A Word to the Wise: Trump Chooses the Printing Press
Last week I promised to share with you some revealing information that makes clear that money printing will be the government’s preferred policy option in the days to come. I said, “It is a story that may disappoint some of you. But it is another warning that you will want to take seriously.”
The story comes to us from veteran Washington reporter Bob Woodward’s new book, Fear: Trump in the White House. As you might expect of a book filled with insider sniping at the President, it quickly shot to the top of the bestsellers lists.
Along the way some officials quoted in the book have disputed Woodward’s account of their words. They are doing to, says Woodward, to protect their jobs. And he threatened to release tapes of some of his interviews.
At RME, our beat is gold, money, and the economy. We are interested in commenting on Washington’s endless squabbles only to the extent it helps our clients protect themselves and profit from events to come.
From that standpoint, one of the most revealing quotes in the book comes from Gary Cohn, who was Trump’s top economic advisor. Cohn isn’t among officials trying to protect his job since he left the White House back in April. His only comment about the quotes attributed to him has been a sort of on non-denial denial.
But the relevant passage of the book comes as the President and Cohn were discussing the national debt. Cohn was trying to persuade Trump that the government can’t go on just running up debt and borrowing money. After all, as a candidate Trump said he would eliminate the national debt in eight years.
“Just run the presses—print money,” said the President.
Now, we are not surprised that governments are quick to resort to printing money. The government’s desire to print money is behind the present dollar standard and Federal Reserve system to begin with.
But printing money is only effective if people are willing to be fleeced by the policy. The government’s newly printed dollars take on value or purchasing power to the degree that the existing dollars people already have lose value or purchasing power.
What I am saying is that if everyone knew the government was intent on debauching the dollar by printing more of them, they would make sure that they are not victimized by the practice.
They would protect themselves by owning gold.
In effect, Woodward’s account of Trump’s money printing policy preference let’s the cat out of the bag.
It should be a word to the wise.
As always, I encourage you to speak with your broker at RME for more market updates. Expert brokers are available Monday-Friday from 9 AM- 5 PM or by special appointment after hours. Call today at 602-955-6500 or toll-free at 877-354-4040.