I understand what you're saying, but it's incorrect in my opinion. Here's why:
Money is the same as debt. It's just a representation of debt. And debt is just a claim on future labor.
Let me put it another way:
When you get a paycheck, your employer is simply transferring a certain amount of claims on future labor (money) that it owns to you - so now you are the "master" over those claims on future labor.
Debt is also claims on future labor. Money is just what we use to trade those claims around with, because it is convenient.
In other words, debt = money and money = debt.
We've heard about the huge contraction in debt that our economy is experiencing from enormous numbers of loans going into default.
Every dollar of debt that defaults and disappears also means that a dollar of "money" has disappeared - because money = debt.
What happens when you have a big decrease of money for approximately the same amount of goods/services? You get deflation. The money becomes harder to get, but it buys more. Deflation also makes existing debt more difficult to pay off, since it takes more labor to earn a dollar - even though a dollar will buy more.
The Federal government is issuing debt as fast as it can to try and balance out the avalanche occurring on the other side of our nation's balance sheet. The government is the only entity that can create new "base debt" into the system. After it gets introduced then banks can create more debt (money) by making loans. But those new loans cannot be made without the Federal government issuing the new debt first.
Inflation can only happen if the Federal government issues more debt (and the banks make tons of loans off of that new debt) in order to overcome the debt destruction that is occurring.
It's not going to happen. We are in a deflationary spiral for the next 8 to 10 years.
Cash is king. Gold and silver are good hedges, but I firmly believe they will be dropping significantly in value (along with all other commodities). Expect gold to drop below $800/oz and silver to go below $10/oz
“Cash is king. Gold and silver are good hedges, but I firmly believe they will be dropping significantly in value (along with all other commodities). Expect gold to drop below $800/oz and silver to go below $10/oz”
But where to keep it? In the freezer, lol? Also, what currency?
What you say is true today. That money=debt.
But that is only because we use FRNs which are a debt based currency. It was not always so. We used to have currency that was backed (not 100% though) by gold and silver. This currency was redeemable in silver and gold
FRN = Federal Reserve Note
Beyond our paper currency our other money exists as computer blips. Does this money=debt? If you want to show me go right ahead