Improving Capitalism

Posted in Perspective |  Email This Post | by James Rick

Until the current financial system is revamped, it’s not possible for everyone to be financially independent. For every million of surplus that’s generated economists estimate there is roughly 7 million in debt. For every millionaire, thousands of people are in debt. For every billionaire, millions are in debt. This will forever create a cycle of ‘haves’  and ‘have-nots’. In its current design, even if everything works perfectly the majority of people will be in debt. Not because they are dumb or don’t work hard – but because the system is designed in a way so that most people are in debt. That’s why in order to get ahead of the system, it’s extremely important you avoid consumer and long term debt like the plague and only take on PRODUCTIVE, SHORT-TERM debt – which we’ll talk about.

While it’s true there is a formula for getting wealthy and if you follow it you increase probabilities of becoming a millionaire or even a billionaire (this book is all about increasing probabilities for whatever your full potential might be) – there are no guarantees. When it comes to wealth, it helps to know the game (the big picture) to play it well.

CAPITALISM AND ITS IMPROVEMENT

Capitalism works when people have capital to produce. The central bank is responsible for providing credit (debt) to the commercial and private banks that then provide credit to businesses and individuals in the form of business loans, housing loans, car loans, credit cards, etc. for the purchase of goods and services. This is how the economy works in a nut shell credit (DEBT) keeps everything flowing smoothly. When credit stops flowing, everything tightens up; this is what you saw happen in the global recession that began in late 2008.

Credit stops flowing for a couple of reasons – either because the banks no longer want to take on the risk of lending or people no longer want to take on the risk of borrowing. When Obama got into office and began buying up stock in banks – nationalizing them, the government began to take a controlling interest in banks overriding the decision by banks to not lend. Basically the government took on the risk of lending because they had to (given the system’s current design.) If they didn’t take on the risk the entire system would collapse. No credit means no spending. No spending means no jobs. No jobs means no taxes. No taxes means no money for government – the economy on a downward spiral. Technically given its current design, the only way out of a recession – keep spending money, keep going into debt.

Interestingly, people will reach a point of maximum burden of debt. When their credit cards are maxed out, their car payments are maxed, their house payments are maxed, their college loans are maxed and they earn just enough to cover interest – this is the breaking point of capitalism. Capitalism in its current form can only survive IF the debt burden can be shared across more backs. In other words if America get’s maxed out, capitalism needs to spread to other countries where people are not in debt yet. This is what you are starting to see happen (with micro-loans), often under the guise of ‘spreading democracy’ which is actually the spread of capitalism. The need for capitalism to spread to new markets is also why the threat of any other financial structure (like communism) is so big. If people start defaulting (going bankrupt) or if an entire country converts to another financial structure (like communism), capitalism is weakened, the economy suffers.

Capitalism (in its current form) is like a dark cloud spreading across the land growing larger and requiring more people to take on debt to keep the economy alive. Fortunately for capitalism there are still billions of people around the world that can take on debt. Unfortunately for Americans they are almost tapped out. And unfortunately for the rest of the world they will soon be enslaved (by debt) to a system that does not love them. But lo’ and behold in the process the few value adders, the value producers: the creative entrepreneur, business innovators, inventors and the like WILL be rewarded. They will thrive in the system and become millionaires and billionaires. Production IS rewarded by capitalism better than any other system tried up to this time.

So if you are simply looking to become a millionaire or billionaire – there is a formula, you will learn it and you will become one of the few within the system to make it to the top.

If you are looking to improve the lot of greater humanity – you will to make an important decision and that is to change the structure of capitalism even if it weakens your own personal power; a sacrifice to be sure.

How can capitalism be improved?
* The central bank (known as Federal Reserve in the US) in their current form as unaudited private entities must be dissolved. The central bank should be in the hands of the republic, not a small handful of individuals.
* The new central bank should be fully transparent – all new loans should be accessible by all citizens, real-time online. All interest from new loans should be deposited in the government treasury to decrease taxes and or sent out as a ‘stimulus’ check to ease the burden of inflation.

There’s more, but we’ll stop here. The factors we will now discuss will show you how to become financially independent within the current system. My hope is that if you ever have the opportunity to influence the way the current system works, you will. I trust YOU, with this information, might one day be in a position to influence millions of lives for the better.

(An excerpt from the upcoming book: Full Potential Genesis)

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