ten percent, prices continue to skyrocket soon a gallon of gasoline/petrol will cost as much as coffee at Starbucks and wages steadily go down while benefits disappear overnight.
Readers engaged in developing their Working Mind should prepare for the inevitable Bad News that inept politicians & government careerists imagine can be avoided by irrational policies & empty promises and by their commitment to ignorance & hypocrisy. Some bubble is going to burst History likes to play that way and the only question is who will survive. The developing Working Mind may be able to reduce harm from such inevitable events as war, pestilence, famine and economic collapse, but only if personal corrective actions are taken.
An economy based on consumerism (not productivity) cannot survive the realities of economics. The Great Depression that began in 1929 was caused by reliance on credit-based ('on margin') profit-taking on the stock market. The only difference today is that the entire economy is based on credit margins & profit-taking, measured by the pumped-up stock market. Sudden collapse due to the stupidity of George Dubya, possibly after replacement of Alan Greenspan with someone even worse for America, will come as no surprise to anyone who is paying attention to news media not owned by the Oligarchy.
The collapse might be avoidable, but Dubya won't implement any such solution. In fact, one of my buddies has suggested that economic collapse is the intention of Dubya's economic policies.
The U.S. economic bubble will indeed burst, as Ayn Rand foretold in "Atlas Shrugged". Maybe worse.Will you be prepared? Or will you be standing naked and dumbfounded in the path of the economic tsunami when it occurs.
The following three economic distinctions are followed by strongly recommended personal actions & practices for readers who are engaged in further development of their Working Mind. These alterations in behavior will reduce the impact of such historic events.
But the cushion of such lop-sided wealth is just that: a cushion, and not a guarantee. The gap between the nature of economics and the pretenses of the consumer-driven, credit-based Virtual Economy is an abyss, one filled with the hot air of belief that any economist has a clue what will happen tomorrow or next week, much less after more of Dubya's willful economic malfeasance.
When the economy next crashes, the Elite may feel a jolt. But even if the worst happens something worse than Republican President Hoover's Great Depression the massive wealth of the Elite will let them down gently. They won't like it, but giving up some shiny new toy (priced equal to a year's pay on minimum wage) is not as hard to take as standing in the line at a soup kitchen in a pouring rain day after day after day.
Regular folks, including the Middle Class who lost 60% of their equity since 1980 to the rapacious Elite/Oligarchy will be stripped of the merest access to the Virtual Economy. Employers will fold, more factories will close, jobs will disappear, credit cards will be cancelled and demand made for immediate payment and hundreds of thousands of Americans will lose everything. (This inevitability is likely the cause of the G.O.P.'s recent disabling of personal bankruptcy protection: bye-bye primary residence, hello living in your car.)
As in The Great Depression of the 1930s, there will be no commerce from which the Oligarchy can spoon off the cream, nowhere for small businesses to seek temporary capital, no safety net to prevent tumbling down the Ladder of Success.
Millions of shocked individuals will say 'Ouch' (and worse) and look around and find nowhere to turn. The Elite will beef up security around their gated communities (the moat around their fiefdoms). New dustbowl 'Okies' in suits by Prada & Armani will have nowhere to migrate to. Instead of blowing away the topsoil, the winds of change will be blowing across acres of empty parking lots in every city across America. The malls will be silent, the checkout lines will be short, and customer service numbers will reach disconnected phone lines.
The Virtual Economy involves unseen databanks and snooty executives in air-conditioned office towers and whirring computers subtracting automatic levies to the Oligarchy. The Cash Economy takes place in person, face-to-face, and your pleasure [or not] is communicated directly to the seller. [This is where Paleo-Capitalism operates; see WMail Issue #40 http://www.working-minds.com/WMessay40.htm ]
So pay off all your credit cards and other debt. Buy only if you have cash in hand.
Make double payments on your car and don't shop for a new one until the old one breaks. Then make double payments on your mortgage.
Keep an active checking account but when things start going bad and you still have a paycheck, ask for cash. Keep one credit card for true emergencies flat tire, emergency room, burst plumbing, etc. but keep it paid off each month.
You can cash your paycheck where you buy groceries no fee is charged.
Walk inside at the gas station and pay cash for each fillup. (And definitely find and patronize the cheapest pump price in your area.)
Go to the movies at the 'early bird' show and skip the $5 popcorn: carry in a granola bar in your pocket or purse.
Shift your small business to the Cash Economy and pay very close attention to both payables and receivables. (Many large & small companies offer a discount for immediate i.e. cash payment.)
Teach your kids that they have no need for the hot! fad-product of the moment.
As an example of making such changes, my move to New Mexico is designed so that the end result of the sale of my trailer-home in California and the purchase of a new home south of Albuquerque will leave me with full equity in the new house NO mortgage for the villainous banks to foreclose on, no monthly payments to feed the Oligarchy. I have paid ahead on the three domain names that I own, and will pay for my new DSL-or-dialup ISP for a year in advance (glad for the slight discount). My Chevy Blazer is paid in full, all I need concern myself with there is insurance and license fees for New Mexico.
When the U.S. economy collapses, I will manage better than my neighbors still clinging to the lies of the media and the government, for they will be confronted with any number of emergencies: typically loss of job, followed by repossession of the car, and foreclosure on the house. You had better hope your relationship with your parents is bright & shiny, for you may have no alternative but to move back home, and the grandkids could make the situation entirely too confining.
Do not think that it can't happen. Do not think that it won't happen. History is replete with cycles of economic piracy, burst bubbles, and widespread economic devastation.
Get ready. Get strong. Spread the warning.
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