There is a saying which goes ‘you need to know where you’re coming  from in order to know where you’re going.’ To a certain extent this is true! We are, after all, a product of our upbringing and conditioning, and then as we become adults, our social circles and peers.  It is these influences that ultimately guide our decision making and choices.  And as such, if you are really serious about your financial future and becoming (more) financially savvy, then it is vital that you do the following; -

1. Surround yourself with likeminded individuals who want what you want and are willing and able to guide you on your way, as you to them and others, also;

2. Acquaint yourself with up-to-date and current news on the economy – see the resource list at the end of this article!

3. Take the time to understand why we are in the economic mess that we are; i.e. understand where it came from in order to have a better awareness and opinion of where it is going.

By doing so, you are embracing the true essence of financial education; and not the ‘what is a cheque book, direct debit ‘type, but the ‘what is the rule of 21; what is an asset, a liability; what is the difference between a passive, leverage, residual or linear income?’ type. Financial education is something that should be taught at school but unfortunately it is not, which is why it is one of the key premises of my organization Butterfly Wealth Creation. 

By financially educating yourself and applying the learning to your life not only do you make better choices with your money, in respect to how to invest it, where to invest it, so that essentially you can make YOUR money work harder for YOU, rather than YOU simply work hard for it; but it also allows you to see opportunities where others only see F.E.A.R (False Evidence Appearing Real) and challenges. This is key to creating wealth as well as protecting it from ANY and ALL global, national and local economic instability.

And lets us not delude ourselves to say that the economic downturn has passed. We only have to read the national and global headlines to know that there is a very real possibility that we could experience a double dip – i.e. another, but longer and deeper, recession. I touch upon this topic in two of my previous blog posts Green Shoots…What Green Shoots?! and And So, The Budget Cuts Begin…

So How Did We Get Here And How Can You Protect Yourself?

The general and accepted consensus is that our global economic downturn was born from the American sub-primed loans crisis. These sub-prime loans were essentially toxic debt repackaged with non-toxic debt, then sold onto other financial institutions in an incestuous fashion.  When individuals could not pay their mortgages the market retracted on its orgy of debt and reckless borrowing, which was when the  global recession kicked in, bringing to mind the adage of ‘when America sneezes the rest of the world catches its cold’. However, the true reality is that the above scenario was just the ‘effect’ or even the ‘consequence’ of other far reaching historical events, rather than the reason.

Last month I attended The National Achievers Congress where Robert Kiyosaki and Kim Kioysaki, and their team of Rich Dad advisors appeared, educating and sharing with us their stories and experiences in order to propel and motivate us on our success journey to debt freedom and financial independence. It was excellent to say the least, and I came out of there with a mission to help others and a determination to live my own life ON PURPOSE, just as Robert Kiyosaki has and continues to do, irrelevant of what the economy does or doesn’t do!

One of the advisors, an economist  - Richard Duncan, author of The Corruption of Capitalism and The Dollar Crisis – was phenomenal and explained the history behind the ‘credit crunch’ with such simplicity and clarity, it was easy to understand, as well as riveting to listen to. He explained that in 1971, the US President of that time, Richard Nixon, withdrew the US dollar from the Gold Standard due to debts created by the Vietnam War and other issues, as well to fund their mission to send the first man to the moon – which to their credit they did do! However, in doing so, the US Dollar was no longer backed by gold and in turn this became the modern source of monetary volatility and consequently unregulated financialization.  That volatility necessitated the rise of risk-hedging financial instruments, such as derivatives (including credit default swaps such as subprime loans). Thus as the value of the dollar was no longer based on gold, it became based instead on projected future value.  This type of money is called ‘fiat money’, sounds very similar to fake money! Which Tim Barello highlights in his blog post ‘Grand Theft Economics’

“…Virtually every industrialized nation on this planet employs what are known as fiat currencies, or money systems that are backed by nothing other than the word of the respective bank and/or government of issue. While politically convenient, such arrangements are nonetheless hazardous, as they allow bankers and governments to effectively create money out of thin air; by doing so, nations have spent well beyond their means, while fraudulently conveying that their worthless pieces of paper hold monetary value.

When juxtaposed against the greatest financial crisis of our era, these revelations also shed light on the mother of all frauds against the US Constitution, and furthermore, the nation for which it stands.”

Richard Duncan goes on to further explain that because the world’s currency is no longer backed by any type of monetary value, the financial institutions are able to employ a duplicitous  method to create money from thin air which is called ‘Fractional Reserve Banking’, This in and of itself is not a necessarily the problem, but  the amount in which they have steadily increased the ratio due to our money no longer being backed by any real value. Please review the videos in my previous blog post Green Shoots…What Green Shoots?! for further information on this.

Inside the world of regulated banking this process is described as ‘expanding the money supply ‘, outside of it ‘inflationary counterfeit-pyramiding’. Thus, when a central bank (Bank of England for example) wants to inject more money into the Markets, officially known as quantative easing, they use this process – create money from thin air to do so. All in all what you need to understand is that the ‘tender’ we hold in our hands no longer represent monetary value but DEBT!!! And because our central banks can print money as and when they like, the value of our ‘fait money’ dwindles due to inflation. Sadly it is the savers who suffer the most because of this. As a saver, not only does the  bank use your ‘fiat’ money to borrow against with better returns for themselves, they also create more of it dulling the spending power of your savings, whist you only receive a paltry interest rate on it, whilst essentially ‘parking’ your money in their bank.  This is what is called going ‘broke safely’ and what Robert Kiyosaki says is a direct result of our lack of financial education. He writes “Without financial education, your money flows to those who profit most from your financial ignorance.”

This process the world Central Banks uses to ‘create money’ is aligned to debt…too much debt, thus the process was, and still is unsustainable, bubbles were created, which is what incurred the recession and when the bubble popped the consequence of that fell at the feet of the taxpayers; and will continue to do so for some time to come. And who are the main group of taxpayers in a country?  Employees and self-employed individuals aka the average Jane and Joe, conditioned by society to go to school, get a formal education in order to get a J.O.B (just over broke), buy a house, pay into a pension/savers account and retire happily ever after! Tell me, how is that working for you? If not great, then hear me when I say the old rules of money are broken! YOU have to create your own personal economy rather than simply rely on the one the State provides.

 Watch Richard Duncan talk about Why the UK’s Ponzi economy is vulnerable to a fiscal crisis.

So now you know the real reason for the recession and why there is a real possibility of a double dip; how do you protect yourself from the continuous deterioration of the value of your fait money; as well as increasing the value of your money? Obvious really! GOLD! This is what the governments used before, so why not YOU?

You only have to watch the numerous TV adverts to see how companies are desperate to buy your gold. I won’t go into the all the reasons why gold is great way to grow and protect your money, and this is not about putting all your assets/money in one basket but solely the recommended amount of 5% – 20%. What I will say, however, is that the value of gold is ever increasing (even though like any item/commodity there are always fluctuations) and I believe it will continue to do so. Why, because there is a trillion dollar amount of debt from emerging markets chasing a billion dollar market of gold, thus gold is a required and wanted commodity in the world today.

So how do you get involved in this market? Well what if I told you your local bank was offering a free service to exchange your money into a gold savings plan starting at E50, would you do it? Would you at a minimum go and find out more about it?  Well, unfortunately your bank can not offer this type of service to you because they do not have the means to, i.e. mines, refinery, production line with no middle men to pay a fee too.  There is a company, however, based in German called KB Kapital & Business. It is 16 years old, and enables YOU to do the above, because they own their own mine, refinery and production line, with no middle men to pay a fee to. As such their margins are low and therefore the FULL exchange of your paper based money into gold from the daily markets is passed totally onto you.  The product is gold – real gold, not coins, or jewellery. And again, their service is a gold savings plan, which if deposited into monthly will counter again the influctutations of the gold market.  KB Kapital & Business is endorsed by the Bund der Sparer, the German equivalent of the FSA, as well as is associated with PriceWaterhouseCooper in regards to its payments system. In its two years since inception the programme has proved a great success in Germany, Holland and other Nordic countries with a number of News appearances by the CEO Mike Koschine. They are now branching out into the rest of Europe and the world, but specifically the UK and USA.

Now, I am no financial advisor (you don’t need to be to talk about gold) or economist but I do know an opportunity when I see one, and this is definitely an opportunity! Even so, you should always do your own due diligence and you can start doing so by attending a webinar tonight given by one of the first pioneers of the company and now, also, one of the top earners of the business, Dennis Nowak, a native of Germany every Wednesday at  at 8pm GMT/9pm CET – please sign up here for access details. 

There is a also another webinar every Fridays at 8pm GMT/9pm CET, as well as others which will be scheduled periodically during the day. Again, for updated information on KB Gold and scheduled informational/training webinars please go here and sign up to the mailing list. 

Other Websites:  http://kbvision.wordpress.com  and http://www.mykbgold.com

KB is offering a service – a Gold Savings Plan –  for EVERYONE and to ANYONE from around the world, as gold is the currency of The World, so why not save in it?

Finally, on the subject of gold do you remember the cartoon ‘The Mysterious City of Gold’? If you do and are anything like me then this clip will definitely bring a smile to your lips! By investing in gold, in either a measured and affordable way, or in bulk, this smile could turn into a laugh…that is you laughing all the way to the bank!

Resources for Your Financial Education

The Corruption of Capitalism by Richard Duncan

The Dollar Crisis by Richard Duncan

Rich Dad Poor Dad by Robert Kiyosaki

Other Business and Economic Books

Green Shoots…What Green Shoots?!

And So, The Budget Cuts Begin…

Money Week

Love Money

Motely Fool

To Your Success and Becoming Financially Savvy

Butterfly Wealth Creation

P.S. I just received my first packagewith KB Gold and it is really does bring a smile to your face!

P.P.S. If you like what you have  read/learned please comment, share by clicking on the buttons below and subscribe by filling in the form to the right of this page. Remember, sharing is wealthy!