The last few months I've been following very closely what's happening in our beloved financial system. The last time I've done this was in 2009, just AFTER the economic crash of 2008. This time I want to get informed BEFORE the crash.
I'm sitting on the train while writing these lines and have just finished flicking through the Sunday paper. Shares and bonds continue to be regarded as safe investments, the real estate market is booming. “10 years after the burst of the housing bubble new records are made again.” Good times for everyone who's happy to get into debt. The question is: How long will it last?
The experts I read and watch – like Chris Martenson, Mike Maloney (who gave talks in 2005 warning about the housing bubble, three years before it burst) and others – they all agree on two things. 1) It's very difficult to predict WHEN the next financial crash will hit us, and 2) it is absolutely certain that it WILL hit us. Some say possibly this year, others in two or three years. Either way, it won't be very long. Mike Maloney calls it the 'Everything bubble' – stocks, bonds and real estate, already now they're all hopelessly inflated. Never before have so many people and countries been in so much debt and still everything is done so that the spending party can go on. In an apparent attempt to stabilize the system, the central banks keep creating money out of thin air and pump billions of dollars into the markets. A bit like trying to put out a burning house with buckets of petrol.
There's more to look forward to, like the retirement of the Baby Boomers which might trigger the collapse of the pension systems, or the millions of jobs that will be killed by digitalization and automation within the next decade, or the environmental armageddon unfolding on planet Earth. But for now let's stay with the smouldering debt fire.
If a massive financial crisis is indeed inevitable, as many confess and logic suggests, well, what to do? In the long-term a new economic system will bring more joy and justice to the world but the short-term ride could well be a bumpy one. Here are a few things that might make the transition easier:
- Accept what is and don't deny reality. Better to see what's coming than being surprised and paralysed by shock.
- If somehow possible, get rid of your debt and avoid making new debt. I know this is much easier said than done for many of you, but still, it's worth aiming for a debt-free existence. Especially in times of crisis.
- If you have savings, consider transferring some of them to the oldest and most crisis-proof currency there is: gold and silver. As a little bonus, both these precious metals are very undervalued right now so you might even come out better on the other side. Who knows...
- Keep some food, water and drugs nearby. And friends. Friends are super important when the world goes nuts.
- If you have space for plants, take up gardening. Apart from giving you some food to eat it's also a haven for peaceful disconnection. When I have my hands in the soil I never worry about this crazy world. I just am.
- Last but not least: Don't blindly trust what you read in the news (any news!) or from bloggers like me who spend too much time on youtube. There is an abundance of misguidance out there. Be open and curious and learn to trust your own experiences!
What remains is the question why my daughter 'knows' that a crisis is coming. Well, luckily she has a History teacher who seems reasonably switched on. And it is history that clearly shows that all empires have ended, that greedy growth can't last forever. No rocket science needed. It's just the way it is.
The dark clouds are getting darker. If you look closely, you can see the storm already raging. It will bring thunder and lightning and many will get soaked in cold rain. But then, afterwards, everything will be clean and calm again. At least for a little while...