Discussions of Mormons and Mormon life, Book of Mormon issues and evidences, and other Latter-day Saint (LDS) topics.

Monday, November 27, 2006

The Death of the Dollar

I hate to bring this up, but many of you just lost about 3% of your net worth in the past few days due to the declining value of the US dollar. And it's likely to get much worse. Clive Maund's "Death Knell of the US Dollar..." provides some of the cheery news of the season that we need as we get out our credit cards for the upcoming pagan holiday season, where Mammon and Lucre are the objects of worship. Hey, if you're going to worship an idol, at least choose one that maintains some value as the dollar declines - or that could greatly increase in value. Silver is still incredibly cheap. Just a word to the wise (and to the rationally greedy).

Meanwhile, get out of debt. Get food storage. Live providently. Save and invest wisely. The insane spending and printing of bogus fiat dollars in the past couple of decades is bringing this nation to an untenable state. When a few major parts of the world abandon the US dollar in favor or euros or precious metals, the dollar will plummet and the Fed will face strong pressures to ramp up interest rates to extremely high levels to maintain foreign interest in US treasuries - and that will only amplify the pain in the economy. We are facing troubled times. Living in debt will only make the pain much worse for you and your family.

10 comments:

Bishop Rick said...

So this means that our increase has actually decreased by 3%. Keep that in mind during tithing settlement.

Anonymous said...

Technically it only means our purchasing power of foreign goods has decreased by 3%. We haven't experienced a 3% inflation in a few days - a loaf of bread is still the same price, unless you buy fancy European stuff. Otherwise, the foreign pressures are just as real.

Zorro said...

Some more "cheery" but necessary reading comes from Club Orlov, where Dmitri Orlov discusses the economic collapse of Russia and the parallels - or lack of parallels - to the pending American collapse. His Russian perspective is amazing.

See http://www.cluborlov.com/ClubOrlov/ConfSlides/index.html.

John Mansfield said...

You think silver is still incredibly cheap? Five years ago it was trading at a third its current price. If it is incredibly cheap now, did you trade away most of your assets five years ago to pick up the free silver lying on the ground? I'm with you on the fragility of the dollar and have a large fraction of our savings in metal, but I get nervous predicting what any asset will do.

Here's a quandary, though. Supposing that dollar inflation will take off in the near future, wouldn't it be good to owe a dollar-valued debt? Borrow dollars now to buy silver or same steady asset, and pay then back later when they have much less value.

Mormanity said...

Historically silver has been 1/15 or 1/16 the price of gold. That reflects the physical reality of relative abundance. But although industrial demand for silver has grown greatly and its reserves are far lower than they were in the past, the price of silver now is about 1/50 that of gold. It's a wild anomaly due to what Ted Butler and others have described as massive market manipulation that is about to crash head-on into the realities of supply and demand. Yes, this is a rare opportunity, when the price of something with high inherent value is far below where it should. It is almost inevitable that in the long run, the price of precious metals will rise strongly, and silver may have the most explosive potential.

Mormanity said...

But do your own due diligence! Some great reading is at kitco.com, for example. And yes, the price may drop at any time - but in the long run, the fundamentals are solid, in my OPINION.

Christian Adams said...

...on the other hand, Brother Brigham said a bushel of wheat would be worth more than its weight in gold. You can't eat gold. All specie predictions are off if and when the system breaks down enough. I like the Nephite system of money (Alma 11), because it included grain in its monetary system - maybe you could call it the Gold-Grain Standard. Food for thought anyways.

Anonymous said...

Brig also said you ain't getting into the Celestial Kingdom without a minivan full of wives. Or something to that effect.
On topically speaking, just because the dollar is falling does not mean the sky is.

Anonymous said...

We, in the US, are like the people of Jeruselem (1Ne.2:13) and of Ammonihah (Alma16:9) who did not believe our society could be destroyed.

Despite the fantastic efficency of an "just-in-time" or "Walmart" economy, our society is at great risk because we are less self-sufficient individually and as a nation than ever before

Bird Flu pandemic or oil shortage could mean severe disruptions in the ability of our country and communities to function.

During the famine in Europe following WW2, Oil and honey were more valuable than gold. See additional LDS quotes on Emerg. Preparedness at emergencynow.blogspot.com

Anonymous said...

If the dollar is crashing, then the smart thing to do is borrow as much as you possibly can! Borrow alive dollars today, and pay back the loans with the worthless, dead dollars of tomorrow.