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Blog Posted in avatar Aaron Jefferson's Blog

Do you have a plan for the dollar collpase?

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Aaron
By Aaron Jefferson
Posted Sep 27, 2009 in Politics
There is no doubt the United States is in for greater economic hardship in the future. The government programs designed to fix to the economy have done the exact opposite, and added trillions to our national debt and courtesy of the Federal Reserve, injected trillions of new dollars into the banking sector.
While this new money has yet to enter into the economy yet, currently it is sitting in an account at the FED, it certainly will in the future, when however not something anyone is can accurately predict. It will be lent sometime and when it does, thanks to fractional reserve banking, banks will hold 10% while they lend out 10x what is held as deposits. Say a bank has deposits of 10 dollars, the same bank can then lend out 100 dollars of credit even though they do not have the deposits to cover this new lending.
However, we are not dealing with hundreds of dollars, but trillions of dollars. It is difficult to even imagine the sheer amount of money that could be lent out in the near future. All of this new money only further destroys the value of our ever declining dollar.
The United States is inevitably headed towards a date when we have a depression and ever worthless dollar at the same time. The last time I remember this being the case was in the 1970’s when stagflation was the primary concern. To get an idea of how bad our future situation will be imagine the 1970’s 10x worse, and that may be the best case scenario at the rate we are going.
Nations around the world are becoming increasingly scarred of buying US debt as it becomes apparent we will never pay it back, unless we print all of it and thus completely destroy the dollar. China, our biggest buyer of debt, is buying increasing amounts of gold. Gold has been on a rally of late, but has not reached a new high, yet. As the dollar continues to plummet in value (as if paper money has value in the first place) gold will rise exponentially.
My question to you is do you have a plan? What will you do when faced with worthless dollar, possibly no job, and assets of worth to purchase life’s necessities, water and food? Some will probably say; “this guy is crazy”, or “that would never happen in the United States”. Well, those same people thought the stock market only went up, home prices never declined, or it was perfectly okay to dive into the Debt sea to buy that new flat screen TV you always wanted or any other consumer good that fancied you.
Prepare for the worst so anything else is just seems like normal.

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