How to Protect Yourself From a Jubilee
YOUR LOOK INSIDE REAL PORTFOLIOS
There are three obvious ways that debts are eliminated... 1. The first is default. You go bankrupt. Your creditors divvy up your assets and everyone moves on. 2. Inflation is a less-obvious way that debts get smaller. Debts can be inflated away by a central bank printing money. 3. And of course, you could simply pay your debt. It goes away just fine that way, too. But most people don’t realize that another way that debt “goes away” is through the redistribution of wealth...
Governments sometimes raise taxes to help pay down these debts, or sometimes there’s a revolution and the debts get wiped out. Today, with debt already much higher than gross domestic product and never-ending government deficits... this final idea – a jubilee – is more and more likely. The question is... How does a reasonable person – without wearing a tinfoil hat or living in a cave – structure his affairs to protect his assets against this sort of grand financial “reset” and restructuring of the social contract?
46 | November 2017
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