Is it affordable?

David's Wisdom : Newsletter 90, by David Lipschitz BSc (Honours) MBA

Dear colleagues

Affordability Written 17 April 2020

We have been brainwashed into believing that we must buy what we can "afford".

And we have been told that we can borrow and live beyond our means because "Debt is good" and "Leverage (a fancy name for debt) is good" and "gearing (another word for debt) is good".

And if you are permanently employed and you have a payslip, you can borrow a huge amount compared to what you earn. I have been self employed for 25 years and I can borrow about 1/4 of what a similar permanently employed person can borrow. For years I was sad about this as I have a number of clients, but a permanently employed person has one client (employer).

And if that client (employer) is also "highly geared" because their income can sustain their debt, then that is also "fine" for the banks. And we've seen massive collapses over the years, for example Edcon. And the South African government and the ANC itself.

Look how gearing destroyed companies. For example until Coleman Andrews was employed at huge expense, SAA owned their own aircraft. Andrews "saved" SAA a fortune (short term) by selling the planes and then leasing them back. And unfortunately this debt was in Dollars. Hence as the Rand depreciated, SAA became technically insolvent. This besides all the other inefficiencies we see in SOE's (State Owned Enterprises) which rely on "Bailouts" (another form of debt) rather than making themselves self-sufficient and self-sustainable.

And then the spark that created this article today (in 2020):

"More than 5.2 million workers applied for unemployment benefits last week, bringing the four-week total to a staggering 22 million — a toll not seen since the Great Depression" from "Your Thursday Evening Briefing" a daily email by the New York Times.

I've heard the following statistics about American SMME's (Small and Medium Sized Businesses)"

"USA statistics show one-quarter of all small businesses can't survive 15 days without cash.

"Another quarter can't survive 27 days without cash.

"In total, about 90% of small firms can't survive for three months."

Half of SMME's (probably worldwide) can't survive 1 month without income. And almost all of them can't survive for 3 months without income.

And I'm guessing that the huge spike in unemployment bailouts in the USA, is because most other businesses also can't survive for 3 months without income!

This is an incredibly poor state of affairs. And debt and gearing and financing and leverage and affordability have all made people poor. Buying stuff you can't afford is truly bad. I've seen houses in Montenegro which take decades to build. Every few years when I got there, I see another room, or another floor. When I ask why these houses take so long to build, I am told that the owner is using CASH to build the houses. And when the shit hits the fan, this owner has no debt and can live for a lot longer than 3 months.

The Coronavirus is a message from Nature to Humans to change our ways. We have learnt that 87% of people are more effective and efficient working from home and 73% of people don't want to go back to the office after lock down. (This from MyBroadband Research).

This is excellent news. Imagine 3/4 less traffic. Imagine 3/4 less pollution. Imagine a clean, healthy, world, where we can breathe beautiful, clean, oxygenated, air, which makes our bodies less acidic and more alkaline, and which makes us more healthy, and our medical bills plummet, also because we stop breathing Carbon Monoxide in traffic jams, and even if we never get into a car, this Carbon Monoxide and other Coal Based "Smog" (we even have a word for this pollution) Pollution gets into our lungs in our Cities.

And imagine people who have more time for their families and more time for their neighbourhoods.

Home schooling has also shot up. Imagine if this traffic also leaves the roads.

This is what Covid19 has taught us. We can be much less polluting. We can survive and thrive. And we truly don't need debt to survive. And we don't need foreign imports to survive. We need to work together in our communities. We need to eat locally grown food and buy locally produced appliances and goods.

This is how the world is changing and this is what the Old Order is fighting against. Renewable Energy has given humans a massive opportunity for Decentralisation. And in the recent Cape Town Drought (which was actually a Water Management Crisis), I estimate that Private People and Businesses spent over R10 billion on Private Water Infrastructure for their homes and buildings. And this spend was in 2 years, whereas the Western Cape Government spent R10 billion on Government Water Infrastructure over the past 10 years!!

And this private infrastructure in water and electricity, which are still growing fast, means that we are less and less dependent on the Old Order and the Old Guard, and they are fighting for what they are used to. They are used to Controlling the Masses. Today they want to do it with 5G and IOT and Surveilance. And they are failing miserably.

The time for Communities to work together is at hand. And this is enshrined in the South African Constitution and in South African White Papers and in South African government proclamations.

We need to decide what is important for us to survive and live beyond a minor problem that lasts for 3 months,? out of our lives which are 1000 months. If we can't survive 3 months without income, and if our employers and governments can't survive for 3 months without income, then our economic system has failed us, and we need a new economic system.

We need to get out of the habit of buying what we can "afford."

We need to work from home. Except for electricians and plumbers and others who need an place to work, but even they don't need "an office" outside their houses.

We need to home school.

We need to stop using Alternative Energies like coal and gas and nuclear power and go back to the original source of power, the Sun (the only Nuclear Reactor we need) and the things it makes live. Like Earth and Wind.

We need to stop eating poisoned food. We need to stop eating GMO's.

We need to buy what we truly need. And we need to be humble on our planet and treat nature with kid cloves. She is our mother and our father and our provider. Without her we are nothing.

26 November 2023: how come we aren’t learning these lessons? How come we aren’t seeing the big picture? How come do we allow history to repeat itself?