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No matter what President Obama says and regardless of his eloquence saying it, it would be a dire mistake, completely lacking in common sense, wisdom, and – mostly – regard for the US Constitution, for “We the People” to allow or accept any health care or health insurance program created by the US Congress and run by the US Government bureaucracy.

The record of accomplishment for US Government run programs is abysmal.

  • Congress established The U.S. Post Service in 1775 – they’ve had 234 years to get it
  • o It is seven billion dollars in debt again this year and will need another “bailout” (a word that is becoming all too common these days).
  • Congress established Social Security in 1935 – They’ve had 74 years to get it right.
  • o It is broke. It survives only on funds the US Government has borrowed from the next generation of Americans.
  • Congress established Fannie Mae in 1938 – They’ve had 71 years to get it right
  • o It is broke. Moreover, it is taking millions of Americans to bankruptcy court while it survives on (here’s that word again) bailout money.
  • Congress established War on Poverty started in 1964 – They’ve had 45 years to get it right.
  • o The IRS confiscates over a trillion dollars of our hard earned income each year to distribute to Washington bureaucracies to help poor Americans escape poverty, but the poor still abound. The US Government is losing that war.
  • Congress established Medicare and Medicaid in 1965.  Both are health care and health insurance programs. - They’ve had 44 years to get it right.
  • o Both are broke. They survive only on funds the US Government has borrowed from the next generation of Americans.
  • Congress established Freddie Mac in 1970 – They’ve had 39 years to get it right.
  • o It is broke. Moreover, it too is taking millions of Americans to bankruptcy court with it.
  • In 2009 Congress established a fund of trillions of dollars in the massive political payoff called the TARP Fund.
  • o It shows NO sign of working the way the Congress and the White House (both Bush and Obama) presented it to “We the People.”
  • In the first weeks of the Obama administration, the US Congress passed an almost one trillion-dollar pork-barrel bill disguised as a stimulus package that would, we were told, moderate the recession and reduce unemployment.
  • o DUH! Did we really believe that?
  • And now—a new record: Congress established “Cash for Clunkers” (welfare for the auto industry) in 2009 and it went broke in 2009!
  • o So much for the ability of the US Congress to think ahead – it simply doesn’t exist.


So, with a perfect 100% failure rate, can Americans truly believe the US Government can
be trusted with a government-run health care system that the Congress designed?


“We the People” pay for every one of the failed programs listed above.  Add another trillion or so (remember, a trillion is one thousand billions) of our hard earned dollars to the money the US Congress can waste, and it most certainly will be wasted.


The health care system in America is undeniably the best in the world.  It became the best because “We the People” are in charge, and because the free enterprise system works.  However, “We the People” also know that the system is imperfect and that the delivery system for health care relies on insurance companies whose self-interest is often opposed to the interests of “We the People.”  It is also plagued by the irresponsible behavior of attornies that sue the medical commuity at the drop of a hat.


The health care and health insurance challenges that face America in 2009 have many more workable and less expensive solutions than the ones the Washington insiders are promoting.  None of these alternatives requires giving the US Government another opportunity to fail.


This blog is too short to enumerate them.  I encourage you to do some research on the internet where you will discover that the systems being modeled in Washington…

  • are failing across the globe
  • are loaded with political payoffs

By Jeffrey Reeves MA,, ltd and Ron Jennings,

In May of 2008 this blog awakened its readers to an idea that is now being recognized after decades of being dismissed.  Fact is, if you had followed this practice through the ’80s and ’90s you would be well ahead of those that followed conventional wisdom.
Jeffrey Kosnett only implies the power, flexibility, and versatility of whole life insurance in his recent article in Kiplinger Magazine.  If you want the whole story I recommend the book Money for Life, which explains the idea in full detail and is changing the lives of Americans for the better all across America.
10 Financial Myths Busted
( Page 2 of 2 )
MYTH 6. Life insurance is not a good investment. This canard spread as 401(k)s and IRAs supplanted cash-value life insurance as Americans’ most popular ways to build savings while deferring taxes. True, the investment side of an insurance policy has higher built-in expenses than mutual funds do. But two factors point to a revival of insurance as an investment. One is guaranteed-interest credits on cash values, which means that if you pay the premiums, you cannot lose money unless the insurance company fails (see “Savings Guarantees You Can Trust,” on page 55). The other is the boom in life settlements. If you’re older than 65, you can often sell the insurance contract to a third party for several times its cash value — and pay taxes on the difference at low capital-gains rates.

Truth: A good investment is one in which you put money away now and have more later. Checked your 401(k) lately?

by Jeffrey Reeves,, ltd.

“The Ghost of Christmas Yet to Cometakes the form of a grim spectre, robed in black, who does not speak and whose body is entirely hidden except for one pointing hand. This spirit frightens Scrooge more than the others, and harrows him with a vision of a future Christmas with the Cratchit family bereft of Tiny Tim. A rich miser, whose death saddens nobody and whose home and corpse have been robbed by ghoulish attendants, is revealed to be Scrooge himself: this is the fate that awaits him.”

There are many promises from the Congress and the President about how wonderful Insurance Reform (formerly Health Care Reform) will be for the American people.

If we want an insight into what will likely happen if these folks get their way, we need only look at what they are doing right now.

Over ten million American seniors – myself included – are enrolled in Medicare Advantage plans.  These are plans that mirror the program the proponents of reform say the “government option” will look like.  So, you’d think the Pres and Pelosi would hold them out as a stellar example.

Not so.  Instead they want to elimimate them and toss ten million Americans out on their keesters – OUCH!  What;s going on.  Here’s a program that delivers ALL of the benefits that are claimed to accrue from “reform” but the reformers want to terminate – along with a bunch of us old folks – because the program is “too expensive.”   Just like the hip replacement I anticipate in about ten years when I’m 80 will be too expensive because the wonderful government program needs the money for something else.

Wake up America!  The issue isn’t helath care, cap and trade, or immigration, the issue is LIBERTY.  The Founders of America broke with England because the British government confiscated the liberty of individuals through oppressive legislation and governance.

While we all want improvements to the way we deliver and pay for our health care, few truly want the Government to take over.  Say NO to any national health insurance scheme that directly or indirectly through “co-ops” cedes control to any agency or organization other than YOU and your family.

Beware of promises that are promised only to win your support.  If the Pelosi/Obama plan passes your future health care will be diminished as will you LIBERTY and your personal economy will suffer severly.

For a workable alternative that doesn’t allow the federal governmant to take over, seeNO! below or view the diagram at

Financial Literacy

Knowledge, understanding, and wisdom are complimentary and synergistic.  However, it should be clear that only wisdom embodies the qualities of all three.  It is possible to have an abundance of knowledge, deep understanding, and a complete lack of wisdom.

NAZI Germany (and successors totalitarian governments around the world today) demonstrated this gap most shockingly when it applied knowledge of what is required to sustain human life and understanding of how to eliminate those requirements to annihilate six million Jewish and other human beings.  Wisdom was absent.

When discussing knowledge, understanding, and wisdom as they relate to personal economics, considering the role of education is essential.  21st century Americans do not understand money.  One of America’s leading commentators on money, wealth, and business in general said this:

“In most cases, when people make more money, they get deeper in debt.” – Robert Kiyosaki

These folks have knowledge and understanding but a serious deficit in wisdom.

Nonsense from VP  Joe Biden and Others

Our educators, legislators, unions, big businesses, and government bureaucracies have led Americans down a similar path to financial ruin.  Many Americans’ personal economies are already broken and the US government is following a fools path to financial ruin with its insistence that “We the people” need more debt.

“Now, people when I say that look at me and say, ‘What are you talking about, Joe? You’re telling me we have to go spend money to keep from going bankrupt?’. The answer is yes, that’s what I’m telling you.” – VP Joe Biden

Debt Equals Loss of Liberty

The foundation for a personal (or national) economy is money that you control.  Debt is money that others control.  Worse still, it is money that you actually pay those others to control.  You give up your libertyand pay others to do so as if it were a privilege.

Alternative to Debt

EUREKONOMICS™ teaches that money serves you in four – and only four – ways.

  1. It serves to eliminate debt and regain control of money that was previously ceded to others.
  2. It serves as ready cash to deal with life’s surprisingly unsurprising surprises – unexpected expenses and opportunities.
  3. It serves to deliver inflation protected income at a time of your choosing that you don’t have to work for and you can’t outlive.
  4. Finally – in every sense – your money and your wisdom about money allow you to deliver a legacy to those you care most about.

Debt is financial death and the death of liberty.  Presidents, Vice Presidents, legislators, union bosses, big business execs, and individual Americans that fail to recognize this fact lack knowledge, understanding, and wisdom.

Jeffrey Reeves

Dennis Prager recently commented that he has been carrying American values around in his pocket for his entire adult life.  To clarify he reminded his audience that those values appear on the coins and currency of the United States: Liberty, E Pluribus Unum, In God We Trust. He referred to these values as the American Trinity.

These observations seem most appropriate at this time in the history of America.  It’s also most interesting that Dennis Prage linked these values to the US of A’s coinage and currency.  Particularly, the idea of liberty relates directly to money.  When the government controls the money that Americans rely on for life, liberty, and the pursuit of happiness, those inalienable rights of Americans are diminished.

In fact, throughout the recorded history of mankind, when governments control the citizenry by controlling the money that those citizens produce, those governments become facist, autocratic, repressive – even murderous.  We need only observe what’s going on in Zimbabwe, Venezuala, Iran, and North Korea today.

What’s going on in Washington DC is also disturbing.  America is on the brink of the greatest loss of liberty in its 233 year history; a loss that would be mourned equally by Democratic icons Jefferson and Jackson and equally by Lincoln, the soul of the Republicane party.  The more of our money that the US Congress and the Executive Branch controls, the less liberty we have.

It makes me proud to see and hear American citizens shouting down the puppets of the political parties and demanding the transparency and honesty we were promised during the 2008 campaign.  It will make me ecstatic when the US Congress backs away from the failed strategy that is on the table now, August, 2009.

That will only happen if Americans continue to challenge the Washington oligarchy that continues to deny we the people our voice.

It has been said the greatest volume of sheer brainpower in one place occurred when Jefferson dined alone…

Especially read the last quote from 1802.

“When we get piled upon one another in large cities, as in Europe, we shall become as corrupt as Europe.”

“The democracy will cease to exist when you take away from those who are willing to work and give to those who would not.”

“It is incumbent on every generation to pay its own debts as it goes.  A principle which if acted on would save one-half the wars of the world.”

“I predict future happiness for Americans if they can prevent the government from wasting the labors of the people under the pretense of taking care of them.”

“My reading of history convinces me that most bad government results from too much government.”

“No free man shall ever be debarred the use of arms.”

“The strongest reason for the people to retain the right to keep and bear arms is, as a last resort, to protect themselves against tyranny in government.”

“The tree of liberty must be refreshed from time to time with the blood of patriots and tyrants.”
“To compel a man to subsidize with his taxes the propagation of ideas which he disbelieves and abhors is sinful and tyrannical.”

Thomas Jefferson said in 1802:
“I believe that banking institutions are more dangerous to our liberties than standing armies. If the American people ever allow private banks (and the Federal Reserve IS a private bank) to control the issue of their currency, first by inflation, then by deflation, the banks and corporations that will grow up around the banks will deprive the people of all property until their children wake-up homeless on the continent their fathers conquered..”

And, just for kicks, Mark Twain said this: ‘If you don’t read the newspaper you are uninformed, if you do read the newspaper you are misinformed.’

“The National Association of Fixed Annuities, Milwaukee, has voiced that concern in a member alert…

“NAFA sees the proposal as “a clear attempt to take control – read collect fees – on all product recommendations,” including recommendations involving life insurance, long term care insurance, health insurance, property-casualty insurance, savings accounts and fixed annuities, NAFA officials say.”

Maybe the answer is for independent insurance and financial advisors to relinquish S6, S7, etc. registrations and quit selling securities. Few Americans are truly qualified investors and most annuity buyers are not.

Whole life, health, and annuity products are usually more than adequate to secure the wealth of the typical American and her/his family and they grow and secure family wealth without risk and without worry.

Pretty soon we will allow the Feds take every authority away from us and our freedom will go with them. Life, health, and annuity agents should not be worried about fixing the system that’s gotten us into the mess we are in now; the same mess that allows the power-hungry in the FED and in DC to grab control. We should be looking for a “soulution” that lets the state insurance departments maintain authority and control.

Perhaps, therefore, the answer to the ongoing challenge of FINRA and the power-grabbers in DC is to withdraw from their area of control. The fewer professional insurance and financial advisors (yes, you can be a true financial advisor without any securities registrations) they control, the less power they wield.

“The National Association of Fixed Annuities, Milwaukee, has voiced that concern in a member alert.

“NAFA sees the proposal as “a clear attempt to take control – read collect fees – on all product recommendations,” including recommendations involving life insurance, long term care insurance, health insurance, property-casualty insurance, savings accounts and fixed annuities, NAFA officials say.”

Few Americans are truly qualified investors and most annuity buyers are not. Whole life, health, and annuity products are usually more than adequate to secure the wealth of the typical American and her/his family and they do the job without risk and without worry.

American citizens and their life, health, and annuity agents should not be worried about fixing the system that’s gotten us into the mess we are in now; the same mess that allows the power-hungry in the SEC and in DC to grab control. We should instead be looking for a “soulution” that lets the state insurance departments maintain authority and allows individual Americans to maintain control of their saving and insurance programs.

If individual Americans don’t watch these regulators “like a hawk,” pretty soon we will allow the Feds take every authority away from individuals and the individual 50 states and our freedom will go with them.

Perhaps, therefore, the answer to the ongoing challenge of FINRA and the power-grabbers in DC is for every citizen to encourage their advisors to withdraw from the arena FINRA and the SEC control. The fewer professional insurance and financial advisors (yes, you can be a true financial advisor without any securities registrations) these power hungry bureaucracies control, the less power they wield.

By Jeffrey Reeves

This post is mainly a link to a powerful assessment of conventional wisdom about the future of the US and the world economy by Jim Welsh, an investment advisor/economist that has been right more often than wrong.

Jim Welsh of Welsh Money Management has been publishing his monthly investment letter, “The Financial Commentator”, since 1985. His analysis focuses on Federal Reserve monetary policy, and how policy affects the economy and the financial markets.

This newsletter is dense, loaded with statistical data, and won’t be an easy read for the casually interested.  It is worth the time and energy you’ll need, however.  There will be a follow-up to this post that will deal with the Ethics of Advising Investing to Middle America – or something like that.

By Jeffrey Reeves, MA, Master Money for Life Guide,, ltd.

Gary D. Halbert’s Forecasts & Trends…

Ideas are strengthened when they are endorsed by informed experts.  Gary Halbert has been proving for a very long time that the buy and hold strategy is flawed.  Below is an excerpt from another of his brilliant articles on this topic.

Unspoken by Mr. Halbert but obvious from the article is the corollary that most Americans should not be investing in the first place.

Recognize that investing for the long term is an oxymoron.  If you had used the buy and hold strategy starting in 1998 and planned to rely on your investments for income in 2009, you would have less money today than you invested over the past ten years.  You would have lost money.  Your $200,000.00 investment could be worth less than $90,000.00.

On the flip side, if you had prudently placed you money in a quality whole life insurance policy you could have almost $250,000.00 in cash values growing tax free and readily accessible for income, opportunities, emegencies, or a legacy for those you care most about.

America has been bamboozled by the shennanigans of the chalatans and scallyways of Wall Street for too long.  It’s time to return to America’s fundamental financial model – save, build equity in your home, finance only when it’s absolutley essential, invest only form assets and never from earnings or ready reserves.

Gary D. HalbertForecasts & Trends E-Letter

More Buy-And-Hold Myths Debunked

by Gary D. Halbert

March 24, 2009

“…Unfortunately, this has not slowed the flood of misinformation being distributed by the usual suspects in an effort to support buy-and-hold investment strategies. It seems that the more I write about skewed articles, studies, etc., the more examples I see of them being generated by Wall Street and the brokerage community to sway unsuspecting investors. [emphasis added]

I recently received an e-mail from a major mutual fund family promoting the buy-and-hold concept. While I am not at all surprised that a mutual fund company would be trying to keep investors in their funds, I was disappointed to see that the argument used was a very old, and thoroughly discredited line of reasoning known as don’t miss the best days in the market.”

I’m not going to disclose the company that published the e-mail I received, but it really doesn’t matter. You can look in the archives of virtually any major brokerage firm or mutual fund family and likely see similar titles. As I pointed out in the March 3 E-letter, it’s in their best interests for you to stay invested, even though doing so may not be in your best interest. Thus, you need to look out for your own best interest when you deal with them.”

Buy and Hold?  Long term?  Whom do you want to make wealthy?

I encourage you to follow this link to the full article.

Jeffrey Reeves

Originally posted on July 24, 2008 and worth repeating…

Americans have been bamboozled into thinking that they can get rich and retire comfortably by putting their money in the hands of people whose only aim is to move money from your pocket into some Behemoth’s accounts; IRA’s, mutual funds, variable annuities, variable insurance policies, ETF’s, and on an on.


Here’s a simple rule to apply to your personal economy: invest from savings, not from income; speculate only with money you expect to lose [if you win add the winnings to your savings.] If you never develop a savings program, you can’t recover by ‘investing’ unless you are just plain lucky. Why? Because most ‘investments’ are actually speculative.

Benjamin Graham, The Dean of Wall Street, and Warren Buffett’s teacher, taught that an investment has two characteristics: safety of principle and a reasonable return. Hmmm! Honestly evaluate what Wall Street calls an investment today.

  • Is it really an investment or is it speculation?
  • Is your money safe and secure?
  • Are you getting a reasonable rate of return?
  • Is it enough to be re-assured that all will be well “in the long-term”?

Guess what? The answers are all NO. You don’t live in the long-term. If you are losing money today, hoping that tomorrow will produce better results is foolish at best. Properly saved money guarantees a reasonable rate of return in the short-term and is safe for the long-haul. Once you have money in hand, and enough money in hand to care for your personal needs, then you can consider investing.

Consider this: many Americans take money directly from their pockets [payroll deducted in many cases] and place it in accounts that produce unpredictable returns for them but assured profits for the Behemoths. Not only that, at the same time they borrow from credit cards and mortgage companies at rates that are guaranteed to be higher than their ‘investment’ account returns. Go figure…

Imagine how much better off these Americans would be if they put their money into financial products that fit the definition of Benjamin Graham referenced above.

It’s time to shift paradigms, to change models; save first, invest later, speculate never!

by Jeffrey Reeves, MA, ltd.

The following comment was submitted by an advisor in response to a recent article by Dr Agon Fly that appeared on ProducersWeb, a financial industry forum.  I believe it could be useful for anyone interested in understanding life insurance policies and – more importantly -  in securing their future.  

ProducersWeb wrote:

What about U.S. Treasury decision 1743 that states that a dividend from a life insurance policy is nothing more than a return of a deliberate overcharge of premium imposed by mutual company?

I’ve been unable to track down the reference made in your comment. It is true, however, that dividends from a mutual company are considered a return of unneeded premium. Your use of inflamitory terms like “nothing more” and “deliberate overcharge,” and “imposed” are, however, off base [at best].

Let’s add some perspective. If a mutual company and a stock company both offer whole life contracts, have the same or similar mortality charges, administrative costs, reserve requirements and guaranteed cash value commitments, the cost of the policies would be about the same for both insurers.

The stock company with the non-par policy would, however, still charge more than their base costs to make sure they made a profit to propell the business. It would also have to charge some excess premium to pay taxable stock dividends to their shareholders. You, as the policy owner would, therfore be paying “nothing more than a deliberate overcharge imposed by the insurer” and receiving nothing in return for having paid the excess.

The mutual company would also charge extra premium to propell its business for the benefit of its policy owners [as opposed to outside investors] and, unlike the stock company, would return that extra premium to the policy owners as a tax-free dividend.

Which would I prefer? I’d rather the return of the “overcharge” be reinvested in my policy than paid to an outside shareholder.

I hope this adds a bit of perspective. Many advisors across America recognize participating cash value whole life insurance as the most versatile, flexible and powerful financial tool available to Americans who want to…


    gain control of the money that flows through their lives,
    become free from debt-to-others,
    secure an income protected from inflation and that they cannot outlive,
    assure ready cash for life’s surprisingly unsurprising surprises, and
    create a legacy of both wisdom and wealth to pay forward to those they care most about.

These advisors study and understand every form of life insurance available in the market today. They do not disparage any of them since each may have a place in an individual client’s personal economy.

These advisors believe that it is every professional advisor’s duty and responsibility to know and fully understand all of the financial products that may be available to their clients. How else could they make honest recommendations?


The Failure of America’s Economy and the Personal Economies of Americans

This is a cautionary tale about four cousins - Elijah, Zachary, Mordechai, and Luke.  Structured as an allegory, it describes their approaches to money and reflects the financial behavior of America and Americans over the last four decades.  I hope you find this brief treatise enjoyable and instructive.

We begin the tale in 1968.  Elijah, Zachary, Mordechai, Luke, and their families live in the mountainous coal-mining region of Appalachia – an isolated area with a relatively self-contained economy. The area’s economy as well as each of their personal economies rely on coal, coal-mining companies, government agencies that regulate coal-mining companies and other businesses that depend on the mining and selling coal to the broader market.

Each of these men views his and his family’s personal economy differently.  Each expects a positive outcome and each approach produces predictable results – though often unexpected by the men themselves.

Elijah…The Value of a Penny

Elijah inherited 64 acres of prime farming and ranching land from his industrious parents.  Elijah, however, didn’t appreciate the value of owning the land outright and applying himself to working the land raising crops and livestock for his family and for the market.  Over the years Elijah raised money to support his family by selling off three fourths of the land in 16 acre parcels to his cousins Zachary, Mordechai, and Luke – more about them later – so that by 1968 each of the four owned equal amounts of land.

Elijah’s parcel sat on the eastern slope of Shelby Mountain.  Although the land was mostly mountainside, about five acres lay on flat land, bordered on the east by Possum Creek and Possum Creek Road.  The family home his parents had built and the four or so acres Elijah used for raising crops and livestock for personal consumption were separated from his cousins’ land by this border.

Just as Elijah was wondering how he could keep all that he had remaining of his parent’s estate, there was a knock on the door; enter The Mighty Coal Company.  Jacob Ebenezer of The Mighty Coal Company wanted to buy a right of way across Elijah’s property to construct a railroad spur line, which, he explained, would carry coal from the rich Anglican Mine across Shelby Mountain to a rail line that would bring the coal to market.

Jacob offered Elijah two options. The first option was that The Mighty Coal Company would pay Jacob and his heirs a royalty of one cent per ton of coal that was carried over his land for as long as the Anglican Mine [or any other mine for that matter] used the spur line. If Elijah chose this option, The Mighty Coal Company would pay Elijah $1,000.00 up front and begin making royalty payments to Elijah as soon as the coal cars started rolling over the tracks carrying what the locals called “black gold.”

The Mighty Coal Company, explained Jacob Ebenezer, was still negotiating with other landowners on the route, and would likely be opening the spur line within five years if they could come to terms with the one hundred or so remaining landowners along the route. Elijah could keep the $1,000.00 if The Mighty Coal Company failed to complete the project.

The second option offered by Jacob Ebenezer was $10,000.00 cash up front. Elijah would receive no royalties and would not have to return any of the $10,000.00 if The Mighty Coal Company was unable to complete the project.

$10,000.00 was a lot of money in 1968 in Appalachian coal-mining country. Elijah thought it through this way. He could support his family in the family home for nearly another five years using the $10,000.00 from the sale of the right of way, the occasional sale of produce and livestock, and doing a few odd jobs when he must.

Elijah reasoned that if he took the $1,000.00 offer, he may never see another penny and, even if he did, it wouldn’t be for five or more years. Moreover, winter was coming and although he could use the extra money to get the family thru until spring, he’d be in limbo waiting for over four years for royalties.

Elijah took the $10,000.00.

The rest of Elijah’s story goes something like this. Elijah eventually sold all of his land and an option on his house to the man who owned the land that bordered his on the south. His neighbor had chosen to take the royalties.

Elijah died penniless and his neighbor took his land and house as agreed. Although Elijah was never a financial success, he remained a beloved character in the small Possum Creek community. His children, however, all left coal country for the big cities and there are no longer any remnants of his immediate family in Possum Creek.

Fast forward to 2008; every month since September of 1972 – 36 years; 432 months – The Mighty Coal Company has shipped an average of 100 coal cars carrying an average of 90 tons of coal each over Elijah’s property every day. That would have created $2,700.00 per month in royalties. That’s $1,166,400.00 in royalties never received. The Mighty Coal Company expects to be running coal over those tracks for decades to come.

A penny is an amazing thing.


Predictable Financial Failures

Pundits and politicians are bemoaning the entirely predictable failure of America’s financial triplets’ [the banking, insurance and investment Behemoths] irresponsible financial behavior over the past two decades: Bear Stearns, Indymac, Lehman Brothers, AIG, Fannie and Freddie, WAMU, Morgan Stanley, other lesser-knowns and others yet to come.

The Economist print cover

The pundits want to explain the situation by pointing at everything from executive compensation to over-regulation.  The Dem’s want to blame it on Bush and the Republicans want to trace it back to Clinton.  You won’t find an answer that makes sense listening to any of those folks and their agenda driven drivel.

Here’s the straight skinny.

During the Clinton years, which coincided with [but did not create] a long and strong bull market, the line between and among banks, broker-dealers, investment advisories and insurance companies got blurred and in some cases erased.  This blurring continued into the 21st century and the Bush years.

But, the Bull Market Didn’t.

During the bull market the financial services industry came to the realization that the more money they could extract from Americans like you and me, the more money they could make for themselves. Moreover, they found that ‘invested’ dollars were more profitable for them than any others.  This led The Behemoths to create the myth that every American should be investing.

The Investment Myth

This myth was easy to perpetuate because of the bull market’s seemingly relentless growth.  When the bull market ended, however, the myth was in jeopardy.  Americans were running out of money and were less inclined to ‘invest’ and that meant the financial services folk might have to take a cut in pay.

The Easy Mortgage

The Behemoths needed a way to perpetuate the myth.  Enter the easy mortgage, the HELOC, the concept of ‘harvesting equity,’ the emphasis on massive and misguided 401(k) contributions [see final thoughts below] and a variety of other strategies to extract money from Americans.

The result for many Americans is that they have no money and the investments they bought with the money they borrowed from their home equity – or their credit cards – are worth less than they paid for them.

Now the Problem Arises.

  • Americans have a ton of debt.
  • They had been led to believe that using debt to buy ‘investments’ was a good idea.
  • It wasn’t.
  • Now, Americans can’t repay the debt they incurred to buy ‘investments.’
  • Now the companies that convinced Americans to ‘invest,’ and also loaned them the money to do so, can’t collect because Americans have no money – they only have ‘investments’ that are worth less than the debt they incurred to buy them.
  • Crash, boom, bang!

KAL’s cartoon

Sep 18th 2008
From The Economist print edition

One final thought. If you think your 401(k) [or any investment plan for that matter] is a good deal because you are putting a large amount of money into it, think again.  If you put $10,000 in a 401(k) and incur the same amount of debt in the same year, you will likely pay more in debt service than you earn in your retirement savings account.

And another…Tax detectability is a monkey trap that many Americans fall into and never escape.

by Jeffrey Reeves MA, EUREKONOMIST

By Dr Benjamin Franklin and Dr Agon Fly

“II. But with our industry we must likewise be steady, settled, and careful, and oversee our own affairs with our own eye, and not too much to others;

WOW! I wonder what Benjamin Franklin would think of ‘modern’ investment vehicles such as mutual funds, ETF’s, hedge funds, and derivatives of all kinds? These instruments require that you not “…oversee [y]our own affairs…”

The companies and the people that sell these products would have you believe that they are “steady, settled and careful,” but those qualities are not intrinsic to their products or the hallmarks of the marketers. In fact, the less you know the easier it is for them. If you think that’s an exaggeration, try reading a prospectus. You’ll discover that you know less after reading than you did before, and the prospectus is supposed to be the fountain of truth about mutual funds and primary stock offerings.

The truth is that America has lost sight of the wisdom that makes it great. Unless Americans reject the conventional wisdom, which is no wisdom at all, and regain clarity about how to handle their own money, they will soon find themselves gaining wisdom and clarity from the bankruptcy judge.

Father Abraham continues his lecture about being “steady, settled, and careful:”

for, as Poor Richard says, I never saw an oft-removed tree, nor yet an oft-removed family,
that throve so well as those that settled be. And again, three removes are as bad as a fire;

Father Abraham uses the word “remove” the way we might use the word “move.” In the America of the 1750’s, the ability to settle down in one place permanently was not quite as easy as it is today. Families built their own homes, made their own furniture, collected dinnerware one item at a time, and so on. Moving frequently would make being “steady, settled, and careful” quite difficult for the family.

You might remember, also, that Benjamin Franklin started the first volunteer fire department in Philadelphia around this time because a fire meant the loss of all that a family owned. The insurance that we rely on today was non-existent.

Just as a transplanted tree finds it hard to thrive, so a frequently transplanted early American family would find it difficult to thrive. In America today we hardly think twice about moving across town or across country. Many families spend their future trying to create a better one. They move to a new house or a new job or a new school district or a new city hoping that the mere fact of moving would create a better future. Americans burn their connections to place and destroy a part of their families when they do.

Granted, a lot has changed in the last 250 years, but Father Abrahams premise is just as valid today as it was in 1758; the deeper the roots, the stronger the tree. The same thinking applies to how you deal with your money. Moving money around like play money on a Monopoly Board is just as damaging to your personal economy as moving your family around is to your personal relationships. Money needs a home; it needs to be “steady, settled, and careful” in its own way.

As always, Benjamin Franklin, through the character of Father Abraham, brings wisdom, which knows no century, to the 21st century. We stand in awe of it both because it is timeless and because it has been buried by the advertising and marketing of the Behemoths, who would like nothing more than that ‘we the people’ remain slaves to their shibboleths.


Life’s that way. Surprisingly unsurprising surprises happen to all of us throughout our lives. They keep us from completing our work on time, being prepared for our kids education and our own retirement. Read the rest of this entry »

By Benjamin Franklin and Dr Agon Fly

I. Industriousness

It would be thought a hard government that should tax its people one-tenth part of their time, to be employed in its service;

Benjamin Franklin and the other Founding Fathers didn’t have to deal with the IRS, state, county, township, city and district income taxes, taxes on gas, electricity, telephone service, internet access, cable and satellite service, water, sewer, gasoline, heating fuel, beer, wine, whiskey, tobacco, and sales tax on almost everything else thrown in just for good measure. Add to that the taxes on corporations, which are rolled into the price of their goods. Those taxes then get taxed again when you buy those goods.

Today’s governments in America take a lot more than ten percent of your time. They don’t require actual time. They take so much of the typical American’s work product – money for short – in the form of taxes that you really work for the government up to 50% of the time.

It can get even worse when you add in estate and inheritance taxes and probate fees and costs if you are financially successful and don’t have well informed and qualified advisors.

but idleness taxes many of us much more; sloth, by bringing on diseases, absolutely shortens life. Sloth, like rust, consumes faster than labor wears; while the used key is always bright, as Poor Richard says.

One thing hasn’t changed. No matter how much of your money the government takes, you are still responsible for your health and your own financial success or failure. That means you have to rely on your own work to produce enough income to care for yourself and your family if you have one.

Benjamin Franklin obviously refers to manual labor when he talks about ‘sloth brining on disease’, rust consuming faster than wear and tear, and saying the ‘used key is always bright.’ Many Americans don’t do manual labor. Finding a way to keep your key always bright is intrinsically your job, too.

A corollary to what Father Abraham teaches is that relying on government for health care or financial support is not a good idea. The more a government gives you personally the more it can take away.



The Money for Life Plan

America is addicted to investments they can’t control and debt they may never repay.

As you will see shortly, T. Boone Pickens has committed $58,000,000.00 to promote a plan to wean America from foreign oil in ten years.

The Money for Life Plan weans individual Americans from the Debt Paradigm almost immediately. [It's not as expensive.]

In both cases the process begins when a person – or in the case of the Pickens’ Plan – when a country changes its mind.

The Money for Life Plan lets YouBeTheBank and gain control of the money that flows through your life. It relies on the individual family re-thinking what works and what doesn’t regardless of the “conventional wisdom” that the Behemoths – large government, unions and business – want you to believe.

The Pickens Plan flies in the face of the “conventional wisdom” of Washington DC. The Pickens Plan aims to keep American money in America by converting electric power generation from natural gas to power generated by wind and solar, then converting petroleum driven vehicles to natural gas.

Both plans rely on the same principle.

The Pickens Plan believes that it’s essential for our nation to regain control of its energy and stop sending  $700,000,000,000.00 of our wealth oversees every year.

The Money for Life Plan believes that it’s essential for individual American families to stop putting their money into investments they don’t control and debt they may never repay.

Below is a detailed description of the Pickens Plan. I encourage you to read it, recognize the wisdom it contains, and sign on to support it. It is worth your time and attention.

I also encourage you to visit and learn about The Money for Life Model. I don’t have $58,000,000.00 to promote this idea and the book that describes it Money Now, Money Later, Money for Life! How to thrive in good times and bad so I’m hoping you’ll discover some value there and tell a friend.

The Pickens Plan

America is addicted to foreign oil.

It’s an addiction that threatens our economy, our environment and our national security. It touches every part of our daily lives and ties our hands as a nation and a people.

The addiction has worsened for decades and now it’s reached a point of crisis.

In 1970, we imported 24% of our oil.
Today it’s nearly 70% and growing.

As imports grow and world prices rise, the amount of money we send to foreign nations every year is soaring. At current oil prices, we will send $700 billion dollars out of the country this year alone — that’s four times the annual cost of the Iraq war.

Projected over the next 10 years the cost will be $10 trillion — it will be the greatest transfer of wealth in the history of mankind.

America uses a lot of oil. Every day 85 million barrels of oil are produced around the world. And 21 million of those are used here in the United States.

That’s 25% of the world’s oil demand. Used by just 4% of the world’s population.

Can’t we just produce more oil?

World oil production peaked in 2005. Despite growing demand and an unprecedented increase in prices, oil production has fallen over the last three years. Oil is getting more expensive to produce, harder to find and there just isn’t enough of it to keep up with demand.

The simple truth is that cheap and easy oil is gone.

What’s the good news?

The United States is the Saudi Arabia of wind power.

Studies from around the world show that the Great Plains States are home to the greatest wind energy potential in the world — by far.

The Department of Energy reports that 20% of America’s electricity can come from wind. North Dakota alone has the potential to provide power for more than a quarter of the country.

Today’s wind turbines stand up to 410 feet tall, with blades that stretch 148 feet in length. The blades collect the wind’s kinetic energy. In one year, a 3-megawatt wind turbine produces as much energy as 12,000 barrels of imported oil.

Wind power currently accounts for 48 billion kWh of electricity a year in the United States — enough to serve more than 4.5 million households. That is still only about 1% of current demand, but the potential of wind is much greater.

A 2005 Stanford University study found that there is enough wind power worldwide to satisfy global demand 7 times over — even if only 20% of wind power could be captured.

Building wind facilities in the corridor that stretches from the Texas panhandle to North Dakota could produce 20% of the electricity for the United States at a cost of $1 trillion. It would take another $200 billion to build the capacity to transmit that energy to cities and towns.

That’s a lot of money, but it’s a one-time cost. And compared to the $700 billion we spend on foreign oil every year, it’s a bargain.

An economic revival for rural America.

Developing wind power is an investment in rural America.

To witness the economic promise of wind energy, look no further than Sweetwater, Texas.

Sweetwater was typical of many small towns in middle-America. With a shortage of good jobs, the youth of Sweetwater were leaving in search of greater opportunities. And the town’s population dropped from 12,000 to under 10,000.

When a large wind power facility was built outside of town, Sweetwater experienced a revival. New economic opportunity brought the town back to life and the population has grown back up to 12,000.

In the Texas panhandle, just north of Sweetwater, is the town of Pampa, where T. Boone Pickens’ Mesa Power is currently building the largest wind farm in the world.

In addition to creating new construction and maintenance jobs, thousands of Americans will be employed to manufacture the turbines and blades. These are high skill jobs that pay on a scale comparable to aerospace jobs.

Plus, wind turbines don’t interfere with farming and grazing, so they don’t threaten food production or existing local economies.

A cheap new replacement for foreign oil.

The Honda Civic GX Natural Gas Vehicle is the cleanest internal-combustion vehicle in the world according to the EPA.

Natural gas and bio-fuels are the only domestic energy sources used for transportation.


Natural gas is the cleanest transportation fuel available today.

According to the California Energy Commission, critical greenhouse gas emissions from natural gas are 23% lower than diesel and 30% lower than gasoline.

Natural gas vehicles (NGV) are already available and combine top performance with low emissions. The natural gas Honda Civic GX is rated as the cleanest production vehicle in the world.

According to NGVAmerica, there are more than 7 million NGVs in use worldwide, but only 150,000 of those are in the United States.

The EPA estimates that vehicles on the road account for 60% of carbon monoxide pollution and around one-third of hydrocarbon and nitrogen oxide emissions in the United States. As federal and state emissions laws become more stringent, many requirements will be unattainable with conventionally fueled vehicles.

Since natural gas is significantly cleaner than petroleum, NGVs are increasing in popularity. The Ports of Los Angeles and Long Beach recently announced that 16,800 old diesel trucks will be replaced, and half of the new vehicles will run on alternatives such as natural gas.


Natural gas is significantly less expensive than gasoline or diesel. In places like Utah and Oklahoma, prices are less than $1 a gallon. To see fueling stations and costs in your area, check out


Natural gas is our country’s second largest energy resource and a vital component of our energy supply. 98% of the natural gas used in the United States is from North America. But 70% of our oil is purchased from foreign nations.

Natural gas is one of the cleanest, safest and most useful forms of energy — residentially, commercially and industrially. The natural gas industry has existed in the United States for over 100 years and continues to grow.

Domestic natural gas reserves are twice that of petroleum. And new discoveries of natural gas and ongoing development of renewable biogas are continually adding to existing reserves.

While it is a cheap, effective and versatile fuel, less than 1% of natural gas is currently used for transportation.

The Mechanics

We currently use natural gas to produce 22% of our electricity. Harnessing the power of wind to generate electricity will give us the flexibility to shift natural gas away from electricity generation and put it to use as a transportation fuel — reducing our dependence on foreign oil by more than one-third.

How do we get it done?

The Pickens Plan is a bridge to the future — a blueprint to reduce foreign oil dependence by harnessing domestic energy alternatives, and buy us time to develop even greater new technologies.

Building new wind generation facilities and better utilizing our natural gas resources can replace more than one-third of our foreign oil imports in 10 years. But it will take leadership.

On January 20th, 2009, a new President will take office.

We’re organizing behind the Pickens Plan now to ensure our voices will be heard by the next administration.

Together we can raise a call for change and set a new course for America’s energy future in the first hundred days of the new presidency — breaking the hammerlock of foreign oil and building a new domestic energy future for America with a focus on sustainability.

You can start changing America’s future today by supporting the Pickens Plan. Join now.