We all have ‘assets’ of various kinds and types. Women have their looks, and some men do also, but I am not interested in men’s looks. We all have brains and personality assets, and that’s extremely important. Tall guys always seemed to be great basketball players, and strong, hefty ones, football players. Beautiful women can be models, movie stars, or any other profession when beauty is an asset for a gal. An ’asset’ can be a great job, education, or skill at a trade. We all have our own store of assets, be they obvious or not. If we had a great childhood, that undoubtedly, is an asset for a successful life as an adult. Lucky you!
What we do with our assets, is all important for a successful life, and assets we do not currently need, but can be stored for future use, can make our old age happy of miserable. A dog burying his bone for future use, shows he is aware of the future, and birds who mate for life, always care for their offspring by feeding them and providing a nest. In all sectors of any animal, bird or even fish’s life, their individual assets are important for their future, even though it may be by instinct, with no thought or brain power involved.
Current vs future ‘assets,’ then, can be divided into several sectors or types. Stamp collectors value their rare stamps as a future asset as well as a current hobby or even profession. Antique anything, can be an asset. An antique car, truck, photo, book, recording, piece of furniture, film, or even a home can be an asset which can give one’s future life, comfortable and enjoyable.
The assets in beauty, muscles, or athletic ability, obviously decay with age, and there’s nothing which can stop it. I actually think that brain-power can increase with age, at least to a certain point, and I haven’t reached that point yet, at age 90, at least I don’t think so. Others may disagree.
My wife Bonnie and I, have an 1887 brick Victorian home, full of antiques, with a, 83-year old truck and a classic a1988 Mercedes 560 SEL in the garage also, which, if we needed money, could be sold quickly. We have a supply of foods, which could be used in an emergency, plus adequate medical insurance coverage, and the contents of our safe. We have well enough provided for our future, that we are ‘self insured.’
When Joe Biden, Donald Trump, or even FDR took office, and proceeded to spend recklessly, giving us inflation of probably an average of maybe 5% or more over the years, (50% in WWII), all those hundred-dollar bills, and million-dollar life insurance policies, instantly became less in actual value, or to put it literally, things bought, would cost more, for the exactly same items, and going down in value dollars. A classic case is the U.S. ceasing to make coinage of silver after 1964. After WW I, an ounce of gold in Germany, cost about $75 in U.S. dollars, but forced endless printing of the reichsmark, thanks to a ’treaty’ of Versailles, which Germany refused to sign, forced them to pay for the damage in the war they caused, and gold went to, as I remember, its price followed by 14 zeros. The reichsmark became worthless, and was used to insulate walls or start fires. All paper currencies in history, have become worthless, and could buy nothing at their end. Where is the ‘end’ of the U.S. dollar? I have no idea, other than its final value. I just watched a 1944 film, titled “30 Seconds Over Tokyo,” with Van Johnson, and was about jimmy Doolittle’s B-25’s bombing Tokyo. I mention this, because Van Johnson is shown buying a Coke for a nickel, which price is posted on the dispensing machine. A big NICKEL for a coke in 1944, even though Dolittle’s act took place four years earlier. What’s a Coke worth now? You decide, remembering that it’s the same Coke, and the same nickel. My Dad bought a new 1940 Plymouth for $650, and Hershey bars were also a nickel then. No matter where in earth you store paper money, be under your mattress or in a safe deposit box, there is nothing you can do to keep them from eventually becoming worthless.
Current insurance policies, advertise that your payments ‘will never go up,’ and ‘coverage will never decrease.’ Not in dollars they won’t, but a life insurance policy you bought, no matter what age you were when you bought it, will be worth as much less as yearly inflation decreases its purchasing power, and of course, your payments will never go up, and your benefits will never decrease…in dollars. That’s why I am self-insured. Just about every physical thing I own, is a hedge against inflation. When I started dealing in precious metals, in November of 1977, gold was $250, and I remember how long it took to reach $400. I bought my first Merecedes diesel in the mid-1970’s, for $3500, and diesel fuel was 35 cents a gallon. Today, it’s about $4.50.
Storing diesel fuel as an inflation hedge, requires a lot of storage space, insurance coverage, rent for the storage space, etc. Dollars, or anything denominated in them, is obviously pointless as an inflation hedge. What then, can be an inflation hedge with no rent, no payments, virtually no storage space required, and no government interference of any kind? After much cogitating, I think the answer has to be gold.
-Don Stott, don@coloradogold.com