Life Despite Money
Editorial Page

Life Despite Money

By Andy Valencia

The United States is staggering along under more debt than you might expect:

US Public Debt, Last 10 Years

Debt is money you borrow – rent, if you like. If the rent is very close to zero, who cares how much you’ve borrowed? But over time, if you print endless money at no cost, confidence in all those dollars starts to fade. How can you tell confidence in your money is fading? People want more of it to sell you the same thing – inflation!

This is why the “free money” party is ending. After the 2008 financial disaster, we had nearly free money until around 2016. The cost of money climbed a bit, then crashed right back down to near-zero with COVID-19. In recent years, unless you don’t drive, eat, or heat your home, you’ve felt the sharp pinch of inflation. In response, the price of renting money is being moved up away from zero.

Fed Funds Rate, Last Ten Years

When these interest rates climb, things like borrowing money to buy a house become more expensive. Yet, what does it do to the nation that has already borrowed almost $32 trillion dollars? Two years ago, the interest rate for new national debt was around 0.07%. Today, it’s around 4.57% – a 65-fold increase. Debt was extremely cheap, but those days are behind us. The US military costs more than the next nine nation’s militaries combined, and yet federal budgeting forecasts our debt payments will surpass our military spending by 2030.

If this wasn’t The Loop, I’d now try to sell you Bitcoin, or gold, or seeds, or guns. Maybe you’ll buy one or more of these, and maybe you’ll feel a little safer. We’re all conditioned to make ourselves happier by buying things. Money permeates our reality.

But can things really make you safe and happy? Even if you have food – it can rot. Water tanks might leak, or tools rust. Possessions can be stolen.

There are two things that will serve you well no matter what you have, or need, or lose. The first is a philosophy of life. If your sense of self-worth rests on job titles and paychecks, would the lack of employment destroy you? Who are you without your phone?

The great systems of thought in human history do not depend upon your paycheck or how you spend it. They also inevitably involve communities of people who share similar conclusions. I’m not going to recommend a particular system to you, but I do recommend that you start looking.

The second thing that will serve you is self-reliance. Most modern people with an urban background are entirely disconnected from all the systems that make their lives possible. How does water reach your faucet? Where does the drain take it? How are lights, plugs, and switches connected? How is a window attached to your house?

It’s an overwhelming list, but take heart from how one eats an elephant: one bite at a time. It’s not about knowing everything all at once. Pick one single project, and work it through to completion. Now you’ll know about how, say, wires go into the back of a light switch. That bit of information is much less important than the real lesson: You can learn and use that knowledge to great effect. Now, make your faucet stop dripping. Then, change your car’s oil. (Along with its oil filter!)

Eventually, a new challenge causes you to feel anticipation and curiosity, rather than a smothering sense of dread and helplessness.

When money seems to be going wonky, make sure that it’s just one part of your life. When needed, pull out a $20 bill, look at it, and say: “It’s just green ink on paper.”

July 10, 2023

About Author

vandys Andy Valencia is a 20+ year islander, tech guy, father, writer