Third World Employment Is Here

I knew the drill. I'd lived it for years.

Don't stop at intersections, including red lights and stop signs, if you don't have to. Just keep going. Stopping makes you vulnerable to "smash and grab" and hijacking.

Keep anything of value hidden away when you're on the street. Keep your cellphone on vibrate so it doesn't attract attention.

Try to keep a wall or fence close behind or beside you so you can't be surprised from behind. Scan your environment in 180-degree arcs in five-yard increments ahead of you.

Dress like a local. Don't make eye contact unless you must, and if you do, just nod without smiling. Above all, look like you belong there... or at least like you've been there before.

Sounds like a scene from one of those "JB" spy stories... Jason Bourne, Jack Bauer, James Bond. But it's just everyday life in many parts of my second home, South Africa, where I've been for the past month.

This is the way we may be living soon here in the U.S... for essentially the same reasons.

Coming to a Country Near You: Instability

People with no stake in a socioeconomic system eventually prey on that system. It's all they have. If the world considers you superfluous and you have no future in it, why not? Especially if the bigwigs in government and business do the same thing.

Over 45% of South African adults have no formal job or do temporary piecework when they can. Millions of people depend on this slender thread for their daily survival. To keep the pot from boiling over, the government has been forced to expand an expensive system of welfare payments. The costs of not doing so - in terms of crime, policing and fleeing investors - would be even higher.

Is this life coming to the U.S.? The signs sure point to it.

A new study by economists from Harvard and Princeton says that 94% of the 10 million jobs created after the great crash of 2008 were temporary contract positions or part-time "gig" jobs. They come without health care, retirement benefits, vacation time, sick leave or employer-paid Social Security and Medicare taxes.

Fewer than 1 in 5 of these jobs ever become permanent. Consequently, as the research by economists Lawrence Katz of Harvard and Alan Krueger at Princeton shows, the proportion of U.S. workers who were working in these kinds of temporary jobs increased from 10.7% of the population to 15.8% from mid-2010.

At the same time, the workforce participation rate has declined, meaning fewer people are working - with more depending on those who are, even temporarily, to survive.

Finally, the long-term unemployment rate, which includes people who are working irregularly or who have given up looking at all, has tripled since 1990.

Crucially, this trend is just as apparent in manufacturing, the very sector President-elect Trump touts as the salvation of the American worker. Over one-third of U.S. temps work on production lines, in warehouses and repairing machinery. Another 20% work in manufacturing management.

No Easy Answers

Capitalism tends to shoot itself in the foot on a regular basis... as it is doing today by simultaneously destabilizing the majority and massively enriching a tiny minority.

The great political economists of the 18th and 19th centuries, such as Adam Smith, were keenly aware of capitalism's contradictory nature. Above all, they realized things that are good for profit-seeking individuals in the short term - like staffing your company with expendable temps - aren't always good for society in the longer term... including those same profit-seeking individuals.

When almost all jobs created over an eight-year period lack the basic features required for a stable life, workers are effectively a disposable commodity, not citizens of a country. People who know they are considered expendable tend to behave very differently from those who are secure and stable, since they have a different stake in the game... i.e., none.

As the proportion of "expendables" grows, they begin to prey on the rest. That's what I've seen in South Africa and many other countries. Those are the sorts of societies where you live behind razorwire-topped walls, don't go out at night and feel nervous and watchful always. In a word: a Third World society.

Are you ready for that? You'd better be... unless something changes, and soon.

Ted Baumann joined The Sovereign Investor Daily in 2013. As an expat who lived in South Africa for 25 years, Ted specializes in asset protection and international migration. Read more of what he has to say about offshore living here.

The Feds Are Inside Your Home

Even when traveling, I have an insatiable impulse to read. There are always a couple of hardcovers in my bag for transoceanic flights. On the ground, though, I read e-books on Amazon Kindle. Carrying physical copies of my typical two to three volumes per week is impractical at the best of times - more so when I'm living out of a suitcase in the African Bushveld.

Like my father, I favor history. Last week, I studied the transformation of the Roman Republic into imperial despotism and dynastic instability.

This week I'm covering the Crusades, that fascinating 12th to 13th century attempt to impose medieval European feudalism on what is now Syria, Lebanon, Jordan and Israel.

There are many possible points of comparison. The one that jumps out at me is how often the powerful were brought low by betrayal within their own households. Roman emperors, Turkish atabegs and crusader counts regularly fell victim to assassins drawn from bodyguards, courts and even families.

At least those traitors knew what they were doing. These days, even insensible household objects can betray you...

Deadly Convenience

Mighty Amazon produces many useful things besides the Kindle software on my iPad. Amongst its big hits is Alexa, the virtual assistant built in to its Echo device. Alexa listens constantly, using an array of seven microphones, ready to hear and respond to all sorts of commands and queries, such as "What's the weather today?" or "Order some more paper towels."

Naturally, Alexa has become part of the current zeitgeist. For example, a recent episode of the brilliant hacker series Mr. Robot has a world-weary FBI agent asking Alexa philosophical bedtime questions and predictions. Alexa can only respond that "I'm working on that one, ask me a little later."

Alexa and similar Internet of Things (IoT) technologies may not be able to speculate on the mysteries of existence, but they can certainly remember everything input into them, intentionally or not.

A Nest thermostat, for example, records all automatic temperature changes and can be used to track your daily movements in fine detail as a result. Samsung's "smart" fridges monitor your food stocks as they rise, fall and change over time. Even lowly kettles can record your coffee habits.

An Arkansas man is about to cross a frightening new frontier in this rapidly evolving "smart" world... potentially taking you with him.

Good Alexa, Bad Alexa

Last week, news outlets reported that Amazon had been served with a search warrant in a murder case in Bentonville, Arkansas. Detectives want to know what Alexa heard in the early hours of November 22, 2015, when Victor Collins was found dead in a hot tub behind a home after a football game.

Alexa listens constantly, recording and transmitting conversations after a "wake word." It then transmits what it hears back to Amazon for language processing and storage, so it can improve its responses over time. Hence, the Bentonville murder unit's interest in bringing Alexa down to the station for a little chat.

The chances that Alexa woke and recorded a murder are quite small, of course. It would have to hear its "wake word" and remain in listening mode for quite a while. Amazon, to its credit, has refused to release the full transcript in this case, but it may be compelled to do so by the courts.

But Alexa isn't the main source of evidence... it's more useful to corroborate other data collected at suspect James Bates' house.

Bates had numerous IoT devices in his smart home. He had motion sensors for the lights, a Nest thermometer and a WeMo for his garage door. Crucially, he also had a smart water meter. Police have allegedly found that an unusual amount of water was used in the house late that night, perhaps to clean the victim's blood from the crime scene.

Testimony by Bates' smart home could well provide enough circumstantial evidence to send him to prison.

If I Should Die, Do This for Me: Delete My Browser History

In my last few days here in Cape Town, I'm staying with a dear old friend who's a bit of a card. He plays harmonica for living (seriously) and habitually wears a kilt, a leather jacket and a battered cowboy hat everywhere. He's also a brilliant quick wit, spouting the heading above within seconds of learning my topic today.

It's great wisdom. Don't do illegal things, of course... but just as importantly, pay attention to what's happening to the information gathered by the smart gadgets around you. Educate yourself about your options in this regard, and make choices that limit your risk. If a given device doesn't allow that, it's not worth it.

After all, in our outrageously overregulated society, we all commit approximately three federal felonies every day without knowing it. Your smart house probably will... and when the cops come asking, it'll tell them everything it knows.

Ted joined The Sovereign Investor Daily in 2013. As an expat who lived in South Africa for 25 years, Ted specializes in asset protection and international migration. Read more of what he has to say about offshore living here.