Lie 8: Holding dollars in the bank is safe
Right now, the absolute worst thing you can do is to hold dollars in a bank. Those dollars will become worthless one day soon.
As Rich Dad Poor Dad Robert Kiyosaki says, “The dollars intrinsic value is toliet paper.” Six months ago he said, ‘‘I see a global banking crash coming.”
In his own words:
https://twitter.com/i/status/1708003956444803443
And as you will see, he is not the only one who thinks this.
“The entire banking system is in free fall. People are going to lose it all,” said Gregory Mannarino, my favorite financial guru, who calls himself “The Robin Hood Of Wall Street."
An active/full time trader of the capital markets with a world-wide following, he says the following:
“While everone is sitting there looking at the stock market, the SNP500 and the NASDAQ, I am looking at the debt market because that is the vehicle that is propping everything else up. The market is pricing in a much much weaker dollar moving forward. This is going to end in tradegy for so many people.”
According to Mike Adams, founder of Brighteon.com, “The dollar has become the coercion weapon against the world and the world is done with it. You can’t save the dollar and you can’t save it as a reserve currency status because the transition away from the dollar is already well underway. It’s just a matter of how rapidly the decline takes place.”
He added, “The Republicans are not going to save the dollar. Republicans are not going to stop printing money. They’re not going to stop debt spending. Republicans just like Democrats are going to print and print into obliteration until the dollar collapses.”
Andy Schectman, owner of Miles Franklin, a leader in precious metal investments, said, ‘‘What is the incentive of countries to hold our dollars which are being inflated away at a rate of a trillion dollars in debt every single 100 days, which used to take 200 years to accumulate a trillion, now were are doing it in 100 days.”
At the heart of the problem here in simple terms is the debt. We have too much debt.
“The over leveraging of the banks is a real big problem here,” Schectman said. “A government that has chosen weaponization of assets of the treasury and the dollar if we don’t align ideology so the incentive of these countries who have been forced into holding dollars and stockpilling them creating this synthetic demand you could argue is no longer in place.”
He added, “How fast does this unwind is the big question. It’s very very very significant. If Saudia Arabia and other oil producing nations start accepting currencies other than the U.S. dollar for oil transactions, the global demand for dollars could plummet. This would undermine the dollars status as the primary reserve currency leading to increased economic volatility and a potential realignment of global financial power.”
A little history here. In 1971, under President Nixon, the dollar was taken off the gold standard. Before that our money was backed by gold. Now the dollar is just a fiat currency, or paper money not backed by anything except the government’s ability to generate revenue thru debt or taxes, and the government’s authority to make people use dollars for transactions.
Ok so let’s slow down here for just a second. The government’s ability to generate revenue thru debt or taxes.
Generate revenue thru debt. So how do you do that? You sell the debt. Problem is, no one wants it.
According to entrepreneur Egon Von Greyerz of Goldswiterzerland.com “Nobody outside of the federal reserve wants to buy U S. debt. That is absolute trash.”
He continued, “The U.S. is bankrupt. They’ve been lucky that the world has accepted the dollar as the reserve currency and that they’ve been skillful in creating the petro dollar. But that’s coming to an end now. Nobody is buying our treasuries. Nobody outside the Fed will be interested in financing the extravagances of the U.S. government.”
Von Greyerz goes on to say, “The U.S. is already a Banana Republic. Debt to GDP is now at 130 %. Not long ago it was 30, 40, 50%. We are in the exponential stage of this collapse of the U. S.”
Kiyosaki said, “The American people are as poor as the U.S. government because our debt is so high. We can’t pay it back. This is a global system.”
Von Greyerz who calls himself an optimist, says he is not optimistic about our future.
He said, “The risk is at an unprecedented level worldwide, we have never had a debt situation in every major continent in the world before. What I see sadly, is that we are going to go into this expodential phase now which will be defaults. Banks will go under, no one can afford to pay debts. I don’t see any debt being repaid. You can’t make debt disappear.”
He sees a hyper inflationary period followed by a collapse of the financial system.
He said, “It’s inevitable. There is no chance whatsoever in my view for this financial system to survive.
Dr. Kirk Elliott, Founder & Chief Visionary Officer of Kirk Elliot Precious Metals,
(https://www.kepm.com) is not very optimistic either.
“This bank contagion is spreading. There is another bank failure run that is right around the horizon. I can feel it. I can sense it,“ he said.
“When banks are under capitalized they run into problems because they don’t have enough money to pay for the withdrawals coming out,” he added.
He said, “When they start now looking and putting under the microscope the four biggest financial institutions in America, there is no way you are going to be able to pay off your depositors, give us a plan B. Plan B is not going to work.”
He said we will have another run of bank failures because they never fixed the problem.
Mannarino said, “The dollar demise in my opinion, is going to escalate moving forward. The eventual erasing of the dollar as the world currency, I think the writing is on the wall, it’s just a matter of how its going to play out. The demise of the U.S. dollar is absolutley accelerating here. The U.S. dollar is in a death spiral. They are continuing to inflate because there is no alternative.”
He goes on to say, “The real crash is not going to be in the stock market. The crashes of crashes will begin and end in the debt market.”
Besides the fact the dollar is losing value, another issue to consider about leaving your money in the bank concerns FDIC insurance. This government insurance protects your money up to $250,000 in a bank that has FDIC insurance. Most banks have this, but some do not.
The money they have put aside to pay depositers in case of a bank failure is 1.35 percent. This is a tiny tiny fraction of total deposits. So far, every time a bank has failed, the FDIC has stepped in and no one has lost any money since 1933.
So, it seems safe right? If a couple or even a few banks go under, there should be enough money. But what if thousands of banks close? What happens then?
“If enough banks went down at one time to destroy the amount of money that the FDIC could get their hands on, that means the entire U.S. economy has collapsed and you should buy a gun.” Financial expert, David Ramsey, from the video “Will the FDIC Protect you if all the Banks Fail.” Link here:
From the U.S. Gold Bureau: (https://www.usgoldbureau.com/news/post/fdic-handle-banking-crisis)
“FDIC assets would cover only 1.26% of current deposits. The additional $100 billion line of credit would equate to about 2% of all deposits. The FDIC's current balance sheets and financials can be found here. If an entire football field is the responsibility of the FDIC, they can only cover the endzone line to the two-yard line.
In a controlled situation with only one small to medium size bank failing, the FDIC can manage the bankruptcy and pay every depositor. However, bank runs are not well-organized and easily managed events.
If another banking crisis the size of 2008 happens, the FDIC is not financially ready to pay the claims.
The sad truth is that trusting the FDIC’s funding is like trusting social security to be there. It is entirely unsustainable, and eventually, a crisis will arise that the FDIC won’t be able to solve. It is better to be prepared and know you will be okay than to put your trust in the government to save your finances. In a cataclysmic economic event, the likelihood of a bank run is very high. Governments historically don’t behave well during banking crises.”
Here is a very short video regarding the FDIC:
Another video regarding the very small percent of money put aside by the FDIC: (less than 1 min.)
And another:
If you want to do a deeper dive and get a good explantion of what is going on, this video is a great start. (20 min.)
But how do we know if there will be an economic collapse?
If the U.S. is bankrupt like Von Greyerz says, then is an ecomomic collapse inevitable?
If so, then maybe shouldn’t you look at protecting your assets away from the banks and the government?
Many financial experts are recommending people put their money in tangible assests such as gold, silver and land.
Buy gold to secure your assets. Gold is not an investment, but rather a way to preserve wealth. It does not matter what the price of gold is because an ounce of gold will always be an once of gold. Kiyosaki calls gold and silver “God’s money” because you can’t fake it. He said dollars, stocks, bonds, mutual funds, ETF’s are all fake money.
Elliot says to allocate your assets in strength. He advises to invest in gold and silver because “it’s real, true, accountable and it’s not paper.”
From Bullionvault.com:
Gold,"says a paper out earlier this year from economic and monetary historian Barry Eichengreen, "appeals to central bank reserve managers as a safe haven in periods of economic, financial and geopolitical volatility."
Silver is very undervalued right now and an excellent choice for a tangible asset. Silver is used in industry and the demand is growing, especially from China. You can buy an ounce of silver for $31.26 (The current price as of 7:30 p.m. July 7, 2024).
Kiyosaki did an interview with a millenial and advised her that millenials should buy silver. “This could be the biggest opportunity you’ll ever see.” he said.
Here is a link to that interview here:
One thing you do have to take note of…there are lots of scammers in the precious metals industry. They try to sell you high priced coins at high commissions or charge outrageous fees.
I can personally vouch for this excellent company called:
https://treasureislandcoins.com/
If you are new to buying precious metals, they will walk you thru step by step. They are legit. They are honest, trustworthy and they are not scammers.
Some other tangible assets could include food, water, fuel, a vegetable garden, an extra vehicle, car parts, a tractor, seeds, emergency supplies, bicycle, solar generators and solar power, camping equipment and guns and bullets.
Think about what could happen if there is an economic collapse. What if you can’t use your debit card? What if you don’t have any cash on hand? What is there is no power? What if there is no internet?
Better to prepare yourself now.
Think barter. What do you have of value that you could trade?
The best reason to have control of your assets is because they are under your control. Not under control of your broker or your bank.
In looking at the big picture, which I will write a separate post about in the future, is the transition to a central bank digital currency. This is their plan, this is what they are going to do whether you like it or not.
One day the bank will close and they will say, “You can have your money but now it’s digital. You will need to get a digital ID to gain access.”
Digital ID? What do I have to do to get a digital ID? “Well let’s see. First you will need proof of the latest vaccinations. We will let you have your money, but we can only give you so much per day. And we want to know what you are using the money for.”
Does that sound like financial freedom to you? Getting out of the digital control system is the only path to freedom.
Mannarino makes a great point here. He said “They are doing this by design to issue in a new cross border world-wide currency. This is what they are doing. One world government, a new world order. The bigger move is not just away from the dollar, it’s a whole new system.”
He added, “If you think for a second that some law, some decree is going to come along and we’re not going to get a digital system here, a central bank digital currency, well again you are way off course. Unfortunately it can’t be stopped. The system is being deconstructed. The world economy is crashing.”
So buckle up people, it’s going to be a bumpy ride!!!
For more information, here are some links to sources provided:
Gregory Mannarino:
Andy Schectman:
Robert Kiyosaki, Rich Dad Poor Dad: