September 27, 2017, 9:02 am

The Great Battle: Gold Standard vs. Fiat Money

by: The Financial Blogger    Category: Banks and You

Comparison begets real knowledge, but of course, solely from a proper one. Discussing about these topics in exquisite detail would require several pages, but this article has been written with the purpose of bringing a good overview in a laconic way.

Therefore, I hope this article helps you to learn more about each system, and based on that, arrive to your own conclusions on which one is the best.

About Inflation And Deflation:

Those who support a fiat money system argument that the principal and most dangerous risk of gold standard is that a positive demand shock for gold can bring risky levels of deflation. Nonetheless, most cannot bring solid arguments on how it would happen and if it would be really that dangerous. However, on the other hand, we can consult history and see that the gold standard of the 19th century suffered periods of deflation and inflation, but they were fairly moderate.

In addition, even the ‘wildest’ periods didn’t show a sign of uncontrollable deflation. Therefore, according to history, a gold-standard system doesn’t necessarily mean that gold demand shocks will result in extreme deflation.

History Supports It

Unlike the current fiat system that has never been properly run, so to speak, gold-standard has a brief yet successful mark in history. If we stick to the most exact definition, then we can say that the real international gold standard system simply lasted from 1870 to 1914.

And what did happen during those decades? Here is some of the evidence that shows the great potential of this system than in such a short time in history proved more than our current fiat system:

  1. A period of very little inflation that was easier to manage
  2. Increased living standards
  3. Drop in employment rates
  4. More competitive and productive industries
  5. Government interventions were reduce to a minimal expression

Moreover, some countries like England and the Netherlands had already adopted the gold-standard system before 1870, but it was only since the international adoption of it that it could finally show its true potential.

Unlike the current times we live in, none was coerced to subject to it. Every nation was free to join or simply look from the outside.

In addition, we can also point the following benefits this system brought to the nations that adopted it:

  1. International trade experienced one of the highest growth rates in history
  2. Capital mobility experienced its best days
  3. The exchange rates were surprisingly stable
  4. Speculation maintained within ‘acceptable’ boundaries
  5. Income and industrial production experienced an impressive growth
  6. Nations, public and private institutions trusted the international monetary system
  7. Liquidity was bountiful
  8. Excellent levels of price stability along with low levels of inflation

All in all, nations experienced several advantages that made them live some of the best years in their history.

If we compare this against the fiat system, then we will find many displeasing surprises…

Arguments Against The Gold Standard

The supporters of the fiat system have many arguments against the gold standards, however, the majority of them are baseless. But for the purpose of showing why it is the case, here you have the three most popular arguments used against this system:

Argument #1

“Gold is a synonymous of panics, therefore, central banks must be left to their own devices and gold must be avoided at all cost so our economies can be more stable”.

Affirming that panics emerge from gold is wrong in several senses, and that’s why we need to understand how they are created. First off, the causes of panics are several but amongst the most important we have:

  1. Overconfidence
  2. Overexpansion of credit
  3. A big scramble for liquidity
  4. A significant and abrupt loss in confidence

From this it is very easy to understand that the direct relationship between panics and gold is nonexistent, and hence, makes our example argument very weak and easy to refute. Moreover, gold is an excellent investment and should be a mandatory part of your portfolio. If you want to learn more about that specific point, then you should visit Marketreview.com.

Argument #2

“There’s simply not enough gold, therefore, it makes it unsuitable for a global economic system”

This is one of the most popular and weakest arguments out there. The key to refuting it is that our focus should shift from the quantity to the price. Then, there is a vast amount of gold in the world that is valued at the right price.

Now that we have these elements into account we can proceed to do the following conditional comparison: if the ounce of gold was worth $17K USD, then it would be comparable to the combined M1 money supply of the following countries:

  1. China
  2. Japan
  3. USA
  4. UE

Therefore, based on this, we can see that the problem of the quantity of gold in the world is a real issue at all.

Conclusion And Final Words

As we can see, after checking history and real facts, the gold-standard system has several advantages that the current FIAT system cannot offer. However, the supports claim that a well-run FIAT system would beat a well-run gold standard any day of week, but the question is: have we ever seen such a thing like a well-run fiat system? Debt creates increasing, inflation is skyrocketing, people are suffering the consequences and yet those very same supporters cannot see the problem.

Maybe, just maybe, it may be about time to rewind and learn a little bit more about the past.

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September 25, 2017, 9:36 am

The Four Worst Financial Millennial Mistakes

by: The Financial Blogger    Category: Personal Finance

Millennials differ in many ways from any other generation in recorded history. One critical way that they operate differently is in how they make financial decisions. As the first generation not to have classes like handling personal finances built into their education, and having all but doing away with paper money, Millennials are changing the way that Americans spend, save, and invest their money.

There are things that you can do to secure your financial future and others that can drive a nail through it. The problem for the Millennial crowd is that not all of them really understand the difference, and according to a credit union in Winnipeg, they are making critical financial mistakes that could potentially affect their resources for the future. The good news is that Millennials are just starting out in the financial world, and even if they make these four major financial mistakes, there is plenty of time to correct and turn them around.

They don’t take full advantage of what’s offered

It is a hard reality, but Millennials might not have the assurance of  social security in their later years. In fact, many might lose their safety net if things don’t turn around. That means that for a Millennial, things like 401(k)s and retirement funds are more critical than ever before. Once considered an option just to have some extra money, it is important for the Millennial generation to understand that they will likely be paying for their retirement themselves, no matter how much they are paying into the system now.

Many who are just entering the workforce are not taking advantage of retirement options. In fact, statistics show that only about 30% of young workers sign up for retirement savings options. The participation is so low that many companies are automatically signing their employees up, with 84% of twenty-somethings being enrolled automatically.  If you have the option, it is always a good idea to maximize pension or retirement savings accounts to secure your future.

Making earning the goal

Millennials have a new mindset when it comes to their occupation. Many have their eyes on the prize, but the prize isn’t to find something you love and do it for a lifetime. Many employees are going into industries purely because they will make a lot of money. What an older perspective knows is that industries come and go. If you want to be financially secure for a lifetime, you have to find something you love to do and stick with it.

When you choose something because of money, you have a tendency to jump around a lot, trying to find fulfillment. That means that you don’t ever really achieve success, either through your career path or your need for emotional fulfillment. If you want to ensure that you are set for your financial future, find what you love and create a life around it, instead of thinking you will work super hard for a couple of years for a big paycheck and then retire.

Not investing or saving early or enough

Those entering the workforce are having a hard enough time paying off their huge student loan debts, so the thought of putting money away seems almost laughable. That is leaving them without a safety net, spending outside their means, and landing them in a slew of trouble when they need money.

If you aren’t putting any money away for even a rainy day, you are setting yourself up for disaster. Just $20 a month is enough at least to start your savings. Incremental savings is what it is all about. It is never too early or too little to put some money away in your piggy bank for when you need it most.

When you do have a little amount, it is also a good idea to invest it. Not only will that make your money grow, but if you lock it up tight in an investment, then you’ve removed the temptation to spend it. Small investments are an excellent way to grow wealth.

Thinking about the quick buck

Millennials are always looking for the big payoff instead of earning a dollar’s wage. The internet and social media have taken the reality away from many young workers entering the workforce. Instead of working hard to achieve their goals and building a career, many bounce around looking for the new fad or get-rich-quick scheme. Again, it is much smarter to remember that slow and steady wins the race, instead of being the hare who falls asleep.

If you are a Millennial, the good news is that you have plenty of time to make the right financial decisions to grow wealth and to protect yourself for the future. If you correct these four mistakes, your outlook will be looking up.

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September 22, 2017, 9:00 am

How to Reduce the Cost of Running an Online Business

by: The Financial Blogger    Category: Blogging,Business

Do you feel that you are spending too much money on your online business? If you look into the costs in your online venture in more detail, you may find that you are wasting a lot of money every year that could be used in more productive ways. Below are some tips that will help you to avoid making these mistakes.

Improve Your Business and Financial Skills

To start with, you need to become more of a business person and not treat your online business like a hobby. You can do this by completing a business-related course, such as a masters in business administration online. An online MBA program or similar course will help you to improve your business skills and financial skills.

Typical skills you will develop include your financial management skills, forecasting, organizational skills and planning skills. Each of these skills is crucial, especially when you want to take control of the financial aspect of your online venture.

Only Pay for the Products and Services You Really Need

It’s tempting to want to purchase every new product or service you see on the internet that promises to help your online business. For example, you may be paying for subscriptions for training courses that you don’t really use that often. For every monthly subscription or payment you make, you should always ask yourself whether your business depends on it. If not, cancel the payments straight away.

Do It Yourself If You Can

Graphic design, web design, content and online marketing are some of the activities that can be expensive, all of which increase your online business costs. However, if you’re willing to roll up your sleeves and get your hands dirty, you could do much of this work yourself.

This is not as daunting a task as you may think. There are plenty of training resources such as video sharing websites and high-quality training courses that can help you develop these skills quickly. As well as this, there are many online tools and generators that are a much more cost-effective option for online entrepreneurs who have a tight budget.

Reduce Customer Product Returns and Refunds

If you sell products or services over the internet, it’s essential to keep your shoppers and customers satisfied. If there are a lot of returns, this can cost your business a large sum of money over the course of a year.

To avoid this situation, make sure you provide a better service and better products. You should also create better product or service descriptions so that your customers know exactly what they are getting from you.

Look for Free Alternatives on the Internet

Certain tools such as graphic design packages are required by modern online businesses. Instead of spending money on these products, there are many free alternatives available. The same thing is true for other tools you may need.

Every online business owner should look for ways to reduce their running costs. Following these tips will go a long way towards helping you achieve this important goal.

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September 22, 2017, 6:54 am

How Getting An MBA In Healthcare Can Be Your Path to Wealth

by: The Financial Blogger    Category: Career

Have you always wanted to have the financial freedom to live life to the fullest? But you’re stuck in a job that simply won’t allow you to advance?  If this has been your story so far in life, then why not do something to change your situation?  Let’s face it, most lower level positions will only get you by in life.  Sure, you have a bachelor’s degree, but these days that may not be enough.  Today, we are going to learn how getting your MBA in healthcare can rocket you to wealth.

The Business Side of Healthcare Is Booming

As you probably already know, there is a huge demand for new doctors and nurses in the United States.  But, did you know on the business side of healthcare, the need for highly educated people is even more in demand?  People who get their healthcare MBA will be able to land leadership roles inside of hospitals, clinics, laboratories, and other health-related facilities.  Plus, these jobs pay really well!  Also, those who graduate with this higher degree can land jobs as a healthcare consultant and some of these positions start out at $150,000!  That’s a lot of money for someone that just got out of school.  While you might not make that much your first year, the job you do land will pay handsomely.

Jobs Are Everywhere

As we learned above, healthcare jobs are everywhere.  The demand is so high for those with a healthcare MBA that many companies are offering huge signup bonuses.  Some pharmaceutical companies are now offering bonuses of up to $10,000 for the right candidate!  Getting a great job early in life can really make a huge difference in the amount of wealth you accumulate.  Starting out at such a high salary will allow you to save more money for retirement and you will be able to invest more aggressively.  So, instead of you working hard for your money, you will be able to let your money work hard for you.  This is one of the most important factors of becoming wealthy.  While some believe you can’t get rich working for other people, if you have the right job, you certainly can.

You Can Get Your Healthcare MBA Without Breaking the Bank

College loans can be very expensive and it often takes years to pay them off.  But, what if you could limit the amount of money you need to borrow for college?  Well, now you can!  By going to school online, you can save a ton of money, which you can use for better purposes.  An online healthcare MBA will save you money in several ways.  First, you won’t have to rent an expensive dorm room just to go to school because you can do it from home.  Second, there will be no need to commute to school saving you a boatload of money on gas.  Finally, you can prepare meals at home, which as most of you already know, can really help.

If you want to be on the path of wealth, you should really consider getting your MBA in healthcare.  With the number of high-paying jobs on the market today, you really can’t go wrong.  So why not start your journey today?

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September 14, 2017, 1:48 pm

8 Career Moves to Make Before You Leave Your 20s

by: The Financial Blogger    Category: Career

In your 20s, your life is just beginning. It feels like you have a world of career opportunities and unending amounts of time to experiment with jobs to find your work bliss. After enduring at least 16 years of school, it finally feels right to leave the classroom and start earning money and prestige in the workplace. What could go wrong?

The short answer is: everything. While job-related mistakes in your 20s might seem small, they could have lasting ramifications on your career. Perhaps the worst mistake of all is failing to complete crucial career moves that position you well for success later in life. If you are young and afraid of wasting the early period of your career, here’s what you need to do:

1.Get More Educated

To break through the lowest level of employment and reach some modicum of authority and respect, you definitely need a bachelor’s degree. However, if your ambitions are a bit loftier – maybe as high as the c-suite – you should spend some time in your 20s gaining even more advanced qualifications.

Education is a risk-free way to gain knowledge and skills pertinent to your field. You should avoid spending too much time away from real-world work experiences. Therefore, the best options for motivated 20-somethings are online degrees. If you can enroll in an affordable, flexible, reliable program – like an AACSB-accredited online MBA – you will reap the career benefits for the rest of your life.

2. Network

No matter what you do, who you know is at least as important as what you know. Especially now that job hopping is such an integral element of career development, you need to have a powerful network to find employment options and gain invaluable insight into correct career moves. As often as possible, you should attend industry events to shake hands with your peers and other influential professionals.

3. Diversify Your Experiences

While you are job hopping, you should consider slightly altering your position and responsibilities with each change in employment. By wiggling around in your experience, you can more accurately identify which tasks you enjoy and which are utterly repulsive. Plus, you’ll get a more holistic look at your field, providing enhanced understanding that will benefit you in management roles.

4. Be Passionate

That popular saying, “Love what you do and you’ll never work a day in your life” is crock. Work will always be work; even artists sometimes find the creative process a slog. Having passion for your job – finding some type of fulfillment in the tediousness – is vital for sticking with that career for any significant length of time. If you don’t already know your passions, you can spend some time sampling courses from MOOCs, shadowing prominent professionals, interning, and other free career searching options that don’t require much commitment.

5. Set Practical Goals

Goals like “be happy and successful” sound poetic, but they do little to prompt you to make moves in your career. Instead, you should develop a concrete picture of what you want your life to look like in 10 years, and then develop a workable plan to getting there. In some cases, the SMART goal-setting method is a useful tool to help you achieve your dreams.

6. Keep Good Records

Employers love to see positive numbers in your employment history, but if you are like most people, you’ll have trouble recalling exact stats off the top of your head. That’s why record-keeping is vital. Whenever you get a new job, update your resume. Whenever you complete a project that benefits the business, analyze your success and write it down. You should have a filing cabinet devoted to your career history, so you have evidence of your impact – for employers as well as yourself.

7. Listen

Communication is inarguably the most valuable skill in any industry, and the foundation of excellent communication skills is listening. Whether you are in an MBA class or in a corporate meeting, whether you are with your boss or your subordinate, you should be listening hard. Feedback from anyone is a generous gift you can use to benefit your career, and you should accept all proffered knowledge graciously.

8. Take Risks and Make Sacrifices

According to Facebook creator Mark Zuckerberg, the biggest risk in life is failing to take any risks. While you should be careful not to make catastrophic mistakes in your 20s, you shouldn’t be afraid of putting yourself out on a limb – especially because you still have some time to make it right. If you are dedicated to chasing true success, you are probably going to spend some of your 20s living off beans and rice while missing events with friends and family. Eventually, you will attain comfort and confidence in your career, and your 20s will have been way more than worthwhile.

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