The importance of saving in hard money, specifically through gold and silver, as a response to national inflation and the decline of the U. S. dollar's value. It highlights historical context and current economic conditions while suggesting personal investment strategies.
1. Historical Context of U. S. Currency:
• In 1964, the U. S. minimum wage was $1.25, equating to $39 today when calculated in terms of silver.
• The U. S. removed silver from coins in 1965 and later ended the gold standard in 1971 due to government overspending and inflation.
2. Inflation Trends:
• A chart shows cumulative inflation from 1913 to 2022, with a notable increase after 1971 when the gold standard ended, leading to unchecked government spending.
• Historical wars, particularly in the mid-20th century, have often preceded inflation spikes due to increased borrowing and spending.
3. Government's Inflation Measurement Flaws:
• The government has distorted inflation measurements, making it seem like prices haven't increased as much as they actually have. For example, the reported increase in new car prices is significantly lower than the real increase.
4. Personal Hard Money Standard:
• While a return to a gold or silver standard isn't imminent, individuals should consider creating a personal standard by saving in precious metals.
• Investing in physical gold/silver or in ETFs like Sprott’s Physical Gold (PHYS) and Silver (PSLV) is recommended. A 25% allocation in these assets is suggested, given the current economic climate.
5. Future Outlook:
• The advice is to hold onto precious metal investments for now, as they may perform well in the next few years, while stocks remain overpriced.
Investing in hard money like gold and silver is a prudent strategy amid rising inflation and economic uncertainty. By creating a personal standard with these assets, individuals can better preserve their wealth against the eroding value of fiat currency.
https://dailyreckoning.com/why-you-should-save-in-hard-money/
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