Saving Yourself From The Black Hole
When examining an economic crisis outside of our so-called bubble of prosperity. It is a risk that centers around 2.3 quadrillion in derivatives debt. Let’s put this into perspective, there is not enough money in the universe to salvage a systemic collapse once it starts to gain momentum. It’s nowhere to be found. Not in the US Treasury or anywhere in nation-state governments. Or looking at it another way, there is not enough human productivity in all of human history to even make the slightest difference in a collapse with the current derivatives risk.
In A Systemic Collapse What Happens To Your Money?
It’s very simple, at this moment, your wealth is a digital entry with no real value. Your IRA and or 401k simply exists on a balance sheet that has been leveraged many times over. In reality, this money has no real meaning– it’s been already vaporized into the abyss. That is why 401k and IRA pension schemes or scams make it so difficult to liquidate money. Keeping the illusion going is a top priority in the fund management business. Therefore, locking up risk capital so the client can’t touch it is a top priority.
I know what many of you are thinking, ” I will just keep money in for the long term. After all, I don’t want to pay a fee for early withdrawal ” or another one is ” The market has always treated me well and I will just wait out a downturn “. I will let you in on a little secret, the markets are an artificial construct that can be changed at any time– and most definitely not in a retail investor’s favor. The markets are not there to treat you well and there are no laws that guarantee you any return on your investments.
What Is The Solution?
You need to liquidate your assets and take your money out of these institutions. Using any hindsight bias will lead you to financial disaster. If you are in your late 60s or 70s the next collapse will be your last! And I am here to tell you these people that manage these derivative products could not care less whether you live or die.
Where are the lawmakers to protect you? Paid by the very same people that are stealing from you. Expect no mercy. What investments are there?
1. I Want Exposure To Equities No Matter What!
Many say, ” I want exposure to equities without risking my entire portfolio ” The solution is straightforward and simple. Simply calculate your equity’s current risk. Then, liquidate that risk. Using only 10% of the surplus money go into the (CME) equities futures markets and buy the corresponding equivalency in contracts. 10% of that money will give you the exposure that you currently have. Without risking your entire portfolio.
Now, what can I do with the surplus money? Pay off your home. Remember, the risk is still the same– with only 10% of the aggregate. Keeping in mind, you can still lose that 10% as you would with the sum total. The most important fact is that roughly 90% of the risk is off the table. I hope this is clear?
2. Metals Are Tried-and-True
When we talk about gold we’re not talking about CME paper contracts. Or gold exchange-traded funds. We are only talking about buying the physical metal. If you purchase gold (paper contracts) you’re right back in the “Black Hole” of the derivatives markets. When the derivatives markets collapse you’ll lose your money, regardless.
Not if, but when, the derivatives markets collapse, you will get a letter that sounds something like this, “ We have suspended redemptions on all of our ETF Gold accounts. Until the current market situation has been resolved “.
Meanwhile, in the background, the current management is liquidating the company — filling their pockets on their way out the door.
The next letter will sound something like this, “ We must apologize we have liquidated our company and due to market factors your money has been dissolved along with the company and go FUCK yourself.” and “ Thanks for our early retirement (it’s been fun) and believe me your money will be put to good use.”.
To get away from these morbidly obese jackals and sloths, You can simply buy the physical metal. There are two products that I recommend the American Eagles or the Canadian Maples. They have the tightest spreads in the physical market. And they are the products that have the quality you need for future exchange.
Some worry about security, First, never talk about your finances. Second, simply get a safe bolted to the concrete–- put the medal in it. What if somebody asks? Your protecting family documents from fire — and end the conversation.
3. Cryptocurrencies Are Good But What About The Volatility And Fees?
When trading cryptocurrencies you need to exchange blockchain products that have low fees and reduced volatility. With Bitcoin Cash (BCH) you can do exactly that. But, what if I want to hedge so that I can get complete price stability? Perpetual Swaps at Bitmex are a good solution for hedging Bitcoin. However, that will change.
What about security? The question is how long does it take current technology to crack through a 256-bit elliptic key? This is a number so far removed from normal reality it is hard to understand how large it really is. You should examine this problem in this way, Add up all the stars and planets in the observable universe and start with this as a brute force baseline. There is no human technology that can crack through a 256-bit elliptic key. Now, or in the foreseeable future. If your money is on a blockchain it is in a– black hole. Lost to the Universe. Therefore, it is a good idea not to lose your seed phrase.
In many ways, this state of affairs is better than gold. Even if you disappear from the face of the planet for 10 years. Your cryptocurrency will still be there for you. In that time, a bank account would have been closed and your money would have been given to the state. Or in the case of gold, it probably would have been seized.
There is absolutely no one that can tell you when or why a systemic crisis will manifest itself. In my view, look at the markets defensively at this point — keeping in mind that this is just a hindsight bias guess and, whether I am right or wrong doesn’t make any difference.
---Roman
Understanding the nuances of the offshore financial centers can be challenging to say the least. In this newsletter, I talk about aspects of our industry that you may never read about otherwise. Some of my most informative articles are only at Substack. This being the case, my goal is to help you preserve your wealth by sharing my experiences.
For more analysis and ideas, subscribe to my mailing list.