Economies are suffering, but was this the purge from a terrible status quo that could lead to a surge of new opportunities?

April 13, 2020

By: Bobby Casey, Managing Director GWP

This situation isn’t totally unprecedented. Many of us watched the world after 9/11, and are still living with the legislative artifacts of that time. We are witnessing as governments use real tragedies to usher in real tyranny.

If you decry the tyranny, and question the contents of the Trojan Horse, you are flagged as a denier of the tragedy.

I don’t deny 9/11 happened and that lives were indeed lost. I don’t deny that Covid-19 is real and that people are dying from it. The fact remains that most will survive this, and those survivors have choices to make.

Option 1: Let’s all scramble to get back to the normal we had!

A lot of people were very comfortable with that. It was the devil they knew. It wasn’t right, but it was sufficient. If they kept their heads down, went to work, paid their taxes, they stood a fair chance of making it to retirement relatively unscathed. The ambition was simple: just let me live my life ENOUGH.

The fact was, many of the major global economies were grossly overextended. Italy, Spain, France, Argentina, Brazil, Japan, and of course the US, all just swirling in a pool of their own debts.

I think most if not all governments are looking for something like this. Docile people who are so grateful to be out of quarantine, and so happy to have been passed over thanks to the benevolent leadership of government experts.

It will indeed be the path of least resistance. But this whole thing will have been for not if people aren’t fortifying their lives.

Option 2: Let’s rebuild, but be mindful of the vulnerabilities.

This is my camp.

First off, I don’t blame the virus for this nonsense. This is humans panicking, and feeding that panic. The virus didn’t shut down tourism and travel. That was businesses responding to governments. The virus didn’t order people to stay home, or deem products and services “non-essential”. The response to the virus tells me a LOT about what I can expect moving forward.

Second, it’s time individuals started taking inventory of themselves and their part in success, failure, and preparedness. The government is at best unreliable, and at worst reliably wrong.

For me, I was certainly hit by all this. My business is about setting up corporate structures, the nomadic lifestyle, and getting multiple passports. Small businesses are getting slammed and struggling to stay afloat, we can’t leave our homes, and many governments are suspending their passport services until all this covid-19 stuff blows over.

The good news is, my streams of income are diversified. In that regard, I was certainly prepared. But I’m always looking for ways to improve, and I’m an ideas guy so I’m always listening to new ideas on new streams of income.

I’ve been taking this time to hone in on that. And given how the global landscape will indeed be changing, what can I do to help others be more or better prepared? What do I see coming down the pike for opportunities?

Opportunity #1: Cryptocurrencies.

While governments are looking at making their own digital wallets and currencies, they’ve also proven to be inflationary disasters. Every time someone busts their hump to make a buck, central banks come along and slash that value in half.

I jokingly posted on social media the other day that the maximum amount of times you can fold a piece of toilet paper in half is five times. I’m not joking when I say there’s a limit to how many times you can debase a currency before you become Zimbabwe or the Weimar Republic.

This last round of US “stimulus” was a blow to the US dollar. And every injection into the economy has not had the effect everyone was hoping for.

I expect to see more people turning toward stores of wealth that hold value and don’t suffer based on political whims.

John Stossel talked about the stimulus and the steep hike in the US debt. He bluntly itemizes three possible ways to address it:

1. Raise taxes 2. Printing money 3. Default

Raising taxes as you’re entering into a depression is not advisable. Printing money is just borrowing more and weakening the buying power of your currency. And a default, well that pretty much would be a death knell for everyone and anyone who ever invested in US treasuries.

Investing in cryptocurrencies or even other assets like gold or silver is a hedge against fiat currencies and their volatility. This is one vulnerability that can be remedied now or on the other side of this. Consider other stores of wealth beyond that of fiat currencies and government treasuries.

Opportunity #2: Gig Work

This has some exciting potential! Many people who once had to go into an office to work, are proving they can keep business going remotely. Businesses across the board will be strapped for cash.

Does that mean businesses downsize their real estate? Possibly.

Businesses that keep the telecommuting model are going to have their pick of top talent, and lower overhead.

Employees also got a taste of remote work. And while initially it took some adjusting, going back to the office and the commute life might not be in the cards anymore. The new fringe benefit the market might offer up comes at little or not cost to the employer: telecommuting.

There’s going to be a huge unemployment rate. The US recently reported 14.7% unemployment with over 16 million filings in the past couple of weeks. The days of one job one source of income were always contrived.

People with one full-time employer who lost their jobs have no back up plan other than unemployment. Full time employment is proven to be a risky undertaking for workers, and a very expensive undertaking for employers.

Politicians have tried to make businesses compensate their workers based on a “living wage” or at the very least hold to a “minimum wage”. In addition, there’s the workers’ compensation insurance and mandatory benefits both federally and statewide. The overhead for a full-time employee is about 15% to 20% more than the gross of what an employee sees.

The new normal, if people want to work and business want to come back, might be gig or contract work. This gives employers the latitude to afford the human resources they need, but also gives the employees the flexibility to have more than one stream of income to withstand waves of political nonsense like these.

Another vulnerability fixed.

Other changes I expect to see include:

The manner in which most countries handled Covid-19 — or failed to, as the case might be — has not instilled a tremendous amount of hope in people around the world. With each retraction, with each encroachment, more and more individuals are realizing that while the event might be real, so too is the agenda.

As for me, I’ve taken this time to spend with my kids, take inventory of my current investments, and explore new opportunities on the horizon. Moving forward, there are some new investments and endeavors to meet the changing attitudes and demands in the market.

The beacon is up. I’m anticipating an entrepreneurial surge, and a geographic shift to markets that will nurture that surge.

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