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Silver Starting To Surge
3 December 2023Introduction
If you are worried about making big investment decisions right now, this article is for you. The world markets and financial systems have never been this complicated. We are truly in uncharted territory. It is safe to say that the United States has the biggest influence on global markets. What happens in the USA does not stay in the USA!
The US Debt Bubble
I have been writing about the US debt situation for a number of years. To put things in context, it is only prudent that we look at the US financial system in a bit more detail.
The US national debt today is just over $34 trillion and their debt to GDP (gross domestic product) is sitting at 122.30%. Yeah yeah, I know, you have heard it all before. What you did not know however is that the US debt on its own is bigger than the GDP of China ($17 trillion) Japan ($4 trillion) India ($3 trillion) and The United Kingdom ($3 trillion) put together. You can now easily see how far out of proportion this situation is. In the last three months starting 1 October 2023, the US deficit is already at $500 billion. Projecting that to the end of their financial year, they will end up with a deficit of $2 trillion to be added on to their total debt. The US has never had such a huge deficit ever. The closest was last year at $1.7 trillion.
Since 1971 the value of the US dollar has dropped by 87% If the US dollar index drops below 100, the value of the dollar will start to fall drastically. It is 103.295 today. We have to ask ….. what will China, Japan and Russia do when this happens? We know what they will do, They will start selling US stocks, bonds and currency at an alarming rate which will accelerate the fall of the dollar. The price of 1 oz of gold in 1971 was $38. To day it is $2007. The price of 1 oz of silver in 1971 was $1.30. Today it is $22.57. The only protection we can rely on is to have a good size of our investments in physical gold and silver.
A recent video by Robert Kiyosaki, author of the best seller “Rich Dad, Poor Dad” sees the gold price going to $3600 and silver to $68. You can check the video here. The gold/silver ratio is around 88 today. Historically it should be around 55. This means that silver has more upside potential than gold.
The US interest payment 3 years ago with rates 2% lower than today was $350 billion. The interest rate on debt in the US has trippled. It simply cannot last. The debt situation will crash! Over 100 banks in the US will fail a stress test right now.
Conclusion
The US debt bubble crisis will happen. There is no doubt about that. This will affect every one of us in some way or another. The best we can do is prepare our financial armour and wait for it to happen.
