Richard Russell – Gold To Save World From Drowning In Debt
September 5, 2012
The Godfather of newsletter writers, Richard Russell, believes gold will be used to save the world which is drowning in debt. Here is what Russell had to say: “The national debt of the US is now well over $16 trillion and growing at the rate of over one trillion dollars a year. It can never be paid off through the ‘normal’ means. Paying off by normal means would entail a huge, really killer boost in taxes and a brutal unmerciful, slashing of entitlements. The only way the US’s debts can ever be seriously addressed is to devalue the dollar.”
Richard Russell continues:
“The US owns the world’s greatest hoard of gold. Here’s what I think the authorities have to do. They should unilaterally, overnight raise the price of gold to a high value, maybe around $10,000 an ounce. Thus, each dollar would be worth one ten-thousandth of an ounce of gold. This would allow our enormous debt to be paid off with vastly devalued dollars.
This would be inflationary, since everyone who owned gold would own a pile of devalued dollars. The huge increase in the number of dollars would drive prices up, and that would work against the current forces of deflation.
Nations owning gold would in turn (in order to compete) — devalue their own currencies, and thus be able to pay off their own ‘impossible’ debts. In the end, a new world monetary system would have to be established, but the terrible problem of a planet choking on debt would be solved.