This is part 6 of a 12 part interview with Dennis Crawford. In this segment of the interview, Andrew and Dennis discuss economics.
Andrew: Yeah. I can definitely relate.
Dennis: Same thing with your business I think too.
Andrew: Yeah, absolutely. And when those depressions do come along, it’s a good time to buy not a great time to sell.
Dennis: Absolutely, I like the way you think.
Andrew: So I want to move on a little bit to talk about economics, of course I’m referring to it in a fairly general sense because I don’t have all the terminology to know about the financial industry, it’s still kinda new to me. So yeah, maybe let’s talk about the national trends and the sort of problems that are definitely facing us right now.
Dennis: Yeah, where would you like to start on that one? Haha, that’s a big topic.
Andrew: It really is.
Dennis: Yeah, well maybe I’ll just give you a general sense. I guess I can start by saying the world is got some challenges in front of it, I think both you and I share this understanding. I don’t think anyone who’s quasi-awake walking around out there has to realize to some degree even if they can’t assimilate it intellectually, they can assimilate it in their heart or emotionally that things seem to be a little goofy.
The headlines on the news just seem to get more and more shocking, it seems to be more and more strategy and so sort. On an economic standpoint in the western world, we’ve unfortunately been living beyond on means for decades, and we’ve created some real problems. When I say we I guess I mean we as society as a whole or western society as a whole.
If you look at characteristics of economies like the United States of America, the biggest economy of the world, and several over economies right behind it like Japan, UK, Canada to a lesser extent, but we’re still in the same grouping… we’ve been living beyond our means for a long, long time and in the case of the United States, to put some quantitative figures to that.. their national debt stands at 17 trillion dollars. And that’s a different number to digest but to give you a little context on that, if you spent a trillion dollars every day of your life.. sorry a million dollars every day of your life since Christ was born, you still haven’t spent a trillion dollars. It’s just an outrageous sum of money.
To back it up another way, 17 trillion dollars for every man, woman and children alive in the United States works out to 55 thousand dollars a head. If you’re a high net worth person with big income, 55 thousand dollars might not seem like a totally crippling number of national debt, and this is just national debt, this doesn’t include state debt or municipal debt and so forth.
But the fact of the matter is that half the US population controls only about 2 percent of the assets, so one out of two people really only have access to 2 percent of the cookie jar so to speak. so there’s very, very wide wealth demographics. The top, the elite, the one percent.. I don’t like to use the word elite necessarily because it implies.. I mean it just means they have a lot of money in this context. So the financial elite have a disproportionately large piece of the pie.
It was revealed in statistics just the other day and they go something like this. The top 10 percent of people in the United States earn 51% of the income, so the top 10% earn over half of the income and they own over half the assets. The top 1 percent, so really small micro-group, control about 24% of the income. So it’s disproportionately skewed very much in that direction and unfortunately that is a bit of a feeding frenzy in and of itself because they also control the political agenda to some degree.
Earlier in my career I was a little more blissfully naive of that concept. You know I wanted to believe in a world and a system of a free world in America that was a little bit more righteous in that, but I think my eyes have been opened a little bit. There’s some things along the way that caused me some deep agitation that caused me to look below the surface, start to look at information that wasn’t being spoon fed by the mainstream media. Because guess who the mainstream media is controlled by? It’s the same one percent right? I don’t know if you can directly translate that the one percent is Dr. Evil and his team and blah blah blah.
Andrew: Not all of them.
Dennis: Not all of them but that element is certainly that, or is it just human greed run amuck and it’s the way it manifests itself.
Andrew: There is a little bit of that.
Dennis: I think so. I think it’s a combination of the two you have some really disconnected misguided people who really believe that more is more beyond basic sustenance. Which is fascinating because time and time again you read a very prestigious studies done that beyond accounting for your basic necessities, money does not bring you incremental degrees of happiness.
Andrew: Just more freedom of time I guess.
Dennis: Yeah, especially when you get into the area of hoarding. If you’re an individual at your age, say you’re 31 year old single man and you have a balance sheet and net worth of 5 million dollars, you would be successful by any measure but is your life any better if your balance sheet is 10 million dollars rather than 5 million dollars, really? And.. I know you personally would answer that as ‘no’ of course but there’s a lot of people out there unfortunately they would say ‘yes’ to that question, they could look at that as the end game of itself and they miss the whole point of what life is really about.
So what I would do, part of what I do I’d guess is help remind people of that without getting too philosophical because I serve a wide range of client types and not everyone might not share my same philosophical or spiritual standpoint. But I think it behooves all of us to kind of shed that light so to speak where we sort of align, even if it’s by the example that money or hoarding money does not equal happiness not in any way, shape, or form and there’s empirical data from many studies over the years that proves that same thing.
So getting back to the economy as a whole, there’s a faction of the populous out there that just does not get that and these are the.. to quote a famous movie the wall street movie the Gordon Geckos out there.. they just don’t get that. It’s a game in and of itself. If you look at characters like Bernie Madoff that perpetuated that huge Ponzi scamming billions of dollars in the US, it can’t be about the money at that point, it’s some perception of power that they believe the money brings and even that is an illusion right? We live in a world that has some significant challenges again most challenges all point back to if you bring it all the way back.. come back to many people having a misguided sense of who and what we really are and why we’re really here.