10 ways to survive the economic tsunami that is coming

10 ways to survive the economic tsunami that is coming
  1. Pray for Wisdom | James 1:5 says, “ If any of you lacks wisdom, you should ask God, who gives generously to all without finding fault, and it will be given to you.”  We need wisdom more than anything to make the right decisions in protecting our families, freedoms, and finances during these turbulent times.
  1. Give Extravagantly | Malachi 3:10-11 say “Bring the whole tithe into the storehouse, that there may be food in my house. Test me in this,” says the LORD Almighty, “and see if I will not throw open the floodgates of heaven and pour out so much blessing that there will not be room enough to store it. I will prevent pests from devouring your crops, and the vines in your fields will not drop their fruit before it is ripe,” says the LORD Almighty.”  God’s Word doesn’t return void and when you give with a joyful heart and learn to give out of your need rather than out of your abundance God will supernaturally intervene in your life and pour out so many blessings that you will not be able to contain it.  And the second half of the promise mentioned here is that He WILL make you more productive.
  1. Read and meditate on God’s Word | Joshua 1:8-9 say, “Keep this Book of the Law always on your lips; meditate on it day and night, so that you may be careful to do everything written in it. Then you will be prosperous and successful. Have I not commanded you? Be strong and courageous. Do not be afraid; do not be discouraged, for the LORD your God will be with you wherever you go.” Yet another promise from God, who’s Word does not return void!  This is a conditional phrase.  When you meditate on God’s Word and are careful to do what it says, THEN you will be prosperous and successful.  The Bible is our blueprint for a successful life.
  1. Get out of Debt | Interest rates are at the lowest point in the history of our nation.  This means they can’t go too much lower, they will go up, and go up rapidly as the U.S. Dollar continues to deteriorate. If you carry any variable debt you will find it increasingly more difficult to service your debt payments as those payments rise. 
  1. Grow your roots in a local church | How could this help you navigate through this harsh economy?  Well, when your roots grow deep you will be able to withstand the storms of life as they arrive.  Remember, storms ALWAYS happen and sometimes Jesus calmed the storm, sometimes he was the peace in the midst of the storm.  Regardless, the end result was PEACE.  Having a support group of like-minded, God fearing, friends and family of the local church will make the storms of life easier to navigate.
  1. Be politically active | Make your voice heard!  We still live in a country where our voice can be heard and we can make a difference.  We need to hold our elected official’s feet to the fire and encourage them to make wise decisions.  After all, it is their policies of excessive taxation, excessive spending, and a continuous elimination of God from the policies and principles of our nation that have produced the mess that we are in.  Make a difference while you still can!
  1. Become self sufficient | In reading accounts of other countries throughout history that have gone through hyperinflations, the people that have survived the best are the ones who were able to produce their own food, had supplies of fresh water, had acquired barter type items prior to the economic tsunami hitting them.  It is sad that we are about at the point where we look at long-term food storage as part of a solid investment portfolio, but our goal is to protect, preserve, survive and thrive, and these type of items should be sought after.
  1. Diligently study the fundamentals of the markets | Knowing what fundamentally causes markets to move is ESSENTIAL to safeguarding your assets from erosion due to bad public policy. For example:  The value of bonds will come down when interest rates rise.  Financial metals like gold/silver do very well during times of political and geo-political turbulence, economic uncertainty, chaos and change.  Industrial and agricultural commodities tend to do very well during times of inflation.  The stock market will ultimately come crashing down as revenues continue to decline and taxes go up. 
  1. Reallocate your assets | You need to analyze your current investment mix and get out of the downward trending asset classes (stock market and allocate into positive trending asset classes like gold/silver.  Precious metals in this economy will act as a hedge against your paper assets as they are in the midst of a HUGE bull market.  Gold has increased over 400% since 2002 and silver has increased over 700% during the same time period.  A proper allocation of metals and cash in your portfolio will help to insulate you against some of the turbulent market activity that will wipe out a lifetime of savings in a short period of time.
  1. Contact a financial advisor who understands the times we are living in | 1 Chronicles 12:32 says the sons of Issachar understood the times and knew what to do.  We need to be modern day sons and daughters of Issachar and understand the times we are living in and know what to do about it.  Also, make sure your investment advisor is the same.  Many well meaning people just don’t grasp the seriousness of the economic downturn we are living in, nor do they grasp the magnitude and scope of the implications of not allocating wisely.  Our window of opportunity to protect us, our families, and future generations will not be open forever.  In fact, it may not be open for very long at all.  ACT NOW to preserve and protect everything you have worked your entire life to accumulate.

Is all spending bad?

Is all spending bad?

When talking to the GOP elite inside the beltway, President Reagan holds almost god-like status.  He was the architect of the great economic boom in the 80s and 90s.  He alone dismantled the iron curtain.  He was the great communicator and was somehow able to reach across the aisle and broach ideological barriers and simply get things done.

Reagan was not the captain of fiscal responsibility that many of his worshippers think that he was.  On page 57 of his book, "The Great Deformation,", Stockman wrote, “The Reaganite legend begins with the false proposition that the Reagan Administration stopped the march of “Big Government” and brought a new fiscal restraint to Washington.”  Reagan’s federal outlays average 21.7% of GDP, compared to 21.1% of GDP during the big spending Carter years.

Looking this, one might scratch their head and think; maybe Reagan wasn’t that great after all and agrees with Stockman.  This made me think further and ask the questions: Is all spending bad?  Is all debt bad?  Let’s consider these questions.

Under Reagan, lower taxes, reducing the growth of government spending, a stable currency and less regulation created 9.6 million jobs and increased the economy by 18.5 percent.

Obama’s policies of more taxes, more spending, more regulation and loose monetary policies have led to 5.7 million fewer jobs than Reagan created and an economy with growth nearly 50 percent smaller than it could have been.

According to usgovernmentspending.com, in 1985, the beginning of Reagan’s second term Reagan spent $356 billion of the $734 billion budget on entitlements and mandatory payments (social security, welfare, Medicare, Medicaid, food stamps).  That is 48% of federal receipts (revenue).  Compare this to President Obama, where 82% of federal receipts (revenue) go towards mandatory payments and entitlements was recently looking over some notes from a dinner meeting I had way back on May 30, 2013 with Stockman’s predecessor, James Miller who was OMB director under Reagan from 1985-1988.  Mr. Miller, unlike Stockman, had nothing but the highest praise for Reagan and his policies, as the growth of the economy for a couple decades are resultant from his policies.  How could two very intelligent people, who held the same position for the same President, have such different viewpoints?  We may never know.  But when I look at the numbers, when I look at the resulting economies that are products of spending policies, it brings up some talking points.  These are education moments that we can have with our clients, with our kids, and practice in our own lives.  The points are:  NOT ALL SPENDING IS BAD and NOT ALL DEBT IS BAD.  If debt is acquired in order to build revenue-generating assets, then over time this will be beneficial.  (I.e. potentially adding debt to finance the purchase of a rental property).

Reagan did not do everything correctly, and as Stockman points out, he did spend a lot of money and didn’t really practice much fiscal restraint.  But, what he did do was an attempt to spend money the right way.  It appears the policies of President Trump are very similar to what Reagan did.  Not everything is perfect, but nobody is.  The good thing is that we are finally moving in the right direction with our economy.  I think it all boils down to the old adage, “give someone a fish and feed them for a day.  Teach someone how to fish and feed them for a lifetime.”

What is inflation?

What is inflation?

What is inflation?

According to dictionary.com, inflation is a persistent, substantial rise in the general level of prices related to an increase in the volume of money and resulting in the loss of value of currency.  So a candy bar going from 35 cents when I was a kid to 99 cents today—that is a rise in prices, and many people would define that as inflation.  However, that is wrong! Inflation is not rising prices. Inflation is an increasing money supply. Everything that we get from foreign countries as an import is basically going to have a cost that is a function of our money supply. If we keep printing and printing and printing and devaluing our currency, they're going to want more of it. So therefore, they're still going to sell us the TV, but it’s going to cost a lot more. They're going to want more of our junk currency in exchange for it. That's why rising prices are a symptom of inflation.