Part 1. The Car Crash
Part 2. The Economic Crash
Part 3. The Cars
Part 4. Freedom and the Pursuit of Excellence
The Economic Crash
I always say that in every disaster lies an opportunity. What coming
this close to death has done for me is to remind me to enjoy my life.
To always do my best, and enjoy what I’m doing.
Back in 2002, when I began this journey into economics, when gold was
under $400 and silver was under $5, I knew I had an understanding of
what was happening in our society. And I knew I wanted to use that
understanding to help others. Seeing the crazy things governments and
central banks around the world were doing to their economies, I started
sharing what I had learned and encouraging people to do their own
research, decide what they should do, and take action. Now that gold is
over $1,600 and silver is over $30, I can honestly say that I feel both
rewarded and privileged to have played a positive part in helping to
protect many, many people from government stupidity.
But it’s not over yet. I believe the biggest economic crash in history
is still coming at us, and is just around the next bend in the road.
For years I have been getting ready for this economic disaster by
investing every spare dollar into gold and silver. And even though I’m
the guy that sees this economic crash ahead as the greatest opportunity
in history, and even though my gold and silver makes me feel safer and
sleep more soundly, I still worry.
From a monetary historian’s point of view there is no example, in all
of history, of the type of monetary malfeasance currently being
committed by governments and central banks turning out well. In fact,
it always leads to disaster… and this time they are doing it globally!
Historically, when a crisis wipes out a society’s middle class, there
is very often a great political change in that country, and it is always
for the worse. As goes the middle class, so goes the nation. The
middle class is approximately 60%-70% of a nation’s population. They
define a country with their vote and when they are scared, and
threatened with the possibility of a life in poverty, they will vote for
anybody. Usually they will vote for a strong, charismatic leader who
will play on their fears and promise them a way out of their
predicament. In fact, you can trace the rise of Napoleon, Hitler, and
Mao directly to currency crisis and a loss of the middle class.
Today, worldwide, we have the largest middle class in history. In the
U.S., and in many other countries around the world, the generations born
after WWII are spoiled… they have never gone hungry… they have never
known real economic strife. Most of them believe they deserve something
just because they are alive. This creates a dangerous situation. When
you take away a spoiled brat’s toys he throws a tantrum.
For the last 30 years governments and this spoiled middle class have
both been rewarded for taking on ever-increasing mountains of debt.
Like rats learning a maze, debt-dependence is a conditioned response,
brought on by a series of rewards and punishments. Artificially low
interest rates, which have been lower than the real rate of inflation,
have punished savers and rewarded borrowers.
Today’s unsustainable debt and currency crisis is entirely caused by
central banks meddling with the economy. To understand how central
banks artificially goose the economy we need to look at how currency is
created.
Whenever a central bank writes a check it creates a type of currency
they call “base money” (paper currency). The reason currency is created
every time a central bank writes a check is because the check was drawn
on an account that always has a zero balance. Basically they are
committing a fraud and counterfeiting. These brand new units of
currency inflate and dilute the currency supply when they enter
circulation causing the purchasing power of that currency to fall. With
each new unit of currency created, each existing unit of currency has
less purchasing power. The symptom of this inflation and dilution of
the currency supply is rising prices.
The recent crash of my Tesla Roadster and the global economic crash
that lies ahead of us have some similarities. Surviving the impact of a
collision is all about the dissipation of energy. By allowing the body
of my Tesla to absorb energy by crumpling and disintegrating it
cushions the impact, while the strong and rigid passenger compartment
maintained its integrity and allowed nothing to intrude, saving my life.
The biggest crash the world has ever seen is happening right now. The
financial vehicle I have chosen to carry me safely through it is gold
and silver.
