The most troubling assertion in the video is that our nation’s usual sources of loans are tapped out…[and that] the only source we have left is the Federal Reserve, which means printing money.
The current U.S. money supply is $3.4 trillion and our current budget deficit is $1.1 trillion, so funding the entire deficit with newly printed money will increase the money supply by 33%. At the same time, $4 trillion in Quantitative Easing is being gradually unwound (removed from bank vaults), an event that…could create serious inflation because there’s a multiplier effect — $4 trillion in new money can lead to $40 trillion in circulation.
What can we do?
Inflation is a tax on dollar denominated savings, so a sensible protection is to save in other forms like a basket of:
- Treasury Inflation Protection Securities (TIPS),
- Precious metals,
- and real estate.
…What do you think is going to happen to your retirement if the government doesn’t get its act together?