The majority of votes elects a President. Sort of, anyway, but the electoral college is another subject. Nevertheless, it is a majority of voters which will elect a Congressman, Mayor, Councilman, Senator, Governor, or what have you. The so-called ’democratic’ method of government, which America is not supposed to be, means that a majority of the populace controls the minority. 49.9% are governed by 51.1%. As a famous man once said, this may be the best way. In my opinion, the majority is usually wrong.
If you are a Biblical reader, the Bible is full of the majority being wrong. The Israelites were in the minority. Noah was in the minority. Jesus was in the minority, as were his disciples and apostles. Lot was in the minority, and it seems to be, that in Scripture, that the minority is always right.
Look at economic history. In 1929, the majority thought the stock market would go on forever, and that a “new age” had been discovered. Some of the majority jumped out of windows, sold apples for a nickel, and manned soup lines a couple of years later.
When the “dot com” stocks were the rage, the majority thought another “new age” had been discovered, and that ’information’ would save the world and make everyone rich beyond their wildest dreams.
Too many Americans are in debt up to their ears, buying new cars with no down payment and zero interest, plus credit card debt, second mortgages, and in general, living high on the hog. In California and a few other places, real estate prices have escalated to the point where a modest three bedroom home may cost well over $1,000,000.
Consider political history. The majority elected FDR, and LBJ, perhaps two of the worst Presidents in US history. I don’t think we have had a really great President since Thomas Jefferson. The majority in Congress votes for the continual welfare, handouts, silly bureaucracies, and endless regimentation and personal intrusion into our lives, not to mention pointless laws.
Consider majority’s buying and saving habits. They are all wearing the same things, buying the same cars and houses, shopping at Wal marts, eating the same junk at fast food places, and placing their excess cash into CD’s and savings accounts. Those who realize the futility of that, go one step further and buy stocks or mutual funds, of which there are many hundreds. All of this majority, are smug in their wisdom, and feel safe with those passbooks, electronic assurances that they own stocks, (no one ever gets physical stocks any more), and that strong bank’s stability and honesty. Is this modern majority wrong, like those majorities in the economic, Biblical, and political past?
Let’s see, and especially the economic ones, because Gold Eagle isn’t particularly interested in religious and political history. As far as economics are concerned, the majority stuck it out in the 1929 stock market bubble, and lost their shirts. One of my friends here in Colorado, came from a very wealthy Rye New York family, and his father was the founder of one of America’s more prestigious stock market brokerages. His father sold out at about the right time in 1929, and became even richer. He saw several of his associates literally jump out of the window, so severe were their losses when it all came tumbling down. When the NASDAQ went from over 5,000 to around 1700; literally from $5 to $7 trillion was lost, ruining many thousands of families, retirement accounts, and other financial savings devices. When the NASDAQ reached 5,000, the majority thought it was the indicator of another “new world” in the making, with all the old 1929 type crashes a thing of the past. After all, weren’t we in the “Information Age?” Wasn’t “information” the real key to wealth? Wouldn’t “information” keep us abreast of what’s going on in the world, and prevent financial collapse? Oh sure, and I have just invented a perpetual motion machine which will also save the world.
For those who own homes, or are considering buying one, please think twice about it. When a 1500 square foot, three bedroom home in California is selling for $1,000,000, doesn’t that seem a bit much to you? When a 1500 square foot condo in New York is going for the same, isn’t that a bit excessive? Especially when one can rent the same for a fraction of the price per month, meaning the owner of it is getting a poor return on his investment. Rentals haven’t gone up that much, whereas sales prices have gone through the roof. If you own such a home and are at a huge profit position, that’s your decision to make about selling it, taking the profits and renting someone else’s joint, but if you are considering a purchase, please stay up nights thinking twice about it. Real estate prices have already begun to decay in some places, with the rest soon to follow in my opinion.
Now as to savings. For those of you who have lived a conservative life style, not gone into debt, and who drive the old buggy for 100,000 or more miles before considering a used one with low mileage congratulations. You have acted intelligently so far. Then, why in the name of common sense, would you pour your hard-earned dollars into stocks or mutual funds, when there are no dividends, and the P/E ratios are 20 or so? Why would you place your hard-earned dollars into a bank savings passbook or CD, paying a single percent or so, when we are having way more than that in inflation, according to the US government’s own figures? Inflation is several times more than your taxable interest, so why would hundreds of millions of US citizens, ever place dollars in a bank at 1% taxable interest? It is a guaranteed loss. A 100% guaranteed loss. Why does the majority always act so stupidly?
On NPR Wednesday morning, came the story of a retirement age couple whose kids were grown, and they had bought a lovely retirement home in Virginia, to live out their days in peace and prosperity. Some dude claiming to be a government spy or some such, got on to them and milked them for $200,000, which they obtained through credit card cash advances. The con-artist is now in jail, but their 200 grand is gone, and their credit rating is ruined because they haven’t been able to make the exorbitant payments on the advances. Here is a couple who had worked hard, and acted economically intelligent, I imagine, and in their dotage, they got conned out of everything. How sad. Every day, there are thousands of characters staying up nights trying to figure out how to get bucks with no work, and a smooth line and smile. “Look, I found this lottery ticket which is a winner, and I’ll share it with you if you put up half the money,” etc.
Does everyone who reaches the age of 60, have to stop being logical? The younger set are busy running up credit card debt and buying flashy cars.
They are ruining their ears by listening to their “music” (sic) at 150 decibels, and doing everything foolish they can think of to do, to act “cool.” (far more deafness has already occurred in youth, than all the underground miners and steam locomotive engineers put together.) When one reaches the age of maturity, one would think that anyone with an ounce of brainpower would realize that two and two do not make five, and that 1% interest is a loss. Yet the majority of mature adults literally worship the buck, as if it were motherhood, apple pie, and baseball. It is none of them. “A penny saved, is a penny earned,” may have been true a hundred years ago, but a dollar saved, is a dollar lost today. Physical dollars, and owning them, is a bad habit, like nicotine. Nicotine is supposedly the most addictive drug known to man. I question that. I think the dollar is more addictive. Addictive, because that’s the way Americans measure their wealth, and it is a shrinking measurement. If the inch or foot shrank a bit every year, it would be impossible to make anything, because the measuring device used to make things would not be reliable. Can you imagine the chaos, if the inch or foot deliberately was shrunk each year? Factories would go out of business until a stable form of measurement was devised. The dollar is what we measure our wealth by, and it is shrinking in purchasing power each hour, day, week, month, and year. So why save in this shrinking measurement? Smart people don’t. The majority do. As usual, the majority is usually wrong. Protect yourself.