US Debt Calamity Dead Ahead?

05 May
debt black hole

US Debt Calamity Dead Ahead?

Tell us something we didn’t know!

In big, bold type the scare headline on the Drudge Report reads, “TREASURY BORROWS TRILLIONS MORE.”

And that links to a Wall Street Journal scare headline that reads, “U.S. Treasury Expects to Borrow $4.5 Trillion in Fiscal Year as Stimulus Spending Soars.”

Here’s the story. 

During the current April – June 2020 quarter, the Treasury expects to borrow $2.999 trillion.  (Think how hard they must have worked the numbers to keep from going over $3 trillion!)  

That means that during the current quarter, the Treasury will borrow more than it did in the entire previous five years combined!

And that is scary.  But because you read these posts, you’ve seen in coming.

Two months ago (Charts and the Stampede to Gold), we wrote, “With businesses slowing down due to the Covid-19 pandemic, tax revenue will fall.  It will fall further still if a payroll tax cut is implemented.

“At the same time, government spending will rise at a relentless rate with new spending on health-related measures.  

“That means the red line (gross Federal debt) will turn steeply higher.”   

In fact, it’s $1.5 trillion dollars higher today!  Just four weeks later!

Actually, we have been telling you for a very long time that the US monetary system – having abandoned the discipline of gold – will wind up in a steaming pile of collapsing debt.  

It’s not as though this hasn’t happened to governments over and over again throughout history.  

But for some reasons our political classes and monetary authorities think this time it will be different.  But it is never different.

Oh, sure, they’ll come up with something to try to paper it over.  They are very clever.  A new dollar perhaps?  An International Monetary Fund scheme?  A currency represented as being backed by gold but that really isn’t?  

Who knows what they’ll come up with? 

But the smart money knows a flim-flam when it sees one.  We wrote about the “smart money” the other day.  (See our recent post All the Smart Money is Buying Gold.)

We’d like to include Jim Rogers in the smart money category.  He’s watching the money printing like we are and is buying precious metals again for the first time in years.  Rogers currently prefers silver, saying, “The gold-silver price ratio is near its record high and so I prefer silver to gold because it is cheaper [on a relative basis].”

Remember that the only gold and silver that will matter is gold and silver that you can hold in your hands.  Not precious metals stocks or ETFs or a paper gold promises.  

Make Republic Monetary Exchange your go-to advisors to protect yourself and your family with real money, gold, and silver, that you take delivery of.

read now: All the Smart Money is Buying Gold