The Looming Global Financial Disaster: Have You Set Your Financial House in Order?

 This is an update on the article I wrote here four years ago, about the coming global financial crisis based on geopolitical forecast of a very well known American geopolitical analyst, Peter Zeihan, who at the beginning of this year published a book titled " The End of The World Is Just A Beginning."

Based on the global demographic situation, he predicted that beginning in 2022 as the largest portion of the baby boom generation begins to retire on mass, and start to take out money that they have been investing for decades, out of the global financial system, the cheap credit and an artificial bubble created by those investments would end. I therefore advised my readers to set their financial houses in order, just as I had done by paying off debts and learning to live within and even below their means.

Now, that we are at the end of 2022, I thought that it would be good to revisit those predictions. Well, it seems like unforeseen events such as the global COVID-19 pandemic and Russian war against Ukraine, just accelerated those predictions.

We are witnessing high levels of inflation all around the world, including the wealthy developed nations such as the United States and Canada. It is partially due to incredible amount of money printing that the central banks have done to give relief to those affected by the pandemic shut downs, but the pandemic also forced many baby boomers into retirement earlier than they would have otherwise done, thus creating this reverse financial tsunami of taking out money out of the financial system.

To counteract the inflation those same central banks, began to increase interest rates, making the cost of loans much more expensive. It is good news though to those of us who don't have debts as we earn more interest money on our savings.

Since it is a long-term problem, we can expect this trend to continue over the next four years. In fact, Peter Zeihan predicts that thins won't really get better until 2040's and only if things go well. So, if you still have not set your financial house in order, then do it now. Get rid of debt because it will only get more and more expensive. Learn to be content with less stuff, most of which you don't need anyway, so you will be prepared for that much tougher future that is ahead of us.