Part 1 How to Adapt & Prepare for a Changing World

Observing and being aware: Is a key skill that makes Living Rich on Less possible

   It doesn't matter if you're stranded in the woods, economic or natural disaster hits you, or if you just enjoy Living Rich on Less. Observing and being aware of what is going on around you is vital.
Being aware of what is happening locally and globally around you is one of the top skills needed to survive and flourish in any situation.
  • Being aware: enables one to take advantage of economic downturns, live rich on less, survive being lost in the wilderness, recover from a natural disaster, protect yourself or your child, or even avoid family breakups.
  • Being aware: of your surroundings enables you to find underutilized or unused resources that can be used to enrich your live and keep you from walking unaware into bad situations.
  • Being aware: also means you can better understand alternative ways to avoid the “conventional” ways that impoverish many.
  • Being aware: of all the different factors that can affect us is very difficult to do on ones own. That is why The Frugal Prosumer knows that community is vital. With a mix of people from different walks of life, skills, and views we have a much better chance of accurately determining what is taking place around us.
   The second part of being aware is knowing what to do based on your observations. Again, community is important in helping decide what is the best next step and implementing it.

   You may have observed that there are big changes ahead and many things about today’s world will change over the coming decade. Change is not new. Look at the vast changes that have happened in just our grand parents lives. (gas is 16 times more expensive, one room school house, no TV, outhouse, no central heat or air, etc.) Unfortunately for many, some of these changes are going to be for the worst and conventional ways may no longer work.

Some observations I have made and I’m sure many of you have noticed.
  • The U.S. debt situation is far worse than anyone in Washington is willing to admit. Debt and the affects it has on people is a special interest of mine as I have counseled and worked with  over a 1,000 people struggling with credit card debt and bankrupt. We’re not even talking about paying off the debt or reducing demands but only the best way to borrow more. We keep hearing calls for more, not less debt creation. But if people would stop kidding themselves and tally up all the many demands the U.S. government has against it, the actual debt-to-GDP ratio rises to something on the order of 400%. In our personal life this is equal to spending four times what we earn each year. Be aware! Historically the usual way for governments to get out of this impossible dilemma is to inflate away debt by creating inflation. How does this work? If tomorrow, because of inflation you are now earning $100 an hour in stead of the current $10 then paying off old debt will go a lot faster. Therefore  government has to have inflation in order not to collapse. Be aware of that!
  • China. I have a special interest in China as my parents worked there, met there, and were married there. I grew up in Taiwan and as a result speak Chinese. China, the world’s second-largest economy, is in trouble plus it’s not as willing to lend us the money we need to keep our economy from collapsing. If things are going to become more equal, we will be forced to take a lesser and lesser slice of the worlds wealth as we share it with a nation that has one billion more people than us. I.e If every person in China were to get an air conditioner it would overwhelm the resources of the world.
  • Japan  This is another special interest of mine as my dad was imprisoned by them for all of WWII and I lived there for 9 years. It has been in trouble ever since I lived there 20 years ago and the current problems at Fukushima are beyond what they are letting on. Be aware there is little standing in the way of the world’s third-largest economy sliding even further. This nuclear accident and effects of their economy is world changing and will affect all of us health wise, energy wise, and economically.
  • The Middle East is in flames. Another interest as we also worked for a while in Pakistan. The odds of the U.S. retaining the same level of influence in over low gas prices that have helped fuel our economic growth, are slim to none. Be alert to opportunities that higher gas prices bring. I.e. starting a more local, or energy saving business; live closer to work; invest in making your house more energy efficient (insulation, LED & CFL lights); etc.
  • The eurozone is becoming more and more unstable as increasing numbers of still-functioning economies in the eurozone diminish or default. Who cares about that? Remember as one member in the European Union fails it affects the welfare and wealth of all members. Just as when one part of our personal community fails it affects us directly and indirectly.
   The bottom line is that the scale of the crisis is beginning to become more widely apparent and thinking and reading about it becomes fatiguing. The cards are in place for a great change that will affect all of us. But that doesn’t mean that one can’t come through this in more or less good shape, just as our parents and grandparents made it intact through the last Great Depression. Being aware, planning ahead, and investing in the right “insurance” are crucial.
   Part 2 will cover some of the things we can do.

I write about the surfer in by book “The Frugal Prosumer Philosophy”.
“Is this a message about doom and gloom? No! It’s only recognizing the facts. Once we recognize the facts, we can be like the surfer who looks forward to the news that a big storm, with big waves, is coming. With the freezing waves crashing, in a death-defying environment, with chaos all around, the surfer enjoys the exhilarating ride of a lifetime while the unprepared perish or get beat up.
The surfer with the right preparation and tools, turns chaos into having the time of his life. A surfer succeeds by:
  • Observing intensely and being aware of wind, waves, currents, weather, and different beaches.
  • Preparing for and being aware of when and where the “big one” is possibly going to hit.
  • Learning what makes the conditions in the chaos just right to take advantage of.
  • Honing skills in the smaller waves of life.
  • Investing in the proper equipment, knowing how to use it, and what conditions it will work in.
  • Taking advantage of the “perfect” conditions amidst the chaos.
The economic storms and accompanying waves are coming. Are we going to huddle in fear or be like the surfer? Vast opportunity and great hazards lie ahead. Surf’s up! Let’s ride!