I recall reading 'Poor Economics' by Abhijit Barnejee and Esther Duflo who won the Nobel Prize a few years ago and they hypothesized based on their research why people were stuck in the poverty trap.

One of the main causative factors was the inability of poor people to sufficiently accumulate in other to invest in proper channels that actually generate wealth rather than constantly battling with the poverty line. Of course they referred to the really poor (people living on less than $2 a day), so it could be understood why there was an inability to save and compound.

No Fault of Theirs?

Regardless of circumstances though, there were a few example cited of Others in the same poverty line who managed to claw their way out of extreme poverty. Many who earned spent money on things that could be considered necessities like food and clothing. Yet some people did manage to accumulate by choosing to do two things:

Necessary Sacrifice

Firstly, there has to be intention in leaving or avoiding the poverty trap. A lot of us probably have legitimate reasons for not being able to save which is quite understandable, but intention can go a long way towards providing enablements for saving and investing. I have also noticed that some people aren't really bothered with increasing their wealth, which is also fine. Being able to identify the minimal requirements for a quality lifestyle of our choosing is very important. Deferment of our spending needs for a target may be uncomfortable in the short run, and almost impossible in some circumstances, but for those who do manage it there is real opportunity to live a more quality lifestyle.

Better Circumstances

Compared to the people used as case studies in their book, I would say the majority of us are in better circumstances in terms of standard of living. Yet we struggle regardless, and are admittedly playing with the poverty line. For me cutting down spending is something I have tried to do, even though I've never been much of a spender to begin with. Anyone on this platform is likely in a better circumstance to improve on their financial situation compared to a substantial amount of people living in extreme poverty and should be capitalizing on opportunities on offer while looking for ways to eliminate wasteful spending habits.

Crypto Offering

Hive has allowed me to sort of recognize the long term effect of accumulating small amounts and letting it compound. This seemingly insignificant amounts keep growing and over the last six months has increased to really noticeable stakes.

Crypto as a whole offers an opportunity to escape poverty perhaps not seen before, in the sense that even those without major investments have been given a chance to have stakes with Airdrops and the likes.

I have also talked about Hive's potential as a bank account of sorts which even pays better interest and offers more incentives than traditional banks. Anyone invested in Hive has a real opportunity, that I am very convinced.

Conclusion

There are certain situations which may render us unable to save and compound. Regardless, even insignificant sums can be kept aside and will make sense in the long term. The major problem is that not many people have the dedication to compound for several years and wait for results. Crypto sort of changes that, as many of us appreciate its long term potential so are willing to hold out. Compounding is an age long consensus on generating wealth, and the blockchain gives us an opportunity to do it like never before.

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