Discussion

So most of the war has been fought using private contractors. In order to go into a war zone, private contractors need insurance. This insurance is very expensive. Who has been issuing these policies? AIG. So, if AIG were to go under, what would happen to the private contractors in Iraq and Afganistan??

Robert,

Several years ago I developed my 5 rules of money. They help me understand what and why money acts the way it does. Here they are:

1) Money is smart

2) Money attracts money

3) Money is amoral (amoral not immoral)

4) Money likes stability and predictability it abhors chaos

5) No person, organization, or government ever has enough money!

Every situation where money is involved one and usually more then one of these rules active.

The sad fact is that while money is smart and people think they are being smart with money they only are on a small scale.

3 examples of financial dumbing down come to mind
1) Online and tv advertising for mortages and reverse mortgages.
2) Junk mail offers to re-finance your house with a "bi-weekly" program. When I owned my last home, I would receive these two - three times a week. I know bi-weekly programs work, but an unsolicited offer is more than likely designed in the favor of the lender not the client.
3) Reverse Mortgages advertised on tv as a solution to the retirement problem. Some of them may work, but I have heard of fees being charged for the loans as high as $15,000.

Thank you Robert for this book. I am also reading other books from you, now about investing.
I am trying to educate myself financially more and more. I have some money from my apartement sold in 2004 (luckely in the Euro otherwise I would have lost half already by inflation).
I am preparing by investing it in commodities. I am also following people like Micheal Maloney (read his book) and I subscribed to David Morgan's newsletters, and listen to Jim Roger. And reading work from Napoleon Hill. I work around this all evenings when I have the time.

Yes, we have been dumbed down, and not only financially, also about our health, I studied alternative healthcare, and there is a monopoly going on by the farma-industry, wanting more profit and taking more risk on anybody's health these days. The government (EU) - read big coorperations - are putting more laws in place to create an even bigger market and taking away the alternative health by putting it to an illegal side.

But schools don't teach us, they make a shape, and everybody has to be in that shape, not be outside the box, otherwise you don't pass the test. When I think about what I learned at school it is a lot of lies and also a lot of facts are not in the schoolbooks. History full of lies, Geography doesn't give you the whole picture (read books from Erich von Daniken). Economy, well that is clear. Biology based on what we see but there is more to what we do not see, think ChineseAcupuncture, Feetrefloxology.

I hope this fiat money crisis will not create what is feared a world bank/power over us. What can we as little people do to prevent that from happening?

I am looking forward to the next chapters. I am so happy to have found you and see more clear.
(Sorry for my bad English)

Robert, I just searched for the book online from Amazon, Borders and Barnes & Noble, and I found something interesting...

NONE of them have the book for sale!!! Granted, there are links to affiliates for mostly USED copies.

I wouldn't be surprised if THAT'S being controlled by the elite through the publisher (American Media), too ... possibly by going out of print?

If anyone can find some clips for Ali Velshi of CNN and Suze Orman I think it would be a good addition to this commentary. People listen to Suze with such confidence, as I used to. Her recommendations of saving money never address inflation. Neither of these geniouses have ever mentioned precious metals to my knowledge.

In general, I think there's a lot of "conventional wisdom" from days gone by that doesn't apply anymore, yet the talking heads keep repeating it as if the economy hasn't been shaken to its core. I don't care what anyone says. These are unchartered waters, and I'm leery of anyone who's giving the same advice in 2009 that they were giving in 2007.

I haven't done enough reading on "stocks as a hedge against inflation" to have an informed opinion, but on Nightly Business Report's retirement special on 4/10, Boston University Finance Professor Ziv Bodie railed against this "conventional wisdom" espoused by one of the financial planners in the preceding segment. He basically called it a myth and said he would advise against most retirees having any investment in the stock market, adding that TIPS were an instrument specifically designed to beat inflation if that's the primary goal.

Hello Robert,

Enormous thanks to you and your team for the education provided here and in your other books.
Just one example:
From Time magazine, 16.03.2009, in the article about Suze Orman:

"Home ownership is a cornerstone of Ormanworld, and a good FICO score makes it
easier. "A home is flat-out the best big-ticket purchase you will ever make," she
wrote in The Money Book for the Young, Fabulous and Broke, which came out in
hardcover in 2005 and paperback in 2007. "Just like your student loans, mortgage
debt is truly good debt." The book, which is geared toward people in their 20s,
suggests that a 3% down payment on a home is acceptable in some circumstances
and recommends a hybrid mortgage, which involves a fixed-rate loan that converts
to an adjustable-rate one at some future date ("the Goldilocks option"). Under
normal circumstances, this might work out fine, but if you had followed that strategy
when the book came out, you might have been ruined when the housing market fell
apart."

The sad thing is that still a lot of people turn to her and people similar to her for financial advise.

In my estimation, the dumbing down has been taking place for quite some time in a much more general and pervasive way than the withholding of specific information about finances, but that specific information is able to be withheld now precisely because of the more general damage that laid the foundation for it. In general, the mass media of television and radio is rife with both subtle and blatant brainwashing and prestidigitation by virtue of touting - in unrealistic and glamorous terms - marketable goods, images and recreational activities as the highly desirable end-products to strive for, while completely keeping the focus away from the actual engines of creation for those end-products. It is this disconnect that disenables a person from seeing cause-and-effect, and therefore disempowers them from making any judgment about that cause-and-effect relationship, much less acting on it. As Richard Cantillon originally expressed: "The land is the source or the substance from which wealth is drawn; the work of man is the form that produces it, and wealth in itself is nothing other than food, commodities and the amenities of life". Therefore, a prime example of the mass disconnect from this foundational reality of economy is the fact that there is no grasp of knowledge between packaged food in the grocery stores, and what it actually took to create that food. Once that level of ignorance is created in the population, it is possible and easy to manipulate the availability of more specific financial knowledge otherwise needed to understand what is happening with our money and financial system.

In the UK we have not had the clear warning voices of the likes of Peter Schiff, Nouriel Roubini, Robert Prechter, Marc Faber etc. One BBC reporter, Robert Peston, attracted serious criticism for refusing to dumb the bad economic news down and became so trusted by the average Brit that he became known as "the Man who moves markets".

TV comment on the situation is reduced to 30 second soundbites. Men of the calibre of Jim Rogers and George Soros have recently been allowed the grand sum of about 60 seconds to comment.

In fine British tradition the only way to get the message across is thru humour. In two 8-minute sketches the wonderful "Bremner, Bird and Fortune" team convey what happened with subprime, SIVs/CDOs, the regulatory framework, CDS, and now reremics. The links are:
http://www.youtube.com/watch?v=lWDdcD-1xoo
http://www.youtube.com/watch?v=ScwGBNMH428&feature=related
Enjoy!!
Much love and gratitude to you, Robert and Kim