X marks the spot


17 May, 2016


The world's pensions in 1970, were valued at around 30% of the world's GDP. There were quite a few productive workers per retiree.

Massive governments spend vast quantities of currency units on roads, bridges, schools, police, armies and a vast array of pet projects. When a massive government runs low on currency units, pieces of paper are exchanged between central banks and massive governments. The government's checking account gets credited with currency units and the central bank gets a bond, which it then hopes to sell to our pension providers.

Basically, the currency units we exchange our labour for are taxed / taken from us by the government and any currency units we put into our pension have already been spent by our government.

Do you detect a pattern? Your wealth is taken from you visibly and invisibly. The value of your pension fund is zero. Every currency unit in your pension has already been spent by your government. Yet, the vast majority of us is unaware of this particular confidence trick.

Today, our valueless pension fund is around 300% of GDP. Which sounds like a lot. However, should we all decide not to pay into a pension, this number drops to zero within a week. Current workers, are simply taxed or encouraged to divert currency units into their pension to pay for current retirees. Everything each retiree saved for their retirement has already been spent, a government bond is effectively a receipt for spent currency units.

Give this post some critical thought and independent research. Shall I do it for you?

The currency units only have value because the masses will exchange their labour for them. Banks create them as required with close to zero effort. Yet the masses go to the banks to ask for loans. If the bank says yes they then tell us how much we must pay back.

My bank offered me £7,500 at 5%, just for fun I took up their offer. They were happy to type 7500 and add it to my bank credits for just 20% apr.

The banks charge for temporarily adding a small sum to my account for three years was 1000 currency units that I must exchange my talents and labour for.

I didn't do that. I got interest free finance and paid 1000 currency units under list price. Next time, I won't do that either. Borrowing just extends this silly financial game.

In England, the banks like to mortgage against brick built houses that will last for a great many mortgage cycles. So, American quality houses in the UK don't get mortgage funding. This is the interesting bit. There is a vast gulf in price difference. 60,000 for  U.S. style home to 240,000 for a properly built home. I only need a house to last 30 or 40 years. I don't want a 25 year interest bearing loan. Guess what the banks want me to do? The flaw in this brief story? Most of the value on a home is currently in the land price. However, do I need to explain everything in absolute detail or can I just give some guidance please and you think critically rather than just evaluate the bizarre nonsense I write in these blogs? I don't care what you feel, I want to know what you think and why mankind doesn't.