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An interview by King World News on Friday with Dr Paul Craig Roberts, former Assistant Secretary of the U.S. Treasury and one of the instigators of Reaganomics, should make one sit up and listen.
Roberts reckons that the current Fed QE program is going to be virtually impossible to unwind – indeed the suggestion is that it might even have to be extended. If the Fed does decide to start to unwind in any significant manner, the U.S. economy, which has been weaned in recent years on ever growing money being printed and pumped into it, will crash - and the dollar with it.
If QE is continued at least at current levels, which he feels it will now have to be, eventually the dollar will also crash as dollar holders around the world realize the ultimate negative effects on the current global reserve currency of just printing more and more money without any economic strength to back it.
Why a US recovery may send Treasury's, dollar crashing
The Federal Reserve's expected move to scale back monetary stimulus signals that the U.S. economy is gaining traction, but some economists argue that the good growth story is precisely why things look bad for the dollar and bond markets.
"The biggest threat we are facing might be economic growth," Axel Merk, chief investment officer at Merk Investments, told CNBC. "Every time we've had good economic indicators in the U.S. pop up, bonds have fallen pretty sharply."
Today, America is like the fourth generation heirs of a fabulous fortune. We may be making all the wrong moves, but our fortune is large, so it takes time for our spendthrift ways and bone-headed policies to erode the legacy bequeathed to us by our forbearers.
Our current standard of living is entirely reliant on the dollar’s world reserve currency position. Outside of that, it’s nothing more than a trashy paper currency. Fortunately, more than 60% of all foreign currency reserves in the world are in U.S. dollars. But when this special, reserve status changes, the U.S. Dollar will be toast.
U.S. bond prices have started to fall recently, which is just another way of saying that U.S. interest rates are rising. If mortgage and credit card rates increase too much, consumers will send the weak U.S. economy over the cliff into a deep recession.
The only reason this isn’t happening right now is because deflation winds are countering the forced inflation. The problem will come when the Fed attempts to unwind the easy money. You see, the easy money has been like heroin to the financial classes on Wall Street. There’s no way to get unhooked without catastrophe.
We live in dangerous times for America, and we all need a plan to prepare ourselves and our families. In the weeks ahead, I’ll share more about what to do to prepare.
I predict Gold and Silver will have no value after the dollar collapse for 5 main reasons probably nobody has ever heard of. Yes we all know precious metal prices will skyrocket from now until the dollar collapses but afterwards it will be as worthless as a paper weight. In history it used to be true that gold would regain itself as currency again after a paper currency collapsed but it wont work this time and I'll explain the reasons why.
(Reason 1)
With no currency, with what are you gonna sell your gold? The amount you paid for your gold before the collapse will by a long shot not equal the goods and services value, you'll have to trade it for after the collapse and no one will want it because it wont really serve any purpose during this time. Meaning for example most people will be forced to trade $1000 worth of gold for $5 worth of food. Well people might argue "You can use gold for electronics and other things." I say who's gonna work at the electrical plants without a paycheck? The only electricity being made are survivalists who own windmills in their back yard and seriously how many of you have those?
(Reason 2)
People will argue, gold will have to return to currency. I argue, who's gonna mint all those gold pieces for free? Remember when the currency collapses nobody is getting paid anymore so why would US mint workers waste their time working for free? Everybody is gonna be busy guarding their food supply. Food will be the new currency. People who are not self sufficient will end up having to help people who are in order to survive.
(Reason 3)
The government wont create a new currency. Everybody thinks the Illuminati will introduce the "Amero" at this time. Those people who are the Illuminati network won't do anything without getting paid. They are going to be hiding in their Apocolyspe bunkers that they paid billions of dollars to reserve a room in the mountains. Once the dollar collapses everything and I mean everything will shut down. The gasoline will dry up in 2-3 days, food will dry up quick, nobody will work a job including the goverment workers. In these conditions the last thing on people's minds will be fancy jewelry or precious metals. The first thing will be how can they eat another meal and live another day. Everyday, people will get shot/killed for stealing food. You can't eat gold you know.
(Reason 4)
The dollar is currently the worlds reserve currency. The reason in history for thousands of years that gold always returned it's value after a paper money collapse is because it happened in a time when world reserve currencys didn't exist. What this means is formerly when one country's currency died, another would just take over. However in this case, the currency currently dieing is the currency that all other countrys currencys are backed upon. Meaning if the dollar dies here, it takes down every countries currency that based their own currency's buying power or value upon the dollar.
(Reason 5)
Manufacturing and mass production stops. With nobody working because their paycheck is now just worthless paper, gold will cease to have a material or useful purpose. I mean seriously, what are we gonna use it for?
I would suggest this. Buy gold for now and hang onto it for about 6 months. Then immediatley sell it just before the dollar completely crashes when you notice inflation going through the roof and buy as much seeds and non parishable foods items as you can and bury it in containers in the ground to hide it. Remember people will be getting killed over food so you'll be able to get anyone to work for you in payment for food. Nobody will have any reason to want gold after the collapse. I predict when it happens this may very well be the end of money all together and the beginning of what Gene Roddenbury tried to portray when the character Captain Picard said "There was a time in history when the world gave up on money and decided to all work together for the common good." Those who survive who be forced to live by this method. Meaning we will all become farmers and fisherman to feed our communities.
(Reason 3)
The government wont create a new currency. Everybody thinks the Illuminati will introduce the "Amero" at this time. Those people who are the Illuminati network won't do anything without getting paid. They are going to be hiding in their Apocolyspe bunkers that they paid billions of dollars to reserve a room in the mountains. Once the dollar collapses everything and I mean everything will shut down. The gasoline will dry up in 2-3 days, food will dry up quick, nobody will work a job including the goverment workers. In these conditions the last thing on people's minds will be fancy jewelry or precious metals. The first thing will be how can they eat another meal and live another day. Everyday, people will get shot/killed for stealing food. You can't eat gold you know.
AfterInfinity
reply to post by antar
If the dollar crashes, and gold and silver and precious stones are all critically affected in a similar manner, then what will we use for currency?
On March 16th, President Obama signed a new Executive Order which expands upon a prior order issued in 1950 for Disaster Preparedness, and gives the office of the President complete control over all the resources in the United States in times of war or emergency.
The National Defense Resources Preparedness order gives the Executive Branch the power to control and allocate energy, production, transportation, food, and even water resources by decree under the auspices of national defense and national security. The order is not limited to wartime implementation, as one of the order's functions includes the command and control of resources in peacetime determinations.
AfterInfinity
reply to post by antar
If the dollar crashes, and gold and silver and precious stones are all critically affected in a similar manner, then what will we use for currency?
I would suggest this. Buy gold for now and hang onto it for about 6 months. Then immediatley sell it just before the dollar completely crashes when you notice inflation going through the roof and buy as much seeds and non parishable foods items as you can and bury it in containers in the ground to hide it. Remember people will be getting killed over food so you'll be able to get anyone to work for you in payment for food. Nobody will have any reason to want gold after the collapse. I predict when it happens this may very well be the end of money all together and the beginning of what Gene Roddenbury tried to portray when the character Captain Picard said "There was a time in history when the world gave up on money and decided to all work together for the common good." Those who survive who be forced to live by this method. Meaning we will all become farmers and fisherman to feed our communities.