Skip to comments.Mike Maloney: The Dollar As We Know It Will Be Gone Within 6 Years
Posted on 07/06/2014 8:14:24 PM PDT by blam
Submitted by Adam Taggart via Peak Prosperity,
This week's podcast sees the return of Mike Maloney, monetary historian and founder of precious metals broker GoldSilver.com.
Based on historical patterns and the alarming state of our current monetary system, Mike believes the fiat US dollar is in its last years as a viable currency. He sees its replacement as inevitable in the near term -- as in by or before the end of the decade:
All of this is converging with the crazy experiments the Federal Reserve has done.
I absolutely believe that there are economic consequences to this that are inescapable. The Fed is not just in a box; a trap has been set. And before the end of this decade, if there is still a US Dollar around it will not be this US Dollar. It will be a dollar that is tied to a very different monetary system.
The last three shifts in our monetary system were little baby steps off of the classical gold standard where it was fully backed. We went down to a 40% reserve ratio with the Federal Reserve in the United States during the Gold Exchange Standard. Then the Bretton Woods system didn't have a reserve ratio specified, but I believe the dollar was about 8% backed by gold by the time Nixon took us off of gold in '71. Now, the only backing that the US Dollar has is the promise to tax us all in the future: it is US Treasury bonds, or the Fed doing its quantitative easing and buying mortgage-backed securities.
And how corrupt is the notion that you can give some entity the power to have a check book that has a $0 balance and they can go out
(Excerpt) Read more at zerohedge.com ...
I take whatever a person who sells gold and silver for profit with a very large grain of salt.
This is precisely the reason why conservatives should be prepared and armed.
The edge of America is close. Society is about to see a Rome-esque breakdown, and there will be three camps. The hordes of former welfare queens looting anything they can find, the far left Marxian wing in all its ugliness, and us.
Bill Ayers stated it would be necessary to ‘liquidate’ the opposition in camps if they refused to be re-educated. Is that where you want to be? Or would you rather see Ayers and company face public trial and whatever comes next in a new America devoted to restoring the Constitution and the values that made this country great.
Sponsoring FReepers are contributing
$10 Each time a New Monthly Donor signs up!
Get more bang for your FR buck!
Click Here To Sign Up Now!
Platinum seems to be absolutely leashed to the price of gold, rhodium has enough industrial users to override any investor spikes.
I agree that the metals market is important to the prepper. I'd look towards a major investment in lead, with minor positions in brass and copper jackets. Ammo can protect what you have, barter for what you don't, and won't feel as bad as handing over an ounce of gold for a loaf of bread.
Never ask a guy who sells tires if you need tires.
We don’t know when the economic SHTF will happen, we don’t even have a idea of how it will play out. We just know it will be very ugly and we average Joe Americans that are still working and paying taxes right now are probably going to suffer the most.
How’s that for a Greek tragedy?
Listened to it, difficult. Verses dont rhyme, back round music was cacophonous. Nothing made sense. What are you trying to say?
If the US will die, it will be slow, and you will know when the rich will rebel to hide their wealth. Look at Nicaragua when the Sandanistas took over.
That would be wise.
It would be equally foolish to dismiss the truth of what he says just because he may be able to profit from what he has been studying and preparing for and preaching about for years.
The dollar is a dead man walking.
Read The Creature from Jekyll Island, if you haven’t. This is what central banks do.
And I suspect the puppet masters will allow one more leftist DemocRat to win the White House (likely Mrs. Bill “Impeached” Clinton) and then a Republican so that it crashes with a Republican, so the socialists can blame capitalism and the free market for the destruction they are deliberately causing.
Years ago, some guy was trying to sell me some gold. I told him when the SHTF, lead would be more valuable than gold.
Yep. Furthermore, I take everything posted on Zero Hedge with a grain of salt. I like the site, and the comments there rival FR for sarcasm and humor. But Zero Hedge is always - and I mean always - predicting the collapse of something or other.
In many respects that is already starting when you consider how the banking systems and economies are stacking up worldwide. There's much shuffling around as nation leaders are growing more and more ‘restless’ with the US Dollar maintaining the power and leverage it does....especially regarding sanctions that the US continues to hold sway over nations, either by imposing them or strong-arming other nations to agree and support them when they do.
Trial? If it all really comes apart, there aren’t going to be any trials.
Lord, what do we do?
we’re still working and paying taxes....
I don't think one should ever be so cavalier about gold as to equate it to a loaf of bread. An ounce of gold has always been equivalent to a month's manual labor, or the finest suit of clothes the market has to offer. And it always will be that. Its scarcity, reliability and desirability are gold's traditional secret to being the most compact store of liquidity and value known to man.
Yes, gold has its fanatics who make absurd claims, and yes, gold has its detractors who studiously refuse to understand its time-honored traditions. Neither are particularly correct; but to ignore gold is to be left out in the cold at crunch time.
Gold was under $300 an ounce in the months after 9/11, in 2001. That didn’t buy a decent suit then and it wasn’t equivalent to a month of manual labor.
So, would you say it fell more into the loaf of bread range?
Gold hasn’t been a consistent measure of the cost of anything. There have been swings both up and down relative to any item you could name. It was $800 an ounce in 1980, in 1980 dollars. It was between $250 and $300 an ounce in late 2001. People look for patterns that aren’t there. Has a suit gotten $400 cheaper since gold fell from over $1,600 an ounce to, what, a little over $1,200 an ounce now? No, it hasn’t. It’s an historical safe haven in times of economic turmoil. It runs up leading into and during such times. It falls when the threat is perceived to have passed.
A good SHTF plan should be effective no matter what the economic conditions are. Can you go buy your loaf of bread today with your gold? Since owner/operators for groceries is pretty low today, odds are you're dealing with a moderately paid clerk, who has to answer for their totals in the drawer or they lose their job in a down economy. A gram of gold is $42 in fiat currency. Who will give you $42 for that speck of gold in a glass tube out of their pocket?
If it won't work today, why would it suddenly work during a collapse? The ounce for a loaf of bread is illustrative, not really predictive. But if all you want was a loaf of bread, and all you have is an ounce coin, I sincerely doubt you'll be getting any fiat currency as change. And in all cases, you'll be severely overpaying for whatever you're buying.
It has been, if you average it out over time. Example: when gold was $300, would you have been smart to have bought it then? Why or why not?
It’s not about gold for bread. It becomes an issue of gold for a field of wheat. The guy with the field of wheat can’t store it; but he could, and would be glad to, take your gold for his wheat at such a time as that.
You’re probably thinking I’m the dumbass.
I did buy it then. Not a lot but it served me well, nearly quadrupling before I sold. Too bad I didn’t go all in, but that’s not my nature. I got an excellent return on a moderate investment.
Congrats. I went all in. We’re both pretty happy. Why?
Creep me out Pings. ; )
Because I got considerably more dollars out of the transaction than I would have had I held the original dollar amount in a savings account or even stocks.
As for you, I can only guess. I don’t know whether you still hold it or not. Equating the price of gold to various items as if gold consistently tracks inflation is a statement typically made by people who are a little too attached, so I’m going to assume you haven’t sold. You’ve lost 25% from peak.
Unfortunately, I won't survive a societal meltdown. Not with an active chronic disease, requiring a steady supply of medication and medical supplies.
My local government shut down my little jewelry sales business, and I was really pixxed because I had just bought $4,000 worth of silver jewelry pieces wholesale at $4 an ounce. I’m not mad any more!! I’m also glad I have a 3 months supply of nonperishible foodstuffs. Of course the Mormons say you should have a year’s food supply.
You’re wrong. I’ve done some of each, and bought more on dips. It’s called leverage.
Just don’t get caught without any.
It’s been dipping quite a bit over the past year year and a half.
You mention an interesting problem. That's another item people should work their way into an oversupply of -- life-sustaining meds. There is a way: always order them the instant they are available on your plan, and maybe over 3-5 years of time, you'll be a couple of years ahead!
That's when to buy a little more. The whole idea is to sell high and buy low (now there's a truism). The fluctuation is the lever. But the bottom line is that the "game" the Fed has been playing has a shelf-life. At some point, the "jig" (forgive the insensitive terminology) will be up. At that point, you won't be able to give $dollars away at hardly any price. That's when metals will look incredibly sane.
I did sell high. It still looks high to me. Buying as you have over the past year and a half would have been a losing proposition.
In most cases, that would be prudent, and in fact, I'm about a month ahead on many of my prescriptions. The problem is that some MUST be kept refrigerated, and the insurance companies will NOT let you "get ahead" on it (very expensive retail prices). And many of my other supplies are temperature sensitive and have shelf lives of less than 2 years. But except for that very expensive Rx, I've got enough for a month or so.
DOLLAR FADE: SKorea, China to trade in national currencies...
BRICs Morphing Into Anti-Dollar Alliance...
France hits out at dominance; Calls for ‘rebalancing’...http://www.ft.com/intl/cms/s/0/883e7912-0513-11e4-b098-00144feab7de.html#axzz36l0QEItG
Frances political and business establishment has hit out against the hegemony of the dollar in international transactions after US authorities fined BNP Paribas $9bn for helping countries avoid sanctions.
Michel Sapin, the French finance minister, called for a rebalancing of the currencies used for global payments, saying the BNP Paribas case should make us realise the necessity of using a variety of currencies.
He said, in an interview with the Financial Times on the sidelines of a weekend economics conference: We [Europeans] are selling to ourselves in dollars, for instance when we sell planes. Is that necessary? I dont think so. I think a rebalancing is possible and necessary, not just regarding the euro but also for the big currencies of the emerging countries, which account for more and more of global trade.
Christophe de Margerie, the chief executive of Total, Frances biggest company by market capitalisation, said he saw no reason for oil purchases to be made in dollars, even if the benchmark price in dollars was likely to remain.
Companies like ours are in a bind because we sell a lot in dollars but we do not always want to deal with all the US rules and regulations, he said.
The uproar over the BNP fine at the usually sedate Cercle des Economistes conference in Aix-en-Provence highlighted what has become yet another friction point in transatlantic relations.
French officials lobbied heavily on behalf of the countrys largest bank and argued that BNP broke no European rules, prompting a debate about whether it had been the victim of US judicial over-reach.
Looks like Europe is tired of being effed by the Obama Administration.
EU goes to war against power of digital giants...
A temporary loss, if you consider it that way, is only a way to get in on a considerable run-up. This is basic. You have to be willing to take risks at times.
And I consider myself to be hugely risk-averse!
Yeah, Mark — I feel for you/ but you’ve gotta do whatever you can to get whatever edge, small or great, that you can get.
When that process is complete a lot of Americans will find themselves pushing wheelbarrows of these:
shoot the messenger then, and ignore the message
What parts of the message do you disagree with and what is your alternate? Life goes on as normal?
I see a silver dime or silver quarter as more in the loaf of bread or bag of salt range and 2 silver dollars as a tank of gas or bottle of antibiotics
Some might prefer to not to do business with people who use bullets as currency
especially if they know where you are and they think or know they have more bullets than you do
I understand. Stockpile your meds *if possible*.
Beyond that, be capable of, and prepared to, see that you do not leave the mortal plane alone should you be forced to depart ahead of schedule.
You can also just ask your doctor for a regular prescription and pay for it out of pocket.
get a script and pay out of pocket.