Two years have passed since I executed the plan laid out in my book Gold Oriented Investing. I have no debt, I own no shares and I have most of my savings in gold. I have also made myself impossible to tax.
The result so far has been good. My costs have gone down, and my savings have done well. I live comfortably on a fixed income. Living modestly, it is possible to get by on a surprisingly small income. I know this, because I do so myself. I live on less than half of what is considered poverty in Norway.
Not everyone is blessed with a fixed income, so under normal circumstances I would still have to work and pay taxes on my labor. However, this would not have prevented me from executing the overall plan laid out in my book. I would still have gotten out of debt and put most of my savings in gold.
But what would happen if everyone did as I've done? Wouldn't that cause the whole system to collapse? This is the question I sometimes get from friends and relatives. The short answer is that a great deal of good would come from this. The system would not collapse. It would merely change for the better.
The way things are today, the state is able to squander a great deal of resources on destructive projects. The richer the state, the more destructive and insane are its projects. Norway is an example of this. It was one of the biggest contributors to the Libya bombing campaign. It has the biggest most bloated child protection service on the planet. It engages in all sorts of social engineering, including the wholesale import of young uneducated men from Africa.
None of this is making life better for the average Norwegian, and all of it is funded through taxation and debt. If everyone did as I've done, there would be dramatically less income to tax, and debt would be prohibitively expensive. Civil servants would suddenly have to make the difficult choice between, bombing campaigns and paying their own salaries. The state would have to shrink. Resources would then be freed up for other purposes.
Another change that would come from this is that stocks, bonds, and real-estate would come down in price by quite a lot. This too would be to the benefit of most people. It is today close to impossible to acquire enough wealth to live off capital income. Pension funds are therefore close to bankrupt. However, were stock prices to come down substantially over the next few years, it would still be possible to buy enough of shares to build a decent pension.
A further advantage would be a return to stability in financial markets. The Dow/Gold ratio would settle around its historic average of about 7, where it would hover, with a slight upward tendency over time. There would be little room for speculation. Stocks would be bought for their dividend. Any type of manipulation would be met with investors either buying the dip below 7 or selling the rip above 7.
This in turn would make it easier for real wealth generating projects to get reasonably priced resources. Speculative projects with little to offer in terms of wealth generation will find it much harder to compete for these same resources. Without access to cheap credit, wildly speculative projects will die even before they are born.
The idea that I am somehow leaching off society by refusing to work is based on the idea that labor rather than capital is the main driver of wealth. This is patently wrong, even if it seems intuitively right. It is perfectly possible to imagine a world in which machines make all the things we require. On the other hand, it is impossible to imagine a world in which labor on its own, with no tools or machines, is even close to sustain the current population.
Making sure that capital is placed in sustainable projects is all that is needed in order to put the world back in order. Getting out of debt and reducing our tax burden to a minimum is the first step in that direction. Refusing to buy stocks when the Dow/Gold ratio is above 7 is another step. Refusing to support the banking system by saving in physical gold rather than currency is another step still.
The great thing about this type of disobedience is that it carries very little risk. We do not have to risk life or limbs fighting in the street. On the contrary, there are good reasons to believe that we will be better off. The Dow/Gold ratio is currently above 21. House prices and bond prices are bloated. Getting out of these assets and into gold is likely to yield a good return regardless of whether people adopt my plan or not.
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