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The Three-Headed Hydra Destroying our Economy & Your Shield in the Fight | by Chris Knight | The Capital | Oct, 2020
The dragon rumbles its roar. The ice of its belch freezes your wealth. The fire of its head embroils political division. The bite of its burden buries you in debt.
Since time memorial we have seen this monster. Up from the depths of your home town, you know its legend. Grandparents have whispered its tale before bed. The imaginations you held as a child seemed arbitrary. As you lay tucked in a soft kiss from your grandmother cooled your fear.
Your grandfather remembered the howl it echoed. Each night you would pull at him to tell you the story. He would tell you stories of triumph. He would tell you the fears of this tale. He would tell you how he prayed it to end. It always ended happily…at least that’s what you told yourself.
After all…your grandparents are still alive. The hydra never destroyed them but their eyes tell you a different story. Could it be that your grandparents were changed as a result of this beast?
What are its three heads?
What is the triple threat they whispered?
What is it that makes the elements so chilly?
What are the rumbles so fierce and the burn so hot?
These hydra heads pave the way for what we know as “Black Swans.” This will be the one event to destroy it all. I will offer you a shield to protect yourself. You will need to defend against fire, ice, and a massive bite.
I AM THE BITE BURDEN — MASSIVE PUBLIC DEBT
World War I occurred during the influenza pandemic. During this time, the hydra’s bite struck. U.S. public debt surged to 33% of GDP. The hydra was briefly tamed as government warriors struck their swords into its mouth. Then during the Great Depression, U.S. public debt reached 43% of GDP. The hydra proved it was not defeated. Government soldiers perished by the thousands until after World War II debt rose to 106% of GPD.
In each case, extreme debt load was fought down due to numerous factors. Some major factors contributing to debt reduction consisted of carefully crafted silver arrows. These arrows were represented as: no social media, general trust in government, money which still held intrinsic value, and ease of suppressing international events with propaganda.
Frankly, it was easier to manipulate the masses and intrinsic money was available to devalue. Today it is not so simple.
In the wake of a COVID-19 pandemic, U.S. debt exceeds 100% of GDP. The Hydra breathes a bone-chilling breath. Government soldiers are protectors in name only. There is no fight in these conscripts.
Only corruption remains.
The scribes at the Congressional Budget Office expect debt to surge past 200% of GDP. The once valiant soldiers of our government are scared of the hydra’s bite. In cowardice, they offered U.S. citizens as sacrifice to protect their own hides. U.S. government soldiers abandoned their posts with stimulus packages.
The result is a bite burden nearly double the worst bite burden since World War II.
I AM ICE — WEALTH CONCENTRATION
One hundred years ago, the top 0.01%, or the richest one in ten thousand American households, controlled American wealth.
In the 1920s, the top 0.01% share of the nation’s wealth rose. These individuals climbed from 5% of American wealth to peak over 10% in 1929.
The trend reversed with the great stock market crash. This event wiped out the fortunes of super-rich. The Hydra’s breath froze economic activity and brought the Great Depression. The Hydra’s breath shook main-street to bankruptcy. Many bites occurred since then but few ice breaths. The next ice breath would begin to brew in 1978. 1978 was when the concentration of wealth in America reached an all-time low. The chill of the Hydra’s ice breath began to shrink the wealth gap during this time.
On September 15th, 2008, the ice breath of our Hydra blew. The chill hit America through the failure of Lehman Brothers. Not coincidentally, 2008 was also the year when the wealth concentration of America matched peak levels of another important turning point long ago — 1929.
In other words, the Hydra’s chill occurred exactly when inequality in America matched the same level of 1929. 1929 was the marker of a major breaking point. 1929 is exactly when the Great Recession began. This was the last time the Hydra froze wealth in America.
There is a monumental difference between the Great Recession of the late 2000s and the Great Depression of the early 1930s.
The Great Depression nearly wiped out the wealth share of the super-rich.
The Great Recession did not.
Our leaders sensed we had far more debt than 1929. Rich nobles did not want to perish combating an icy breath Hydra this time around. I am certain 100 years from now, we will read of another Jekyll Island. Somewhere U.S. politicians and business people engineered a financial system to take advantage of a far more vulnerable system.
The wealthy knew what was going to happen this time around. The wealthy paid attention to history. The wealthy were determined to let everyone else get wiped out this time around.
That’s why the government embarked on the largest bank bailouts of all time.
That’s why the Fed allowed the Hydra to unleash its great icy breath of money printing.
That’s how large blocks of money flowed to elite companies and elite families of America.
This action helps explain why the concentration of wealth surged to the most extreme level in U.S. history. (See chart above)
The end result is the great social and cultural divide we have today. We have frozen remnants of society. The Hydra has frozen our wealth and looks to melt it with its fire breath.
I AM FIRE — POLITICAL UPHEAVEAL
In the chart above, the red line represents the Hydra’s fire. This is a measure of polarization based on an exhaustive study of voting patterns in the U.S. House of Representatives.
Notice the fire of the Hydra moves up and down as the wealth concentration fluctuates. In trading this is called a “Positive Correlation.”
When the Hydra’s fire is low, it means Republicans and Democrats cross party lines to draft legislation in unison.
We hope joint drafted legislation is based on issues but rarely they coincide.
As the Hydra’s line soars, this means our politicians vote strictly along party lines. This leads to a Hydra torching or worse.
What are signs of this extreme polarization? Anyone who watches the news sees the roar of a political Hydra blowing fire everywhere. Lies, misinformation, and political attacks are common place. The presidential debate was a heatwave of fire. The disdain for parties is intense.
THE SHIELD OF PROTECTION
The shield I offer is one to absorb fire, not shatter during great cooling and strong enough to take a bite.
The shield I offer is “store of value.”
In each circumstance, the Hydra fell defeat not through a sword but a shield.
The protection mechanisms to weather intense heat of legislation designed to devalue money are protected through the acquisition of assets. Digital assets such as cryptocurrency, blockchain, and big data offer store of value.
Gold, silver, and real estate survive intense fires as well.
The freezing breath of wealth preservation occurs to those who secure store of value. Intrinsic values always hold their tensile strength under arctic conditions.
The bite taken by a Hydra can easily be fended off with store of value. As values soar debt is not necessary. Buying power is protected. Buying power is increased.
If you want to protect yourself take this shield aspiring warrior.
Take the shield of Store of Value. Protect yourself. The Hydra stirs. Fire, ice, and bites lunge at you. The government soldiers are dead. They lay at your feat. No soldier to protect you. Behold the Hydra awakens!
To your knowledge success!
***
About Christopher: Christopher Knight Lopez is a Professional Entrepreneur. Christopher has opened over 7 businesses in his 14-year career. Christopher’s purpose is to take advantage of various market-driven opportunities. Christopher is a certified Master Project Manager (MPM), Master Financial Planner (MFP) and Accredited Financial Analyst (AFA). Christopher previously held his Series 65 securities license examination. Christopher also has his General Lines — Life, Accident, Health & HMO. Christopher has managed a combined 286mm USD in reported Assets Under Management & Assets Under Advisement. Christopher has work experience in 29 countries, raised over 50mm USD for various businesses, and grossed over 8.0mm in his personal career. Christopher worked in the highly technical industries of: biotechnology, finance, securities, manufacturing, real estate, and residential mortgages. Christopher is a United States Air Force Veteran. Christopher has a passion for family, competitive sports, fishing, martial arts and advocacy for entrepreneurs. Christopher provides self-help classes for up-and-coming entrepreneurs. Christopher’s passion to mentor comes from belief that entrepreneurs need guidance. The world is full of conflicting information about entrepreneur identity. See more at www.christopherklopez.com.
Disclaimer: This information is not meant to be a form of investment advice or financial advice. Do not apply this situation to your own personal circumstance. Various risks include: business risk, investment risk, political risk, and other risks. This information is for informational and educational purposes only. Please do not reach out to the author for any investment strategies or philosophies. Please consult your own financial advisor or legal advisor for your own circumstance. Not a recommendation or endorsement of any kind.
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