An Amazing History of Failure
- It’s not working - but they’re still doing it
- In fact, it’s never worked
- Who gets hurt?
The Government is failing itself and its citizens. Every year you and I grow poorer. Every year we pay more for basic necessities. Every year we see our earning power diminish.
And yet, our Government remains steadfastly loyal to the very policies that cause this increasing poverty.
It’s following the EXACT same path as dozens of other failed, defunct states. In fact, the list of failed states would be a short one if it didn’t include those governments who devalued their currencies.
Devaluing a currency might be the best way to destroy a state. War rarely wipes out the state. Disease, famine, rebellion - these misfortunes don’t hold a candle to currency devaluation.
Were you to engineer the downfall of a State, you could scarcely draw up a more effective blueprint than to put Mr. Ben Bernanke in charge of your central bank and then give him free reign to print as much money as it takes.
I’m not the first person to point it out, but if the devaluation of currency was good for an economy or a state, than the Weimar version of Germany would still be around and kicking. Zimbabwe would be a world leader in GDP. Robert Mugabe would be on the cover of Fortune magazine.
If it was effective, then Japan wouldn’t be at the tail end of 20 years of stagnation.
It doesn’t take much inspection to see the consequences of currency devaluation - and yet, as I said, the US Government is actively pursuing this disastrous policy.
The question is; will this central banker be the first ever to put the genie back in the bottle? Will Ben Bernanke put the brakes on the money printing at just the right time?
Or will the immutable laws of economics once again punish the hubris of people who legitimately believe that wealth can be willed into existence with nothing but strong words, good intentions and a government printing press?
I’m putting my money on the long term trend. The dollar is doomed to failure, and before it finally fails, it will continue to lose its value in spectacular fashion.
Perhaps more insidiously, we know that it’s not heads of state or the assorted underlings of bureaucracy who bear the brunt of currency devaluation. It’s easy to overcompensate public employees to account for inflation when money is conjured out of thin air.
More to the point, it’s always the poorest individuals who are most injured by currency devaluation.
If you want to see what happens to poor people when they can no longer afford to feed themselves, you only have to look to Egypt, Tunisia and the handful of other states that are being strained by the effects of dollar devaluation.
The death of the dollar isn’t coming, it’s already started.
Invest accordingly.
Kevin McElroy
Editor
Resource Prospector
