One of the biggest myths that is being propagated by the government is that the economy is better than ever. Officials point to low unemployment, rising wages and unfilled job openings as indicators that we’re in the midst of some really good economic times. However, these numbers don’t really reflect the actual quality of the economy or how it’s being propped up by a complex fiscal shell-game.
Borrowing to Run Government
One of the reasons that the economy appears to be doing so well is that we just received one of the biggest tax cuts in history. While this is good news for corporations as well as small business owners and sole proprietors, it hasn’t had a huge benefit for workers. Sure, there have been some bonuses given as a result of the tax cuts, and people are seeing small increases in their take home pay, but these are really negligible in the big scheme of things.
While the tax cuts have produced tangible results, they have not contributed to more revenue into government coffers. In fact, it will take years before revenue increases, and that’s contingent on an explosion of companies setting up shop, paying taxes and hiring workers who also pay. In the meantime, the government has to borrow money in order to stay running, and the government is continuing to grow. The reality is that we’re getting to the stage where we’ve borrowed so much that it’s becoming next to impossible to be in a position to pay these debts back.
Once we reach that tipping point, our ability to borrow more will be limited, and confidence in the dollar will erode. When that happens, you can expect the value of the dollar to plummet, investors to pull out of US markets, and companies will move assets overseas in order to protect themselves.
There is no shortage of experts who are predicting that we will experience a collapse if things don’t change. Unfortunately, these warnings fall on deaf ears as people are convinced that the economy is strong. However, there is a fundamental difference between jobs and the health of the economy, and the boom that we’re currently experiencing is temporary. Unfortunately, we don’t have a safety net in place for when the next crash comes, and that can be catastrophic in a worst-case scenario.
As the old saying goes, make hay when it rains. Take advantage of the good economy now to prepare for when things hit the fan later. It may be a year, two or ten before things get really bad, but those dark days will come. The question is whether or not you will be ready to sustain yourself when it happens. A lot of preppers have started to let their guard down because they perceive that we’re heading into peaceful and prosperous times. Don’t be one of them.
The exact opposite is true. Aside from our own fiscal irresponsibility as a nation, we are linked to the global economy, and we are particularly vulnerable to any hiccups that are caused by world events. Just look at the rising price of oil as an example. Uncertainty about the Iran nuclear deal has driven prices through the roof. This is just one example of how something that happens thousands of miles away can have a direct impact on our bank accounts.
Think about what would happen if a few catastrophic events were to take place simultaneously. They can be anything from a failed crop to an environmental crisis or political unrest in a country that we depend on for trade. Anything that upsets the delicate balance that represents the status quo can send our economy into a tailspin with little or no warning.
We’re very exposed fiscally at the moment, and unless the government makes fundamental changes to how the economy is managed and fueled, we’re heading for a disaster. Please take advantage of these good times to prepare for the bad, because there’s a good chance that you’ll need to rely on the quality of your preps and your ability to be self-sufficient for a long time to come when the economic S actually does HTF.