Finland Finland Finland. part 5
Stagnation or renewal?
We were smirking in the last part of February. After that piece, there were four to five weeks of strikes in Finland and Budget talks (more taxes). It got even more stupider in two months, so an update is needed.
For decades, you have begged your alcoholic dad to give up smoking, just the smokes. Yet it never changes; you feel nothing, but you keep trying. Begging and crying. But sometimes, surrender is the only path left. Just like with your homeland, you keep clinging to a prayer that one-day things will change. Let it go. Sometimes, release is the only relief…
Under Finland's most right-wing government yet, the proposed solution is clear: Increase taxes to address the issues!
Biggest being the VAT from 24 (already fucking high and cramping businesses/consumers) to 25.5%
Reactions from Finnish people:
"I once held out hope for necessary cuts in the public sector, but no longer." (5-10%)
“The tax rises are a necessary evil we have to do it, it is only 1,5€ more in 100€ purchase, so it is nothing, why whine?” (Vast majority of Finnish people)
“This ain’t enough we need to tax more and more! No cuts!” (5-10%)
The “top growth project” is the one-hour train to Turku, which is a fucking joke.
+ Some “green energy” incentives. Let’s try to make this work with subsidies! Great idea, idiots! (Well, the EU and the US are giving even bigger and more idiotic subsidies; hint: don’t compete with idiocy).
If you did not think about the possibility that Finland will go down to the toilet, well, it is time to wake up.
It is a possibility. There is still plenty of time; everything will continue to erode, but how long before the living standard becomes unlivable? Decades.
The years 2022-2023 were the first taste of what is to come. Did you thrive or struggle to make ends meet?
📉 Purchasing power
📉 Living standard
📉 Asset prices (nominal values can stay the same)
📈 Inflation
📈 Taxes
📈 More government
95% of my friends, colleagues, and business associates have this situation.
Massive mortgage / House is the savings account.
1-2 kids (preschool/school age)
Very little interest in investing (if anything, it is 100% of the time about some Finnish company)
If the 2023 type of shit continues, you will be royally fucked. It is ok we all get fucked from time to time. It is normal. It won’t be so bad if you prepare a little bit.
The House
Well, you kinda got fucked. House prices in Finland have either dropped or stagnated at their purchase values. “It is not so bad”. 500k in 2018-2019 meant something… And now, in 2024?
Okay, so you're stuck with that house. Remember, it's only a loss if you decide to sell. When you think of your home as an investment, always ask yourself: who will want to buy it in 20-30 years if things keep going like this? Probably no one. But if you truly love your home and your neighborhood, and you're willing to do some of the upkeep yourself, then the extra cost might still be worth it.
If you don't already own your house, should you consider buying it? Why do Finns seem so driven to own their homes? What makes home ownership so appealing here?
Living rent in an okay house and reasonable living costs: 7+ Home.
Have the freedom to invest more and the luxury to leave
Living like a debt slave for 20-30 years to achieve the 9+ almost dream home?
You have to grind the corporate ladder and play the Ponzi game of real estate, going from a one-room flat to a three-room flat to the “dream house.”
Xiit code:
Maintain a student-level budget even after graduation, living modestly and always a notch or two below what might be expected. There’s no need to pretend to be a lifestyle of the upper-middle class if your means are more middle-class.
Both are viable options, but if we have zero growth for the next 20 years, you are better off with option A. Property tax punishment has also just started here in Finland, so keep that in mind. It used to be a fantastic deal, but not anymore:
💰The Financialization of Houses was starting (you were at the top of the Ponzi).
💰 Finland was growing like there was no tomorrow; we had the best tech companies at the time (Nokia), the best education, and the safest place in the world.
💰 Interest rates were tax deductible.
💰 Property tax was pennies.
💰Utilities were cheap back in the day.
💰Zero regulation and bureaucracy.
It is not worthwhile to own a house in a socialist country - What were once compelling reasons to buy have become burdens.
It's okay. It is just a house; don’t expect it to be your retirement fund. Then it will be fine.
The Plan
The positive thing about eroding purchasing power is that the consumer mindset dies; there is no need to consume more and more - you simply can’t.
✅ Live prudently and budget everything!
✅ Start saving money outside of Finland. You work in Finland, own a house in Finland, have bank accounts in Finland, and invest in Finland.
A good way is to open online bank accounts, e.g., Revolut, Wise, Norwegian, etc. Zero costs with free virtual cards. Moving money is becoming harder and harder every year. Try moving cash nowadays. What do you even do with 5k cash? As a bonus, you get higher APY for your money outside Finland. Anyways, good backup cards, since the banks have problems from time to time…
✅ Start investing in foreign/global companies; why all in Finland? Sure, it can work, but picking winners outside of Finland is ten times easier.
✅ Start following what happens in other countries. We considered Norway at one point, but it turns out it is an even more socialistic place than Finland. Australia? Canada? The same story, “Oh, but ten years ago, it looked fantastic,” yeah, shit changes so fast nowadays, even in countries. Finland is not so bad after all, and there is still plenty of time to plan.
✅ Have desirable skills. Are you an engineer? Work in niche hot industries like biotech, etc. Do you have knowledge that everybody wants? Sadly, I’m a service business monkey/economist, so I have to focus more on financials. You don’t need to worry about financials so much if you get offers abroad.
✅ Start Studying Bitcoin
The goal is to strengthen your financial sovereignty, making you less dependent on any single government or financial system.
Finland, where do you go?
Finland is a small country, and that's a massive advantage; we can shift directions quickly - not just to the downside but also to the upside. It might only take one visionary like Elon Musk or a couple of top-tier companies to drastically alter our trajectory.
The worst option is to continue this depression stage. The vast majority of Finnish people support increasing taxes and more government involvement to change the course. The slow erosion continues. If your strategy is hopium that it might change for the better, it won’t. What do we have left if 2022-2023 extends into 2030?
I have never hoped for a severe recession, but here we are. This would be the best medicine for Finnish people to wake up. Recessions are painful but necessary.
✅ Correction of Malinvestments
✅ Sustainable Production
✅ Entrepreneurial Opportunities
What is Finland's vision? Right now, people are lost, companies are directionless, and leaders seem increasingly out of touch.
Every Finn might need to feel the pain, vomit our past failures, shed tears for what was, and wander through our forests to find our new vision. Only by confronting our current reality can we forge a path to a future where, despite the challenges, the people of Finland will ultimately win.
We've seen it before:
Post-World War II Reconstruction: Finland not only managed to pay off its reparations but also used the process as a catalyst for massive industrialization and economic development.
Early 1990s depression in Finland: Finland became a global leader in telecommunications largely due to Nokia’s success. This not only transformed the Finnish economy but also placed it at the forefront of the global tech industry for a time.
Waiting for a change in Finland? It's like hoping an alcoholic dad will suddenly quit smoking. Maybe it's time to cut your losses and find a better setting. Isn't it time to consider a plan B?
