I must say that some history has unfolded. Guns drawn in the Congress Chamber, shots fired and 4 dead per the latest reports. This is certainly ugly stuff and not a good indication of the current situation in the USA. It's taken a while to get to this point and it will take even longer to reform out of it. Trust has been broken and the Institutions that we once depended upon are shattering. But this is not news to those who have worked so hard to destroy families, entrepreneurship and rugged individualism in favor of the collective. And now heavy handed restraints on use of the modern media outlets. This never ends well.
As much as current events like Covid-19, contested elections, Capitol Building riots and disdain for law and order deserve attention, these are nothing more than distractions from the big event that, quietly or not, is happening right before our eyes. Destruction of the US Dollar. The days of a balanced budget are gone. The concept of taxation paying for government spending is now an obsolete one. The poison pill of the freely running fiat currency printing press has been swallowed by most whether a Democrat or Republican. The Libertarians who never really have gotten a foothold in American politics have some sensible people on this subject. I always enjoyed Ron Paul's viewpoints, particularly about auditing the Federal Reserve and getting back on the Gold Standard. Naturally, he is considered a nut by the mainstream who just push the gas pedal through the floor board in reckless abandon.
My suggestion and it is a serious one, is to keep your eyes on the National Debt, interest rates, the USD and watch Bond auctions. These will tell you the future. In that future is Inflation. Most young people have never experienced it and most older Citizens who have experienced it have forgotten its bite. The destruction of buying power effects life at large. The rich can weather it but the middle class (if any are left) the poor, both working and non-working, and the retired on fixed incomes will suffer. What do you do when a loaf of bread jumps to $10. Eat less bread. But self controls like that have their limitations. What do you do when interest rates get to 15, 16 percent or more and that McMansion mortgage payment takes 80% of earnings? This has happened before. Demand will drop and home prices will eventually fall. The wealth effect will morph into a poor effect and the longer one holds onto to cash, the less it will buy. This is truly the stuff that ruins countries. It happened in Germany, Zimbabwe, Argentina and many others. Their money became toxic and no one wanted it. The confidence in a currency is the only real gauge of its exchange value and when that goes away, that currency crashes and inflation is inevitable. Modern gurus don't even bring this up any more suggesting that the Fed can print us out any problem. They just miss the little fact that printing money IS INFLATION. Right now that inflation shows up in the price of Stocks and Real Estate and some other assets. In fact, a theory says that in inflationary times you should hold certain assets that will rise in value to protect purchasing power. That's not a perfect theory but good enough for me. Bitcoin, the darling of the speculation world has no intrinsic value. It will crash. That doesn't mean today but it will eventually be exposed for what it is, a ponzi scam dressed up like another fiat currency. Gold, silver, copper, platinum all will rise and I can see it as meteoric. These precious metals will preserve purchasing power because when exchanged for day to day cash their price will bring much more and buy many more loaves of bread.
Politics counts, particularly local politics. But the big stuff comes from Congress and they've collectively bought into the printing press and abandoned the concept of a balanced budget. Can you do that at home? No! You don't have a printing press. Congress in the hands of Democrats is not going to help because their stated plans depend even further on the printing of money… more than the Republicans who are almost as bad. Buying off the public with $600 or even $2000 checks as if they have it to give is absurd. If $2000 is good why not $10,000, $20,000 or a million. Just run the press. Eventually and sadly, the emperor will be seen to be naked.
Wise up, watch National debt, interest rates, bond auctions and stay aware of the real destruction to the USD and your purchasing power. Hedge by buying Gold and Silver. Mining stocks are good too but hold some physical Gold and Silver. The day will arrive when inflation hits and hits hard. You'll have protected your purchasing power and be making an occasional visit to the coin shop to get some day to day cash...bring a wheelbarrow.
Be advised!
Best,
Donn Marier
DM-Your Own CFO