@hooeem: We're heading into a full blow...

We're heading into a full blown financial crisis.

It will either make you, or break you.

& that all depends on two things:

Do you ignore it? or do you prepare?

First of all I need to say...

1: I'm not a fkn doomer.

But there's some topics that I will mention in this article that would make it seem this way, but that's just the reality of the situation and I actually look at it all with optimism.

2: Am I an expert?

Fuck no, but I do put my own dollars on the line when I make decisions in the market and what I do in my life. I'm also aware we're potentially looking at a bit of relief and some green in the market where people may QRT this post to troll me but I'm not talking about this week in the market, I'm looking ahead, because yes, I like to conduct deep research to read and understand what's happening, and right now, a lot is happening, and it's not just the war on Iran.

But let's start with that...

OIL, ENERGY, AND THE INVISIBLE TAX:

War in the Middle East, destroying key infrastructure, threats of destroying more, escalation, pretending there's deescalation, and the strait. It's obviously going to spike oil.

Higher energy costs are a stealth tax on everyone, and that ends up going through the entire supply chain making everyday people struggle.

This eventually leads to interest rates rising, people being squeezed, no longer able to afford their property and pass an affordability assessment for their property ending up on a standard variable rate which works out to be double what they were paying previously on their 1% fixed term rate they got during December... yh, it's NOT good.

Consumer spending suffocates because of this.

https://x.com/i/status/2036495767565639924

oh, and right now the US are doing everything they can to keep this down...

https://x.com/i/status/2036551740917526789

SOVEREIGN DEBT DEATH SPIRAL:

The US national debt just cracked $39 trillion. Let that number sink in.

This is whilst the government only takes in $5.4 trillion a year whilst spending around $7 trillion. Around 120% of all receipts get swallowed through baby boomer entitlements, interest on past debt, defence. You can see all of this live here @USDebtClock_org:

Then it gets worse.

If the government cuts spending, GDP shrinks. The deficit-to-GDP ratio paradoxically gets worse. It's a trap with no clean exit.

So what do governments historically do when debt becomes mathematically unpayable?

They print magical computer money. Or they start a war to distract everyone. Sometimes both.

And across the pond with your oldest friends the UK a doom loop is already spinning. Public sector pay rising above inflation forces higher taxation, which suffocates the economy, which demands more printing. Rinse. Repeat.

30-year UK gilt yields are hitting levels not seen since 2008. The bond market thinks the UK government is no longer creditworthy.

When you look at the global picture, the collapsing spread between 10-year US Treasuries and Japanese government bonds, paired with a weakening yen, is the textbook warning sign of a sovereign debt death spiral.

THE AI DEFLATION / BUBBLE THREAT

AI represents the fastest technological acceleration in human history. Massive productivity gains incoming.

Sounds brilliant until you clock the problem.

We are sitting inside a debt-based system. Massive deflationary productivity in a leveraged economy doesn't create prosperity. It detonates the whole thing.

White-collar workers are loaded with mortgages, car loans, and non-dischargeable student debt. AI doesn't need to replace all jobs to trigger a crash. Even a small percentage of displacement cascades into systemic defaults across the banking sector.

Read that again.

"Okay, but what if AI is a bubble?"

And then there's the other side to this, and that AI is potentially a bubble, and bubbles, well they fuck shit up...

Here's the historical pattern:

Today? Some analysts are staring at AI company valuations and getting that same sinking feeling.

The entire system runs on a credit bubble. Austrian economists have been screaming this for decades: you either stop the bubble voluntarily (massive depression) or the currency itself gets destroyed (hyperinflation). Pick your poison.

THE EARLY WARNING SIGNS:

These are not predictions. These are the early signals that are live right now:

You don't believe me?

https://x.com/i/status/2030412906064380249

https://x.com/i/status/2004554041557184580

https://x.com/i/status/2016189195929198619

https://x.com/i/status/2031399980867498363

https://x.com/i/status/2036439829714534888

https://x.com/i/status/2029581183756169561

Okay, that's enough proof, so what are we gunna do about it?

Sit there and cry and say how life's not fair? fuck no...

We're going to survive this by having the knowledge of its existence.

HOW TO SURVIVE IT (PLAYBOOK):

The following is going to act as a checklist for you to act on.

We're going to approach this with a glass half full mentality.

We're going to approach this as grafters, believers, and with the self awareness to know that all things will work out again, it's not the end of the world, and knowing that means we'll be able to take risk when we need to take risk...

IMMEDIATE FINANCIAL DEFENCE:

Build an emergency fund covering three to six months of bare-minimum expenses. Prioritise this above everything except minimum debt payments. If you have nothing saved, get your first $1000 stashed immediately.

This is not optional.

Do not borrow money for consumer spending. If you must make a large necessary purchase, lock in a fixed rate now if you can. Variable rates in a recession will eat you alive.

Crush your credit cards now. Variable interest rates climb during downturns. Pay them down aggressively. Call your bank and negotiate a lower rate, there's no harm in asking, there's a stat that suggests around 70% of people who ask actually get one. Alternatively, switch to a 0% introductory balance transfer card. Do the maths first and make sure you can clear it before the rate jumps.

Do not co-sign anything. Nearly 40% of co-signers end up paying the loan themselves. If you want to help someone, give them cash or a personal loan. Protect your name at all costs. This is basic stuff but just know it.

CAREER AND INCOME PROTECTION:

Oh, you hate your boss? if you don't have a backup plan then rage quitting on dumb ass shit like not liking your boss during moments where hiring will be at all time lows alongside job displacement... good luck if you want to rage-quit your job.

Upskill relentlessly, I'd focus on utilising AI, but it can be other things. YouTube, Udemy, Khan Academy, coding bootcamps -- most are free or near-free. Learn coding. Learn SEO. Stack skills that make you harder to cut. Or allowing you to begin a hustle.

Start a side hustle. Freelance work, online offerings, handmade goods, the average side gig brings in nearly $500 a month for a few hours of work. That is your safety net building itself while you sleep.

INVESTMENT AND WEALTH STRATEGY:

Ignore the media panic machine. Economists predict a recession every single year. Doom-scrolling leads to emotional decisions that obliterate portfolios.

The S&P 500 over a long enough time horizon is up only, I mean, it's literally always going to be the top 500 companies in America, so if you're able to be in a position to add risk during this period as you're well prepared then it's a perfect time to add risk. I will be doing this alongside buying myself as much Bitcoin as possible when the time comes, until then I will just average down.

The markets always get better, and missing the 10 best days of the market means you miss out on all the juice, so take the risk when the boomers are telling you that's it's going to get even worse when it's already 25-35% down (S&P that is).

Trust the timeline. A Schroders study covering 148 years of data showed investing for one month carries a 40% risk of loss. One year drops that to 30%. Investing for 20 years? The odds of loss drop to practically zero. THINK LONGER TERM. I mean I'm not thinking 20 years time but at least for next cycle lol.

Or you can be an absolute Cockroach...

Do you know who this guy is?

Well, this mother fugger was one of the wealthiest men recorded in human history. When he died in 1525 he controlled like 2% of all European GDP... and he did this shit by being a cockroach...

Being a cockroach in modern terms looks a bit like this:

CASH. COMMODITIES. STOCKS. equally split...

It's a portfolio that will let you compound uninterrupted.

This is more for people who have a large balance as this isn't going to make you rich.

If you're sitting on cash I'd still aim to venture further out of the risk curve especially if you end up seeing an asset like Bitcoin down around -70%, but that's me, I'm not telling you what to do.

PANIC SELLERS AT HUGE DISCOUNTS WILL GIVE THE OPPORTUNITY OF EXTREME WEALTH TO THOSE THAT TAKE THE RISK ON WHEN NO-ONE WANTS TO ANYMORE.

Moving on to an overlooked and under appreciated investment.

PERSONAL PREPARATION:

1: Investing in your health.

Make yourself harder to kill. Invest in your physical health right now. Get into the best shape of your life. Getting a sickness, requiring surgery, or being unable to work will destroy you.

That is why this is the highest-ROI investment you will ever make.

2: Estate.

Tax planning. Maximise your ISAs and pension allowances. Do your estate and death duty planning before the end of the tax year, especially if governments remove the 7-year exemption or slap capital gains taxes on death. Speak to someone who knows what they're doing.

3: Invest in your knowledge.

Don't let people take the mick out of you for being interested in topics outside of your usual niche, yeah, maybe Nikita's algorithm might bum you but who actually cares, the omni-curious are winners and if you keep putting in reps and learning in public you're going to gain attention and you're going to learn, and the algorithm will eventually shine a light on you...

The 2008 recession wiped out millions of jobs. It also produced an entire generation of developers, digital marketers, and online entrepreneurs who learned new skills on the cheap during the downturn and printed money during the 2010s bull run that followed.

So where should you invest your time:

Tier 1 -- Skills that generate income directly. Copywriting. Sales. Coding. SEO. These skills are immediately deployable as freelance work or internal leverage. A competent copywriter who understands direct response can generate their own income in any economic environment. A developer who can ship product is unhireable in the bad way -- nobody can afford to lose them.

Tier 2 -- Skills that protect and multiply existing income. Financial literacy. Tax planning. Negotiation. Legal basics. Most people hand money to advisors to handle things they could understand themselves in a weekend. The cost of that ignorance compounds just as brutally as the benefits of knowledge.

Tier 3 -- Skills that create long-term positioning. Macro analysis. Understanding technology cycles. Identifying where capital flows before the crowd does. These are the skills that let you see the Jacob Fugger moment coming before everyone else starts panic-buying gold.

But really, invest your time where you feel passionate and curious.

THAT'S THAT!

You're doing this for your last name.

You're doing it so they never have to worry.

That is why we prepare, we're not children.

We're optimists, not idiots.

We believe in ourselves.

And this, was a really fun article to put together. Whatever the world is going to throw at us, we are ready for it.

P.S. The information above is not hidden. It's just ignored. The gap between knowing and doing is where fortunes are made or destroyed. You've read it.

Now share it with a mate you think:

1: is an absolute idiot.

2: is doomscrolling right now.

3: is splashing his cash on bottles of ciroc on the weekend

4: is driving rentals.

5: is drifting through life aimlessly.

Know someone? Share it with that fucker saying "hey retard, read this" you're their friend aren't you.

Okay, that's it. Hope it was a good read.

OH WAIT...

Almost forgot to plug my newsletter.

Come subscribe to it.

Best newsletter ever.

https://x.com/i/status/1640004722609225728

Lub you!

I’m really proud of this piece.

I feel I’ve left something on the timeline that will have a positive impact on people.

I hope you enjoyed the read.

Can’t wait to read what you say :)!