Economies around the world have been in crisis over the last several years and have been making headlines due to slow economic growth and excessive debt. It doesn’t matter if you take a close look at the U.S., Europe or Japan, all struggling economies have several things in common. For starters, they all have fiat currency. Fiat money is money whose value is now backed by anything tangible like gold and silver. It is essentially a piece of paper that has value only because it is believed to have value by those who use it for trade. Secondly, they all have governments that have meddled with their monetary supply. As a result, the current economic conditions we are experiencing are largely related to currency problems. Even though headlines are touting, “recovery” other major markers including the central bankers and politicians indicate otherwise. If things were improving so drastically, central bankers and the Fed wouldn’t be increasing the monetary supply so dramatically. Observe what people do, not just what they say.
The Monetary Supply Has Exploded Since The Government Got Involved With The Currency
Since 2008 the Federal Reserve has embarked on four different rounds of Quantitative Easing. Their efforts have tripled their balance sheets and more than doubled the national debt. Generally speaking, when governments start messing with the countries money, only negative results come about in the long run. For example:
-The continuing recession in the EU.
-Japan’s economy is flat lining
-Growth deceleration in the U.S.
It should also be noted that there has been no such thing as a successful fiat currency. All fiat currencies have at some point failed. Take Weimar Germany and Argentina for example. The last thing we want is for the dollar to follow suit.
World Wide Currencies Are Not Looking Good Since The Government Got Involved With Monetary Policy
When Big government gets involved, anything that stands in the way of their interests must and will be removed. For example, in Japan the Prime Minister Shinzo Abe threatened the autonomy of the Bank Of Japan unless they doubled their inflation target and agreed to print unlimited money. The U.S. is no different. After QE4 was passed it raised our monthly commitment to increasing the monetary supply by $85 billion per month.
How Do We Protect Ourselves Against Problems With The Currency?
Like it or not, long-term misuse of currencies will result in the destruction of that currency, and ultimately the creation of massive economic problems in that country. The only investment that can stand up in the face of inflation and currency failure is gold and silver. Gold and silver are not typical traditional commodities, they are money. Their value lies in their ability to retain wealth in dire economic circumstances. By choosing to invest in gold and silver you can protect yourself from whatever lies ahead in the economy.
For more information on current economic policies and the relationship to the U.S. dollar, and to learn more about investing in gold and silver, speak to a Redhawk Advisor near you.