Who owns you?
Your creditors, ie The people you borrow from. You are their debtor, which means you owe them money. They own you, especially when your life gets tough financially.
Who are your creditors?
The bank where you have your bond.
The car companies where you have leased or bought cars with debt. And for those of you with Balloon Payments who will never be able to sell your cars, what then? You happily drove a car for 5 years, and at the end of that 5 years you still owe 30% of the purchase price. This allowed you to buy a R300,000 car, when you could only afford a R200,000 car!!
So so far you work for Nedbank and Renault and Hyundai and BMW.
If you have a business then you might have overdrafts and credit cards so you also work for Standard Bank and MasterCard and Visa and American Express and Diners Card.
Then you've borrowed on a store card, so you also work for Edgars and Woolworths and Caltex (petrol) and and.
Then you have creditors. Even if you work for someone else you still have these kinds of creditors. Your landlord, who wants his rent. The government who want their PAYE and Cigarette Duty (Tax) and UIF and Petrol taxes and Carbon taxes and VAT and so many other taxes that you pay without thinking about it. You also owe money as soon as you use electricity and water and sewerage and as soon as you have solid waste. You might pay monthly in arrears or you might pay in advance. If you pay in advance then the government owes you money. See if you can claim it by telling the City of Cape Town for example, "I bought R1,000 of electricity in advance and now I don't have money for food. Can I have my money back so that I can buy food, or pay my landlord? I'm prepared to live without electricity!"
And if you're in business you have other kinds of creditors and suppliers. I've been running a micro business for 25 years and during that time I've had over 300 suppliers and some of them I still have, for example Internet, Accountant, Lawyer, Cloud providers like Apple, Amazon, Google, Electrician, Plumber, Newspapers, etc.
Some of these suppliers you can just switch off. They are your variable costs. Some of these suppliers you can't just switch off, for example your landlord (which might be the bank if you own your house and you have a bond), or your electricity or water or insurance providers. These are your fixed costs. And if you have employees in the current environment, then you are really screwed if you don't have income. Your first responsibility is to your employees and so you are using all your cash reserves to pay them (the right thing to do ethically), but you know that in 6 weeks time (which is now only 1 week away since social distancing and lock down started), you are going to run out of money. And the problem with this is that you will then never be able to restart your business, and you will probably lose your house and all your assets which you have used as security for your borrowings.
And even if you're the world's richest and most powerful department store like Neiman Marcus, which owns Bergdorf Goodman amongst other brands, you are in shit.
Take a look at this.https://neiman.gcs-web.com/index.php/static-files/1c2deeb5-00e3-45f3-b87d-ae83fdfaf4ab
As far as I can tell, from a cursory analysis as I don't have access to their Financial Statements, and I can only see what they have had to legally file with the SEC (American CIPC), they owe about $5 billion, some of which is due now, some next year and some only in 10 years time. Note that if I owned one share in Neiman Marcus, I could get their Financial Statements. Note that I'm not picking on Neiman Marcus in particular. I've just chosen to use them as an example as they are in the New York Times, suggesting that they might have to declare bankruptcy next month!!!
In about 1992, I went to one of their branded shops, on 5th Avenue, New York, called Bergdorf Goodman. All I could afford was a pair of socks. Nice socks. I still have them, so they've lasted incredibly well. I wear them around the house. They are too fancy to wear outside.
David Lipschitz: "I find it absolutely shocking that people and organisations and companies don't have at least 3 months of cash at all times, or near cash, so that they can live when the shit hits the fan. The owner could be in hospital. A client might not pay for two months. The supplier we are expecting to supply us could have hit problems. The ship delivering our goods might have sunk. A virus might have hit us. And to some extent I understand that weekly employees don't have the financial resources to do this, even though I see DSTV Satellite TV aerials on their roofs and flat screen TV's in their rooms. But the middle class? The rich? The world's biggest corporations? Governments? WTF people. See my other article on Affordability."
And worse than this one of Neiman Marcus's debts is $550 million at 14% interest rate. Who in their right mind would borrow so much money at such a high interest rate, especially in the USA where housing bond interest rates are so low? Unless greed and shareholder returns clouded their minds.
Look for the world LIEN in the Neiman Marcus filing. And you will know that they are slaves to their creditors. Lien means slave, and my new book is about aliens. An a-lien (alien) is someone without a lien, someone who is not a slave. An alien is free. An alien has been redeemed from slavery and has become enlightened.
Look at this as well: https://neiman.gcs-web.com/index.php/static-files/f58320dc-415d-419a-bd94-5bc951d2343a
This is an instrument which allows a (big (someone who owes millions or billions or trillions)) debtor who owes money to a creditor to renegotiate debt under exceptional circumstances.
Also look at how they will cover their debt. They will give a "First Lien" over their prime land asset! They are going to give away their golden goose which lays their golden eggs. Why? Because of debt and short term thinking!
Which leads me to my last point and my first question again. Who owns you?
Now lets say the cavalry come riding in offering to help you through these tough times and they say to you "Don't worry, you can have payment holidays, and you can have lowered interest rates (so that you can borrow more, but we'll put the interest rate up again as soon as we can, when the economy starts growing again to stave off inflation), and we'll give you grants, and we'll increase your child support grant. and we'll give you food parcels, and you won't have to pay your employee's PAYE, but we still want our VAT payments, and if you don't pay your VAT you have a 20% interest rate in your first year" then you realise that the knight in shining armour is dazing you with their shining torch into accepting their loans and grants and interest rate reductions.
And who owns you now?
And if you had a private business or you owned your own house or you owned a holiday house or you had money in the bank, then who owns you now?
This is nationalisation on a scale never seen before.
But don't worry. There is a silver lining. A big silver lining that these nationalists and raiders and lenders cannot take from us. And do you know what that is? It is called decentralisation and it is these Lords biggest FEAR. You see we might be scared, but they are even more scared.
And if our governments are bailing us out with borrowed money, who are their creditors? Because they are also slaves to someone, who will one day knock on their doors and say "where's my money?"
What is already saving us (small people) is our ability to cheaply and affordably make our own electricity, water, deal with our own sewerage and waste, and make our own food.
(Note that even though my initial "Patron" target market for the User Manual is Presidents of Countries and Corporations, Think Tanks. Strategy Consultancies, Philanthropists, ..., I can still write like this, because at some point we are all alone, sitting in our bedroom, wondering if we will be under attack tomorrow, will we still be the president of this country or that corporation, will our think tank be sunk by debt or an unforeseen crisis. We are all small people, even if only for a minute a day, when we worry about our stuff.)
In South Africa this is already happening on a mass scale, but it is "hidden". Sometimes hidden because the government doesn't want to see it. "See" means publishing it. I did a 4 hour video series last year called Dear Moody's which explains in detail how this decentralisation works.
There has been mass private investment in electricity and water and other infrastructure. We now need to take even more responsibility for ourselves, because we know what is right. and we know that when we pray for our leaders we are praying for people like Greta a young climate activist, who understands how important our climate is too us, externally and internally. We are praying for the hundreds of leaders who are showing us the way to a new world. We are praying and blessing the multitudes of active citizens who try to do the right thing every day in giving donations, or buying lottery tickets, or making food parcels, or giving their time to millions of charities and NGO's world wide.
I'd like to thank these real, if somewhat hidden leaders, for what they are doing.
It is time for us to understand that we don't need to borrow from our future to live now. Our abundant world has everything we need. If only we open our eyes to see it.
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