hn Ing: Fifty years ago, under the crushing weight of debt to foreigners, President Nixon severed the dollar\u2019s link with the gold standard, replacing the dollar\u2019s backing not with gold but the \u201cfull faith\u201d of the United States\u2019 economy. What followed was an era of fiat money debt-fueled spending and the great inflation of the seventies and early eighties.<\/strong><\/p>\n\n\n\nAfter years of massive deficits from LBJ\u2019s Great Society and financing the Vietnam War, the United States did not have enough gold to back its debts. The Fed also tried to keep rates low until Paul Volcker forced rates to the roof to stop hyperinflation. Since 1971, the greenback\u2019s purchasing power has lost 98 percent in real terms\u2026<\/strong>
Today America not only has record debts but the Fed keeps creating dollars as the tsunami of money cheapens the world\u2019s leading currency. Money is free. America\u2019s debt is larger than its economy and it is unlikely that debt will every be repaid, debasing the dollar. In less than 10 years, America\u2019s debt has doubled to $29 trillion, another record. The dollar is structurally weak. The present system depends on the dollar, however without confidence in the dollar, the world has no valid reserve currency. America\u2019s exorbitant privilege is not infinite as are the laws of economics.<\/strong><\/p>\n\n\n\nGold Is Going To Be The New Global Currency<\/span><\/strong><\/p>\n\n\n\nThe crux is that America is reliant on foreign capital to fund its deficits and profligate spending \u2013 that is America\u2019s Achilles heel. The greenback is overvalued, deficits are unsustainable and inflation is their next problem. In Washington they do not seem to care. Both the economic vulnerability and geopolitical risk are more acute than it appears. If interest rates rise, paying down and servicing the debt will become unmanageable. Interest on their debt alone tops $500 billion and that is at new zero rates. America is operating a reckless financial system whose main characteristics are rising deficits and a rising stock market. A consequence of America\u2019s profligacy, is that the dollar must depreciate further which will exacerbate rising inflation. And again, America remains divided against this threat. What damages trust in the US, damages trust in the whole world.<\/strong><\/p>\n\n\n\nInvestor confidence is fleeting. History shows that there is a cycle of debt, and borrowing trillions of dollars only makes it harder to be repaid. The overvaluation and bubble-like market conditions have masked many problems but the swamp is draining; exposing some very ugly frogs. Credit Suisse alone suffered a $5.5 billion loss from the collapse of Archegos Capital which cost the big banks a total of $10 billion in losses. Greensill in the UK filed for bankruptcy in March, sparking a corporate and political scandal, shortly after the Wirecard implosion in Germany.<\/strong><\/p>\n\n\n\nToday, the crackdown from Beijing has hurt many of the big private equity players as Chinese tech stocks dropped the most since 2008. While global capital has so far digested these shocks, risk keeps piling up. Awash in a sea of debt, growing public and investor disenchantment over government mismanagement of the economy, pandemic and ESG has created inequalities and an unjust society. Without confidence, there will be pressure for familiar old remedies. Our problems are being treated as everybody\u2019s problem and therefore nobody\u2019s. All in all, gold is a good thing to have\u2026<\/strong><\/p>\n\n\n\n________________<\/p>\n","protected":false},"excerpt":{"rendered":"
August 24, 2021 Today a man who is connected in China at the highest levels said gold is going to be the new global currency. The Great Default August 24 (KWN) \u2013 John Ing: Fifty years ago, under the crushing weight of debt to foreigners, President Nixon severed the dollar\u2019s link with the gold standard, replacing the … Continue reading “Look At Who Just Said Gold Is Going To Be The New Global Currency”<\/span><\/a><\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"closed","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"om_disable_all_campaigns":false,"_jetpack_memberships_contains_paid_content":false,"footnotes":""},"categories":[1],"tags":[],"class_list":["post-383","post","type-post","status-publish","format-standard","hentry","category-uncategorized"],"yoast_head":"\nLook At Who Just Said Gold Is Going To Be The New Global Currency - Gold Silver Desk<\/title>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/goldsilverdesk.com\/news\/look-at-who-just-said-gold-is-going-to-be-the-new-global-currency\/\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"Look At Who Just Said Gold Is Going To Be The New Global Currency\" \/>\n<meta property=\"og:description\" content=\"August 24, 2021 Today a man who is connected in China at the highest levels said gold is going to be the new global currency. 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