Have you noticed that the price of everything is always going up? Almost everything that we do is tied to the price of fuel. It is the single main thing that drives our world economies. When the price of a barrel of crude oil goes up then so too does just about everything else. That packet of your favorite biscuits has to go up too, maybe just a few cents. However, when your shopping trolley contains a hundred or more items and everything goes up by just a few cents every couple of weeks then that, over a period of a year, translates into hundreds, if not thousands, of dollars.
You see, in the case of the biscuits that single packet is just one in a large carton. Several large cartons form a pallet. The pallet is then loaded onto a truck and trucked along the freeways and highways to a distribution centre where it is unloaded and put on another truck to reach your local supermarket. The cost of fuel is averaged out then attributed to each and every item that is delivered. So, when the cost of fuel rises, so too does everything that is trucked.
When the price of everyday household items, including food, rises then that affects the inflation rate. Banks then become jittery and seek, via the federal reserve, to raise interest rates. This has the effect of dampening spending. So, interest rates rise making repayments to mortgages and overdrafts and credit cards cost more. But people still have to eat. They still have to buy food to survive.
We now have a situation whereby the cost of living has risen and the amount of discretionary spending has compressed. The budget of most families is squeezed even more. It becomes harder and harder to maintain the same standard of living.
This is going to continue for as long as we rely on the dwindling reserves of fossil fuel. Whether the fuel reserves are, in fact, dwindling is largely immaterial. Governments will seek to keep the cost of fuel as high as they can because they all derive large tax revenues from every gallon or liter that you put in the tank of your motor vehicle.
So, what is the solution? Sadly for wage and salary earners there is nothing much that they can do - except for one thing ...
To keep pace with this dog-chasing-its-tail economy you need to have a method for creating wealth OUTSIDE your normal weekly, fortnightly or monthly pay-packet. The traditional pay-packet for a vast majority of the population just isn't going to cut it for much longer. Inflation is going to well-and-truly outstrip what most people are being paid. Passive income is the ONLY way that you will be able to win this race.
I have been writing about this and passive income techniques for more than two years now. Every month I am becoming more and more convinced that this is the only way to fight back against the current and looming pressures of world economies. If you are not engaging in passive income techniques, supported by your active income (pay-packet) then very soon it won't be a case of whether you will be able to breakeven or not. It will simply become a case of how far you are going to fall behind.
If you don't want to look after your ability to house and feed yourself and your family by yourself through PASSIVE INCOME techniques then the only thing to do is to run to your boss every few months and keep asking for another pay rise. Good luck with that!
Gary Simpson operates the Turn Debt Into Wealth website. To learn what you are REALLY worth and how to create a PASSIVE income visit: "How to Save $1000's and Increase Your Net Wealth." You can also discover "How to Stop Wasting Your Life and Start Getting What You Want."
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