Preparing for the dollar’s demise with prudent gold and silver investment does not make one a left-field doomsday prepper. It is no more than a prudent response to a situation that has a long history of precedent.
Contrary to popular belief, America will survive and flourish long after the dollar’s reign has ended. Germany suffered the worst-case collapse of a major currency in modern times following WWII, yet even with having to rebuild its devastated infrastructure Germany’s economy grew to become Europe’s flagship.
America will have it far better than Germany because all of our stuff is still intact. We could come out of this virtually unscathed if only we would surrender before the real problems start.
There are many examples of countries that have managed fairly well with inflation running 25% or more, because people can adapt to that. Salaries get paid more frequently and interest on savings rises to keep pace. More significant, however, the black market emerges.
The final stage of a currency’s demise is not so easily accommodated. Hyper-inflation sets in, which in Germany meant prices nearly doubling every day. Once ignited, hyper-inflation leaves little opportunity to adjust, let alone take cover. But through it all, the black market flourishes.
Black markets exist when the open market cannot supply some desired commodity or when unstable legal tender necessitates a substitute medium of exchange. Until very recently the substitute most in demand has been the dollar. The black market that will emerge during the dollar’s decline, however, will undoubtedly trade in gold and silver.
Once hyper-inflation begins trade quickly shifts almost entirely to the black market and, despite all efforts by the government, the alternate medium of exchange becomes the new legal tender by default. That is amply demonstrated by the number of nations that now use the US dollar for their legal tender.
As things are today, a defensive posture in gold and silver is well advised. The real threat, however, still lies somewhere down the road. But he who hesitates may well be lost. When hyperinflation hits, it rarely gives much warning.
Hyperinflation will come to America as surely as it has every to other nation that turned to fiat money. It may not happen for 20 years or more but it could happen tomorrow. The degree to which wealth is preserved depends how much of that wealth is held in the alternate medium of exchange.
For the past 5,000 years – and until a superior alternative emerges – that medium of exchange will unquestionably be gold and silver.