Since none of us were taught a thing about financial matters in high school, it’s no wonder Americans live a reckless monetary life. In the “old days” (pre income tax and mortgages) our grandparents had to save before they could buy. “Neither a borrower nor lender be” was the rule.
Back then our currency was backed by an equivalent amount of gold bullion stored at Fort Knox, so we were on the Gold Standard. If Washington wanted to expand the money supply they had to buy more gold to back it up. You can imagine how inconvenient this was, so Richard Nixon took us off the gold standard.
With no restraint on validating the money supply, the Treasury was free to print money out of thin air. This resulted in an ever increasing money supply, exceeding the value of our total goods and services, resulting in inflation. It is vital that you understand the effects of inflation.
The natural law of compounding can help or hurt you, depending which side you’re on. The sooner you use it to your advantage, the better.
Determining trend changes from charts is key to my investing system. You can become an expert trend-spotter by following a few simple concepts.
The last few years have seen an army of insurance and fund salesmen selling annuities. There are many variations to consider before putting your hard-earned money into one of these.