Most people don’t calculate their net worth.  For those who do, it is somewhat of a guessing game.

Your net worth, technically speaking in a financial sense, is your assets minus your liabilities. If you own a car worth $20,000 with a $12,000 loan on it, then you get to count $8,000 for that one asset.

If you want to get a picture of how you’re doing financially, and where you are in terms of being able to retire, then it is probably better not to calculate your net worth in terms of everything you own.

Should you count your living room couch as part of your net worth?  What about your new smartphone?  What about your clothes?

They are all technically part of your financial net worth, but they don’t really contribute to your financial well-being in terms of being able to retire, unless you are planning to sell them.  These things contribute to your standard of living and enjoyment of life, but you shouldn’t be counting them as assets for the purpose of retirement planning.

Your couch and your clothes pay no interest to you.  You probably aren’t going to sell them, and if you do, they aren’t going to be worth very much.  You probably aren’t going to sell your smartphone unless you trade it in for another new one down the line, which will just reduce the expense of getting a new one.

I’m not telling you whether or not to buy a new smartphone or nice clothes or a new couch. I’m just saying that these things shouldn’t be considered as assets when planning for retirement or financial independence.  In fact, if you are planning to get a new phone every year when the latest model comes out, then this should be counted as a liability, as it means a higher cost of living.

It gets a little trickier with a car.  Most people need a car for transportation.  Most people also own a car that provides much more than just transportation.  If you buy a new $25,000 car, then it should be realized that you could have bought a new car for under $20,000, assuming you don’t need something large for transporting cargo or something where the type of automobile you drive actually matters for your occupation.

So I am hesitant to count a car towards net worth.  At the same time, if you own a $20,000 car with a $12,000 car loan, what happens if you take $12,000 from your checking account to pay off the loan in full?  Your checking account has been reduced by $12,000, but if you aren’t counting your car as an asset in your net worth line, then your net worth just went down by $12,000. This obviously isn’t right.

I don’t have an easy answer to this.  I think the easiest way is to calculate your net worth without counting anything that you aren’t going to sell.  This would include your car.  But you have to count the liability for your car (or anything else) in the negative column.  So if you owe $12,000 on your car, subtract $12,000 from your net worth without counting the value of the car.  It doesn’t matter if your car is worth $15,000 or $50,000.  If you aren’t going to sell, it makes no difference anyway. It may make a difference in the enjoyment you feel when driving, but it doesn’t make a difference to your financial net worth.  If anything, the more expensive car is more of a liability in terms of insurance and maintenance.

When you think about all of the junk that people accumulate in their house (you are probably one of them), it doesn’t make sense to value these things, especially when you aren’t going to sell most of it.  And for most of the things that will be sold, it will be a few bucks at a garage sale.

If you have something that is really valuable (a classic baseball card, a gold coin, a diamond ring) and you may potentially sell it in the future, then it is reasonable to count it towards your net worth.  Otherwise, forget about all of the junk in your house, and forget about things that aren’t junk if you don’t intend to sell them.

Your House

This brings us to the question of whether to count your home equity towards your net worth.  If you own a $300,000 house with a $160,000 mortgage, shouldn’t $140,000 go towards your net worth?

Even here, I would tend to lean the same way as above and say that you should only count it if you intend to sell it.

As with the car example, if you pay off your mortgage early, shouldn’t the added equity offset the amount that your checking account went down?

If you take $160,000 out of your checking account to pay off your $160,000 mortgage, your net worth is still the same.  It may start to go up more by not having to pay the interest on your loan, but that is your future net worth.

There are people who bought a house a long time ago in an expensive part of, say, California, who now live in a house worth a million dollars.  If they didn’t have the equity in their house, they wouldn’t be able to afford the house they live in.  Should they be considered millionaires by virtue of the fact that they have a million dollars in home equity?

If someone is planning to sell their million-dollar house and move to another area or rent, then certainly that million dollars of net worth will come into play, assuming the house value stays up.

However, if someone lives in a million dollar house and never intends to move, I don’t think it should really be counted towards net worth, at least when determining the state of the person’s finances and whether retirement is possible.

If anything, as Robert Kiyosaki would say, the house is a liability.  Someone who lives in a million-dollar house is paying much higher prices for insurance, upkeep, and property taxes than someone living in a house worth $300,000.  The insurance, maintenance, and property taxes on a million-dollar house will often be more than many people pay for their monthly mortgage payment.

Again, as noted above, it is better to just count the debt part against your net worth, but not count the value of the asset if you are never planning to sell.  Or in the case of a house, even if you are going to sell, you should only count the difference of what you will later buy.

For example, if you are going to sell your million-dollar house and buy another million-dollar house, then this will actually cost you money because of closing costs and commissions.  If you are going to sell and then buy a house for $700,000, then you can reasonably include $300,000 towards your net worth, minus the transaction costs.

Calculating FI

If you are trying to calculate a number for financial independence (FI), you also have to be strategic in how you count your home equity.

Many in the FI community like to say that you need approximately 25 times your annual expenses.  So if you spend $40,000 per year, you would need a million dollars to reach FI.  If you spend $100,000 per year, you would need $2.5 million dollars to reach FI.

I think the 25 times expenses formula is too low.  I find that many times the estimated returns that are counted on in the future are too high.  But that is beyond the scope of this post.

If you have paid off your mortgage, which is probably a good idea if you are planning to retire early or retire at all, your home equity should not be counted towards your net worth, unless you are planning to sell your house and move to a cheaper one. If you have a $600,000 house paid for versus a $300,000 house paid for, the person with the cheaper house is better off financially if neither one is going to sell.  The more expensive house is a bigger liability for maintaining.

The benefit of paying off your mortgage is that you won’t have the mortgage payment (principal and interest) as an expense.  So you don’t have to count that as part of your annual expenses, which can be a significant piece.

If you are going to pay off your mortgage sometime in the future and want to calculate your FI number, you can just deduct the amount you owe on the mortgage from your financial net worth.  But then you don’t have to count the principal and interest from your mortgage payment as part of your expenses when calculating your FI number.

So if you owe just $40,000 left on your mortgage and are trying to calculate your FI number, take $40,000 off of your net worth.  But you also get to take the principal and interest portion of your mortgage off of your expenses.

This is the way I would handle it.  It is ok to calculate your net worth to include your home equity, but you should also calculate it the way suggested above for planning purposes.  If you have any thoughts of your own to share, please comment below.

Let’s say that SARS-COV-2 is exactly what the medical establishment tells us what it is, even though the virus was never properly isolated.

Let’s say that the PCR tests used to test people are accurate, even though they are often run at 35 cycles or higher, which even Dr. Fauci admitted will spit out false positives, and even though the creator of the test – Kary Mullis – said it should not be used for diagnostic purposes by itself.

Let’s say that this is a really deadly virus and the death count is accurate, even though the CDC changed its guidelines in March and April 2020 to essentially count anyone who dies with COVID-19 as a COVID-19 death, and hospitals received increased reimbursement for coding patients as COVID-19 positive.

Let’s say that society at large is willing to accept sacrifices to mostly save people who were on the verge of death anyway, even though those sacrifices mean higher unemployment, economic depression, increased anxiety, loneliness, and higher rates of suicide.

Let’s say that locking down society by shutting down “non-essential” businesses makes a significant difference, even though there seems to be no difference in cases and deaths in places that locked down heavily as compared to those that didn’t.

Let’s say that we could achieve keeping people at home and closing down businesses on a voluntary basis, even though it was only through state force that this could be widely achieved.

Even granting all of those things, what is to say that masking, social distancing, getting rid of large gatherings, and having people stay at home was the answer to this virus?

If the virus is deadly to those who are elderly and those who are in bad health, wouldn’t it have made more sense for the other 90% of the population to carry on with life as normal and achieve herd immunity?

I believe very little, if anything, of significance coming from the establishment media.  But even if everything that we have been told has been true, and even if we ignore the immorality of controlling others, the lockdowns still don’t make any sense.

People make judgments every single day, including how much risk to take.  If there were a really deadly and contagious virus with people dropping dead all around you, then human behavior would react rather quickly.  For most people, if they personally knew just a couple of people, who were relatively young and healthy, who dropped dead because of a virus, then they would act accordingly. It wouldn’t require a governor or mayor to tell them to stay home.

It is a bit of a joke when you see people in the store walking around with a mask on, as if that will protect them from the plague.  If it was really a high-risk situation, then I’m pretty sure most people wouldn’t be shopping for shoes.  Even with groceries, if you thought there was a one percent chance of contracting a virus with a one percent chance of dying if contracting it, that would probably be enough for a lot of people to order their groceries online.

Most people aren’t terrified of COVID-19.  If they are, their actions don’t really represent that.  But there is a small segment of the population that really is terrified and have mostly stayed home for the last year.  For their sake, wouldn’t it be better for those willing to “risk it” to live something of a normal (prior to March 2020) life?

If every healthy person under the age of 65 went about their life as before, then any virus would quickly spread and dissipate.  It’s not that the risk would be lowered to zero, but most elderly people and those in poor health would probably feel a lot more comfortable by now going about their lives.

I can’t think of a more tortured way to deal with a supposedly deadly and contagious virus. If anything, not only is it just prolonging the whole thing, it actually makes the more vulnerable people even more vulnerable.  It would have been better if the people willing to take on the risk had been allowed to live their lives.  They would have “achieved” herd immunity and provided some protection for others.

And now that the establishment is promoting their vaccines, they have to admit that herd immunity is a factor.  It was something taboo to mention a year ago, or even 6 months ago.  But if vaccines are going to “work”, there has to be herd immunity.  Otherwise, it just means that people can be reinfected, or it means that people who get vaccinated can easily spread the virus.

If the vaccines actually work, then we should reach herd immunity at some point.  Otherwise, they are mostly pointless at best.

If we are to believe what the establishment tells us about the virus (which is often contradictory in itself), then we could have easily achieved herd immunity a while ago. Life would have gone on as normal for most people, and life would be mostly back to normal for those who were fearful and stayed home until things fizzled out.

Not only were these lockdowns wrong, which destroyed millions of people’s lives; they also made no sense in terms of protecting vulnerable people.

Stocks are in a bubble.  Bonds are in a bubble. Real estate is in a bubble. Cryptocurrencies are in a bubble.

The latest thing in the near-everything bubble is NFTs.  An NFT is a non-fungible token.  You can search for some of the stories out there showing the ridiculousness of it all, including the absurd prices of some of these things.

As described on Wikipedia: “A non-fungible token (NFT) is a unit of data on a digital ledger called a blockchain, where each NFT can represent a unique digital item, and thus they are not interchangeable.  NFTs can represent digital files such as art, audio, video, and other forms of creative work.  While the digital files themselves are infinitely reproducible, the NFTs representing them are tracked on their underlying blockchains and provide buyers with proof ownership.”

So you can “own” a digital file that is easily accessible by anyone.  So what?

For years in following the arguments for cryptocurrencies, I have heard about how the blockchain technology will have many wonderful uses in the future.  I don’t disagree that the blockchain technology will be beneficial in the future, but NFTs is not one of those useful things right now, except for those making money off it.

This is especially a joke in the year 2021 as patent laws become harder and harder to enforce. What happens when someone in China uses a piece of digital art that is “owned” by an American?  Will the American shout out on the rooftop to “stop”?  Will the Chinese government enforce the ownership of NFTs?  I think the question answers itself.

This is just the latest gimmick.  Since anyone with some computer programming skills can create a new cryptocurrency out of thin air (and there are thousands of them), I guess we are on to the latest thing of creating ownership of digital artwork and other video and audio files.

All you have to do is create something and then sell it for a lot of money, and you too can be rich.

Maybe I can find a friend who will go in on this with me.  I’ll create an NFT (of something), and he can create an NFT of something.  I’ll sell my NFT to him for a million dollars, and he’ll sell me his NFT for a million dollars. Then the value of each of our NFTs will be a million dollars.  We can be millionaires just like these fellows who created their own crypto currencies.

https://www.youtube.com/watch?v=Z4gZGHP1y8U

This mania is what happens when the central bank creates trillions of dollars out of thin air while trying to suppress interest rates to near zero.  People lose their minds.

This is Tulip mania in the 21^stcentury. At least back then, you got a tulip bulb and hopefully a nice flower later on.  At least it was an actual physical asset.

With NFTs, it is nothing.  I could sell you ownership of a square mile on Pluto, but it doesn’t mean much if you can’t do much with it.  It doesn’t mean much if you can’t enforce your property right.

Of course, I have long thought cryptocurrencies to be similar, as they are just made up out of thin air.  I have always been sympathetic to the crypto crowd because they tend to be anti Federal Reserve (or anti central bank), but I have never thought cryptocurrencies to be an answer to replacing the dollar as money.

Believe me, I wish I had bought lots of Bitcoin back in the early days.  I would be a multi-millionaire from it today from a small speculative investment.  So I can’t discount the possibility that these NFTs are going to explode in popularity and price.

There is a lot of easy money floating around out there.  People don’t want it eaten up by more inflation, and many are looking to make a quick buck.  I believe the newest craze of NFTs will last as long as the everything bubble lasts.

We are in an era of major speculation right now.  When it finally stops, it is going to stop hard.  The last suckers holding the bag will get hurt the most. This goes for NFTs and cryptos. It may also go for stocks and bonds.

The Federal Open Market Committee (FOMC) released its latest monetary policy statement on March 17, 2021.  As expected, the Fed will keep its target rate near zero, while continuing to add at least $120 billion per month to its balance sheet.

The FOMC statement says, “Inflation continues to run below 2 percent.”  Apparently the Committee members do not buy gasoline for their cars, and they don’t shop at the same grocery store as I do.

The Fed continues to maintain that, “With inflation running persistently below this longer-run goal, the Committee will aim to achieve inflation moderately above 2 percent for some time so that inflation averages 2 percent over time and longer-term inflation expectations remain well anchored at 2 percent.”

They never exactly say how they will calculate the average.  Does this mean averaging inflation over the last 20 years?  Does it mean the last 2 years?  It sort of makes a big difference.

In Jerome Powell’s press conference, he continued to preach the 2% inflation mark.  He also said, “Beyond these base effects, we could also see upward pressure on prices if spending rebounds quickly as the economy continues to reopen…”  He added, “However, these one-time increases in prices are likely to have only transient effects on inflation.  The median inflation projection of FOMC participants is 2.4 percent this year and declines to 2 percent next year before moving back up by the end of 2023.”

Ever since the Fed announced it would target 2% inflation as an average, I suspected that it is just an excuse to run price inflation above 2%, even according to the government’s own statistics.

Powell is saying that we should expect price inflation above 2% this year before falling back. But why would price inflation push higher and then drop back to 2% or below?  Does this mean he expects a recession?  Does it mean that the Fed will tighten as compared to what it’s doing now?

According to Fed officials, we should expect the target federal funds rate to remain near zero for at least a couple of more years.  Maybe the Fed will slow down its purchases of assets, but there are no signs of that yet.

Looking back at 2008 to 2014

From 2008 to 2014, there were three rounds of quantitative easing (QE).  There was QE1, QE2, and QE3.  The Fed would inflate its balance sheet like crazy, then stop, and then start again.  It basically got away with it.  Sure, we all pay the price with misallocated resources and prices higher than they otherwise would have been.  But from the Fed’s perspective, they got away with it because we didn’t have a recession for 11 years, and price inflation remained relatively tame.

And when there was a sharp economic drop in March 2020, it could all be blamed on the virus. Of course, it was really state and local governments to blame for shutting down businesses.

We can’t overlook though that we may have been in for rough times anyway.  In 2019, the yield curve inverted, which is a classic sign of a coming recession.  In September 2019, the Fed had to step in when the repo rate spiked up.

So the virus and all of the hysteria was a convenient excuse for the Fed to massively inflate starting in March 2020.  It was also a good excuse for Congress to run even higher deficits than they were already running.  And it is largely the Fed funding these deficits.

I don’t see how we get out of this pleasantly.  There has been a massive buildup of debt, which was already a major problem. The interest rates are low now, but what happens when they go higher?  What happens when price inflation goes higher?  Does the Fed really believe that it can keep creating trillions of dollars out of thin air while keeping rates low, price inflation low, and the economy humming along?

I don’t think the Fed will get away with what it did from 2008 to 2020.  I think the chickens will come home to roost.

We are in a nearly everything bubble.  I think precious metals is one of the few things that isn’t in a giant bubble.

Real estate is likely in a bubble, but there is some justification for this, and it may not be as bad as 2008.  Stocks are in a massive bubble.  Bonds are in a massive bubble.  Crypto currencies are a bubble.  And now we have NFTs, which may be even a bigger joke than cyrpto currencies.  I’m just waiting for tulip bulbs to be in high demand.

All of these asset bubbles (although it’s hard to call cryptos and NFTs “assets”) could blow at any time.  The Fed will try to prop them up, since it was the Fed that inflated them all.

But what happens if price inflation, by the government’s own measures, hits 5 percent?  What if it hits 10 percent?

At some point, the Fed is going to have to choose between the dollar and funding the bubbles and massive deficits.  If history is any guide, the Fed will choose the dollar, just as it did in the late 1970s and early 1980s.

While I put the chances of something resembling hyperinflation higher than I would have a year ago, I would still give it less than a 5% chance.  The more likely scenario is that the Fed pulls back and we experience a depression for the ages.

We really don’t know what is going to happen.  This is why I recommend something resembling the permanent portfolio.  However, I do think chances are good that the Fed will scale back eventually.

I don’t know what that breaking point will be.  I don’t think the Fed will purposely go to 10% annual price inflation.  It could still happen if it loses control quickly.  But if we go beyond 5% price inflation, I would expect to see the Fed pull back in some way.

The Fed has been able to pull off this trick for a while, so it seems that it can go on forever. But the debt and bubbles are unsustainable.  Something has to give at some point.

All real estate is local, or so the saying goes.  But when you have nationwide lockdowns and a central bank that is creating money out of thin air like crazy, then there tends to be some uniformity with real estate prices.

Stocks aren’t the only thing booming these days.  The real estate market is hot in many areas across the country.  This is particularly true if you don’t count big cities in blue states.

For example, real estate is not booming in New York City.  Prices are likely to decline for a while in Manhattan, which was previously attractive for the cultural scene and for high-paying jobs.

Now the cultural scene has largely been shut down.  There are no Broadway plays to see, and it is difficult to find entertainment at a comedy club or even eating at a restaurant.  Meanwhile, millions of people now work at home who didn’t just over a year ago.  They are realizing that they don’t really need to go into an office. Why not make the same amount of money in a lower cost-of-living area with lower taxes?

I live in Florida, where real estate is booming.  This is good if you are a seller.  It is not so good if you are a buyer.  Anecdotally, I know of people moving here from the Northeast.

Florida has been open for business completely since September 2020.  There are still many people running around with masks on, but at least business is seemingly thriving.  I was in Orlando (in a very touristy area) just over a week ago and there were long waits at some restaurants.  I don’t know what it was like in this area before then.

It is no surprise that people want to move to Florida.  The state is open, and the governor said he has no plans of enacting any more restrictions related to the virus.  The weather is warm (or hot).  There is no income tax.  I just hope that the people moving here don’t bring bad politics with them.

While Florida may be booming more than other places, there is still a general rise in residential real estate prices happening across the country.  I believe this is largely due to Federal Reserve policy.  The Fed’s balance sheet has exploded since March 2020, and short-term interest rates have been pushed to near zero. While the 10-year yield has risen back up a bit in the last couple of months, mortgage rates are still near all-time lows.  This makes it cheaper to borrow money, which means that people can afford (or think they can afford) a higher price for a house.

It makes some sense why people are rushing into housing.  If the Fed continues to depreciate the currency, then it is better to have hard assets.  And what is more of a hard asset than real estate?  It’s better than having money sitting in a savings account earning .01% while losing 2% or more per year in purchasing power.

I was initially uncertain what would happen to housing prices when the virus hysteria began. The government has made it convenient for people renting to not pay their rent.  It has also been convenient for homeowners to not pay their mortgage.

(Unfortunately, you still have to pay your property taxes.  That includes business owners who were forced to shut down.)

I have several friends who own rental real estate.  As far as I know, every one of them has been receiving rent in full and on time. Their properties are in relatively nice, middle-class neighborhoods, which obviously helps.  It also helps that they are all in Florida, where the economy has not suffered to the same degree.

While I believe that the housing market is probably overheated and has largely been pushed higher by Fed policy, I don’t think it is a bubble in the same way that it was back in the mid 2000s.

In my own neighborhood, the housing prices are probably now just above where they peaked around 2006 or 2007.  But over the last 14 years, there has been massive Fed inflation.  So if we are in a bubble, it has to be less of a bubble than what happened previously.

I also don’t know that the Fed is going to take its foot off the monetary gas any time soon. The Fed says it wants price inflation to average 2%, which means it will go beyond 2% before thinking of slowing it down.  Somehow, I don’t think its price inflation metric is taking housing prices into much account, even though it is typically the biggest expense for most people outside of taxation.

If the Fed keeps pouring in $120 billion per month for a long time, then I see no reason why housing prices in most areas should go down in any significant way any time soon.

With that said, I don’t think it’s the best time to buy, whether for a primary residence or for rental real estate.  The best time to buy was in 2011.  And it was certainly better to buy in 2019 in most areas than it is today.

We also face the prospect of a severe recession or depression.  If there is a major spike in unemployment and reduced wages, then it may not matter if the Fed keeps digitally printing money.  People have to have money to pay for their mortgage.

Still, because of the extent of the Fed’s interventions and its likelihood to continue, I think any fall in housing prices will not be anywhere near as dramatic as what was seen after the bubble in the mid 2000s.

If you are considering buying or selling a house, then I think you should just use common sense right now and not try to time the market.  If you are buying, then you should only buy what you can afford and with the intent of not selling for a long time.

If you are thinking about selling, it is probably a good time to do so, assuming you don’t live in Manhattan.  Or maybe now is a good time to sell if you own in Manhattan if you expect prices to decline farther in the future.

It seems like many things are in a bubble right now, which includes real estate.  But if you are living in a house that you own and plan to stay there for a while, then it probably makes sense to stay and do nothing.  You can refinance your mortgage if you haven’t already taken advantage of it.

I believe we will ultimately see a major crash in stocks and crypto currencies.  I am not as confident that we will see a crash in housing.  Everyone needs a place to live, whether it is to own or rent.

Even if we hit a severe recession, the Fed will react with even more funny money.  If you have a low fixed-rate mortgage for 30 years, then your last payment may be the price of a nice lunch when the time comes.

The latest CPI numbers came out for February 2021. The CPI for last month came in at 0.4%.  The more stable median CPI came in at 0.2%.

While 0.4% is a bit higher than typical for the last decade or so, it does not correlate well with the unprecedented rise in the Federal Reserve’s balance sheet. That is now over $7.5 trillion.

The U.S. stock market is at or near all-time highs.  The Dow has been hitting new highs, while the Nasdaq has retreated a little from its recent peak just above 14,000.

The boom in stocks seems heavily reliant on the Fed’s easy money and low interest rate policy. But if monetary inflation is giving us a stock bubble, then why isn’t consumer price inflation also exploding upwards?

There is no question that much of the newly created money is being used to bid up asset prices. This includes stocks, real estate, and even crypto currencies.  This does not get accounted for much in the CPI numbers.  Real estate will factor in a little, as one would expect rents to also go up.

I believe the CPI numbers are likely understated, but they are useful for looking at trends. I don’t think consumer prices in general are going up 10% or more as some have claimed, but it is probably higher than 2%.

If this all seems unsustainable, that’s because it is.  I think we are going to see a massive fall in stock prices at some point, but it can take a long while for a bubble to finally pop.

I have heard some argue with me that stocks won’t dramatically fall because the Fed will always be there to back them up.  I can’t completely discount this argument, although I do point out that stocks fell hard for 6 months in 2008/ 2009 before starting to climb again.

At some point, it should be expected that something has to give.  If stocks are that reliant on monetary inflation, then monetary inflation has to continue in order to prop up stocks.  It will either lead to significantly rising consumer prices, or it won’t be enough to keep the stock bubble propped up.

Jerome Powell, chair of the Fed, said that we could see a pickup in price inflation this year. Stocks fell after he said this, although it didn’t last that long.  But Powell has also said numerous times that the Fed is going to remain accommodative.

If we get to a point where price inflation is increasing and the Fed is forced to slow down its monetary inflation, then this could crash stocks.  Even if Powell announced that the Fed would reduce its asset purchases from $120 billion per month to $100 billion per month, we would likely see a market frenzy.

Of course, it will take more than 2% price inflation for this to happen.  The Fed changed its inflation target from 2% to averaging 2%.  So if we go to 3%, then it will be ok with Powell because it will be averaging out to 2% since inflation was below 2% previously according to its metrics.

Which Comes First?

Here is the big question.  What comes first? Will we see a significant pickup in price inflation, which then forces the Fed to tighten?  After the Fed tightens, (or in expectation of it), we would likely see a recession or depression of some sort.

Or will we see a major stock market crash and weakening economy (according to GDP statistics) that will lead to the Fed creating even more ridiculous amounts of money? This will likely lead to higher price inflation down the road, although this could take longer to happen.

Let’s put this in some numbers.  Which is more likely to happen first, if at all?  Will we see the Nasdaq fall below the 10,000 mark, or will we see annual consumer price inflation hit 5%?

I really think it could go either way at this point.  Assuming the Fed stays on autopilot for now, I slightly lean towards the Nasdaq going below 10,000 first.

If this happens, it will only encourage the Fed to create even more money out of thin air, which could lead to even worse price inflation down the road.

The Fed has had it relatively easy since 2008.  The central bank, with the dollar still acting as the world’s reserve currency, has managed to create massive amounts of money out of thin air without getting massive price inflation.

It is still very harmful, as prices are higher than they otherwise would have been, and it has caused a major misallocation of resources.  But from the Fed’s point of view, they have gotten away with it so far.

There are limits to almost everything, and this is no exception.  Sure, the Fed can start printing up a trillion dollars a month, but we are going to see massive depreciation of the dollar.

It is important to prepare for these scenarios.  While I do believe there is going to be a crash in stocks, I have no idea when and for how long it will last.

There is much greater certainty that the Fed is going to continue with its reckless policies, and we are going to see our money buy less and less as time goes on.

Even though I tend to think we will see a major fall in stocks before we see high price inflation, I am still bullish on gold.

I recently watched the documentary House of Numbers.  I watched it many years ago and remembered the major points, but it was especially interesting to watch it over again now that a year has passed since the coronavirus hysteria began.

I was already not a fan of establishment medicine, which includes much of Western medicine, before 2020.  Much of this is because of my own personal experiences and having to do my own research on health issues due to the failures of establishment medical care.

I never believed what most politicians and the corporate media were saying about COVID-19 from the start because of my distrust.  It is all tied to my libertarianism and distrust of the power elite, along with my own health experiences.  Still, I also believe that having watched House of Numbersmany years ago contributed a little bit to also questioning the narrative on coronavirus.

House of Numbersquestions the whole narrative on HIV and AIDS.  When I re-watched it recently, I was expecting to see some similarities with coronavirus, but it surprised me just how many similarities there are.  Incidentally, even though I had this article planned, I saw an article by Jon Rappoport also comparing the two.

First, there are people who questioned (and still question) the existence of HIV, which is the virus that supposedly causes AIDS.  HIV was never properly isolated, but it was assumed by the medical community that it was everything we were told it is.

The SARS-CoV-2 virus (i.e., COVID-19) has never been properly isolated.  This was reported early on by Jon Rappoport, and he has continued to hammer home this point.

Anecdotally, I know people who tested positive for COVID-19.  Some of them had the same symptom of losing their taste and smell.  That is the only common characteristic other than just not feeling well.  So there is obviously a virus.  Whether it is the same virus that was happening in Wuhan in late 2019 and early 2020, I have no idea.

Still, if you have not properly isolated the virus and you are relying on computer programs to fill in the sequence, it does call into question everything else, especially the testing.

And that brings us to the second similarity between HIV and COVID-19.  The PCR and other testing was (and is) completely unreliable.  In House of Numbers, it is demonstrated what a joke the tests were and the many people who were told they had HIV who likely had nothing wrong with them.

The HIV test, in many cases, came with a questionnaire.  Your result of being positive or negative could actually depend on how you answered a question about your lifestyle.  It is somewhat amusing (but sad) that someone went to a testing place in Africa and was told that there were two different testing measurements.  If they both came back negative, then you were HIV negative.  If they both came back positive, then you were HIV positive. If one came back negative and the other positive, then a third test was used to decide.  The guy in the video asks why they don’t just use the third test then, if it is more reliable.  There was no logical answer because it is an illogical system of testing.

The testing with COVID-19 is also highly unreliable, if useful at all.  The tests are run at different labs that use different cycle thresholds (CTs).  The higher the CT, the more the material is magnified and the better chance of a positive result.  Even Dr. Fauci himself (if you want to call him a doctor) admitted last year that anything run above 35 cycles is unreliable and will spit out false positives.  Yet, the CDC has no problem recommending that tests be run up to 40 cycles.

Speaking of similarities, Fauci was a big pusher of the HIV narrative back in the 1980s.  He appears in a few clips in House of Numbers, as does Kary Mullis.  Mullis, now deceased, was the creator of the PCR test, but he stated that it has its limitations (and would likely be appalled today with its use in diagnosing coronavirus).

Another similarity between HIV and COVID-19 is the treatment, or the bad treatment. If you pay attention to the establishment media, they will continually tell you how bad coronavirus is and how deadly it is and how many people have died.  They will also tell you everything you need to do to avoid getting it (stay at home, social distance, wear a mask).  But they rarely offer advice on what to do if you test positive for COVID-19.  Don’t you find that a little bit odd?

With HIV, people were put on drugs that were actually weakening their immune system and causing them to die.  In other words, the drugs were doing what AIDS was supposed to do.  So when someone starts getting sick and weak from the drugs, they were just told that it is the AIDS progressing.

It hasn’t been quite the same with COVID-19, but I can’t help but draw some comparisons. First, the establishment did everything they could to demonize alternative treatments.  They would either say that they don’t work effectively (like zinc and other vitamins) or they would say that they are dangerous (like hydroxychloroquine).  And if you get really sick with COVID, then you should go to the hospital.

At the beginning of all of this, ventilators at hospitals were pushed hard.  Do you remember Cuomo in New York demanding 40,000 ventilators immediately?  Almost everyone put on a ventilator died.  I believe there were many people who went to hospitals in New York with anxiety attacks or other issues who were drugged up and thrown on ventilators.  If they hadn’t gone to the hospital, they would have survived.

Even to this day, hospitals are using ventilators for some COVID patients.  How did I know from the very beginning that this was a harmful treatment?  I have no medical background other than what I have read on my own.  I don’t know if the medical community is just ignorant or evil, but many people died (and continue to die) because of their fake treatments that only cause greater harm.

We’ll see if the so-called vaccines also end up being more deadly than the disease itself. They sure are being pushed hard.

One lesson to take away is that when Cuomo or some other hack politician is telling you something seemingly important, it is best to believe the opposite until you can verify one way or the other.

When I was a kid, I remember some of the hysteria over HIV.  Luckily, there were no lockdowns at that time.  I remember that if you got HIV, it was supposed to be a death sentence, which it typically was if you took the prescribed drugs. If you got HIV, you would develop AIDS and likely die in 5 years or less.

I remember when Magic Johnson announced he was HIV positive.  It was supposed to be a death sentence.  And here we are three decades later.  Magic Johnson is still alive, yet most people don’t question the HIV/ AIDS narrative that was sold to them back then.  Yet, there is no cure for HIV.  The cure was to stop giving patients deadly drugs.

With COVID, we were also told it was very deadly.  It wasn’t like HIV, but it was supposedly a 3 to 4 percent mortality rate coming out of Wuhan, China.  These were obviously bogus statistics from the start, as they were just measuring the death rate of people who were already severely ill.

And that leads to another similarity between HIV and COVID-19.  The people who die from these things are typically people who die.

With HIV, it was primarily people in Africa and other third-world nations who were severely malnourished.  They lived in unsanitary conditions.  They did not have proper food, and they didn’t have clean drinking water. It was easy to label someone as having AIDS.

The same goes for the gay community.  This is a generalization, but many gay people were living an unhealthy lifestyle.  They were taking drugs, including “poppers”, which is documented in House of Numbers.  So the people supposedly dying of AIDS were people who were dying.  They were people living an unhealthy lifestyle, to put it mildly.

The same goes for COVID.  The people who die are mostly elderly, or in really poor health, or both.  The majority of people supposedly dying of COVID (really, with a COVID diagnosis) are over 80 years of age.  Most of the rest are severely obese or have severe health issues of some kind.

You can always find someone who dies of an unknown cause, which can now easily be chalked up to COVID.  And out of a country of 325 million people, you will hear anecdotal stories about how a young healthy person died of COVID.  But these are rare, and there are always deaths occurring with an unknown cause, so it is convenient now to label it COVID.

Lastly, perhaps the biggest similarity is the acceptance of the narrative by the medical community and the population at large.  I remember the hysteria that started in the 1980s with HIV and AIDS.  The good news is that society didn’t shut down because of it.  Many people were fearful, but it was pretty clear that you were not likely to contract HIV if you didn’t sleep around and you didn’t do drugs.  So even believing the narrative was not that damaging to one’s life.

With COVID-19, the establishment narrative was largely accepted, and we all paid the price in the form of lockdowns and hysteria.

People who have not bought into the hysteria are generally better off than those who did because we don’t have to live in constant fear of contracting a virus.  Still, most everyone has suffered in some way due to lockdowns, mask mandates, and other restrictions, plus having to deal people who are irrationally hysterical.

We can only hope that with the internet and some experience that people will stop trusting the “medical community”, or at least those presented to us by the establishment and its corporate media who parrot the same lines.

It is time to stop blindly trusting the “experts”, who are really experts in getting funding and promoting propaganda.

We are almost at the one-year anniversary from when the U.S. government and state and local governments announced the start of “two weeks to flatten the curve”.

This meant that most of society would be shut down in order to stop the spread of a supposedly very deadly virus that is easily spread.

While this happened largely worldwide, it is disappointing that it happened in America, the supposed land of the free.  The American people never should have tolerated this.

I saw the phoniness of this whole thing from the start when it was announced that there was something like a 3 to 4 percent mortality rate coming out of China.  These were obviously phony statistics, yet the establishment and its media seemed to ignore this.  Most people just accepted this as fact.

The statistics were phony because they were based on counting the sickest people.  Even if everything else they were saying was true, and even if the testing was reliable, it is still a lie.  They were calculating the mortality rate by taking the number of deaths divided by the number of people who tested positive. The biggest problem with this is that the people being tested early on were the sickest people.  They were typically people going into the hospital.

But when it became obvious that these original phony projections were completely wrong, the American people had already accepted the vast increase in tyranny, mostly in the form of lockdowns.  So even if the mortality rate is 1% or 0.1% or 0.01%, we can’t be too cautious. After all, if preventing everyone from going to restaurants and concerts and sporting events means we can save a great grandmother somewhere (i.e., extend her life by a couple of months or a couple of years), then we should do it.  Of course, I don’t even necessarily buy this premise, but it is still absurd even if it were true.

The original excuse for lockdowns was two weeks to flatten the curve.  This was repeated endlessly at the time.  I’m sure your really smart friends explained to you how we don’t want to overwhelm the hospital system and that these measures were necessary to spread things out so as not to fill up all of the hospital beds at one time.

Of course, most hospitals never were overwhelmed.  In fact, back in March and April of 2020, most hospitals outside of the New York City area were mostly empty.  There still isn’t a shortage of beds in most places.  If anything, there have been shortages of healthcare workers because they have to stay home for two weeks when they get the sniffles or because they have to stay home for two weeks when one of their kids gets the sniffles.

There are many absurd things that have happened, and it is all based on propaganda.  The CDC changed the way it counts deaths back in March 2020.  To sum it up, if you test positive for COVID-19 and then you die, then you died because of COVID-19. This was a complete change in how deaths were determined before that with, say, the flu.

As a side note, there are people dying after getting vaccinated for COVID-19, but these are not considered deaths due to the vaccination.  They are coincidental.

So if you are 85 years old and get vaccinated and then die, it was just your time to go.  If you test positive for COVID and die, then you died because of COVID.  Got that?

There are many problems with all of the propaganda that has been put forth over the past year. The virus was never properly isolated, so we don’t even really know what we are dealing with.  The PCR tests are a complete disaster, as they put out false positives, which just inflate the already phony data.  Fauci himself said that tests run above 35 cycle thresholds (CT) are not accurate.  The number of cycles run mean how much the labs are magnifying the material. Yet, the CDC recommends labs run CTs up to 40, making the tests meaningless in many cases.  At the very least, there are a lot of false positives.

Even if the statistics were real, which they aren’t, we are constantly fed fear through the corporate media.  When have you ever seen a daily ticker of deaths due to heart disease or something else? And I don’t buy the argument that it is because heart disease isn’t contagious.  It is easily proven that most people who die of COVID (or really, with a COVID positive test) were elderly or had severe health issues to begin with.

The people who supposedly die of COVID are typically people who die.  They are old people, and they are people with severe health issues.

Ceding the Moral High Ground

Regardless of the lies and propaganda, the tyranny of lockdowns and other mandates never should have been tolerated.

If you are against the lockdowns, you may or may not be a libertarian.  But if you favor the lockdowns in any way, then you are not a libertarian.

It is nice to show charts on how outdoor dining doesn’t really cause the virus to spread. It is nice to show that states without lockdowns are faring just as well as states with heavy lockdowns. But in the end, it wouldn’t matter to me if it showed that lockdowns really do save lives.  I would still oppose them on libertarian grounds, and so should everyone else who cares about liberty.

In fact, if you have libertarian principles, then you never should have gone astray in the first place.  Maybe you thought the virus was really dangerous and that it was important to stay home, but it is never acceptable to permit the state to force you to stay at home or to shut down your business.

Let’s say that the virus had been properly isolated and was proven to be highly fatal.  Let’s say that the PCR tests are reliable. Let’s say that lockdowns and mask mandates do help prevent spreading.  It still doesn’t justify lockdowns or any other government interference.

This should be the starting point of every argument against this government tyranny.  It is an argument for property rights and freedom of association.

If there is a really deadly and contagious virus out there, then most people will take the level of caution they think is necessary.  You don’t need to force people at the point of a gun.  Some people will measure that the risk is worth it to continue operating their business or to do any number of other things.

I cringe when I hear a shutdown restaurant owner argue that dining is safe or that the virus can’t be traced to their establishment.  This is ceding the moral high ground to the lockdowners.  It doesn’t matter whether they are taking extra safety precautions or whether the virus is spreading at their restaurant.  It matters that it is their property and they should be able to use it how they want as long as they aren’t initiating force against others.

This is the time that all libertarians – true libertarians – need to argue forcefully and without shame for property rights and freedom of association.  We should never cede the moral high ground, as it is the other side that is employing violence against others.

Back in January, there was a debate between podcaster and comedian Dave Smith and Maine State Senator Eric Brakey.

The debate was whether people in the Ron Paul liberty movement should focus on the Republican Party (GOP) or the Libertarian Party (LP).  Brakey argued for using the Republican Party to advance a libertarian agenda, while Smith argued for using the LP.

Dave Smith, for the last couple of years, has been advocating a takeover of the Libertarian Party.  There is already a good faction in the Mises Caucus, which is the more radical wing of the LP. You could say it is the libertarian wing of the Libertarian Party.

Dave Smith, Tom Woods, Scott Horton, and much of the Mises Caucus promoted the candidacy of Jacob Hornberger in the last election.  He came somewhat close to winning the nomination, but it ended up being Jo Jorgensen.

While I was disappointed in the Jorgensen campaign and ended up not voting for her, I thought her candidacy was a move in the right direction after having Gary Johnson and Bill Weld in 2016.

Spike Cohen was the VP nominee in 2020.  While I disagreed with some of the messaging coming from Cohen, he is a more radical libertarian (in a good way) than what we’ve seen in quite a while. So again, it was a move in the right direction.

Brakey argued that libertarians should focus on taking over the GOP because it is a two-party system and that is where we can have the most impact.

He cited Ron Paul’s campaign (or campaigns) for president on the Republican ticket as the best educational endeavor for liberty.  I agree with this.  If you can copy Ron Paul, then I think someone should do it.  But who can copy him?  Who can become a principled congressman and then get on the debate stage in Republican primaries?  If someone can do it, then they should try to emulate him and use the Republican Party.

If you are running for local office, then I do generally think that running as a Republican is a better bet.  So on a local level, I agree with Brakey.  In terms of political strategy, I generally agree with Brakey.

However, Brakey also admits that it is easy to take over the LP.  He asks, “What’s step two?”

He actually answered his own question in the debate when he admitted that the LP presidential campaign can be used as educational outreach.

The answer to his question of what’s next is easy.  The answer is that you put up a Harry Browne like candidate for president and spread the message, which is essentially what Dave Smith argued.

Imagine if the LP had had a really strong candidate in 2020.  Imagine if someone like Harry Browne or Ron Paul had been the candidate.  Mary Ruwart ran for the nomination in 2008 on the heels of the Ron Paul presidential run.  If she had been the nominee then, I believe Ron Paul would have endorsed her and she would have received millions of votes that year.

If the LP had someone in the 2020 race who continually spoke against the lockdowns and in favor of small businesses, I think that person would have done significantly better. But even better than that, we would now likely have tens of thousands of business owners sympathetic to the libertarian message at the very least.  Some of them probably would have converted into radical libertarians if they had heard someone defending property rights and freedom of association as an argument against lockdowns.

Overall, the debate was good and polite.  There was no name calling.  Dave Smith and Eric Brakey respect each other and mostly agree with each other in terms of policy and philosophy.  Their difference is a matter of tactics.  One thinks people should focus on the GOP, while the other wants to focus on the LP.

Again, if you are running for local political office or trying to effect change locally, it is probably better to join with the Republicans.  If you want a widespread movement to spread the message about liberty, and assuming you can’t repeat what Ron Paul did, then I think it is better to join the LP.

It would only take a couple of hundred more radical libertarians at this point to join the LP and radically change the direction of the party and return something resembling the Harry Browne days.

The difference between now and 1996 and 2000 (when Harry Browne ran) is that the internet is now widespread and we are post Ron Paul Republican presidential campaigns.

Due to alternative media and the explosion of the libertarian movement from the Ron Paul campaigns, there are hundreds of thousands – or perhaps millions – of libertarians who didn’t exist back in the year 2000.

If we had a principled libertarian who is a good communicator at the top of the ticket of the LP, this person could have a significant impact.  The person wouldn’t win the presidency, but he or she could convert millions of more people towards libertarianism.  I also think a lot of Trump followers would be sympathetic to the message in the future, especially if nobody named Trump is running on the Republican ticket.