The Government Relies on Your Participation
Conclusion: the economy crashes and you lose your job, both jobs. You lose your house you've been paying on for 2 years, because you now have negative equity in it. Your car gets repossessed although you were a few months shy of paying it off. You look up to the heavens and wonder where you went wrong.
Conclusion: the economy crashes. But, you're an independent worker to begin with so you don't lose your job. You don't lose your house since you bought it outright. Your don't lose your car since you bought it outright. You look up to the heavens and wonder when is it going to rain next, so the tomatoes can bloom.
In each scenario the jobs are of course different, but also the person's approach is different. While people are very hesitant to living, what they feel is, a backwards lifestyle, when the system crashes, they go down with it. Way down! While the person who is still tied to the earth might not live the jet-set lifestyle of a penthouse playboy, they also have a much more worry free life.
The government now is in bed with business. The two are so intertwined that the business of government is now the government of business. 50% of all policy and government laws is geared to assist business, not govern people nor do the job that they were created to do, protect people. But, the government only gets away with any of this, if you participate in the scam.
Scam #1 - CREDIT: credit is the biggest and largest systemic scam out there. You are barraged daily, not just with the message of borrowing and spending, but that having good credit, to begin with, should be your goal for a happy lifestyle. The message goes beyond just having credit, to the point that you should be so ingrained in the credit system as to assist yourself in it, by upping your "credit worthiness". Financial planners now advise you how to get better credit.
-- STOP --
Credit cards launched a massive marketing campaign to not only get people involved in credit, but banks even started issuing credit cards down to a local level, so that the entire system, top to bottom was saturated with the credit doctrine. Stores launched their own credit cards.
But, it is all a lie. You do not need credit. Hell, even a debit card is not something a savvy person should use. The person, adult, that knows anything about money, knows that you will never personally leverage yourself enough to have a winning side in the equation of banking and credit. That means, that the message of use credit so you can have a better lifestyle now based on a fraction of the cost, is a losing position to have.
Use of borrowed money to increase production volume, and thus sales and earnings. It is measured as the ratio of total debt to total assets; greater the amount of debt, greater the financial leverage. Since interest is a fixed cost (which can be written off against the firm's revenue) a loan allows a firm to generate more earnings without a corresponding increase in the equity capital requiring increased dividend payments (which cannot be written off against the earnings). However, while high leverage may be beneficial in boom periods, it may cause serious cash flow problems in recessionary periods because there might not be enough sales revenue to cover the interest payments.
Here's the part that gets you, as a person, tripped up. Your leveraging, credit, does not generate you any income. Even borrowing for a house or car, never generates money for you.
Scam #2 LOANS - taking out loans is a new thing. There is still a very large percentage of the population that saves up money and buys a car in cash, or a house in cash, or all of their home furnishings and appliances in cash. Noone is telling you this, because they are on the take and in on the scam of loaning you, your own money.
Here's the promise. You take out a loan and you can buy far more house than you ever could, if you saved up. It is completely and utterly untrue. If you ever set aside the amount of money, in total, that you pay for the amount of time that you spend in a house, you would always come out ahead in savings, to loans.
Let me help you with the calculation: [ warning this might be forgetting some things ]
- down payment
- impound and taxes
- home insurance
- 3% to seller agent and 3% to buyer agent
- title insurance
- mortgage insurance [FHA]
- lender points for doing loan
- loan origination fees
- escrow fees
If you saved that same amount of money for that time period, let's say 15 years, you could buy a house twice as expensive as the one you took out a mortgage for. THAT is what everyone is trying to make sure you don't realize.
Americans used to save up and buy a house. Or, better yet, live in the same house and the father and mother pass it on to the kids, while they are alive or when they die. Americans also did not kick their kids out at 18. This is more of the inner city phenomenon. I have no idea when it started, but it has no logical thought behind it, nor no financial logical thought behind it.
The best possible thing to do as a parent would be to have a savings account for each and every child you have and put funds into it very single month. Your child would even be better served by you taking that money and buying them a house with some land, at 18, than paying for their college. If you did it right, you could have enough money for both school and a home.
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