Introduction
We come up with a new monetary system approximately every 40 years. Each time in the last we have slowly been moving away from gold up until 1971 where we completely removed a gold backing and decided to make the dollar back by just faith in it as a currency. (Look into the Bretton Woods System)
China just band cryptocurrencies and they are shutting down all exchanges. They have been stock piling gold since the US went off of a gold back system in 1971. Russia has been something similar with getting as much gold as they can.
Countries Moving Away From the Dollar
China starting to benchmark Oil against gold coming up (Check out this video). Saudi Arabia may follow that trend as well. The petrol dollar that has been keeping the dollar on top is starting to go away. Venezuela has said similar things with their oil.
US System Compromised
The US dollar is the world's reserve currency. The US runs on credit. Fractional reserve lending practice by banks is mostly credit based. Equifax, one of three credit report companies, just had a massive hack. If the credit system goes down the rest will tumble like a domino effect.
Scenarios:
That company goes under from lawsuits and credit fraud as a result of the hack. US loses a third of its credit history
Does the government protect and/or bail them out?Hackers steal the 143 million identities and implode the credit system from the inside.
People lose faith in the credit system and demand a better way.
Any combination of the above 3 could force the creation of a new monetary system. Not to mention the housing bubble is inflated again and many students cannot afford to pay back their student loans. Place on top of all of this that we are reaching the debt limit again. If it is not raised the government could potentially be furloughed. If not we will just raise it and keep our heads buried in the sand and watch the debt keep skyrocketing. (read about the debt limit)
What will the world agree on when the backing of the entire world collapses? It could be cryptos but, with at most, a third of the world population having access to internet it is not possible to do so. Gold, silver and other hard assets will be what drives the value of a country in the new system. The easiest way to get hard assets is in gold and silver. They are both way undervalued, especially according to the US debt clock .org, there is about 784 dollars per ounce of silver with the price to purchase silver currently under $20 an ounce. That is under valued by 784/20 ~ 39 times its value. Similar story with gold with 6,461 dollars per ounce of gold and you can currently purchase gold around $1200 an ounce. (US debt clock)
Time To Buy Gold/Silver
I have posted a couple of Mike Maloney's videos before. I think he does great analysis and explains this in very good detail. He has another great video on reasons to buy gold and silver. Which I am echoing and trying to pass along the word. Check out the video below for more details!
