Couldn’t sleep last night. I kept thinking about the false hope I may have given people in yesterdays blog that if you somehow got your spending habits in line everything would be ok. Actually I honestly believe it’s too late. Even if everyone stopped spending more than they made and saved every penny, we have already cooked our goose. Our debt has already passed the point of no return. We have gone way beyond the tipping point. Basically we should now be in damage control mode. It’s like the guy that forgot to apply the parking brake. As he watched his driverless truck roll down his driveway, no amount of yelling and screaming could stop it from crashing into the neighbors car.
I should clarify, when I say “we” I really mean the U.S. The problem is that Canada is so closely tied to them that when they go down so do we. And believe me, they are going down hard.
Any money that is not in hard assets could be subject to devaluation or outright forfeiture. The bank with it’s smiling tellers is the worst place to have your assets. Mutual funds, GIC’s bonds, anything that resembles a piece of paper is just a promise to pay off the bearer with more useless fiat currency.
The famous Englishman Bernard Shaw once said “one has the choice between the natural stability of gold and the natural stability of honesty and intelligence of government. And he was of the opinion this choice was not hard.” Yes I’m a gold bug. Well not really, I like silver better. Same diff. They are both real currency, the only way to preserve your wealth when all financial hell breaks loose. Any one can start by saving 35 bucks to buy a Canadian silver coin at the local mall. When our currency collapses, you have something to trade for things that really count. Like food for example.
So why is China now the world’s largest purchaser of gold? Do they know something we don’t know? We are due for a complete currency change. The greenback is no longer going to be the world’s currency. The change over has already started in parts of the world. China and Russia no longer trade with each other in U.S. currency.
What does all this mean to the average working stiff? The difference between your take home pay and your expenses is diminished. Imported goods are unaffordable. (we didn’t like the cheap offshore junk anyways). Families now need 2 incomes just to survive. Women are too stressed and too busy working to make babies. Some people don’t think that’s such a bad thing but when you destroy the family fabric, so goes the country. Unemployment is a given for more and more people. Social unrest becomes a serious issue. We become a third world country.
If you put a frog into a pot of hot water he will jump right out. Put him in cold water, slowly turn up the heat and he will stay there complacently …til he’s cooked.