Sovereign Wealth

Sovereign Wealth

At $2.3T, Norway's Sovereign Wealth Fund (SWF) owns ~1.5% of ALL global equities in its portfolio, providing Norway's 5.67M citizens a notional account value of over $400,000 USD for every man, woman, and child in Norway.

This SWF derived from Norway's collection of a 78% profit tax on oil production. Keep in mind, Norway is only 12th in the world in total annual oil production.

Given that the United States is the LARGEST net oil exporter in the world, producing some 13.5 million barrels per day as of 2025, it begs the question where is OUR Sovereign Wealth Fund?

The United States operates under an antiquated 1920s 12.5% Mineral Leasing Act, earning a reported "$8B last year."

Yet 2025 crude oil production in the United States was as previously mentioned 13.5M barrels per day totaling some ~5 billion barrels for the entire year. With an average market price of $65 USD per barrel that equates to roughly $325B in total US crude production revenue.

I'm no Albert Einstein, but there seems to be some SERIOUS "leakage." 12.5% of $325B is NOT $8B. Where is the other $33B going? Hint: Probably NOT to YOU the taxpayer.

Imagine if the United States government was not beholden to Big Oil, but rather it had the integrity and foresight to establish a sovereign wealth fund like Norway and charge an equitable royalty rate (after all, these ARE all citizen taxpayer public lands) of say 50%.

The oil majors would all still be wildly profitable, and within 10 years the United States would have well over $1T in a SWF. In a generation the earnings of this fund could wholly replace Social Security (and the economic break-pedal of its onerous wage tax.)

Imagine if instead of a National Debt of ~$40T or about $115,000 for every man, woman, and child in the United States we too had early positions in Apple, Amazon, Dell, Google, Microsoft, Nvidia, SpaceX, and Tesla like Norway?

The United States is the EPICENTER of innovation. Citizens should be reaping the rewards alongside this innovation.

Let's utilize royalties from national natural resources from public lands to invest in the future productivity and innovation in this country for all citizens to benefit and wean ourselves off of wasteful employment taxation.

Within 10 years the United States Sovereign Wealth Fund (USSWF) could and should totally replace the need for Social Security or the Social Security Administration. 

The Boomers would be the LAST generation to receive benefits under Social Security, while GenX and beyond would receive proportional income shares in the new USSWF.

T. H RAPKO & COMPANY, LLC would be proud to manage the USSWF on behalf of all Americans. If we are going to "Drill, baby, drill" in this country, we should also "Invest, baby, invest."

Trump Accounts

Trump Accounts

The newly formed Trump Accounts offer a generational path forward to ultimately replace Social Security with individual retirement accounts.

Under whatever guise they may be called, we at ILAF have long championed widespread implementation of personal retirement savings accounts that could someday fully replace Social Security in the United States.

The newly formed Trump Accounts offer a viable path forward for generations to come that can offer individuals the opportunity to compound their wealth over time without penalizing workers with the heavy burden of Social Security taxation and misappropriation of said funds by Congress.

Of the many assets in life, time is among and perhaps the most valuable asset of all. The Trump Accounts leverage time by seeding the accounts early in life, in fact before the child is even aware of the account. The first decade then becomes a growth engine.

Assuming the government, billionaires, parents, grandparents, and even friends contribute and gift each child's account over the first 18 years of life a child now has a sizable nest egg at 18 to pursue a variety of either educational goals, buying a business, real estate, etc. or some combination therein including continuing to save and invest.

The time value of money and the power of compounding under the Trump Accounts is truly revolutionary and has been in wide practice for centuries with the nobility and modern day aristocrats who have seeded generational wealth the moment their progeny are born.

The Trump Accounts offer every American child now the opportunity to advance in life with prudent saving and investing over time. The constant drip method of dollar cost averaging over decades is tough to beat.

Just like the GLPs will add millions of life-years to the human population, the Trump Accounts will collectively leapfrog a generation of Americans in better standards of living with better education opportunities and career choices.

Hopefully the newly formed Trump Accounts will be a wake-up call for hundreds of billionaires avoiding just taxation by moving their assets to foundations rather than funding Trump Accounts for millions of American children.

Imagine the impact Warren Buffett could have if he honored his giving pledge by providing $2,000 to each Trump Account rather than positioning $50B with each of HIS kid's "foundations." That would be true impact investing! And Buffett is by no means alone.

Truflation

Truflation

Truflation, a portmanteau I've coined from "True Inflation," is probably in the range of 10-12%, just don't share this information with the U.S. Bureau of Labor Statistics! According to the BLS, inflation in the United States is nonexistent. In fact, conditions are SO benign that it is actually wise to CUT interest rates! Well dear financial farmers, I have a different perspective.

For the past 45 years there has been almost no real wage growth. From about the time Nixon took the USA off the gold standard rampant inflation has devastated the earnings growth of the middle class. And in the late 1980s things got significantly worse in terms of calculating the Consumer Price Index (CPI).

The CPI was changed from a constant cost of living to one where substitutions were allowed. No big deal, right? Wrong. This allowed politicians from both sides to effectively mask the true inflation numbers. Why was this done? Well when you significantly underreport official inflation you don't have to make cost-of-living adjustments to Social Security. Or account for increased pension plan returns. Or worry about the size of the deficit. Fudging the numbers solves a lot of big problems.

Examining the "growth" of income over the past 45 years is another way to take a look at this problem in a pragmatic way; real buying power has barely budged, yet the cost of acquiring the same goods and services has SKYROCKETED!

Anything of value in life whether it is housing, education, or medical care to name the "big 3" have increased exponentially. What college student can pay for tuition now from the proceeds of a summer job? Can a family put 20% down on a house after working for just a year? Why would a single medical bill now cripple a family? The answers to all these questions, sadly, is Truflation.

What is an aspiring member of the Middle Class to do? Vote? That obviously doesn't seem to work. Rebel? Hmmm...good luck with that. Earn more? Maybe, but earning more alone won't fix the problem, as the U.S. Dollar loses more buying power by the day and taxes have a sneaky way of eating up even more of any higher income. Invest? Yes! 

My argument is the best way to fight Truflation is a combination of earning more and investing, and ultimately funneling as much tax-deferred growth as possible into investments, particularly stocks, real estate, and gold. In terms of stocks I'd highly recommend readers take a look at my "Rapko's Rules" in previous posts. In terms of real estate, well they ain't making any more of it (except in the South China Sea and in Dubai) Take a hard look at quality vacant land, commercial real estate, and single family homes. Finally, gold is a really interesting element. And it has been used for thousands of years for storing VALUE. I wonder why that is...hmmm.

Bottom line? Borrowing costs are going DOWN, but the PRICE of everything is going UP. Invest.