“Buy now and save” scream the media headlines, but few buyers are saving anything at all for the future. They’ve bought the No. 1 consumerism lie: Spending equals saving.
Consumerism lie No. 2 is that you can become wealthy without working, i.e., by gambling without allowing any savings for in the future. Millions today believe gambling equals wealth.
Shall I go on?
In January 2005, America’s savings rate finally hit a whole number: 1 percent – the lowest annual level since the Great Depression! America is now near the bottom of the global savings ranking. I could hear the mass media yawn. They’ve forgotten that just a little over a decade ago we still had the moral /economic courage to save 9 percent per year.
The Dallas Morning News reported: “The most-repeated saying among economists the whole world round is, “Don’t underestimate the U.S. consumer.”
But that’s not the problem! The real issue is that consumers have overestimated themselves for so long that now the delusion of both “spending equals saving” and “gambling equals wealth” goes unchallenged. It’s mantra has become the middle-class equivalent to the “bling-bling” craze among the wealthy.
Today, America is standing nose deep in an ocean of personal, corporate and government debt – we’re treading water at best, yet the lie goes on – daily – brainwashing the next generation.
The moral model from history is that we should be exalting the future by saving instead of consuming.
Sadly, this perspective is not widely understood today. Instead, America has become soft in our seemingly unending era of pseudo-prosperity. The proof? Millions of Americans fall into the credit trap, annually resulting in over 2 million bankruptcies in 2004 – doubling over the last decade.
My perspective is that most simply suffer from a lack of a clear perspective on the proper use of money, debt and credit. The great problem today is that our whole debt-based money system is strangling us because we have not learned the historical mandate to own “honest money” and shun debt.
Honest or “real” money must have four minimum characteristics:
- Must be scarce.
- Must be divisible.
- Must be portable.
- Must have store of value.
Today’s “U.S. dollar” fails the test, (it has no store of value) yet the world pretends it is the standard of all other currencies and assets. Yes, it sounds crazy, but it’s true. Not even Alan Greenspan would deny that our modern credit-debt-money system operates on pure public confidence – perpetuating a massive deception at all levels.
- No wonder the dollar’s value has slid 40 percent since 2001.
- No wonder the stock market is going nowhere fast.
- No wonder virtually every commodity on the planet is rising.
- No wonder gold and silver coins are known as “the real thing.”
Here are five time-tested steps to create real wealth – without gambling:
- SHUN DEBT and begin to live within your means. Establish a workable budget and begin to pay off your debt ASAP. Practice daily living under your means – then you’ll never have to live beyond your means.
- SAVE 10 percent for your household, THEN GIVE 10 percent to your favorite charity. This means working toward the goal of learning to live on the other 80 percent.
- DIVERSIFY your reserve capital into seven or eight areas, beginning with the least risky. Ask yourself, what if my home value began dropping? Everyone should have at least six months income in emergency savings, just in case.
- “REAL” MONEY is something everyone should own. U.S. gold and silver coins offer the best of everything – safety, financial privacy and profit potential. So much so that I wrote a book about it (“Rediscovering Gold in the 21st Century”).
- TRUE WEALTH FOLLOWS GOOD IDEAS – conversely, true poverty follows bad ideas. Home-based businesses are helping millions of Americans “live the dream,” but beware of those promising wealth without work. As a chief executive officer for over 20 years, I’ve discovered the fundamental cause of financial problems is often as simple as our attitude toward hard work.
The bottom line is that we should work all we can, save all we can, and then give all we can – that is the anti-drug to gambling with debt. May we all remember the second of the “Seven deadly social sins” according to Gandhi:
- Politics without principle.
- Wealth without work.
- Commerce without morality.
- Pleasure without conscience.
- Education without character.
- Science without humanity.
- Worship without sacrifice.
Perhaps in the weeks ahead we can tackle some of Gandhi’s other seven deadly social sins.