December 10, 2012

São Paulo, Brazil

Brazilians are the luckiest people on the planet.

Aside from being blessed with great weather, gorgeous beaches, and beautiful people, their country is one of the few that can exist in a state of complete independence from the rest of the world.

They have their own energy supplies, food production, manufacturing capacity… and a population of 200 million high-propensity consumers, one that is more than sufficient to sustain the economy (which generates over 1 million new jobs annually).

They have one of the largest stock markets in the world, their own credit system, and the 13th-largest active-duty military.

They have their own movies, their own music, their own celebrity obsessions.

Simply put, these people don’t need anyone else. And I’ll tell you why this is important–

The entire global financial system is based on the idea that the US can and should be the center of the economic universe. The dollar is used extensively in cross-border trade; US banks are the cornerstone of the global banking system; and US government debt is the foundation of nearly all financial markets around the world.

This structure might have made sense several decades ago, back when it was the national dream of every little tinpot country to export products to the United States. But things have changed now. The rest of the world has grown beyond this system, and it’s time for the system to change.

Being on the ground in places like Brazil, it’s obvious that the US has become markedly less relevant in the global economy. As such, there’s really nothing to prevent the system from changing.

Russia, India, China, Indonesia, and Brazil… countries whose economic relevance is rising… all have taken steps to reduce their reliance on the United States and the dollar.

This trend is completely obvious to anyone paying attention. In fact, the only people pretending to not notice are the political elite in the US who are too busy printing money and indenting the economy.

The trend is very clear. It’s one of those things that future historians will look back on and say, ‘Well, duh, obviously…,’ a bit like how we can easily diagnose the origins of World War I.

It’s important to stay in front of this trend, diversifying your savings and income into stronger currencies and real assets like gold, land, and collectibles.

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