I cannot, and will not predict what will happen, even ten minutes in the future, but I think that some warnings are pertinent. If your car’s dashboard says, “Check Engine,” it may be a good idea to have it checked by a mechanic. If your smoke alarm starts beeping, because is batteries are weak, there is a possibility of a fire going un-noticed, till it’s too late. There are many signs of possible future health problems, such as a sore throat, temperature, or a sore which will not heal. I go to my dermatologist twice a year, and to my dentist twice a year to have my teeth cleaned. These are part of my health insurance. Gold and silver, are my insurance against a crash, or simple inflation, which goes on continuously.
Last week on PBS, there was an hour show, showing how the Nazis had become sort of popular in the 1920’s and into the 1930’s. They had ‘Bundts” (organizations), throughout New England, and even in the western U.S. It was scary to me, as I had never heard of such a thing, but after WW I and the stock market crash, plus huge unemployment, I can see how it may have been possible. Germany and Europe, were far worse than the U.S., and millions of people were literally starving. Hitler’s promises made sense to many, in the depression. This show pointed out that hundreds of thousands, lost everything they had, when the market crashed. I looked it up, and the Dow was 381.17 on July 3, 1929, and ended at 41.22 on September 5, 1932, a bit over three years later. On today’s Dow, that would be going from 38,000 down to 3420. Millions would be wiped out. Back then, the forecasts were so rosy, that millions bought stocks on credit, and hundreds of banks went broke and lost their depositor’s money.
Never having smoked, I can only vaguely understand nicotine’s hold on smokers. My Dad began smoking at age 15, and died of lung cancer at age 63. He couldn’t quit. He did, at age 63. It was a lovely funeral. Some still smoke, and unfortunately, kids seem to be taking on the habit. Maybe the dollar is so habit forming, like nicotine, and we have been using it all our lives, literally, for everything we do, be it buy, sell, invest, etc., that when someone comes along, and logically points out that paper monies, throughout history, have always ended up being worthless, we are so used to dollars in our every transaction, that we can’t imagine our beloved dollar becoming worthless, even though in the last 75 years, it has lost 90% of its value. At my advanced age, I still vividly remember quarter a gallon gas and nickel Cokes and Hershey bars. America, now has probably five or six percent inflation, and banks pay one percent interest. Why would anyone store dollars in a bank, when it loses probably five percent purchasing power in a year? Habit? Like nicotine?
Are there any signs of a future economic crash? I looked up the current Dow price, and in one calendar year, it has gone from 31,429 up to 38,109. I have no idea why, as I own no stocks, but I do watch Fox Business News regularly, and recently, one commentator noted that the increase in employment, is because of government hiring, not industry, and he said that is a bad sign if it reaches 10%. I’ve seen a few other ‘signs’ mentioned by others, and when I looked up the 1929 crash, the analysts in 100% of their writings, predicted a rosy economic future. In 1929, The ‘future,’ was tragic. Are commentators today, like1929, today, predicting a rosy future? You decide, as I am only mentioning possibilities, not predictions.
In 1929, the price of gold was $20.67, and after the crash, it was still the same, till Roosevelt, in 1933, raised it to $35. If you had gold then, it would not have ‘crashed.’ I was born in 1934, and cannot remember the crash, but is must have been hideous, and I guess one can’t blame Roosevelt, for his efforts to hire hundreds of thousands, building Boulder Dam, many federal post offices, and the Civilian Conservation Corps. These did help, not only with jobs, but the general mental condition of America. By 1937, America was still in the depression, and it actually didn’t end until 1941, when Roosevelt got America into WW II.
Washington D.C., was wonderful when I was a kid, and I rode my Schwinn bike all over D.C., without a care in the world. Now, D.C. is close to being the murder capital of the world, and pricey restaurants are closing, because people are afraid to go out, even in daylight. Car Jackings and robberies are common in D.C., New York, Chicago, San Francisco, et al. If you live in a huge city, Like D.C., would it make sense to get out, and move to a small town? My kids have. Things have changed, and so has the U.S. un-backed paper dollar and big cities. Use them to buy, but not to save!
I just cannot imagine how terrible it must be to have, almost suddenly, lose everything you have. Imagine, literally starving and selling apples for a nickel on street corners! Until I began dealing in gold and silver in November of 1977, I spent my dollars as fast as I earned them. I soon realized that printing presses cannot produce wealth. Stocks? There are 4.2 billion shares of Ford, and 6.715 billion shares of GM. A trillion shares on the U.S. stock exchanges? You never get shares any longer, just like bitcoin, only an entry into computers. Could America’s enemies ‘crash’ or empty all computers with America’s total information on them? Is such a thing possible? Where are we then?
Don Stott (retired) don@coloradogold.com