Hello again and Happy Monday!   It’s been awhile since we wrote about Gold and Silver and why people buy it.    So what has happened in the last couple of months?   Over the late summer weeks, the temperature of the U.S. stock market started cooling down over the nervousness of continued threats of war with North Korea nuclear missile testing and the U.S. retaliatory comments back and forth.  U.S. jobs data have been mixed and the plight of the U.S. Dollar has continued to sink to a 11 month low with a record high $19.9 Trillion Dollars in debt.

So what does the U.S. Dollar value have to do with our dollars in stocks, bonds, and other types of funds in banks, IRA’s and 401(k)’s?

This is a typical question that should be on everyone’s mind these days.  Let’s try to demonstrate in very simple terms with the following example. 

So let’s talk about this….If Fred the “stickman” above only paid money back to Bill sooner later he gets mad and steals it back…then what?   He probably will get rid of it somehow to hide the evidence!  Ok, are you with me still?   Let’s say Fred is the U.S.   and the U.S. has $20 Trillion in debt to other countries like China, Japan and other countries that buy U.S. Treasuries in order to trade in U.S. Dollars.    But, now the circumstances have changed.   The U.S. Dollar is unneeded by a growing list of countries.  For example, China is now buying gas with their own currency, the Yuan from Russia. So, China is using their “petroyuan” for billions of gallons of natural gas.   So, what is happening to the value of the U.S Dollar in the process?   The U.S. Dollar is going down in value!     Why is that?  The U.S. Dollar is being sold off for lesser amounts.  Remember if Fred doesn’t have enough money to pay back Bill then Bill will likely take this IOU and sell it for less so he gets something out of it.   So goes the story for the U.S. Dollar. Look at this chart below… 

 

So think about this for a minute.   So what could happen if all of sudden our U.S. Dollar became so devalued that now one bought the debts or dollars we had to sell?   Then in theory the U.S. would run out of money.    Check out the U.S. National Debt Clock at http://www.usdebtclock.org   Here is a quick screenshot showing how the $19.9 Trillion in U.S. national currency debt or “sovereign debt.”     Compare this to how much income or our Gross National Product which totals $19.3 Trillion.   We have MORE DEBT THAN INCOME…!!

Every 33 years since the late 1700’s government’s have become financially insolvent or plain and simply stated – Bankrupt!    So, what is the U.S. became bankrupt?  The U.S. Congress in early September was handed the task of figuring out how to erase the Debt Ceiling because technically speaking the U.S. government is out of money and there are too many expenses.   President Trump gave Congress until December to figure this out.

So, economists are now calling the worldwide “sovereign paper debt” problem a “global credit crisis with more than $230 Trillion in sovereign debt worldwide.  In fact, look at this snapshot of the situation in Europe.

 

So back to your retirement accounts in 401(k), IRA’s and pension funds.  Remember what happened to the U.S. Stock Market when the mortgage backed securities became worthless?   Yes, the financial markets collapsed!   Imagine the weight of the global credit crashing down on with debt holders scrambling to find value?

This is when it affects YOUR MONEY IN YOUR RETIREMENT!

Market analysts are predicting we will see a market collapse soon.  Look at the value of stocks in the years preceding the market crashes.   We are heading to another market crash soon.  Maybe even this year.

WHAT CAN YOU DO TO PROTECT YOUR MONEY?  

Simple.    DO THESE THREE THINGS:

1. Don’t have all your eggs in one basket
2. Don’t try to time the markets
3. Dont’ bet on the markets

So, if you think about the guy or gal who goes into the casino with $50 and plays blackjack until he or she loses the $50 then walks to the nearest ATM to get another $50. He or she is already down $100 or betting on making the money by still gambling!   Or, if you came into the casino with $10 and you won $50.  Take the $40 and stick it in your other pocket and do not bet it!  Take your winnings and go home…  So what should you do now?

IT’S IMPORTANT TO HAVE OTHER ASSETS IN YOUR RETIREMENT ACCOUNT THAT WILL NOT BE AFFECTED NEGATIVELY BY A STOCK MARKET CRASH.  

You can buy ACTUAL PHYSICAL GOLD AND SILVER FOR THESE REASONS.

You can also buy Gold and Silver using your existing IRA or 401(k).  They call this process of “Self-Directing” retirement money.  Because you can establish a different IRA to purchase other types of assets like actual physical Gold and Silver, distressed consumer bank debts or other tangible assets of value.  The process is pretty simple.  You choose to transfer a certain amount of funds from your existing IRA account and transfer it to a new IRA for these other alternative assets or debts.  These assets or debts are held in the new IRA under the same IRS tax rules and guidelines as your existing IRA.

WHY SHOULD YOU ACT NOW?

Because when the stock market crashes it is too late!  By the time you learn of a stock market crash you will have always lost money.   Think about this way.  If your “house of money” was on fire today, could you buy insurance for it?  NO!  

Physical Gold and Silver and other alternative assets can be like insurance for your “money house” so if it catches fire then you will have a back-up plan.  Gold and Silver goes UP in value when the stock market goes DOWN.     Buy some actual Physical Gold and Silver now before its too late!

Give us a call at 715-318-4653 or send us an email at jimt@alternativasolutions.com