{"id":22708,"date":"2017-02-09T16:06:02","date_gmt":"2017-02-09T21:06:02","guid":{"rendered":"http:\/\/olduvai.ca\/?p=22708"},"modified":"2017-02-09T16:06:02","modified_gmt":"2017-02-09T21:06:02","slug":"which-assets-are-most-likely-to-survive-the-inevitable-system-re-set","status":"publish","type":"post","link":"https:\/\/olduvai.ca\/?p=22708","title":{"rendered":"Which Assets Are Most Likely to Survive the Inevitable “System Re-Set”?"},"content":{"rendered":"

Which Assets Are Most Likely to Survive the Inevitable “System Re-Set”?\u00a0<\/a><\/h3>\n

Your skills, knowledge and social capital will emerge unscathed on the other side of the re-set wormhole. Your financial assets held in centrally controlled institutions will not.<\/i><\/p>\n

Longtime correspondent C.A. recently asked a question every American household should be asking: which assets are most likely to survive the “system re-set” that is now inevitable?<\/b>\u00a0It’s a question of great import because not all assets are equal in terms of\u00a0survivability in crisis, when the rules change without advance notice.<\/i><\/p>\n

If you doubt the inevitability of a system implosion\/re-set, please read<\/b>\u00a0Is America In A Bubble (And Can It Ever Return To “Normal”)?<\/a>\u00a0This brief essay presents charts that reveal a sobering economic reality: America is now dependent on multiple asset bubbles never popping–something history suggests is not possible.<\/p>\n

It isn’t just a financial re-set that’s inevitable–it’s a political and social re-set as well.<\/b>\u00a0For more on why this is so, please consult my short book\u00a0Why Our Status Quo Failed and Is Beyond Reform<\/a>.<\/p>\n

The charts below describe the key dynamics driving a system re-set.<\/b>\u00a0Earned income (wages) as a share of GDP has been falling for decades: this means labor is receiving a diminishing share of economic growth. Since costs and debt continue rising while incomes are declining or stagnating, this asymmetry eventually leads to insolvency.<\/p>\n

The “fix” for insolvency has been higher debt and debt-based spending–in essence, borrowing from future income to fund more consumption today. But each unit of new debt is generating less economic activity\/growth. This is called\u00a0diminishing returns<\/i>: eventually the costs of servicing the additional debt exceed the increasingly trivial gains.<\/p>\n

…click on the above link to read the rest of the article…<\/p>\n","protected":false},"excerpt":{"rendered":"

Which Assets Are Most Likely to Survive the Inevitable “System Re-Set”?\u00a0 Your skills, knowledge and social capital will emerge unscathed on the other side of the re-set wormhole. Your financial assets held in centrally controlled institutions will not. Longtime correspondent C.A. recently asked a question every American household should be asking: which assets are most […]<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"closed","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_monsterinsights_skip_tracking":false,"_monsterinsights_sitenote_active":false,"_monsterinsights_sitenote_note":"","_monsterinsights_sitenote_category":0,"footnotes":""},"categories":[2,7],"tags":[39,127,3920,353,4924,1302,14786],"class_list":["post-22708","post","type-post","status-publish","format-standard","hentry","category-economics","category-survival-2","tag-assets","tag-charles-hugh-smith","tag-financial-bubble","tag-gdp","tag-oftwominds","tag-status-quo","tag-system-reset"],"_links":{"self":[{"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/posts\/22708","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/olduvai.ca\/index.php?rest_route=%2Fwp%2Fv2%2Fcomments&post=22708"}],"version-history":[{"count":1,"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/posts\/22708\/revisions"}],"predecessor-version":[{"id":22709,"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/posts\/22708\/revisions\/22709"}],"wp:attachment":[{"href":"https:\/\/olduvai.ca\/index.php?rest_route=%2Fwp%2Fv2%2Fmedia&parent=22708"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/olduvai.ca\/index.php?rest_route=%2Fwp%2Fv2%2Fcategories&post=22708"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/olduvai.ca\/index.php?rest_route=%2Fwp%2Fv2%2Ftags&post=22708"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}