For a long time in human history, there has been a system operating outside the normal legal side. Many people know about it, some use it and generally most end up within the violence of the system. For the system there is relatively easy money, but often it comes at a cost which is people do not live to old age retirement. Some people spend most of their lives in the other system, some people rarely ever venture in. It used to be that it was considered 10% of the economy and was loosely described as the underground economy.
In the last 20 years, it might have grown and the book Dark Commerce – How a new illicit economy is threatening our future by Louise I Shelley published by Princeton University Press, Princeton, NJ, 2018 is a good book to read if you wish to understand the economy. The book is very well researched.
There always has been a dark economy or the criminal element, but it seems to have grown more mainstream or main street and no one really knows.
One of the greatest companies during Victorian Times or when England essentially was the world leader was the East India Company. The company started out as a trading company which brought spices and teas to England in exchange for manufactured goods from England. Spices are the prime reason why Europeans were open to see the world and claim parts for itself. Eventually the company evolved to selling opium from India into China and causing a silver shortage in China and balance of trade payments overwhelming to England. A number of wars were fought, and Hong Kong became British territory.
In the Sherlock Holmes novels, Sherlock is addicted to cocaine, but drug use was not common throughout the population of England. They drank beer and alcohol.
The drug cartels which come from Columbia, Afghanistan, and a host of other companies have resulted in wealthy people who move their money into legitimate areas of the economy including real estate, stocks, bonds, etc.
Whether it is North Korea selling illegal cigarettes or other countries or groups destroying the environment, the growth of dark commerce leads to many issues about government policies.
The internet is wonderful to gather information, but it can also cause fraud, deception and if you are looking for a deal, it is buyer beware as counterfeit, poor quality and a host of other concerns are found in goods. In addition, there is place called the dark web where non legal actions are the norm.
Linking to dividend paying stocks, many times people looking at the dark commerce see the returns made in dark commerce. The returns can be very high, there is a reason why many people involved spend most of their money on lifestyle. It generally does not last. If you believe you want to live to retirement with a reasonably comfortable life, then the steady consistent aspect of dividend paying stocks over a long period of time is an excellent choice.
There are more questions than answers, till the next time – to raising questions.