Just weights and measures
but it makes Investing in Gold and Silver make sense..
One of the greatest dangers of a fiat money system is that over time people lose a sense of just measurement. I say
‘over time,’ because if we use the US Dollar as an example, this has occurred over a span of almost 100 years. The
USD has fallen in value by over 96% since the inception of the Federal Reserve Act.
I have said many times that if I were a carpenter building a house with a tape measure that had its measurement
changed constantly, my house would be unstable and a catastrophe waiting to happen. Yet modern economists are
baffled at the idea that an economy built on a broken measurement unit (for example, a fiat paper dollar that is
constantly devaluing) is in danger of collapse.
An example to illustrate this point further:
“Back in January of 2000 with the Dow Jones industrial average (top 30 blue chips stocks) at 11,750 points and gold
at $280 per ounce, the Dow was worth about 42 ounces of gold. Today, with the Dow at approximately 11,000 points
and gold over $1,150 per ounce, the Dow is only worth less than 9.5 ounces of gold. In other words, measured in
terms of gold, the Dow has actually declined in value by over 75%. To make a real new high, given the current price of
gold, the Dow would have to rise above 48,000 points.”
The fact is, if history is any indicator, this trend will only continue. Those who hold gold will continue to retain and grow
their wealth, and those who hold paper will continue to lose it.
Regards,
Alex Stanczyk
