What Are You Doing NOW To Change Your Life?

Most of my readers will probably know that I am typically extremely bullish about the future of Bitcoin, Ethereum, and crypto in general.  I have a strong conviction in not only where I think markets are heading, but the world as well.  But, when I become bearish, it might mean it is time to begin to worry.  Recently, there has been no escaping that feeling.  All you need to do is just look at the world and you'll be able to see it quickly.  People are hurting.   In the USA for example, people were already having extreme financial hardships.  Several studies showed that most Americans didn't even have a few hundred dollars saved in case of unexpected emergencies.  But now, things have become much more difficult.  The prices of housing/rent, goods, essentials, and even gasoline have risen to points where many people are struggling to just survive.

And then there are the governments as well, which very honestly could be on the brink of a collapse. 

(credit to B18 for this picture)

The American GDP to debt level has increased by such a significant amount during the last two years that even the USA can barely afford to raise interest rates.  While inflation is still soaring high, the FED would traditionally raise interest rates much higher to help fight off inflation.  For example, during the 1980's when the FED rose rates to nearly 15%.  Because the debt has risen so much, approaching anywhere near those interest rates is impossible and the country would collapse before it even approaches it.

Because the US has the Dollar which is the current world reserve currency.  This helps to give the USA more options than most other countries.  For example, in Japan where I currently reside.  During the last 6 months, the Japanese Yen has fallen more than 30% compared to the US Dollar.  Their debt to GDP level is even worse than America's.  Even worse, they are still in a money-printing type of mindset.  Their debt is so high that they simply can't afford to raise interest rates. Japan isn't the only country where this is happening.  It is a problem that is becoming more and more widespread. Countless countries around the world are on the brink of a financial collapse.

So what should we do?

When financial markets traditionally break down, the typical solution would be to save your money in cash.  But even that isn't a safe option anymore.  This year if I would have saved all my earnings in Japanese Yen, I would have already lost 30% compared to the Dollar.  And this mess is just beginning.  The Yen will likely drop even further in the near future.  Our best bet would have been to put our savings into US dollars as that has been strengthening during the last few months.  This would have been the best option to preserve wealth.

Recently there has been a consistent mood across macro and financial markets.  We all know the world is in a horrible situation and that these markets are on the brink of collapse.  We are just waiting for the bubble to finally burst.  It could happen next week, the week after that, or even a few months later.  It is this drop that would finally be the price bottom for crypto and stocks as well.  While most view this as a fearful event.  If you plan it correctly, it could become one of the best opportunities to change your life.

First and foremost; you need to make sure you have enough cash saved up.  During times of panic, cash is king and you will need to be able to pay for everyday living expenses. You shouldn't be investing money that you can't afford to lose.  While it always hurts to lose money while prices are dropping, if you have invested too much money it will become extremely painful. A target we should be aiming for is to save at least 3 months' worth of expenses.  If you can do that, then you will be in a great situation.

Now let's assume that this "giant" price drop will happen.  Which it may not, because financial markets often perform much differently than most people expect. 

Should You Stop Investing?

While it is likely that prices will drop further and maybe you could buy at a better value later on.  I will continue buying Bitcoin and other crypto with my dollar-cost-averaging strategy.  The reason for this is that there have been countless times when I waited to buy because I was waiting for a better price.  Most times I was better off just buying and averaging my costs.

But, now it is time that we need to start grinding to raise extra money to invest.  This might require you to sacrifice your free time for the short term.  In my opinion, a few months of being very busy is well worth being able to change your life.  

The first thing you need to do is go around your house and begin selling things.  If you haven't used it within the last two months you can sell it.  This could mean clothes, shoes, video games, electronics, and the list goes on.  You would be very surprised how quickly you can raise money by selling things on the internet.  Most people would be able to earn at least a few hundred dollars by just doing this.

Next, we need to cut down on our spending budgets.  Most people have no idea how much they are spending on things that they don't use or need.  For example, most people don't need 3 video streaming services.  You can cancel and switch between the services on a month-to-month basis.  Cut back to only one streaming service.  With your cell phone data plan, most people don't need the highest data plan.  You can cut back there as well.  By planning out your meals and eating at home, you will be able to save a significant amount of money as well. Go through all of your expenses and you'll be surprised how much you can save.

Now to the last bit of advice that most people won't want to hear.  If you're in a difficult financial situation and want to take advantage of the markets, then you might need to get a part-time job.  It will make you very busy, but it is the best way to earn extra cash quickly.  I actually did this myself during the March 2020 price crash.  I felt it was an incredible opportunity and worked as much as I could to have even more cash to invest.  It was the best thing that I ever did. Even though crypto prices have dropped significantly in the last several months.  Since March of 2020, Bitcoin is still up 6x, and Ethereum is up nearly 14x.  When prices were at their peak, the gains were even more staggering. If you were able to save just $1,000 and invest it during this time.  You could have bought nearly 0.30 BTC or more than 10 ETH.  

The theme of this article is the same as the famous Warren Buffet quote. "Be fearful when others are greedy, and be greedy when others are fearful."  If you can work extremely hard during the next several months and also sacrifice a little.  It might just end up being the best thing you ever did.  

So what are you doing now to make sure you're ready to take advantage of that great opportunity?

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As always, thank you for reading!