FROM THE DESK OF PORTER STANSBERRY
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like Silvergate... Silicon Valley Bank... First Republic... Signature Bank and more... Now of course, the government stepped in to bail out all these banks too... Another fire
And that’s just inflation. You probably won’t be surprised to learn that they’ve changed how they calculate them over the years. And that every time they make these changes, inflation seems to conveniently come down. If you measure the dollar to the value of gold, which is a measure that is impossible for the government to pervert, the dollar has lost 90% of its value since 1999. AMY: That’s a shocking number. PORTER: It is. And Americans are finally waking up to this fact because they’ve seen their quality of life decline so much. More than ever before, Americans are learning about economics and financial history, and they’re realizing we’re playing a rigged game. And it is rigged because of the government. But as my friend Richard Maybury, the famous author of the Uncle Eric book series would say... “It’s the only game in town. You must hold your savings in some form. There is no escape.” So while I worry about our country’s debt, and what our leaders are doing to our dollar, which is the kind of thing you normally only see in a banana republic... We all are faced with the same dilemma. We must store our money somewhere. Cash isn’t a great solution, obviously, as I just mentioned. And I would stay away from any long-dated U.S. government debt, which will likely be defaulted on, either through inflation or through outright default. I think that in 20 years, people are going to find it absolutely unbelievable that so much of the world’s wealth was once stored in the credit of U.S. treasuries. No one will believe that anyone was ever stupid enough to lend our government money. I like to own real estate. I have a nice farm in Baltimore County. And I’ve always owned gold as a hedge against what I knew would happen to the dollar. And I’ve done very well personally with those investments. But for most people, and certainly for people reading right now, we need to have liquid assets in addition to gold and land.
“suppressed”... But all that bad debt... all the debt from 2008 and all the bad debt from last year’s bank bail outs is still owned by our government. The taxpayer will, one way or another, pay for that bad debt – NOT the banks. And so, for the past 15 years, I’ve been telling this story and explaining why the U.S. dollar is inevitably going to be replaced as the World Reserve currency... and why that will forever end our ability to continue to spend and add debt the way we’ve been accustomed to for the past 70 years. And that end, I believe, is a lot closer than anybody else is expecting. That’s the entire story. That’s the world we are living in. And that’s the reason why most Americans don’t feel safe. It’s also the reason why America doesn’t feel like the America that you and I grew up in. That’s the most important macroeconomic story you need to understand if you are investing in the markets today. We are approaching an enormous fiscal, monetary, and cultural cliff. AMY: But when exactly do you expect it to happen? PORTER: Well, I’ve been talking about this for 15 years now, Amy. And my belief isn’t that the dollar will disappear entirely. The dollar will exist as long as our country exists. But the value of those dollars will continue to decline as they have for the past century, since the creation of the Federal Reserve. Just consider, since the start of the pandemic, the purchasing power of any dollars you hold in your bank account have declined by at least 20%-plus . Poof. 20% of your cash gone. And that’s if you trust our government’s reporting of the numbers.
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