By Katie from Atlanta
When you are ready to adventure into college life, money is the last thing on your mind...
It’s more like:
How will I fit in?
How HARD are these classes going to be?
IS this the right major...?
What is living in the dorms going to be like?
How is my roommate going to be?
You are ready to leave your hometown...make moves...better yourself....
at any cost.
Especially when you grow up in a blue-collar focused town in a very depressed community.
NO matter what school I chose, it was more about it being far enough away from home for me to concentrate on my academics with little distraction from my past.
My mom and dad were so inspired for me to have a bright future that they clicked yes to almost anything that involved "Student Funding"...
One thing you do NOT learn in high school is financial, budgeting, realistic economic challenges and how to deal with them...
The closest you learned about budgeting was selling bread twists in a fundraiser to support your senior class trip....
I fell in love with Youngstown State University (YSU) when I walked around the not too big..not too small..not too intimating campus that screamed-this is it-
As always, I ignored the small talk regarding tuition and fees and dove head first into -let’s get this done- attitude....
First purchase...the laptop...(no idea where the money came from but my parents’ words that became very frequent to me were "we will worry about that later"..
Then the room..board....
all of a sudden it was my junior year of college and I was doing GREAT...
Loving my classes, working 20 hours a week (student requirement number of hours) on campus at the library then disability services shortly after. President of a national health honorary society...member of college democrats...became a very popular girl in many ways....not that it mattered..just another contribution to the many ways I excelled in my college years.
I think I just LOVED learning and being part of a community that was motivating.
I was obsessed with wanting to change the world when I decided to CHANGE my major from psychology to Public Health and gain an extra year only to receive my BSAS.
After living in the dorms for 2 CRAZY years and 3 years at University housing it was time to kiss the fairy tale land of learning goodbye and face real life...
moving back home to Akron, Ohio to live with my parents and work for a nonprofit was absolutely brutal.
This was NOT what I thought as far as SUCCESS would go...
The student loan situation SURFACED and I was confused and caught off guard...
"But mom, I didn't know I was paying for everything with imaginary money that would somehow TRIPLE by the time I graduated..."
Working in non profit; your chances of making over $12.00 an hour were VERY SLIM....
Frustration boiled... I worked resettling refugees then went to Planned Parenthood to continue to help the troubled....
I decided that the CDC would solve everything and packed my things to change the world in Atlanta, GA during the worst time of 2009-2010 economic downfall...
6 months in- the money was gone and I had to learn to survive without focusing on my degree's capabilities…
I then decided to REPRESS the financial burden of anything extra to basic needs....
6 different debt collectors later I have continuously witnessed harassing phone calls and terrifying conversations of threats to force me to fix the impossible...
Till this day I sadly compare myself to criminal.....carrying this embarrassment on my back..this heavy weight on my shoulders...
I will always know that the more I MAKE, the more I will LOSE to student loan debt that was mistakenly taken during my innocent and inspired youth....
I make payments here and there..I have difficult conversations with bosses and credit card company's...rejection letters are extremely common when trying to apply for credit..sign a lease..or anything that I need to do to get by like the average person would...I even wish they would put me in jail for a month...anything to erase the debt that has buried me and prevented me from moving forward...
If there is anything I can do at this point..its to help the lower middle class with topics that are not clear and have a long term effect.... provide more resources...improve situations that were easily mistaken through uneducated peer persuasion...
I numb myself to the burden this has caused in my personal life...
forever may I be an activist in unethical situations such as these...
Since Millennial's cannot file for bankruptcy for their student loans, their filings have gone down quite a bit in the last 25 years. On the other hand, Baby Boomers filing for bankruptcy has sky rocketed. This is a very disturbing trend. What do you think is the cause of this trend? Let me know your thoughts.
by Kathy Miller
June 19, 2018
Fred Ebb’s famous lyrics from the musical, Cabaret, say it all:
Money makes the world go around
... The world go around
... The world go around.
Money makes the world go around
It makes the world go 'round.
A mark, a yen, a buck or a pound
... A buck or a pound
... A buck or a pound.
Is all that makes the world go around
That clinking, clanking sound...
Can make the world go 'round
©1972 ALLEY MUSIC CORPORATION and TRIO MUSIC COMPANY, INC. All Rights Reserved
But before shells, coins or even the use of livestock or grains, humans bartered for resources or services. The practice of bartering dates to 6000 BC when it was introduced by Mesopotamian tribes and adopted by the Phoenicians. Goods were exchanged for food, tea, weapons and spices and with the growth of agriculture, livestock and grain products became standard forms of barter.
The first use of shells, or cowries, as currency is traced to China where these shells were a highly valued commodity for their use as body ornamentation. Some form of shell money has been found on almost every continent: America, Asia, Africa and Australia. The cowrie has been cited as the most widely and longest used currency in history.
As the cowrie became recognized as a preferred currency, bronze and copper cowries were manufactured by China at the end of the Stone Age and are considered the earliest forms of metal coins. But outside of China, new coins were developed using precious metals such as silver, bronze and gold
and first appeared in Lydia, part of present day Syria. Coins were stamped with images of gods or emperors to authenticate their value and continued to be refined by Greek and Roman empires.
The first banknote can be traced to China’s development of leather money in 118 BC, consisting of pieces of decorated white deerskin. China also pioneered the use of paper money from the ninth through the fifteenth century but the use disappeared in 1455 when the production of paper money had grown to the point that their value plummeted, causing huge inflation and a national financial crisis. Paper money disappeared from use in China for several hundred years.
In Europe, banking was disbanded after the fall of the Roman Empire but re-emerged at the time of The Crusades to expedite payments for supplies and equipment, much like the services already in place in the Italian City-States. These written instructions became recognized “bills of exchange.”
By 1660 in England, the importance of goldsmiths’ safes for jewels and coins and subsequent exchange of receipts for deposits and payments, developed into the “banknote.” While in the English American colonies, certificates attesting to the quality and quantity of Virginia tobacco, came to be used as money and in 1727 were declared legal tender.
The Gold Standard
Britain adopted the gold standard for the pound in 1816, directly linking its currency value to that of gold to theoretically offset government overspending and hold inflation in check after the economic instability after the Napoleonic Wars. The United States officially adopted the gold standard in 1900 which helped establish a central bank. However, The Great Depression of the 1930’s marked the beginning of the end of the gold standard with Britain and most of the Commonwealth abandoning gold.
The United States kept the link to gold after World War II and abided by the international monetary system, dubbed The Bretton Woods system, after a meeting of 44 countries in Bretton Woods, New Hampshire in 1944. These countries agreed to keep their currencies fixed to the dollar, and the dollar was fixed to gold. As the US held about three-quarters of the world’s official gold reserves, the system seemed secure.
However, by 1971, US inflation was on the rise and a gold run was looming around the world, creating what has been called the “Triffin dilemma.” “This occurs when a country issues a global reserve currency (i.e. the United States) because of its global importance as a medium of exchange. The stability of that currency, however, comes into question when the country is persistently running current account deficits to fulfill that supply. As the current account deficits accumulate, the reserve currency becomes less desirable and its position as a reserve currency is threatened.”
** Ghizoni, Sandra Kollen “Nixon Ends Convertibility of US Dollars to Gold and Announces Wage/Price Controls - "Federal Reserve Bank of Atlanta, August 1971,
On the evening of August 15, 1971 Nixon enacted a plan that ended the dollar convertability and brought the gold exchange standard to an end. In 1973, the United States officially ended its adherence to the gold standard and the world reserve currency became fiat money.
As of November 30, 2015, the Chinese yuan officially became a world reserve currency and makes the yuan the third reserve currency after the US dollar and the Euro. China has been accumulating gold for many years now. Some experts speculate that China has upwards of 3,000 tonnes which would make it sixth place globally. If China were to tie the yuan to gold, this could be a game changer for the US dollar reserve currency status.
The Chart from Phoenix Capital says quite a bit. As Nixon moved the US off the Gold Standard, the growing divide between GDP and outstanding debt began. What are the consequences of this divergence? Look to the US Dollar decline significantly over the next few years and the precious metals and Cryrptocurrencies to explode upwards.
Looking at my portfolio, the main reason I added commodities (i.e., gold and silver) is for a store of value. The US dollar has been strong over the last few years, but I believe this cannot continue. With all the debt that the Unites States has accumulated via Government, Business, and Consumers, it is only time where the dollar’s value diminishes. When countries discontinue lending us monies, hard assets will become in favor. Don’t get caught in the stampede out of the dollar. It will be too late.
Regarding cryptocurrencies, I do believe it is important to hold some in your portfolio. It is another option to hedge against the US dollar.
February 11th, 2018 – Update on Bitcoin and Ripple
Since my last blog in late December, both Ripple and Bitcoin have been on a wild ride. Bitcoin was up around $20,000 USD and Ripple reach around $3.60 USD. It made Christmas and the New Year quite exciting. But since then Bitcoin and Ripple have come down to earth.
As of 2/11/18, Bitcoin is trading at $8,400 USD and Ripple is at $1.05 USD. In any market this is typical. Anytime a stock takes off like this there is consolidation to its appropriate price. That’s the efficiencies of the market!
I’m still long both Cryptocurrencies. But for very different reasons. Bitcoin is similar to gold in the crypto space. It is the defacto standard and is what every other crypto is measured on. I don’t see this changing soon. I will let my readers know if my stance changes.
Now Ripple is my darling. I believe this has the greatest potential. I listened to Brad Garlinghouse, CEO of Ripple speak at the Yahoo Financial Forum. If you get a chance, listen to his presentation: https://www.youtube.com/watch?v=kyWZzgZN3wo&t=1413s. Why do I think Ripple will be a winner in this space? 1) It solves a problem unlike other cryptocurrencies. The Use Case that it solves is a trillion-dollar problem. 2) It already has real customers. 3) Google has invested hundreds of millions into the company. In this space, be careful out there.
December 24th, 2017 – Update on Bitcoin and Ripple
I am not sure I have the words to describe what is happening. It is very similar to the dotcom euphoria back in the early 90's. As of today, Bitcoin sits at just over $13,000. Ripple, which is my favorite crypto is trading at just around $1.00. Unbelievable. I will be adding some links on the potential of Ripple in the near future. Merry Christmas!
May 21th, 2017 – Update on Bitcoin and Ripple
WOW... The cryptocurrency sector has gone mad. It is the wild wild west in this new area so buyer beware. As of May 21, 2017, Bitcoin is trading at over $2,000 USD per coin. It should be ripe for a pull back. Stay tuned.
Even crazier, Ripple is now trading at .33 a share. This huge rise is due to the hot sector. However, I believe Ripple may be a leader in this space with their unique technology. Whatever company wins out to become the hub of the exchange of currencies (traditional and crypto) will do exceptionally well in their investment.
May 7th, 2017 – My first purchase of a Cryptocurrency
I did my research and it came down to 2 cryptocurrencies I liked. The first was Bitcoin. It is the most well known and has a track record I could review. It continues to gain momentum and has recently shot up to over $1500 US dollars per coin as of May 7th, 2017. I made my first purchase on April 13th around $1215 per coin.
The second purchase I made with Ripple or XRP. XRP is an independent digital asset, native to the Ripple Consensus Ledger. It has solid investment from Google, so I decided to take a shot. When you do your research the key is the algorithm the currency has backing it. I am betting that the smart people at Google did their research. Google won the search wars due to their great search algorithm. I also purchased XRP on April 13th at around .03 a Share. As of May 7th, 2017 XRP is trading at .13 a share. It is the wild west of cryptocurrencies, so enter at your own risk. But this is definitely an alternative to our US dollar and why I believe it is so popular. To purchase these cryptocurrencies, I used a company called Bitstamp.net.
April 11th, 2017 – What is a Cryptocurrency?
Up until now, MonieStorm has focused on Gold and Silver as an alternate currency as well as an investment vehicle. Gold and Silver have stood the test of time as money and will continue to do so as far as the eye can see. So this journey I am about to take you on is new to me. I will be learning alongside you. The world of cryptocurrencies…
In this series, I will look at Cryptocurrencies as an alternative to holding US Dollars. Wikipedia defines a cryptocurrency as a digital asset designed to work as a medium of exchange using cryptography to secure the transactions and to control the creation of additional units of the currency. Many of us a have heard of Bitcoin. While this is the most prominent cryptocurrency, it is by no means the only one out there. In the next series, we will look at the most active cryptocurrencies in the marketplace today.
Privatizing Social Security has always been off the table for Congress. First, they think we are too stupid to manage our own finances. Second, if we were to create individual accounts for each of us, they could not get their hands on the monies. Back during the Clinton years, Congress borrowed against the funds. Any money that is not tied down is free game for Congress. When you go to your broker and open an account, they don’t put you in the pool of investor. Each person has their own account. Let’s do the same for Social Security.
So let’s see what the numbers look like if we did not run this huge Ponzi scheme and we let individuals manage their own SS fund. .
Wow… If let alone to manage one’s own retire income you can see by the chart the possibilities. Obtaining a return of 6% is very reasonable. That would give a retiree 1.4M vs. 428K at retirement. I understand that Social Security is a safety net and we don’t want individuals to blow their retirement. But accounts could be setup so investments are very conservative. Give people the opportunity to invest in CD's. At least get some return on your monies…..
What are your thoughts? Is privatizing SS a crazy idea?
Here are the numbers:
In the United States, the federal funds rate is the interest rate at which depository institutions (banks and credit unions) lend reserve balances to other depository institutions overnight, on an uncollateralized basis. Wikipedia
This rate is determined by the Federal Reserve. It is manipulated to stimulate the economy during periods of recession. It is lowered to stimulate the economy. As you can see from the chart below, the funds rate has never been near zero for this many years. What are the consequences of this rate? The bubble that was created will burst. This time the bubble includes student debt, auto loans, business debt, government debt, mortgage debt, and credit cards. This bursting will happen within the near future. Take cover!
Have we really recovered or is this just an illusion? Take a look at the 9 data points below and see what you think. These number reflect the economic trends since the recovery began back in 2008. As you can see the trends are quite concerning. What is really happening… Just like in your own family budget, if you were to keep charging up your credit card things can seem pretty great. Consumer and Government continue to accumulate more debt to smooth things over.
The shaded red identifies the Obama presidency....
Source: Zero Hedge
Let’s look at a few of the numbers:
Students loans – Some 40 Percent of Borrows aren’t making payments. The total outstanding student debt is around 1.35 Trillion dollars. That’s trillion with a T. As college cost continue to increase exponentially, look for this number to keep climbing. While it is not shown on this diagram, auto loan debt has skyrocketed. Dealers now provide 84 month loans.
Labor Participation Rate – The BLS came out with the unemployment number this past Friday (June 3rd 2016. The headline number is that we are at full employment with a 4.7% unemployment rate. Let’s pull back the onion a little bit. The proportion of adults working or looking for work dropped in May to 62.6 percent, near four-decade lows. This low level of participation is based on those individuals who can’t find jobs and quite looking. But the headline number is what people talk about.
Federal Debt – The Federal Debt is quickly approaching $20 Trillion. If you get a chance go to the debt clock website- www.usdebtclock.org. The Government continues to ignore the elephant in the room.
What are the underlying repercussions of this debt? 1) We see that neither Republicans or Democrats want to deal with it. Hence, the Presidential race is become quite entertaining. 2) Janet Yellen keeps declaring that the Federal Reserve is preparing to raise interest rates. The Fed may be able to raise the rates 25 more basis points, but that will be it. We can’t afford the interest payments. 3) Finally, the US is beholden to China, Russia, Saudi Arbia to name a few. If these countries were ever to sell some of their holdings, this oculd trigger a World Economic meltdown.
The Great Recession of 2008 was a difficult time in our counties history. However, I do not believe we have successfully tackled the issues at hand. The consequences are fast approaching. Prepare!!
Since the US dollar is used as the world’s reserve currency, does this provide the United States greater financial security?
Absolutely not…. Being the world reserve currency does not entitle us to any special treatment. I have heard some experts use the analogy that we (the US) own the casino and the house always wins. The same rules of finance and economics apply to all countries in the same manner. If a country continues to deficit spend and borrow money, the country is still obligated to payback the monies owed. I think having the world reserve currency status is a symbol of stability and strength. However, the Federal Reserve’s QE1, QE2, and QE3 (i.e., printing money) is jeopardizes this status and could be the nail in the coffin to our economic system. What are your thoughts?
I hold a B.S. in Economics from Florida State University and a MBA from Nova Southeastern University. I have over 30 years experience in investing in stocks, commodities, and most recently cryptocurriences. I spent a brief stint on Wall Street where I learned some valuable lessons. My strong faith in God, my love of country, and strong desire to help others, has lead me to create and promote MonieStorm. I believe the articles, videos, and personal commentary provide useful information for the upcoming times we are about to face.