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The Other Currencies

Chris Baken
Nov 2, 2010

Everywhere you turn, it seems like there’s another economist with a different opinion on where our economy’s headed. Despite persistently high unemployment rates and slower than expected economic growth most economists seem to agree the recession is over. But is it really? After all, what has changed since the crash of 08?

The media would have you believe that happy days are on the way. The Fed, (which most Americans fail to realize is a banking coalition and not a government agency) has you covered! But the underlying fundamentals of the US economy remain the same as they stood in early 08. We are still reliant on credit fueled purchases of discretionary services to fuel our economic growth. The core problem of our economy is that it isn’t based on real wealth, but rather artificial wealth created by easy credit.

But wait, haven’t you been paying attention Chris? Ben Bernake’s about to save the day with more Quantitative Easing! This economic malaise can’t possibly withstand the combined intellect of all those smart people at the Fed, can it?

Well, let’s break it down. At its essence, the term Quantitative Easing boils down to printing money! Wow, case closed, problem solved, we can all retire now and create imaginary wealth instead of actually working! Or maybe, we can create so many jobs printing money we can cure unemployment!

It’s no wonder than that the public distrusts the clowns in Washington and public disillusionment with both parties resides at all time highs. Unfortunately, while most Americans say they distrust government, they are in fact entrusting the government with the keys to their future financial security.

Let me elaborate. Take a second and think about what you’re invested in. Maybe it’s stocks, bonds, cash or some combination of all of the above. You’ve diversified across multiple economic sectors and asset classes. But have you diversified across different currencies?

Chances are as an American you think about wealth in terms of dollars. This is only normal as we use dollars every day for our day to day transactions. But at the end of the day, what is a dollar? It’s a piece of paper backed by the word of the US Government. Like everything else the dollar is a commodity. It’s affected by supply and demand just like any other commodity. Printing more dollars decreases the value of the dollar and increases the price of other commodities (like food, oil, gold and silver) relative to the dollar. Do you trust the government to preserve the value of your hard earned dollars?

You have other options. But ssshhh, the government doesn’t want you to know. If you trade in your dollars for hard assets and other currencies, that decreases the demand for the dollar. Commodities like gold, silver, and other precious metals as well as other commodities like oil, natural gas and food have been bought and sold for thousands of years, and are universally accepted as valuable. But why own real value when you can own the US Dollar!

The American government doesn’t care about you. Printing money allows the government to buy its own debt and fund more spending indefinitely. The value of your savings and investments? Don’t worry about it. You weren’t actually saving were you?

Stop letting the government babysit your financial future. Grab control of your financial future! Invest in commodities - the other currencies.

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Chris Baken
email:
cgb0057@yahoo.com

About the Author: Chris Baken is a disillusioned young economist from Dallas, Texas amazed by the lack of common sense in modern economics.

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