I had a conversation with my friend Andy Schectman the other night and we were discussing one of his many appearances on YouTube. Andy has been an industry leader in the precious metals space for years, but he has stated to me that “YouTube changed my life”. Just the day we spoke he must have done 5 podcasts and the last one was at 8:30 PM for an Australian channel.
I let him know that I appreciated all of the great information that he was providing not only in the gold space but also bringing to light the BRICS currency, CBDCs and the changing global landscape where fiat currencies of all kinds along with sovereign bonds are being exchanged for real money- Gold.
As we were speaking, I brought up what I wrote a few weeks ago about if you had bought the DOW in 1971 with gold (real money) and measured it in gold you would have a return of MINUS 30% over that time.
Andy said that he read that but couldn’t figure out the numbers. Here they are.
In 1971 the DOW Jones Industrial Average was: 884.
Gold was: $35.
If you purchased the DOW with gold, you would have needed 25.26 ounces to purchase the DOW.
Today, the DOW is 37,920 near the close on May 1, 2024.
Gold is $2312.00 near 4PM on May 1, 2024.
If we have the same 25.26 ounces of gold that we bought the DOW with in 1971 it would be worth
$58,401.00 TODAY. $58,401- $37920 = $20,481.00 That is actually a 54% LOSS if our “money” held its value.
Why is this important?
#1 It is an amazing illustration of how our “money”has lost value over time. It also illustrates that those things that we buy don’t change but with the loss of purchasing power it gives the illusion of higherVALUE when all that is actually rising is PRICE. Keep in mind that a hunk of gold, silver or really any hard asset doesn’t change. It is the currencies COLLAPSING that give the ILLUSION of their Price going up.
#2 It is a chilling example of how we have been played in the past few decades. How much “money” has been extracted from productive members of society and blown on endless wars and propping up failing enterprises? Some has been funded with taxes but the most underhanded tax of all is inflation- which is nothing less than those who can, conjuring up cash out of nowhere. As a result, PRICES rise, quality falls and life becomes harder for everyone- except those “in charge” of course.
Why doesn’t the “government” stop them? Think about it. Nothing changes but TRILLIONS get extracted from the public via higher wages- which equal higher taxes and capital gains taxes. You may have bought an investment in a stock index and it “went up”. The VALUE may be even LESS than what you have paid but since you have a paper gain Uncle Sam wants his. He always gets it too- one way or another.
This allows politicians to continue spending FAR beyond their means and allows those “in charge” to hold on to their power. This is a stealth TAX that not even 1% can figure out. Those in the know have already figured it out and they are already moving to hard assets before the population catches on.
They usually catch on far too late, and the music stops when those “in charge: run out of other people’s money.
#3 Many people shun gold because in their words “it doesn’t do anything”. This is the illusion that fiat “money” creates. Anyone who says this is actually correct. A hunk of gold or silver just sits there BUT, as currencies are debased, they hold their VALUE. While many games are played to manipulate the PRICE downward and to give the illusion of volatility so many are fearful to participate- those in charge (central banks and their owners) are buying in record amounts. In addition, gold is a tier 1 asset. It is listed on the central bank’s balance sheet as “riskless”. But don’t believe it- they would have competition trying to buy it all.
#4 For MANY years people have pointed at Japan as the example of why we could “print” to infinity. Anyone like me who brought up that you can’t conjure up INFINITE amounts of cash with FINITE resources was labeled a kook. Let’s look at Japan. I believe we are heading right down the same path- just a few years behind. Their currency- the Yen is collapsing because of their massive “printing and buying” schemes. Just 6 months ago- according to a Kitco chart it cost 298,000 Yen to buy 1 ounce of gold. Today, it is 359,487 Yen. As you can see when things accelerate it happens quickly. In just 6 months a Japanese citizen needs an additional 61,487 Yen to buy 1 ounce of gold. Again- did the gold change? No. The Yen is collapsing.
The US dollar is also collapsing. It is just collapsing at a slower pace than what it is measured against- worse fiat currencies. This is another reason those “in charge” are keeping a lid on gold and silver prices- to disguise the weakness of the currencies. We are bombarded with propaganda about price gouging and other excuses for higher prices, but it is simply too much cash conjured up out of nowhere, a lack of production because of price manipulation and handouts, and an unwillingness to recognize the problem and try to fix it.
Instead of reigning in our spending we are spending like drunken sailors on a two week leave after 6 months at sea.
There appears to be no end in sight to our deficit spending which is leading us straight into a Japanese (I hope) situation. I only hope that because the other options are Weimar Germany, Zimbabwe and Venezuela- all which we are currently emulating at this time also. Remember, everyone in Zimbabwe was a billionaire- too bad it cost a trillion Zimbabwe dollars to get a dozen eggs a few years ago.
Most people have NO CLUE how close we are to a watershed moment that could be triggered at any time.
There is a reason that wealthy families have passed on generational wealth with art, unencumbered real estate and GOLD. They are ASSETS and not units of DEBT- like most paper assets.
Be Prepared!
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