Has anyone ever told
you to invest in gold or silver because the economy is going to collapse? Did you think these people were crazy
Doomsday preppers who wear tinfoil hats? But ask yourself in all honesty and
seriousness “Is there any immediate or potential danger that I should take precautions for?”
To answer this we need
to take a step back and take a quick look at the evolution of money. Gold and silver, often known as precious metals, were used as currencies because of their
highly prized characteristics. They didn’t rust, had a bright luster, could be
shaped easily, could be used in jewelry, etc. etc. Just like food or tools they
served a purpose and provided a real tangible benefit to people.
Over time though they were replaced by paper promissory notes, or I.O.Us because it
was hard to carry around heavy coins all the time. The promissory notes were
still worth something though because they represented a payment of tangible gold
or silver. If somebody paid you in a bank’s promissory note you could take the
note to the particular bank and exchange it for gold or silver coins. These
notes further evolved and were centralized by governments who regulated the notes
and deposits of precious metals. This gave birth to paper currencies like the
US Dollar, Great Britain Pound, Japanese Yen, etc. etc. Eventually the
governments stopped maintaining deposits of gold and silver which these currencies
used to represent. So as of today the vast majority of these currencies
represent nothing other than the economy of the government that issues them.
They are no longer backed or supported by a deposit of gold, silver or any other
food or tool which serves a purpose or provide a real tangible benefit to
people. These paper currencies are just slips of paper which have some value
because a group of people say they do.
This is a very big problem because today far too many governments have far too much debt. Fiscal irresponsibility has lead to large international loans which are becoming impossible to pay back anymore. Also, reckless governments have been printing more and more paper money in attempts to pay off loans which has been driving up inflation. Currencies all over the world, which have become closely interconnected through globalization are all losing value. Banks, which have been the architects of this reckless systems need massive amounts of government loans to thrive. Fractional Reserve Banking has wreaked havoc on our economy. However, governments don’t want you to think about these problems. They keep printing money, playing games with currency reserves and toying with interest rates to keep the ship afloat.
But you should think about your financial future. The facts are right in front of your eyes and you live through this problem every day. Ask yourself “What did I used to pay for a full tank at the gas station 10 years ago? 5 years ago? 1 year ago?” Then ask yourself “What do I pay for a full tank of gas today?” Do the same exercise or for daily staples like milk, eggs, and bread in the grocery store.
Prices
for these goods shouldn’t be skyrocketing because their supply is still the
same. Oil producing nations haven’t shut down all of their wells. Cows and chickens haven’t magically disappeared.
Wheat fields haven’t been destroyed by Biblical locusts.
Inflation,
interest rates, and fractional reserve banking has destroyed the purchasing
value of our Dollar. Since the Federal Reserve was created in 1913 our dollar
has lost approximately 95% of its value. We are at the edge of the cliff and
any further devaluation of our currency could lead us into a crisis much worse
than the Great Depression of 1929.
I ask all of you to take some time out and think about these issues. Ask yourself are there any possible benefits to owning gold and silver?
