There have been dozens of currency crises over the last several hundred years. But until recently, currency crises were confined primarily to either emerging third-world economies or fascist political systems like Germany and Italy in World Wars I and II.
Now, the currency of the world’s foremost superpower is about to enter its next leg down.
Already, in just the past couple of months, we’ve seen the central banks of Australia, India, and Norway, and even our northern neighbor Canada is about to jack up their short-term interest rates to defend their currencies — while our Federal Reserve, month after month, not only prints more money …
But also makes it perfectly clear to all of us — including our foreign creditors who are increasingly getting upset with our profligate ways — that it is going to keep interest rates low in this country for as long as the eye can see.
What’s more, Singapore has just jacked up the value of its currency versus the dollar — a prelude to an inevitable dollar devaluation against China’s yuan!
That one really gets me. Do the folks in Washington really think that by pushing China’s yuan up — and the dollar down — they’re going to save the U.S. economy?
Unfortunately, that’s exactly what they think. Because Washington’s solution is to pay its debts with cheaper dollars.
I’m not the only one who has caught on to this scheme. Consider these other notable people and what they have to say …
“It’s the … official policy of the central bank and the United States and to … debase the currency.”
— Jim Rogers, Co-Founder of the Quantum Fund
“The current crisis is … it’s basically the end … of a 60-year period of continuing credit expansion based on the dollar as the reserve currency.”
— George Soros, The world’s #1 global investor
“Holding dollars today represents risk … without … reward!”
— Joseph Stiglitz, Nobel Prize-winning economist
“In the absence of the gold standard, there is no way to protect savings from confiscation through inflation. There is no safe store of value. Deficit spending is simply a scheme for the ‘hidden’ confiscation of wealth.”
— Alan Greenspan, Former Chairman of the Federal Reserve
Pay particular attention to this one …
“By a continuing process of inflation, governments can confiscate, secretly and unobserved, an important part of the wealth of their citizens … in a manner which not one man in a million can diagnose.”
— John Maynard Keynes
Please Take Steps to Protect Yourself!
If you have not already done so, consider the following …
First, keep your emergency funds SAFE! In my opinion, money market accounts, especially Treasury-bill only money markets, are a great place. But only keep a small portion of your liquid cash in them, because they are in U.S. dollars … the yields are effectively nothing … and those funds are completely exposed to a loss of purchasing power in the dollar.
Second, stay away from long-term government, municipal, and corporate bonds as well. They’re a disaster in the making.
Third, keep the bulk of your investing money in REAL WEALTH! I’m talking assets and companies that specialize in tangible contra-dollar investments such as gold, oil, base metals, and foods.
These investments give you great inflation hedge protection … and insulate you from the deflating dollar.
….read more on Inflation by Larry Edelson HERE
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