America's Growing Trend: Opting Out and Becoming More Self-Sufficient

Currently, my interest revolves around the developing trend of “opting out”, the phrase I use to describe Americans growing distrust of those in charge of our economy, both macro and micro, to the point where they are looking for ways to not engage with them anymore.  When you were a kid, did you ever find yourself sitting opposite a friend, playing a game, when suddenly you realized they were cheating, or otherwise bending the rules to insure their victory?  How did you respond?  Some of us called the other kid on it, and we gave them a chance to come clean and compete in a fair manner.  Others got mad and punched him in the nose.  Some of us got up in disgust and walked away, whether we gave them a chance to make it right and they refused, or we just left right away.  The latter is what I see and hear now in terms of the average citizen’s response to our country’s financial system.  Those at the top have gamed the system to their own advantage, regardless of the cost to the rest of us.  Only a very small percentage of our population is winning at this game.  It is only a matter of time before they start to lose, though.  For the last several years I have asked out loud this question:  “Who do these people think is going to buy their products and services if they keep all this money to themselves?”  Only recently have I received an answer, from my friend Alan Shelton*, one of the most intelligent persons I have ever met.  His answer was essentially this:  “Eventually, the wealthiest Americans will realize that their assets are devalued by the inability of people to buy things.  Most of their net worth is not in cash but in their assets, so this will ultimately eliminate up to about half of their wealth.  Homes, yachts, bonds, all these things that they possess will have less value because the market will no longer bear the prices they had when money flowed.  When money stops flowing, it becomes stagnant.  They will eventually realize that they will have to pay taxes and in other ways put money back into the system if they want their assets to retain or regain their value.”  By the time the folks that occupy that strata of our economy realizes this, it will likely be too late to make amends with their customers and consumers.  The former middle class members will have already moved on to a more self-sufficient lifestyle, playing the economic game with those who know how and are willing to play fair.  There will be fewer people in the market place for what it is the very wealthy want to sell us.  Trust will be the new currency, I hear from time to time.  Bartering will be the way we get what we need, rather than an exchange of cash.  We are a resourceful people, and we will find ways to get around whatever barriers are erected before us.  I don’t foresee us going completely without cash anytime soon, but I do believe more people will opt out more often as fears of a deep recession languish.  

No one fully understands how our economy works, no one.  It is too large a machine with too many moving parts.  There are those who can guess at how A affects B better than others, but it’s still a crap shoot in terms of exactly what the outcome will be if say, Greece’s economy collapses, or Italy’s, or if any of the EU countries stop participating in the use of the Euro. 

However, I can tell you this:  Every day I hear from people all over who share their concerns about America’s economy and what they perceive as their tenuous foothold in it.  These people, everyday average working Americans, are looking at a future of not using money to get what they need, because they sense that in the not too distant future, they may not be able to win this game against those that designed it. 

Check in tomorrow to read the rest of my overview of the “opting out revolution”.

*Special thanks to my friend Alan E. Shelton, a philosopher and the West Coast's best financial guy turned corporate thought leader, for all the many and varied conversations over the course of our friendship.  It is due to his level of analysis and his ability to get to the heart of complex issues such as government, economies, and when to worry (almost never, he says, at least not about those two areas of life) as well as his crystal clear explanations of these complex issues that have led to the level of clarity on my part in understanding what's going on in the worlds of finance and government.  Any inaccuracies are my fault, not his.  Alan's first book, "Awakened Leadership:  Beyond Self-Mastery" is due to be released in May of 2012.  For more on Alan, check out his website:  www.alanshelton.com