Benefiting from the constant transfer of wealth

Sometimes, a quick demonstration of a very obvious point could be very important to you. Even if the point is quite obvious, it may be very rare for someone to directly explain it. The reality could be very simple and yet very startling (even shocking). However, clearly perceiving the reality could quickly give you access to huge benefits, reduce risk, and eliminate the old familiar anxiety that results from a lack of clarity.

What in particular could become clear? You may be stunned to recognize the simplicity of what is going on with the global transfer of wealth right now. Massive amounts of wealth are being redistributed through two general types of activity: free markets and government programs. We will briefly review both so that you will learn what to do to better position yourself, your household, and your business.

First, why should you be interested? (How will you benefit?)

Most people do not realize that they are the sources of the huge profits of a small number of recipients of a massive transfer of wealth. It is common knowledge that governments create tax systems that collect wealth from the masses. Perhaps it is less obvious where that money goes, but it is probably no surprise that large amounts of tax revenues go to groups like government employees and the manufacturers of the expensive military equipment purchased by governments.

But what about something like investment markets? One thing that is clear is that every single transaction in investment markets will create a cash flow for brokerages. The biggest brokerages and their employees can make a lot of profit just from the commissions for all of those transactions.

But who else benefits? And who is the source of all of those profits? Again, most people do not realize that they are the source of the huge profits collected by a small number of recipients.

How you will benefit is simple. We will benefit you by positioning you to increase the amount of wealth that you receive, as well as reducing or eliminating your current exposure as a source of profit for the select few.

Next, you will watch a slideshow that will demonstrate simply and quickly how massive amounts of wealth are being transferred right now. You can pick from two versions (one with audio and one without audio). There are two basic sections:

Who benefits from investment markets?

Who benefits from the programs of governments?

Before proceeding, note that wealth is not just exclusive ownership of valued resources. Wealth is exclusive access to resources PLUS the intelligent use of those resources.

Now, select a choice below: (links are not active)

> See slideshow with audio

> See slideshow without audio

> Contact us

> Skip to main menu

 

 

SLIDES: (To see all the writing, you may need to increase your screen magnification or click some of the images.)

net5h
Keep in mind that investment markets do not create any wealth. They ONLY transfer ownership of existing wealth. Over a lifetime, we can chart different amounts of total gains or losses.

 

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Gains will be shown in black and losses in red.

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Here is an idea of the long-term results that most people think is going on with investment markets.

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Let’s visually isolate those who profit (in black) from those with a net loss (in red).

 

net5c net5b

Let’s quickly review the investment returns last decade for the Dow Jones Industrial Average of 30 popular US stocks.

djia 10 yrs

At the end of the entire decade, the result would be a small decline in liquidation value. Also, the vast majority of the time, there was a significant standing loss (often greater than 10%). One reason why many people tend not to notice the negative long-term returns is that they are frequently adding money to make up for their occasional investment losses (like adding funds with every paycheck).

However, stock markets can go down quickly and can take years or decades to recover (if they ever do). Plus, all of that is before we adjust for inflation. There are a few ways to calculate inflation, but all of them would produce double digit losses for that stock market index for last decade, like this:

djia 10 yrs2

Also, many investors in the US are subject to taxes for any year in which they have an annual gain. Last decade, there were profits 5 of the 10 years.

djia 10 yrs7

Depending on the exact losses on taxes, the final results could be a significant loss of purchasing power, like over 30%. Investors would have done better by just investing in the safest government bonds (to at least balance the loss of purchasing power from inflation).

djia 10 yrs5

 

 

So, again, here is what most people think is happening:

 

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But here is what is really happening (after considering inflation and taxes):

 

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Again, keep in mind that investment markets do not create any wealth. They ONLY transfer ownership of existing wealth.

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Here are some ideas of the different groups that typically benefit from investment markets (as well as those who are the source of those benefits).

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As investment markets transfer wealth year after year, huge numbers of typical middle class investors are the source of massive gains for small numbers of recipients.

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Also, note that I left out one group who benefits from that transfer of wealth. They benefit even more than the brokerages and the stock exchanges. They collect fees on every transaction and also collect taxes on all the profits. Who do I mean? Governments!

 

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We can pause here. What you have learned so far may be enough to interest you in considering the potential value of investing using the strategies of “smart money” investors who consistently make the highest profits. For many of you, that may begin with accurately re-assessing your current risk levels (not just what your broker wants you to believe).

We can help with all of that. First, I’d like you to also review a much shorter presentation on wealth transfers  performed by governments.

> Go to that slideshow about governments
> Skip to learning about the best investment methods (and the results you can get through them).
> Skip to learning how the most popular investment methods are so risky.

 

 

 

 

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We will create a chart similar to the one you saw about investment markets.

 

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On the left, we will show different levels of contribution (in red) or benefits (in black).

 

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Note that we are considering the total net transfer of wealth over an entire lifetime.

 

 

 

 

 

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With governments, how would you imagine that the chart would look? Is it more common to pay more in taxes than is received in benefits?

 

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Considering all the businesses and households in a single country (such as the US), here is a possible range of how many people are net donors or net receivers from government transfers of wealth:

 

 

 

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Next, consider some examples of who receives the benefits of government programs to transfer wealth.

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Consider also some examples of who provides those benefits.

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Through taxes and other revenues sources (fees, fines, etc), governments consistently transfer wealth from the masses to those who have the lobbying power to form governments and direct their policies.

 

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Before considering what actions to take, it may be useful to first be very clear on the interests of governments (as in the actual results that they consistently produce). They generally transfer wealth to a select few recipients from large numbers of human resources (contributing donors, such as the taxpayers that are the involuntary “underwriters” of government debt). Even with governments that claim to promote equality, what often happens is that the masses own little or nothing and are assigned their work (with severe punishments for non-compliance), which is also known as slavery.

So, be cautious about the interests of government-regulated specialists. They tell you what they have been programmed to tell you (and they are subject to penalties for presenting truths that are contrary to the interests of a particular government).

Further, do not expect government-regulated specialists to empathize with you or validate your observations. Do not expect the masses to be interested either. They have been programmed by schools and mass media to focus elsewhere. They may have even been programmed by religious indoctrination to be ashamed of accepting their own self-interests and acting on them.

Instead, expect some people to be repulsed by small pieces of this information. This presentation was created to be a gentle but provocative “demonstration of the obvious.” You can share the presentation from the beginning. To share individual points “out of context” can repulse people (as in frighten them without first establishing hope in favorable alternatives).

So, because of years of government-regulated programming to promote the idea of governments as the champion (or even the savior) of the masses, many people will be upset emotionally by simple and obvious truths. In that case, it is important to relax, slow down, and remain calm.

While reviewing the prior content, it is not unusual to get light-headed or experience nausea. In extreme cases, just drink some cool, clean water, take a break and then return to this content as soon as you are able to be attentive.

When it works for you, we can explore some objective measures of what works best and why, plus review why the methods promoted most by governments and financial institutions tend to be so good for them (and so bad for everyone else). You can proceed immediately or get a link emailed to you for you to continue at a later time.

By the way, the massive transfer of wealth is not going to stop. It will still be here whenever you are willing to position yourself wisely to benefit from it more than you ever have before. It will go faster or slower at certain times, but there is no stopping the fact that different people have access to different resources (as well as different levels of expertise in knowing how to use the various resources).

Nature contains diversity (variety), which means inequality. Rats are not as smart as cats, and neither of them are as smart as humans. Just like kids may eventually tame a stray dog, government leaders may eventually tame new human resources to provide wealth to the few (like through invasion and then ongoing colonization with occupation soldiers).

If you have a reaction of contempt (envy) for certain nations, political groups, or politicians, that is common enough, but will be of no practical benefit. Here is what will actually make a real difference in terms of long-term results.

You may be motivated to stop doing any unwise (detrimental, risky) practices that you may have been programmed to do. You may even choose to start doing some things that have been working very well for a select few people for a very long time.

> Learn about the best investment methods (and the results you can get through them).
> Learn how the most popular investment methods are so risky.

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2 Responses to “Benefiting from the constant transfer of wealth”

  1. How much larger are the gains produced by the most successful investors? | power of language blog: partnering with reality by JR Fibonacci Says:

    […] power, language, authority, perception, myth, god, faith, heaven « Benefiting from the constant transfer of wealth […]

  2. Simple insights regarding investment markets, IRAs, and more | power of language blog: partnering with reality by JR Fibonacci Says:

    […] J R Fibonacci Hunn An Austrian Economics kind of intro piece:https://jrfibonacci.wordpress.com/…/benefiting-from…/ […]

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