It took a large iceberg to sink the RMS Titanic ocean liner in 1912. It took an invisible viral particle to sink the Titanic American economy in 2020.
Oh, I know, it hasn’t sunk yet, but economic activity all around the world is screeching to a halt. Unemployment is soaring. The American stock market has crashed (and has probably not hit bottom yet). Credit markets are freezing up. Banks are having liquidity problems. There are very serious, underlying, systemic issues. An economic recession is certain. Great Depression 2.0 is probable.
Not to worry, though. The stock market always rebounds. It might take decades, but it rebounds. In the meantime the government will bail out all kinds of failing businesses. And they will send every average American a check (or direct deposit) for a couple thousand dollars. They call it “Helicopter money.” Clever.
Free-market economist, Milton Friedman, coined the term, “helicopter money” back in 1969. The idea of the government creating ginormous amounts of money and, figuratively speaking, tossing it out of a helicopter into all sectors of the economy, as a way to jumpstart economic activity, was a theoretical absurdity to Friedman. He saw it as a desperate last resort… that would ultimately fail. Friedman was no dummy.
Our money from the government will be coming soon. Before this pandemic/economic episode is over, we will probably be getting more than just one handout payment. The money must be sent because millions of Americans are seriously impoverished. Millions of Americans are either totally or partially dependent on government handouts. If the government does not distribute the money, there will be riots. The cities will burn.
But these helicopter money handouts are harbingers.
No, not Harbinger, as in the 2012 book by Jonathan Cahn, the Messianic Jew Rabbi pseudo prophet, but harbinger as in the definition of the word: “something that foreshadows a future event: something that gives an anticipatory sign of what is to come.”
The “free money” handouts, along with the trillions of dollars flushed into failing corporations, and all manner of “free” government services, are a harbinger of hyperinflation and the eventual destruction of the American dollar. That would be something worse than Great Depression 2.0.
It won’t be the first time a paper-money economic system has totally failed. History shows that, in due time, they have ALL totally failed.
With that in mind, back in 2013 I wrote a series of six essays on the subject of How To Survive The Coming Hyperinflation. Much of what I wrote revolves around the historical book, When Money Dies, by Adam Ferguson. The information and perspective I present in the series is still pertinent. It is more pertinent than it was seven years ago. It is also a decidedly Christian-agrarian perspective. Here are the links…
President Trump is telling Americans that our economy will boom when this wave of pandemic passes. He might actually believe that, and he might actually be right. Ginormous infusions of government money can goose the economy. But it will be a fake prosperity. It can’t last.
Keep in mind that history is full of examples of people in power assuring the citizenry that all is well right up to the point that all heck breaks loose. I take everything politicians say with a grain of salt.
The fundamental economic problem will not be fixed after the pandemic wave passes. The fundamental problem will, in fact, be significantly worsened. That problem is leverage. Governments, businesses, and individuals are overleveraged like never before. Debt is not just the elephant in the room, it is a whole herd of elephants in the room, and the beasts are getting restless.
There are three kinds of people: Those who make things happen. Those who watch things happen. And those who wonder what happened. My 6-part series (links above) offers practical, positive, proactive, economic self-defense ideas for anyone who wants to make things happen by positioning themselves for the eventual hyperinflation that will come to America.
My How To Survive Hyperinflation series does not focus on buying gold and silver, but I do discuss that in Part 4. If you are one of the few Americans with some savings, and you want to hedge your bets with some of that money, there are very simple ways to get money out of the fiat-money banking system and into allocated precious metals. These ways were not around when I wrote those essays in 2013. Vaulted and Sprott Bullion Trusts are a couple of options for you to check out. Those are not affiliate links, and I am not recommending those companies. I am simply letting you know that those kinds of options exist.
In the final analysis, hyperinflation and the eventual destruction of the American dollar-as-we-have-known-it, will not be the end of the world. People will pick up the pieces of their shattered modern lives and rebuild. Economic activity will continue. The sun will still shine. God’s common grace will still fill the land. We were all born for such a time as this.