Senate Republicans Just Voted to Add $10 Trillion to the National Debt And The Gold Standard Became Officially Impossible.
President Donald Trump says in his financial disclosure that he has an “investment in gold,”
He has even accepted three 32-ounce gold bars as security deposit for his commercial real estate leases.
"The legacy of gold as a precious commodity has transcended to become a viable currency and an accepted universal monetary standard," stated Mr. Trump at a press conference.
"Central Banks around the world are holding Gold as a reserve asset. It is also a terrific, potentially lucrative diversifier in a portfolio, especially with such volatility in the stock market."
The President of the United States of America is clearly infatuated with gold.
Perhaps it's because the debt clock keeps on ticking.
The U.S. federal debt is around $20 trillion and still rising.
Republicans have introduce a budget increase of $9.7 trillion dollars forecasting the debt will hit $30 trillion in the near future.
Republicans won the White House. Republicans control the Senate. Republicans control the House. And what will the first order of business be for the new Republican majority?
To introduce a budget that will create $30 trillion in debt.
So, what are the odds that we will see a gold standard?
It's about as slim as paper.
According to Bloomberg: A move to a gold standard just in China alone would require an exchange rate of as much as $64,000 an ounce!
That is 50 times bullion’s price now, according to Bloomberg Intelligence.
A traditional gold standard, in which the precious metal backs the currency, is basically impossible at current prices due to the amount of metal needed.
Look at the paltry cumulative gold production since 1493
According to the latest data from the World Gold Council, approximately 186,700 metric tonnes (6.5 billion ounces) of gold have been mined in the history of the world.
If we take that figure and multiply it by the first quarter of 2017 we find that the value of all gold comes within a nugget’s throw of $7 trillion.
This is an unfathomably large amount, to be sure, yet it pales in comparison to total global debt.
According to management consulting firm McKinsey & Company, the world now sits beneath a mountain of debt worth an astonishing $200 trillion.
(This figure does not include shadow debt like derivatives.)
Now, if gold backed total global debt, it would be valued at $33,900 per ounce.
Let's imagine we wake up tomorrow morning and learn that all debt as reported by McKinsey was backed by gold?
That means each ounce of the yellow stuff would suddenly be valued at roughly $33,900.
With one American gold eagle, then, you could buy a new family car and still be left with some pocket change.
How's that for purchasing power?
In 1970, a year before President Richard Nixon "closed the gold window," the US owed $370 billion.
Today, it owes nearly $20 trillion and the republicans are calling for a raise to just under $30 trillion dollars.
The Senate Republicans just voted to add $10 trillion to the national debt and the gold standard became officially and practically impossible with the stroke of a conservative pen.
Here's the really scary part.
Every single Republican, except for Rand Paul, voted for this legislation.
President Trump attempted to clarify his plans for the national debt in an interview with CNN saying,
"You never have to default because you print the money."
Donald Trump says he's not afraid of debt - he even says matter factly that he is the "king of debt."
"I'm the king of debt. I love debt," President Trump told CNN.
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