Free Market Capitalism is dying. “Capital”, from capital-ism has no value today, in fact, it is more of a liability than an asset. If you have capital in a bank today with a year on year inflation of 9% and the bank pays you 0.5% per year, you basically are losing 8.5% for owning that capital. In a world of bigger governments, primarily financed by inflation and less markets, inflation is and will continue to be the silent yet most aggressive tax on capital.
The new challenge investors face is to accurately forecast where the new ship is headed and hop on it before it is too late. That’s the game and the only one we can play and try to win.
As an example, if you have 1 million dollars or equivalent on whatever currency and feel rich today, the truth is if you don’t do anything and understand the game, even if you don’t spend it, you will feel poor 5 years from now. You’ve got to really understand the trends on how the new planetary paradigm is shaping. We may call the new system whatever we want but something is for sure, it’s not free market capitalism.
I have been writing about and reflecting upon this postcapitalism topic for 10+ years and as with the end of feudalism 500 years ago, I knew and shared with my readers, that capitalism’s replacement by postcapitalism would be accelerated by external shocks, big government and shaped by the emergence of a new kind of society and a new kind of human being. And it has started.
Our new socio-economic world is driven by information and technology, needing less human labor as days unfold. Power hungry politicians and central bankers are sucking dry whats left of the middle classes and enforcing deficit producing, free market distortion policies with promises such as saving the planet, free stimulus checks, health emergency plans, better resource allocation, gender equality and all those other utopian promises we are all getting used to.
For better or for worse, capitalism is having an agonizing death. So let’s make good calls while we enjoy what little is left of it.