The Coming U.S. Dollar Devaluation - A Major, Negative Impact on All of Us
The Coming U.S. Dollar Devaluation - A Major, Negative Impact on All of Us
The fact that the dollar is falling in value means that investors consider the United States economy to be in disarray and out of control.
This is not something that has occurred in the last year or even in the last decade. This is an event that has been in the making for much longer than that.
I don’t have to tell anyone this. The U.S. economy is mired in a huge amount of debt.
In fact, the U.S. government is sitting on up to $125 trillion of debt which must be paid at some time in the future.
This debt includes:
$11.5 trillion National debt – this debt has exploded in the last 12 months. It includes cumulative debt plus all the bailouts, stimulus plans, and the 2009 deficit.
$104 trillion Unfunded obligations – this includes obligations for social security and medicare. There are 80 million baby boomers scheduled to retire over the next decade. We do not have the money to make these payments.
$9 trillion Projected deficits over the next 10 years
$1 trillion Health care reform – When the final health care reform package is passed, this number will probably be much higher.
Investors have major concerns about the U.S. government’s ability to pay what it owes.
Therefore, we are seeing the dollar on very shaky ground.
In order to pay its bills, the U.S. government must borrow a significant amount of money from investors (lenders). A large percentage of these lenders are foreign countries such as China, India, Brazil, and European countries.
Spending Huge Amounts of Money is Hurting the Dollar
For some time now, many of these countries have been complaining about the falling value of the dollar. They are imploring the Obama administration to start getting its financial house in order. Instead, the government continues to expand its debt level in a very major way.
Let’s look at it this way. China and India have built up large cash reserves because their economies are booming. They want to invest this reserve cash.
In the past, U.S. dollar investments made sense. For example, long-term bonds were a good investment. They were backed by the good faith of the U.S. government.
But because of the falling value of the dollar, this is slashing the return on their investments. They have every right to move from the U.S. dollar into stronger investments. Many are doing just that by investing in gold, oil, and natural resources. This puts pressure on the dollar to fall even further.
Just this week, a United Kingdom newspaper reported that Gulf Arab nations were joining with Russia, China, Japan, and France and are considering replacing the U.S. dollar in all oil transactions. This would be a major blow to the dollar. When this report came out, the value of the dollar slumped.
Even if this meeting did occur, they are probably far away from doing this. However, this is the path we are on. It supports the strong probability of the coming dollar devaluation. Most likely it will not occur immediately. It could happen in a few months or even a couple of years.
Another way to cover these huge deficits is to tax Americans. Unfortunately, this will probably be coming soon. But in the middle of a serious recession is the worse time to impose a major tax on us.
The only other alternative to covering our deficits is to devalue our currency, the U.S. dollar. This will have a very detrimental impact on all of us.
I will not go into this subject right now because of its complexity.
This scenario is very likely. Here’s how it will impact you and me.
The result is hyper inflation. Many Americans don’t remember this type of inflation unless you remember the 1970s. I do remember it, and it’s not pleasant.
Many people will see their lifetime savings wiped out. This will primarily hit seniors and those living on fixed incomes.
Even those who have built up a nice nest egg for retirement will be hurt. As the prices for goods and services soar, they will find that they haven’t saved enough money to cover their accelerating costs.
But inflation will hurt all of us. Because of the coming dollar devaluation, the price of imported goods will rise. That means that we will be paying much higher gas prices at the pump.
Walmart’s revenues have held up fairly well during the current recession because of its low prices. Because many of its products are imported from other countries, Walmart will be forced to increase its prices substantially.
In the past, a high percentage of our country’s Gross Domestic Product (total sales of goods and services) was from manufacturing. Today, it’s not. Much of our country’s sales are now from imported products.
The purpose of this article is to let you know that the coming dollar devaluation is highly probable. This impacts all of us, whether you are a corporate professional looking to leave your job in corporate America, a small business owner, or a network marketer.
But there are things you can do to help offset the negative effect of this event and even profit from it.
The Coming US Dollar Devaluation A Major Negative Impact on All of Us - To learn more about this author, visit Scott Hubbard's Website.
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The coming U.S. dollar devaluation will have a major impact on all of us.
The fact that the dollar is falling in value means that investors consider the United States economy to be in disarray and out of control.
This is not something that has occurred in the last year or even in the last decade. This is an event that has been in the making for much longer than that.
I don’t have to tell anyone this. The U.S. economy is mired in a huge amount of debt.
In fact, the U.S. government is sitting on up to $125 trillion of debt which must be paid at some time in the future.
This debt includes:
$11.5 trillion National debt – this debt has exploded in the last 12 months. It includes cumulative debt plus all the bailouts, stimulus plans, and the 2009 deficit.
$104 trillion Unfunded obligations – this includes obligations for social security and medicare. There are 80 million baby boomers scheduled to retire over the next decade. We do not have the money to make these payments.
$9 trillion Projected deficits over the next 10 years
$1 trillion Health care reform – When the final health care reform package is passed, this number will probably be much higher.
Investors have major concerns about the U.S. government’s ability to pay what it owes.
Therefore, we are seeing the dollar on very shaky ground.
In order to pay its bills, the U.S. government must borrow a significant amount of money from investors (lenders). A large percentage of these lenders are foreign countries such as China, India, Brazil, and European countries.
Spending Huge Amounts of Money is Hurting the Dollar
For some time now, many of these countries have been complaining about the falling value of the dollar. They are imploring the Obama administration to start getting its financial house in order. Instead, the government continues to expand its debt level in a very major way.
Let’s look at it this way. China and India have built up large cash reserves because their economies are booming. They want to invest this reserve cash.
In the past, U.S. dollar investments made sense. For example, long-term bonds were a good investment. They were backed by the good faith of the U.S. government.
But because of the falling value of the dollar, this is slashing the return on their investments. They have every right to move from the U.S. dollar into stronger investments. Many are doing just that by investing in gold, oil, and natural resources. This puts pressure on the dollar to fall even further.
Just this week, a United Kingdom newspaper reported that Gulf Arab nations were joining with Russia, China, Japan, and France and are considering replacing the U.S. dollar in all oil transactions. This would be a major blow to the dollar. When this report came out, the value of the dollar slumped.
Even if this meeting did occur, they are probably far away from doing this. However, this is the path we are on. It supports the strong probability of the coming dollar devaluation. Most likely it will not occur immediately. It could happen in a few months or even a couple of years.
Another way to cover these huge deficits is to tax Americans. Unfortunately, this will probably be coming soon. But in the middle of a serious recession is the worse time to impose a major tax on us.
The only other alternative to covering our deficits is to devalue our currency, the U.S. dollar. This will have a very detrimental impact on all of us.
I will not go into this subject right now because of its complexity.
This scenario is very likely. Here’s how it will impact you and me.
The result is hyper inflation. Many Americans don’t remember this type of inflation unless you remember the 1970s. I do remember it, and it’s not pleasant.
Many people will see their lifetime savings wiped out. This will primarily hit seniors and those living on fixed incomes.
Even those who have built up a nice nest egg for retirement will be hurt. As the prices for goods and services soar, they will find that they haven’t saved enough money to cover their accelerating costs.
But inflation will hurt all of us. Because of the coming dollar devaluation, the price of imported goods will rise. That means that we will be paying much higher gas prices at the pump.
Walmart’s revenues have held up fairly well during the current recession because of its low prices. Because many of its products are imported from other countries, Walmart will be forced to increase its prices substantially.
In the past, a high percentage of our country’s Gross Domestic Product (total sales of goods and services) was from manufacturing. Today, it’s not. Much of our country’s sales are now from imported products.
The purpose of this article is to let you know that the coming dollar devaluation is highly probable. This impacts all of us, whether you are a corporate professional looking to leave your job in corporate America, a small business owner, or a network marketer.
But there are things you can do to help offset the negative effect of this event and even profit from it.
The Coming US Dollar Devaluation A Major Negative Impact on All of Us - To learn more about this author, visit Scott Hubbard's Website.
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John PowerJohn Power, founder of Biltmore Franchise Consulting, has extensive experience developing and marketing franchises and business opportunities. He has been in and around franchising for over twenty years. From 1980 through 1990 he conceptualized, organized, and developed the American Video Association. He grew AVA to 2,000 national members, before selling the company it 1990. It was later merged into another home video marketing company. From 2000 to 2005 he worked as a contract marketing and human resources consultant to several local and national companies. In 2005 Mr. Power began working as a franchise development consultant on a full-time basis. Since that time he has helped more than three dozen companies initiate and develop their franchising program. He notes that there are many companies interested in developing a franchise program, and who need his specialized assistance. Mr. Power is a “hands-on” franchise consultant. He said, “I am the ‘nuts and bolts’ person who tends to the details for my clients.” Mr. Power holds a B.S. degree with a major in Marketing. See: www.biltmorefranchise.com You may contact Mr. Power at: jpower@biltmorefranchise.co - Visit John Power's Website |
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Stephanie RobeyStephanie Robey is President and CoFounder of Pivot Positive, LLC - an Internet marketing business focused on helping people start work at home ventures. Previously, she was employed at The Search Agency with over 20 years experience in graphic design and 10 years experience in online marketing. She was responsible for launching the Conversion Path Optimization (CPO) unit where she and her team have conducted hundreds of optimization tests for online companies across multiple verticals. She is a successful entrepreneur having started and sold 2 companies and remains on the board of directors of the third, PhotoSpin.com Stephanie began her career in the direct marketing realm creating and producing direct mail for many of the major cable television companies and directly attributes her understanding of Internet marketing to those early offline experiences. Stephanie is a graduate of San Diego State University with a BFA in Graphic Arts and also holds an Executive MBA from the Graziadio School of Business and Management at Pepperdine University. Read Steph's Blog Meet Steph and Dave Sign up for our Free 7-Day BootCamp: Self Employed & Rich - Visit Stephanie Robey's Website |
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