RSS FeedRSS

We don’t live our lives cloistered in the ivy covered walls of academia, we have to make our way out here in the real world.

July 22, 2011 – “One thing is clear,” says Graham Summers in Seeking Alpha, “we are fast approaching the real crisis.” There is nothing alarmist in that statement, only cold hard truth.

We don’t live our lives cloistered in the ivy covered walls of academia, we have to make our way out here in the real world. Yet we allow academicians toy with our future with policies formulated on outdated theory that has no relevance in the new order of globalization.

One thing in particular has become abundantly clear: Fiat money has run almost every major western economy on the rocks and has proven to be completely unsuitable for underpinning the global monetary system. Europe continues to founder and America’s credibility has suffered an enormous blow as political infighting drives us to the brink of insolvency.

World economists have been looking ever more to China for salvation, but that country is facing its own liquidity dilemma as it struggles to ward off inflation and reduce the risk of asset bubbles and loans defaults. Early in July China failed to fully subscribe a bond auction for the first time since 2003, and one week later a second auction fell short of its target by a full one third.

Fiat money invariably declines to virtual worthlessness and in the process drives up prices for life’s essentials. That is particularly devastating in third world economies, causing desperate people to take desperate action. But America is not immune from social unrest, which will become clear as our safety nets deteriorate and ultimately disappear.

Yet we remain curiously complacent, trusting the dollar to see us through. When Jack Hough declares in the Wall Street Journal that “no country uses gold as money today or has plans to do so,” we take his word as gospel and disregard the IMF’s call to action and the global clamor for a sound monetary system.

No, Summers is not a doomsday radical. When he says the real crisis “will be the equivalent of 2008 all over again, along with food shortages, civil unrest, outbreaks in crime, bank holidays, and the like” he is only calling our attention to a very real and very serious situation.

And saying “if you haven’t already taken steps to prepare yourself and your portfolio for the coming disaster, you need to do so now,” does not put him in what Hough labels “the tinfoil underpants crowd.” He is simply urging us to take prudent measures to protect ourselves should the worst come to pass.

Kevin Johnson

Senior Staff Writer – GoldCoin.net

Get Your Complementary Award Winning Guides Below

 Publish Real Money Magazine

 Publish Gold Investment Magazine

 Publish IRA 401K Kit Magazine

 Real Money Magazine

captcha