It isn’t too often that the Wall Street Journal writes my column for me, but they have done it again. The following, are excerpts from a piece which appeared in the Journal on June 22nd, and none of the wordage is mine. Enjoy.
“America is crossing into an uncharted sea of federal debt, with a public seemingly untroubled by the stark numbers, and a government seemingly incapable of turning them around. Donald Trump and President Biden, have overseen similar additions to the nation’s accumulated debt; in the range of $7 trillion, in each case, during their terms. Over the centuries and across the globe, nations and empires that blithely piled up debt, have, sooner or later, met unhappy ends. Only a dozen years ago, the U.S. aggregate government debt, amounted to about 70% of the nation’s gross domestic product. This year, it will be equal to the entire gross domestic product, and in some cases, higher.”
After establishing a foothold in the New World, Spain financed its military adventures and globe-spanning, with extensive borrowing from abroad and high taxation, eventually losing its status as Europe’s greatest power.”
France traveled the same path, and defaulted on its debt. Ultimately, profligate borrowing and spending by the court at Versailles, caught up with the royals, producing deindustrialization and fiscal crisis that led to the revolution of 1789.”
China’s Qing Dynasty, went through a similar cycle, and encountered a similar fate. It was a leading world economic power, but spending and foreign borrowing in the 19th century, led to underinvestment in the infrastructure, needed to keep advancing.”
Great Britain, may offer the most compelling parallels. It oversaw the world’s most far-flung empire through the 18th ad 19th centuries, before war spending, including the fight against the American Revolution, produced high debt. By the 20th century, it could no longer afford the spending required to both maintain an army and navy to police the empire, and finance rapidly growing social programs. Debt began crowding out other investments, and economic weakness sapped the strength of the British Pound. The Pound ceased being the world’s leading reserve currency, and the British Empire soon declined.”
That punishment could come here someday, if China, which today holds enormous quantities of U.S. Treasury bonds, just decided to dump vast amounts of Treasuries, setting off a fiscal and economic crisis in America. The federal debt, is being driven upward by higher interest payments, plus the fact that the current tax code isn’t providing enough revenue to cover Social Security and Medicare.”
So much for the Journal. It is undoubtedly he best newspaper in America. Colorado Gold, delivers insurance against inflation and even collapse, for 1% above our wholesale cost. How can any company do that? High volume, in the many tens of millions each year, that’s how, and with no advertising bills to pay. The question is not “If,” but “When,” as far as I can see. If you knew when that accident was going to happen, you wouldn’t need insurance! “When,” nobody knows, any more than when or where lightening will strike. That’s why we don’t take shelter under a tree during a thunder storm. Protect yourselves with precious metals, and don’t take shelter under a tree. That may make sense during a storm, but it won’t help economically.
Don Stott don@coloradogold.com 1-970-249-4646