Survival__ Structuring Prosperity for Yourself and the Nation - Charles George Smith [198]
Tangible assets have some intrinsic value, intangible assets do not.
While all assets can be traded on some market somewhere, a medium of exchange--money-- simplifies the transactions for everyone. Paper money is a means of exchange, and gold is widely recognized as a time-tested means of exchange as well.
I bring this up to draw one more distinction: that between assets and means of exchange which earn interest or create income and those which do not.
Though fiat currencies tend to lose relative value over time (when measured in tangible assets like oil, wheat, etc.), in periods of high interest rates and deflation (that is, when money and credit supplies are falling and the value of tangible goods is falling when measured in currency), then paper money earning interest may outperform all other assets.
I note this to illustrate that there are no hard-and-fast rules in relative value and thus there are no hard-and-fast "answers" on how to invest/speculate to maintain or increase the purchasing power of your existing assets.
We can only be alert to relative value, flexible in our observations, expectations and plans, and keen to buy cheap and sell/trade dear. We can seek to "own"/control some of all four types of capital, and seek income streams from assets which are in our control--which generally means tangible assets such as orchards, arable land, tools/equipment and other means of production, income-producing housing/shelter and some "liquid" capital which can be shifted between assets to maintain our purchasing power.
In terms of risk management, we can remain aware that some assets have intrinsic value which is unlikely to fall to zero, while paper money and paper assets (stocks and bonds) all have long histories of falling to near-zero in periods of financial crisis. As they can also outperform all other assets for long periods of time, we should perhaps conclude not that they should be avoided but only that they are inherently speculative in nature.
I will have provided some lasting value in this section if readers in 2019, ten years hence, can still profit from the ideas presented here.
Applying the Principles to Communities/Enterprises
The key feature of communities and enterprises is that membership is voluntary. One can quit, move away or otherwise opt out of membership.
By "community" I mean any self-organizing group of people. That includes school districts, transportation districts, farmers markets, building co-ops, organized swap-meets, churches, local sports leagues, local small-business associations, bicycle clubs, and hundreds of other organizations which self-organize around a specific purpose or interest (transparent non-privileged parallel structures).
Enterprises are organized to enter and profit from a specific market. These can be sole proprietorships, corporations, community co-ops, non-profit educational centers, performing arts councils, city-owned utilities, and so on. The key feature of an enterprise (by my definition) is that it does not depend on grants from a government--grants which are essentially non-market redistributions of tax revenues directed from concentrations of power.
Thus the arts council must charge customers money for a service rendered in a market (be self-supporting) to be an enterprise.
The distinction is not arbitrary. Since the devolution and eventual insolvency of the Central State is inevitable, then any organization depending on State redistribution of tax revenues for its livelihood is doomed. A community may be called upon to support such organizations with donations of money and goods, but that requires an entirely different understanding. In essence, the group is serving a market which generates no financial activity (for instance, a homeless shelter). If the community values the service,