Surviving a Monetary Collapse

Monday, July 15, 2013
By Paul Martin

Harry Richardson
Sunday, July 14th

Where Are We Now

Our current monetary system has only existed in its present form since August 1971 when President Nixon reneged on the convertibility of the US Dollar to gold. Prior to this it was the world’s reserve currency, tied to all others at fixed exchange rates creating a worldwide quasi gold standard known as the “Bretton Woods system”. Breaking the convertibility of paper money into gold allowed the US and most of the developed world to print money with abandon stoking severe inflation. At the end of the 1970’s however, Fed Chairman Paul Volker hiked interest rates right up around 16% causing a savage recession. Since then however, interest rates have been trending downwards. Currently, rates around the developed world are close to zero and many central banks are printing huge sums of money (Quantitative Easing) to prevent financial collapse and prop up an insolvent banking system.

They are currently in a “sweet spot” where, although this money printing is not stimulating the economy (of course), it is not yet showing up as consumer price inflation. When this does happen, it will likely accelerate at an alarming rate which will take peoples breath away and devastate societies and peoples way of life.

As paper money loses value, the only alternative will be real money, represented by gold and silver. The increased demand this will create means that they will appreciate in value not only against paper money, but even against other tangible goods.

Price Suppression of Precious Metals

In my previous article (here) I looked at ways that precious metals prices may be suppressed by banks and governments to make their own debt based money look more attractive. If this is the case then the current low prices make them worthy of a serious look for investment purposes. As Rick Rule famously said about commodity investors, “you are either a contrarian or a victim”. Right now, precious metals are about as contrarian as you can get with all but the staunchest supporters having sold out.

Gold and Silver as Insurance

It is possible in theory that our current paper money system will survive. If it does however, it will be the first time in history that unbacked paper money hasn’t lost all value. My own opinion is that modern economic theory exists purely to justify and inspire confidence in this system. There is certainly no scientific method employed and the underlying school of thought (Keynesian) which supports all modern economics is the only one which sees this system as a benefit.

This article is my attempt to explain the theories of the “Austrian School” of economics. To me, they make far more sense than the voodoo pedalled by the mainstream economics profession which seems entirely unable to understand, explain or predict even seismic events such as the GFC.

Most of us buy fire insurance for our houses which will almost certainly not burn down. Taking out insurance against monetary collapse which looks inevitable seems to me like a really good idea.

Even More Important

I believe a global monetary collapse would represent a catastrophe not seen in our lifetimes. I still believe however that humanity will recover from this event and rebuild, hopefully learning from the experience and creating a more stable and fairer economic system.

What scares me far more than this, is the religion of Islam. Having studied it extensively, I have found it to be far more dangerous than almost everyone (including most Muslims) believes. I have spent years trying to condense the essence of this religion into a short, interesting book which can be easily understood by everyone. No one would publish this book for fear of death so I have posted it on the net where people can read it for free at:

If you are starting to suspect that the mainstream media, politicians and supposed experts are not telling the truth about this religion then this book is for you. By the time you reach the end you will realise why, short of a rogue asteroid strike, this is the gravest risk facing humanity today. Please take the time to educate yourself on this subject for the sake of all the peoples of the world (especially Muslims, many of whom who suffer greatly because of this religion).

Please help to educate others about these issues by forwarding these articles by email or especially by posting them on social media and giving them a “like”.

Full Piece…HERE

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