The Crash Course - Chris Martenson [138]
Financial Services
It’s time to dust off the old valuation books and begin to perform very basic fundamental analysis on individual stocks and bond offerings that will help separate the winners from the losers. Because growth will no longer work as a general, across-the-board concept, index fund investing won’t work. To deliver truly superior returns, or any at all, you’ll need to know everything about a company—especially its dedication toward energy and materials conservation—and much of this won’t appear in the annual report. The opportunity exists for fundamental analysis to regain its footing, and lots of jobs will be created in this area.
The future that I see will require far more nimble and alert money management than ever before. Many clients are going to demand a higher degree of engagement from their financial advisors, and this will open up new avenues for alert professionals in winning and retaining clients. The services to be performed here could include helping people find a qualified investment professional who can operate effectively in the new wealth-generating landscape of the future, or even training financial advisors toward better performance in that new landscape.
Unfortunately for the industry as a whole, I see a coming reduction in the amount of services currently offered. I doubt that the new future will be able to afford having 40 percent of its total profits funneled into the financial industry. But even though I see a lot of shrinkage visiting this industry, I also see plenty of work for those who can shift with the times.
Government Employment
This is one area where I can see only shrinkage. I think government pay, benefits, and total employment have all seen their peaks. In a reduced-energy environment, there’s simply no way to afford having one in six workers employed by the government at a far higher total wage package than private workers enjoy.
With that in mind, where’s the opportunity here? I think private companies are going to have to fill the void left by shrinking government services, hopefully at a more competitive, cost-effective rate (or the services will be dropped because they won’t be worth it). Everything from trash removal, to policing, to sewer, water, and road maintenance will be up for grabs, and many communities have already made the leap to private management in some of these areas.
Whether we think this is the right thing or the wrong thing is beside the point; government services in a time of declining energy are going to be a lot smaller or fewer in number than government services in a time of abundant energy. Yes, there will have to be some trade-offs, and some treasured services may disappear, but not all of them will, and finding the best and most cost-effective way to provide the preserved services will certainly involve a new equilibrium in these areas.
The second opportunity will be for consultants to come in to help make trade-off decisions and provide insights into how to manage the tricky business of doing more with less. I can also envision local politicians needing (or desiring) someone to blame for necessary cuts, and consultants could provide cover for difficult decisions that need to be made.
Money
Money is a nonnegotiable element of a rich and complex society. Most people currently rely on others to manage our money for them, which is right and proper, because money is a service and it cannot manage itself. We call those managers “bankers.” I see a future that involves different forms of money, offering both competition (which is healthy) and complementary forms of money. There’s an enormous risk that our single-currency systems—the dollar or euro or yen or what-have-you—will cease to operate effectively, or at all, in the future. Recognizing this, many communities have decided that having only one currency is both