Biden To Preside Over Another Financial Crisis

Treasury Secretary Yellen believes runaway government debt spending isn’t a risk factor for the next crisis, but rather the solution to the current one. During her recent testimony, she urged Congress to “act big” on stimulus.

Acting big means pushing an already record-high budget deficit even higher – likely to over $3 trillion this year. Meanwhile, the official accumulated national debt (not even counting unfunded Social Security, Medicare, and other liabilities) is approaching $28 trillion – well in excess of total U.S. GDP.

Inflation Danger Ahead

The powers that be in the U.S. have managed to keep kicking the can down the road for longer than many sound money advocates had thought possible.

But fiscal and monetary policy have now entered a new and dangerous phase. Politicians promise to literally send out cash (“stimulus”) to millions of voters while the central bank monetizes the deficit spending and abandons previous commitments to “stable prices.”

The specific danger ahead is inflation.

The official consumer price inflation figure reported by the Bureau of Labor Statistics is just the tip of the iceberg.

The true magnitude of the inflation problem that could hit the economy is represented by a spiking currency supply and the untold trillions of more dollars that will have to be created in the months ahead on behalf of the Treasury Department’s ever-growing borrowing needs.

Skeptics who say there’s no underlying inflation problem apparently think the stock market, Bitcoin, and other financial assets have simply “inflated” on their own. But they won’t be so sanguine when inflation manifests through record-high food, energy, and precious metals prices.

Gold and silver are more than just inflation hedges. They are insurance against various sorts of financial and political crises – including the ones nobody sees coming.

Precious metals markets can be just as unpredictable day-to-day as world events. Over longer periods, however, they more reliably reflect the inverse of investor confidence in the Federal Reserve Note.

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Disclaimer: Money Metals Exchange and its staff do not act as personal investment advisors. Nor do we advise about or advocate the purchase or sale of any regulated security, listed on any ...

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