The antidote to the collective economy
By Jeffrey Reeves MA
Americans have been bamboozled. They have been deceived into thinking that the”economy” is some esoteric power wielded by Behemoths over which they have little or no control. They have been convinced that their role is simply to earn, borrow, spend and repay debt. They have been brainwashed into believing that the Behemoths know better than individual Americans and their families how they should deal with the money that comes into their lives. They do it by picking our clients pockets, and we willingly let them do it! Have we insurance and financial advisors lost our minds, along with the rest of Americans?
The result of this kind of economic thinking has been the consolidation of financial resources and the concentration of the money — which belongs rightfully in the pockets of everyday Americans — into a limited number of accounts that are owned and controlled by Behemoths. The Behemoths have created a collective economy where we, as advisors, are expected to give over control of our clients' money to strangers and hope that they care for it as thoughtfully and prudently as we would. That’s not the worst of it. This flawed thinking is the cause of the economic failures of the first decade of the 21st century:
- Two stock market crashes that decimated the wealth of Americans, wealth that was trusted to Behemoths
- A real estate debacle of monumental proportions that has destroyed the personal economies of countless American families; a crisis that was hatched by the arrogance of Barney Frank and other insiders in Washington and the deception of America by:
- Government-protected Behemoths Fannie Mae and Freddie Mac
- Impenetrable financial monoliths like AIG and Lehman Brothers
- Wall Street wizards that are no more wizards than Oscar Zoroaster Phadrig Isaac Norman Henkel Emmannuel Ambroise Diggs —the “man behind the curtain” — the Wizard of Oz
- Government-protected Behemoths Fannie Mae and Freddie Mac
- The failure of hundreds of banks and the loss of billions of dollars of equity by shareholders in those banks
- The failure of GM and Chrysler and the loss of the long-established precedent protecting the ownership rights of bond holders over the demands of corrupt union officials for more money and power
- China, the Oil States, Japan and other foreign investors, some of whom want nothing more that to see the demise of the United States of America
- An out-of-control Federal Reserve Bank that prints money as the solution to every problem and is undermining the very fabric of our free economy in support of the collective economy
- Undercover and unaccountable “czars” imposing unvetted regulations on every aspect of their daily lives
- A health care law that will destroy the best health care system in the world and vest power over their personal health in Washington
- A financial regulatory law that puts even more control of their money into the hands of the greedy-for-power dolts in D.C. and the greedy for wealth on Wall Street
In 1974, the U.S. Congress passed ERISA and began convincing American advisors, and through them, the American public, that saving money was a bad idea. The law they passed convinced us that investing [aka gambling] in an IRA or 401(k) was better than putting our money into guaranteed return savings vehicles. Americans listened. Wall Street and the IRS rejoiced. In 1977, a high school coach convinced thousands of naive amateurs that they were financial advisors and taught them to strip every penny possible from secure whole life insurance policies and — you guessed it — buy term insurance and invest [aka gamble] everything else in mutual funds. Americans listened. Wall Street and the IRS rejoiced.
A few years later, one of the Wall Streeters invented a new kind of life insurance that took the money that whole life insurance saved in guaranteed accounts and moved it into accounts that were not guaranteed, but that the Wall Streeter could profit from even if the policy owner didn’t. These kinds of policies destroyed dozens of successful insurance companies and cost billions in lost savings to American families. Americans listened. Wall Street and the IRS rejoiced.
In the ensuing decades, Americans listened to advice to invest [aka gamble] in dotcoms, and invest [aka gamble] our home equity in all sorts of schemes. Americans were convinced that carrying debt equal to their investments [aka gambles] made some sort of sense. Americans listened. Wall Street, the IRS, and money lenders rejoiced. Bunk, a thousand times over, bunk.
The fact that an opinion has been widely held doesn't mean that it's not utterly absurd. —Bertrand Russell
EUREKONOMICS™ is a personal economic model that is working for millions of American families today and worked for the entire country during its first two centuries. It's a set of economic principles and financial practices that have withstood the economic failures of the 1820 to 1840 depression; the Civil War that cost over 600,000 American lives; the Crash of 1907; the Great War; the Great Depression; WWII and the downturn that followed; Korea; the severe economic downturns of the 70s, 80s, 2001, and 2008-2009.
Unlike many pseudo-models of personal economics, it does not rely on planning, which is often no more than a selling system put in a fancy binder. Planning may also be described as map making. It provides useful information based on a snapshot in time, but planning is not the journey. EUREKONOMICS™ depends on preparation. Preparation is more comprehensive. Preparation is more akin to provisioning. It uses the information on the map as a guide, but also acquires the resources to assure success on the journey without incurring significant risk. As a result, advisors that apply the economic principles and financial practices of EUREKONOMICS™ to their clients' personal economies have delivered guaranteed growth of their clients' assets. Any speculative or investment losses their clients incurred were offset by guaranteed gains.
Albert Einstein said, “The significant problems we have cannot be solved at the same level of thinking with which we created them.” The typical financial plan wants for wisdom. Think about it. Do your clients rush to the bookshelf to pull out the neatly-bound financial plan when their family faces a crisis and they need money? Ask yourself how your clients would feel if, instead of unfounded fantasies in a fancy leather binder, they were free from debt-to-others: no mortgage, no car payments, no credit card bills or store charge card balances, no home improvement balances at the home improvement center, no debt of any kind.
How would they feel if they had an income they didn’t have to work for, that they couldn’t outlive, that was protected from inflationary pressures, and that wasn’t decimated by interest payments and taxes every month. What if they had ready money to take care of their families when some planned or unplanned life event occurred such as a job loss, college for the kids, illness or disability, a long-awaited second honeymoon, or a long term nursing home expense.
Imagine if they had a secure, tax free legacy of your wisdom and their wealth to pay forward on their terms to those they care about.
These are the four pillars that are the framework of all stable personal economies, because they rest on a foundation of money that your clients — and they alone — control: money that is safely deposited in a participating whole life insurance policy. This is EUREKONOMICS™. This is the antidote to the collective economy that has America and Americans trapped in a dungeon of debt built by the Behemoths. And the only person that can deliver the antidote and save the American economy — one family at a time — is an insurance and financial advisor that understands his or her role as the last bulwark against the collective economy.