Saturday, November 25, 2017

Building financial skills is the foundation of your immortal future


When I look back 50 or 100 years - well hundred years might be a bit long for me but just visit a museum such as Calgary’s Heritage Park or Fort Steele in B.C.   There you will see a bit of my world or better the world my parents grew up in. In some ways it was much more personal than today; you knew your neighbors by name; probably you went to the same school and church as the rest of your neighborhood did. Church played a key role in life; it told its followers what to eat on Fridays; that sex was impure and many of us were not exposed to what happened elsewhere in the world. Vacation in a resort; vacation at all was unheard of. Our fathers worked for income and our mothers were in charge of the house. Father worked in a, or in his, store or as a teacher, a carpenter, a farmer, a plumber or a car mechanic. Not many people had a degree. We believed in Adam and Eve, despite of Darwin and his survival of the fittest.  The church told us to vote for the Catholic or Protestant party.
There was a fairly strong manufacturing base. Just like in Warren Buffett’s neighborhood, in my Dutch home town there were textile factories where many worked. In fact, textile had peaked around the time of my birth and we lost market share to developing countries like Japan, Taiwan,  Hongkong and Italy where labor was cheaper. But when we bought manufactured products, they were a lot more simpler and cruder than today’s. And everything automated was the same in size and in shape and often even in color. Because our machines were not much more than template makers and the workers were trained in certain production parts such as over and over sewing a seam in a particular pair of pants. You may remember film clips of Charlie Chaplin in horribly monotonous factories where everyone was but a number.

Yes, mankind through the industrial revolution had progressed tremendously. But everything that was not handmade was made in a cookie-cutter world. Probably if you noted the fear and adherence people had towards their religion and church, you might have thought you’d be dealing with Islamic fundamentalists. That is right, we may today look down on the inflexible believes of much of Islam all the way to the books they are allowed to read and what science would be acceptable to their church, but our Christian churches were not a lot better a 100 or even 50 years ago. I remember coming home from religious classes all in tears as a 6 or 7 year-old, because the priest had told us that we were sinners and that if we didn’t adhere to the laws of Christ; if we didn’t go to Church on Sundays then we would be servants of the Devil and we would go to hell. My mother, quite ahead of her time, dried my tears and told me: there is no hell and little boys or girls would certainly not go to any hell.
The baby boomers were a generation of technological change. Invention of the portable transistor radio; black and white TV and gosh, even color TV.  There was the newest phenomena called the Beatles and as teenagers and then as rebellious students we were shaking off the tyranny of the church. Today in Europe many churches are empty or being sold to large furniture stores for retail space. But as teenagers our rebellion existed of not going to Church on Christmas night or Eastern. The sexual revolution led to lots of premarital babies. Our sex education was from the priest who told us: If two people, a man and a woman love each other, they are getting married and then they make love and then a baby is born. How wonderful is that?  I was a rebel and as a twelve old, I asked the priest what “Fucking” was?  Because we had learned already quite a bit through the grapevine.

We have gone through truly revolutionary times, but looking back the main thing was that technology forced us to conform. Just like the Church told us what to do when it still was in power. Now technology required that everything was the same size and the same shape. So was our education system. We were divided on 'intelligence'. This one is good enough to become a store clerk. Doesn’t need to know very much. That one seems to be good with his hands, so maybe teach him to become a plumber. So what does he care about learning mathematics?  He’ll go to a technical school. That girl is only good for cleaning houses, she doesn’t really need to know much more than what her mother can teach her. That is how we fitted into round holes.  And you’d better not be a square. Maybe the army will teach him to fit in! Of course, there was no army for square peg girls. That was tough!
Today, life expectancy has increased way beyond the mandatory 65. Usually, when you reached your 65th birthday you’d be a physical wreck and so any state pension (a new concept invented by my parents) was not to last beyond a few years.  My grandmother was terribly old at 83 years, when she finally passed away; her husband died at 56 from a prostrate operation. They had 11 children and two passed away as teenagers during the war.  Now my father is one of the last standing at 92. And I would consider myself way too young if I died in my eighties. I think I have a good chance to reach well beyond ninety. These days, I am counting to live for a century! So, that creates quite a different life view than if I was expected not to live more than a few years beyond 65. 

You see, younglings, your world is quite different. I know, that today’s lifestyle with vacations in Mexican vacation resorts; with climate controlled buildings and 3-D printers is quite different. And maybe now, we can with our robots and other technologies ‘custom make’ nearly every form and shape and thing we can imagine.  Yes, we lost textiles and then many other forms of manufacturing, like steel and possibly car manufacturing is not far behind. On the other hand, with automation we don’t need cheap overseas workforces, but you won’t work in those new robotic factories either. This new economy will not condone the 9 to 5 job and other forms of uniform thinking.  If your body is not exhausted and broken, you don’t deserve a pension to live off during your few remaining days in peace and relative comfort. Because at 65 you have still an entire life before you. Just imagine that having brought up your children together; will you love him or her still so much to live together another 50 years? Heck, you can have a whole new career in those 50years, probably if technology keeps on changing that fast, you’d have several careers and many different forms of employment during your life.
You the new generations won’t rebel against religion or restrictive sexual attitudes. Your problems are not legalizing marijuana. That was the baby boomer dream! Figure out something else to kick against. Yes, the liberal government thinks that legalizing marijuana is the big revolutionary thing to do. Well they did a lot of that 30 years ago in my home country and possibly centuries ago in parts of Asia. These issues are maybe the dreams of the old boomers but it is not your fight.  Now that us boomers are reaching our 60s, we realize we still want to do things. Because we will not be dead within a few years.  I guess, we want to smoke legal pot and behind-the-times-liberals are helping us doing that.

You can resent your parents for still working in jobs you feel, now that you are out of school, that you should have. Problem is, your parents are way too skilled in those jobs – you can’t compete youngster! After all they have done that stuff for the last 30 or 40 years. You, younglings, have to carve out your own revolutions, your own occupations which may be rewarded in completely different ways than we baby boomers were paid. Maybe crypto-currencies are an intricate part of this. Or maybe all your money is digitally tracked by Visa and or by banks. I personally hope, you guys become financially literate so that we can do away with large numbers of Wall Street sycophants!  I also hope that you will become more accountable for your actions and that you count less on the welfare state.  Yes, there are always roads to be build and there are always sick and feeble people (in more ways than one) who we as good neighbors should try to help. But maybe we can do way with our sense of entitlement and stop demanding social support for obsolete things such as pensions. Your life is going to last longer than ours. Maybe you reach immortality and what are you going to do after 65?  Watching soap operas or play never ending golf games?
No way, Jose! You probably won’t need a welfare state and its bureaucracy.  Yes, there will always be a government and a legislature. There will always be discussions about what is acceptable and what is not. But what I really hope is a world where we are more accountable for our actions and where we pursue new ideas and ventures. Where we maybe even venture out colonizing other planets. To use a cliché: to boldly go where no one went before!  That is another revolutionary thing from the 60s. Remember William Shatner – yes that old man?

That is what I have been trying to tell you for the last number of years on this blog. Bureaucracies and endless little laws and rules are from the age of round pegs - the technology age that has trouble dealing with square ones.  The new world doesn’t stop at 65 and hopefully for me it doesn’t stop at hundred. Taking care of your finances will be more important than ever.  Maybe you don’t get paid for working in a factory; but society will always pay for the things that it deems valuable. Doing things that are valuable for yourself and for society that is the new paradigm. Not being the round but rather being the square peg. Looking for challenge; going out on a limb. That is the new future. To some degree that was life always like; but now that you may have to live for 100 years or longer, waiting for your pension waiting for retirement won’t do. You’d be dead at 75 or as early as 65 out of shear boredom. To survive you have to be the square peg and you should be willing to go out of your comfort zone. If it goes wrong, well you have many, many years to make up for it.
All those rules about political correctness, about climate change. about going to school and doing your homework. That is all about the world of round pegs. That is passé. Chances are your will never starve but if you don’t dare to go out on a limb you probably will die prematurely out of boredom. Why is your personal finance more important than ever?  I don’t think you could stand working for a boss of 25 or even 40 years old when you are seventy.  I think that you need to have more money than ever to finance whatever your want to pursue in life. Making money should be second nature for you, because there maybe times that you lose it all. What are you going to do when you have to start over again financially?  Oh, I can’t start over, instead I jump out of a window at the tender age of 55?  No, you MUST know how to accumulate the resources that you need to make your life worthwhile. What is the use of a very long life if you can’t afford anything but live like a vegetable? 

I think, the new generation will have to get rid of the nanny-state, It can’t afford a large over-indebted bureaucracy of kleptomaniac politicians and brain-dead bureaucrats. I think we baby boomers caused a sexual revolution. You will reform democracy and overthrow the concept of an overbearing state. You won’t accept that your government can order you to die ‘for the good of our country’. Sorry, but our lives are too valuable and too long for that. In previous centuries, politicians such as Kings and Presidents could send young kids onto the battlefield to die for ‘the good of our nation’, whatever political agenda or religion that may have represented. Maybe today or tomorrow we will be too smart to accept that kind of a bullshit.  Though sometimes, when I despair at how much freedom we have given up out of fear for terrorists, which usually is nothing more than a developmental phase in political ideology or religion (remember Baader-Meinhof? Or Al Qaida?) No, I think there will be a revolution against the bankers of Wall Street and the politicians that live of Wall Street’s political ‘donations’ and with grabby hands in the nation’s treasury. I certainly hope there will be an end to the busybodies who want to tell others how to live?  Did ’t we learn from the baby boomers and their revolution against the Church and against the dark secrets of suppressed sex?  Didn’t we learn from repressive legislation such as the drug and liquor wars?  Criminal organizations, corruption and abuse thrive on an oversupply of rules and laws. We need less rules and laws and more human decency. We need more self-accountability and a more adult attitude towards life.
Strange as it may sound, environmental issues, social issues, even poverty do not get solved by rules and law.  Yes, there is a need for structure; for property rights and for some moral guidelines. But in the end, most depends on your own decency as a human being and on your self-accountability.  Laws can always be circumvented and then the loopholes are filled with more laws. That is what creates a clutter of sycophant lawyers and uncaring judges – , I have seen that in action in my own life. It is a terrible justice system – something that together with our current education belongs in the era of round pegs. Be proud of your own decency and integrity. Be accountable for your own actions and create opportunity for all around you. Find the win-win solution and don’t waste your time on blaming others. Others will take care of others. But you, you’re number one. The buck stops with you the square peg who doesn’t only live for yourself but also for helping to create opportunity all around you. And how can you do all that? It starts with building your financial skills and resources early in your life.  That is what this blog tries to help you with.

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