America is awesome. It is the #1 economy in the world and for good reason. America is built on a tremendous amount of trust.
Posted January 1,2020 in People and Nations.
You have to understand that in America, people would put out all sorts of food stock and products out in the street under the expectation that nobody would walk by and steal it.
That's how much people trust each other in the United States. In fact, you need to only look at the typical insurance policies and there's a tremendous amount of trust there. In fact, it would be nothing short of mind blowing to somebody who comes from another part of the world where trust is in short supply.
The reason why people trust each other in the United States is because the economy incentivizes trust. It grows the more people trust each other. That's why there's a tremendous amount of credit. That's why the credit is freely given and this means that a lot of businesses get started.
When businesses get started, a lot of jobs are needed and people are employed. In fact, in the United States right now thanks to the economic policies put in place by a high trust mindset, there are more job openings than people. And I'm talking about people taking second and third jobs. Even after they've done that, there are still more job openings.
This is the reason why America is looking to either import more people or invest heavily in automation. Regardless of how things turn out on that front, it is very important to focus on the one thing that made American economy great. Trust.
It is amazing, It is nothing short of miraculous because thanks to America's solid judicial system where crimes are quickly solved and guilty people are punished, there is certainty. So when people do the right thing, they can expect to be rewarded.
When they do bad things, they can rightfully fear swift and certain punishment. When you have such a system in place, trust grows. But the root of all of this is self discipline. It take discipline to do the right things day after day regardless of the fact that people are not watching you.
Make no mistake, it's very easy to steal if nobody is watching you. But people don't do it. Enough people do the right thing and that's why the economy and the justice system that enables that economy continues to operate smoothly like clockwork.
But here's the problem, given the awesome economy that this amazing reservoir of self discipline and trust has brought forth, it also planted the seeds of its destruction. Let me explain. Since the economy is based on trust and this leads to convenience, people are focused now on getting stuff as quickly as possible. They'll pay for it later and everything's fine.
Generally, this is not a problem because of easy credit. But here's the problem. The more you engage in easy credit and pay for stuff you don't need with money you don't have, your discipline breaks down. It becomes addictive and more and more people are getting on the bandwagon and it's no surprise that American credit card debt is in the trillions.
Most people are only $500 away from a fiscal emergency. In other words, they're messing with bankruptcy if they get hit with an emergency that cost $500 or more. That's how bad our economic self discipline is.
This creates a paradox because if you don't have any self control over your spending, you spend spend and spend and this is great for the economy. When you buy from a business on credit, that business would have to hire people.
That creates jobs and it boosts the economy. But the problem is it is all rooted in lack of self discipline and this is going to eventually lead to an implosion. That bill is going to come due. No amount of burying your head in the sand is going to make that unpleasant reality go away. We already had a sneak peek of that in the 2008 financial crisis that leveled the global economy.
Well, the coming consumer debt explosion is going to put that economic crisis to shame. In other words, the one thing that made our economy great, which is the emphasis on convenience, which is rooted in trust, which is rooted in self discipline, is also its biggest threat.
Thankfully, the solution is equally simple. The solution is self discipline. In other words, stop spending money you don't have on garbage you don't need. You don't need to impress your neighbors. You don't need to wear the latest and greatest fashion.
Live within your means and before you know it, you have enough cash to invest and your money will grow and grow and you will be better off. The best part is you would be living life completely free of debt bondage.
Believe me, when the credit card debt collection company tries to discipline you, it's not going to be a pleasant sight or experience.