The Sovereign Individual which I previously summarised here on StackerNews, depicts a different view of the future than we have grown accustomed to and to which I believe many believe is an invevitability. Inflation.
Below are passages lifted from different parts of the book and arranged in a timeline of stages by myself. The intention is to identify 'where we are' along a potential timeline in the transition to the 'Information Age'.
End-Game Stages
- Step 1 ☑️ The Sovereign Individuals of the future, will have undergone the political equivalent of laser surgery. They will be seeing 20/20.
That's us! Check. - Step 2 ☑️ The result to be expected is an intense fiscal crisis with many unpleasant social side effects.
Check. - Step 3 ☑️ The economic consequence of this transition crisis will probably include a one-time spike in real interest rates.
Check - fastest rate hikes in history. - Step 4 ☑️ Governments facing serious competition to their currency monopolies will probably seek to underprice the for-fee cybercurrencies by tightening credits and offering savers higher real yields on cash balances in national currencies.
Check. - Step 5 ☑️ It is to be expected that one of more nation-states will undertake covert action to subvert the appeal of transience. Travel could be effectively discouraged by biological warfare, such as the outbreak of a deadly epidemic. This could not only discourage the desire to travel, it could also give jurisdictions throughout the globe an excuse to seal their borders and limit immigration.
Check. - Step 6 ☑️ Debtors (individuals with loans) will be squeezed as long-term liabilities contracted under the old system are liquidated.
Check, still playing out. - Step 7 ☑️ Higher real rates around the world will spur liquidation of high-cost, unproductive activities and temporarily reduce consumption.
Check, still playing out. - Step 8 ☑️ Those in regions where computer usage and net participation are low may opt for old-fashioned hyperinflation in the early stages of the cyberecononomy.
Check. 🇻🇪🇦🇷🇹🇷 so far. - Step 9 🟡 The leading states will no doubt attempt to enforce a cartel to preserve high taxes and fiat by cooperating to limit encryption and prevent citizens from escaping their domains.
In progress. - Step 10 🔲 Those countries that first recognise the validity of digital signatures and provide local court enforcement for nonpayment of cyber debts will stand to benefit from a disproportionate surge in long-term capital lending.
TBC. El Salvador? - Step 11 🔲 The deflationary environment may drag on for some time, with more adverse consequences in the high-cost industrial economies of North America and Western Europe than in the low-cost economies in Asia and Latin America.
TBC - Step 12 🔲 It will be easier for persons living in traditionally poor countries to surmount the hurdles that their governments have thereto placed in the path of economic growth.
TBC - Step 13 🔲 The "losers and left-behinds" in the Information Society will envy and resent the success of winners.
TBC - Step 14 🔲 Military authorities in the United States and other leading nation-states are both planning for and fearing acts of information sabotage that could have severe consequences for disabling large systems. An act of cyberwarfare could close down a telephone switching station, disrupt air traffic control, or sabotage a pumping system that regulates the flow of water to a city.
TBC - Step 15 🔲 The ineffectiveness of efforts to bar illegal immigrants convincingly shows that nation-states will be unable to seal their borders to prevent successful people from escaping. The rich will be at least as enterprising in getting out as would-be taxi drivers and waiters are at getting in.
TBC - Step 16 🔲 The flight of the wealthy from advanced welfare states will happen at just the wrong time demographically. Early in the twenty-first century, large aging populations in Europe and North America will find themselves with insufficient savings to meet medical expenses and finance their lifestyles in retirement.
TBC - Step 17 🔲 Nation-states wishing to suppress Sovereign Individuals would have to seize simultaneously both the world’s banking havens and its data havens. Even then, if encrypted systems are designed properly, nation-states would merely be able to sabotage or destroy certain sums of digital money, not seize it.
TBC - Step 18 🔲 A government that lacks an unchecked ability to confiscate the incomes and property of its citizens would be unable to finance participation in another great power conflict like World War II. Yet this fiscal limit poses less of a threat than the reactionaries will pretend, for the simple reason that there will be no more conflicts like World War II. The very technology that is liberating individuals will see to that.
TBC - although not looking that way so far.
My Interpretation - Deflation NOT Inflation
Many believe inflation or even hyperinflation is around the corner, for the United States, Europe and most countries. The book states that deflation will kick-in, now that Governments are having to compete. I'm not sure people realise that the landscape may well have changed.
I would argue that Governments and the entire banking system know they know they cannot print the way to prosperity any longer. They have 'political cover' to actively avoid printing now and drain the punch bowl. The last 3 years was a disaster for credibility. Banking on hyperinflation to make your debts cheaper, is not a great strategy. We're in the austerity stage, where it's time to find a loser to pin the debts to. CBDCs can bring about a tsunami of austerity. They are not designed for helicopter money. Handouts could be administered today with decade-old tech of cheques and political support, if they really wished to or planned to. Another round of stimulus may not come.
It would be beneficial for you all to re-read the book and reassess if you're in the inflation camp and banking on any outstanding debts getting cheaper. Lastly, another good read if you're open to the deflation thesis is The Great Taking book.
I rest my case, for now...