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Wealth preservation is the key

Republika

THE WAY I SEE IT | Susan Amoroso

The first week of 2021 gets me wondering when the dust of pandemic 2020 finally settles. The way things are, it will take a long time. Meanwhile the Bangko Sentral ng Pilipinas has its hands full keeping the economy afloat. For months since the pandemic struck, the government through BSP has kept interest rates so low, down to two percent. The BSP infused almost P2 trillion in the country’s financial system which is roughly ten percent of the country’s gross domestic product (GDP). I would say the government was forced to keep the economy running by printing more money and circulating them. How? The forced liquidity came in the form of cash assistance, government funded loans, cash assistance, pensions, social amelioration program or SAP. The government used part of the money to pay for products, services and priority projects. The government needs to keep operating normally in an abnormal situation. I would say printing more money is legal. Everywhere, governments do it. The Federal Reserve of the United States does it as a matter of fact.


However, we ordinary mortals cannot print money. What do we ordinary mortals need to do to stay afloat then? Because of the pandemic a systemic loss of savings for the general population is expected. Recession will linger. Lockdowns and travel bans have dampened the business spirit.


How do we navigate the new normal? The answer is wealth preservation. Conserve and preserve. Economic managers say public consumption must be encouraged to keep the economy going. I daresay no. Do not be tricked into spending more than you can afford. Drive a hard bargain. Economize. Do not be an online-purchase addict. Do not be an impulse-buyer. Do not invest in big ticket items if you are over sixty years old. Unless of course you have so much money lying around.


If you must invest, invest not in luxury items but in real estate that are priced below the market price. Real estate are sure winners for the long haul but I caution you to avoid overpriced condos now flooding the market. Location, location, location is the key to a wise real estate investment.
If you want to put money in the stock market, try putting some in an enterprise that uses blockchain technology. Blockchain technology is the future. Crypto-currency like bitcoin is here to stay.


If you are under-employed or unemployed, be an entrepreneur. Make your idle hands work. Be productive. Be creative. Learn a trade. Study on-line. Take advantage of free on-line classes. Try an online business or delivery service.


As I have always said, plant, plant, plant. Even if just on your window sill or in front of your house. Vegetables and herbs are so expensive these days. A small bunch of camote leaves or kangkong leaves now cost P20 each. Before the pandemic, they cost only P5. Bell peppers, tomatoes, onions and garlic cost a small fortune for the wage earners. But you can grow them on medium size pots. Urban farming is now a must even just to put a few leaves of pechay in your “nilagang baboy.’’


It will be a long time before the world experiences another economic bubble. Meanwhile expect all existing bubbles to burst. The equities market is facing a dark reset. The stock market is just being propped up artificially. How long can the tycoons withstand the onslaught? Meanwhile, we the little people need to wise up. Over-consumption will be a thing of the past. Again, I say, conserve and preserve.


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