Many people worry about their savings and their money in general in times of crisis and pandemic. It's important to know that in order to be calm, we need to understand money, not study previous crises.
All crises are different, the world is changing after each of them, and if we take the previous ones as an example, it is certain that we will be among those 99% of the people who will suffer losses from the crisis. There are similar examples of war, and France is one of them if one considers the recent wars.
During the First World War, the French fought with beautiful red uniforms and made fun of the Germans for their gray and impersonal uniforms. And during the previous Napoleonic wars, they had fought in a similar way and now thought it was right. A little later, they realized that they are so easy to detect and be fired at by the enemy. So they decided to change their uniform, but this happened after many casualties.
Shortly before World War II, the French decided to prepare for it and did so by learning from the First World War. They decided that there will be a trench war again. They made a huge defense line to Germany, deployed all their troops there and waited. However, the Germans were fighting a new way. They threw all of their forces at one point, moved with motorized divisions, made a breakthrough and went deep into the enemy's rear. Thus, they succeeded in conquering all of France in a few days, even though as an army and armament the French did not have less.
The same is true of people's finances and their investments, because they are simply preparing for the previous crisis and trying to use a learned model rather than understanding money and the principles of how they work. Therefore, even in calm times, we see that very few people are truly real free.
In order to understand what to do with money and investments in general, is it necessary to go back to the beginning and understand what money really is? What are they serving for? How to use them?
The first and very important condition for dealing with money is to understand that they are fiction. THEY ARE NOT REAL. They were created for the purpose of better control over the population and this is only possible if we consider them real. Money is a contract between all of us that they cost this much and that we can buy things with such utility that we have assumed they are worth.
All this is true in the conditions of excess and tranquility. Then we are all satisfied and we respect the agreement. We also know that if we are not satisfied, we are in breach of the agreement. An example is people who take a loan from a bank or a loan officer. They agree to the agreement as they take the money and subsequently, when they have to return it, violate it because they find it unfair (because they find it difficult to handle).
Each of us has entered into agreements, and when it has become disadvantageous for us, we look for a way to get out of commitment. Of the 1000 people I know of only one or two who will abide by the agreement and will not look for a way to prove that it was wrong or misleading. I will give an example of fines. When we get our driver's license, we agree to the rules of the road, but when we get fined, we no longer agree that we are violators.
When we marry, we agree to be together in joy and sadness, but everyone can remember how it was with him. This quality of keeping an agreement, as long as we are comfortable, makes it so that when everything is right, the money agreement works, but when things get bad, we break it altogether.
An example is the monetary system in post-war Germany. American cigarettes are the best payment method. When people lose confidence in money, they replace it with something that is useful and scarce to them right now. After World War II, human life was totally depreciated and people lived for some small pleasure. Cigarettes were such a pleasure. They were sought after and rare, so they take on the role of money.
We continue with our genuine human needs. Let's remember them. We need water, food, health, good nature, freedom, clothing, shelter, community and opportunity for development. The world would be very simple if we followed these needs. Money would be very useful, because everyone would have just as much as value he or she has created and would not seek any more.
Human shortcomings, such as greed, laziness, power, selfishness, greed, envy, fear, and malice, are already interfering here. Many people want to have something, even though they don't deserve it, and they use the monetary system to get it.
The interesting thing is that they do this by using money as an amplifier for other people's shortcomings. Most people have rubbed a lottery ticket in order to get a profit they don't deserve. Many workers are aware that they are cheating on their employer by not doing the job at 100% but collecting the salary at 100%.
Today's financial system is designed to deceive people that they can have more money than they really deserve, and ultimately the organizers of the system take everything for themselves. The current financial system is much like gambling. There are many temporary winners, but in the end only the organizers of this system win. I do not know one person who has has freed himself by using it. The people who created and controlled it use so-called "economic cycles" to rob other people who have managed to raise capital.
How do they do it?
First, through government and banking institutions, they borrow from people, promising them either a pension or a profit. Huge loans are accumulated and ordinary people are getting rich on paper. Market turnover grows mainly from loans taken by big players in the market. They give jobs to very small businesses and people who are happy with the situation. At one point, they reduce the amount of work they provide, and firms begin to experience difficulty. Then the big institutions take on the role of saviors of the situation and say that they have to print money to push the economy.
Naturally, small businesses and employees are in favor of this push because they see their lives slip away. However, printing money devalues total money supply. And what happens is that all the small investors who have given their money to countries, exchanges, bonds, government securities are actually losing their value, and people who hold cash or accounts lose their contractual utility and value. The interest they receive is not enough to cover the devaluation.
How do owners of the system never lose?
The answer is that they always invest their money in assets. They buy factories, they organize places where people live with their shops, businesses, hotels, leisure facilities, schools, universities, hospitals, workshops and more. What is the cost of money, they do not care because people always give their money to them.
Or they have sources of goods, services and areas of living without which no one can survive. This always sends all the cash flow to them. They all organize it by taking people's money through their banks, investment firms, exchanges, pension funds and more. Then, depreciating the money, they pay back much less, but all the manufacturing facilities and organizations remain with them, taking up-to-date prices for products and services after the depreciation of the money.
So we are all forced to live in their cities, work in their businesses (or be subcontracted to them), buy their goods, try to catch up with them in their monetary system (through which they always rob us).
We continue to look at the two crisis scenarios.
The first is the one our generation knows. In which we still respect the money agreement and only depreciate it by a certain percentage (in the last crisis by about 50%). There is another scenario that we have not seen, but our grandparents (the older of us) have seen. Military scenario. Then the monetary systems stop working. Many people think that gold is worth it then, but they are wrong. In a military scenario, the only thing that matters is the goods, services, organizations and good places to live.
The military scenario is not only about war, but also with major natural disasters, pandemics and the like. Let's take a look at what happens in a six-month blockade (estimated to continue more than a year). People in their cities have bought wonderful homes of 50-60 square meters (with a total area of 70-80 square meters) and rely on malls, pubs, discos, gyms, public life, public transport to compensate for the box in which they live.
By hurrying to work, going on vacation and relaxing in clubs, they did not have time to look around and see that they are living in a prison. Now they have all the time in the world to feel the pressing constraints of the city. Anything they have managed to compensate for the crushing little place to live will be gone for at least a year.
Their supply chains are broken. In the city you cannot find or produce food, and you rely 100% on the supply from the shops. There you are 100% supplier dependent. Groceries go through 5 chain-links before reaching the end consumer. This means that in times of scarcity (such as martial law or a pandemic), there will be a shortage of essential goods, especially for the end consumer (so people also stock up without realizing that they do not have so much storage space in their small homes to store food for one year).
Supplying people with food can be like in a military regime - with coupons. The rations are determined centrally. This makes the price of money nothing or can happen as it did in Germany after the First World War - to buy bread with one hand cart full of Deutsche Marks. Then it was easier for people to make wallpapers with money instead of regular wallpaper.
The same thing happened with the USSR after the 1917 revolution. Money has become paper that is worthless. In these cases, it is good that there are other countries that have stable currencies because life there has remained normal and their agreements have stayed valid. Then you can store value in their currencies.
The situation is different now. The pandemic is global or all agreements are breached and the money will only serve as a kindling. The same applies to bitcoins and gold, because when you need food and health products, you see no value in speculation or jewelry.
So far, we have looked at the problems of living in the city only from food supply, but let's also see more aspects of city life. People should only be confined in their homes because of the risk of infection. No movement, no social life, no nature. Gradually, this also affects the police and the army, who are demotivated.
Gangs and crime are rising from people who have nothing to lose or are no longer under quarantine. This further disrupts the supply chain and the serenity of life. One year, if the blockade continues, life gets worse than prison. What can we buy with the money and who will sell it to us in return for it?
Will people who have lived a year in the prison of the city want to live there again? Will the price of the garages rise and will it make sense to keep our cars there, with nowhere to drive them? How much will real estate prices in the city collapse? Will the city ever return to its familiar shape?
Will our urban properties have value? Is this the latest pandemic? Could there be scarier ones? In decreasing the population, what will we do with all of the apartments? If we answer these questions, we will see that urban property loses value for years to come, and that is where our money (our saved productivity) loses value dramatically.
It is important to realize that money is not real, and to believe that our availability of pieces of paper gives us any security is the biggest misconception of the masses. If we want a future and a normal life, we need organization and investment in assets that benefit people in the new environment.
We have been working in this direction for many years, and we have a solution what needs to be done in this new world. Think about whether you will act or lose, waiting. In times of change, only the fast-acting have a future.