Steps to Protect Your Wealth Against Hyperinflation
Hyperinflation in America
Doom and gloom? No. As citizens we have the obligation to wake up to the economic forces in our lives. To understand hyperinflation you first have to understand the meaning of the word inflation. Inflation is simply a rise in the general price level that results in the decline of purchasing power of money. Hyperinflation is simply inflation out of control as evidenced by the speed at which prices rapidly increase and currency continually loses value. Prices will rise as never before seen in the US.
The price of consumer items is driven not by the product itself, but rather by the value of currency. In 1923 Germany the citizens of Germany used the German dollar as wallpaper. Even if wages are increasing the fact that consumer items are increasing more negates the purpose of wages increasing. This will lead to a climate where it is common for people to hoard food, water, and supplies in fear of what might happen. Poverty and crime will spread as more companies lay off workers.
So what can the prudent person do to protect his current and future wealth from inflation? One consideration is to invest in precious metals such as gold and or silver. As the dollar declines there is a proportionate upswing in the value of long term assets.
Changing economic conditions can drive prices out of reach of the average person. Investments that may be worth $1000 one week may be worth and cost $1500 the next. Complacency is the enemy of prudent change. Keep in mind that most of our money today is not in physical wheelbarrows but electronic form. The value of that currency can be dictated by the government. That dictate is influenced and driven by ineffective fiscal policies that perpetuate an overabundance of currency which increases the price of everything.
“Inflation is taxation without representation.”
― Milton Friedman
Unless you have taken a recent accounting of your financial assets you may be going broke without knowing it. This is a frightening thought as everything you have worked for may be eroding in value. One of the keys to maintaining your awareness is to notice the price of the small things you pay for. For instance did that candy bar today cost more than three months ago. How much did the gallon of milk and bread cost compared to last year. Sometimes the truth is in the details.
So what are the minimal practical things you can do to prepare not only yourself but also your family?
- Subscribe to financial publications or at least get a library card and visit your local library. 2. Increase your circle of acquaintances. If an emergency happens you may be only two or three people away from who you need to help you. 3. Align yourself with organizations of like minded individuals who are taking steps to preserve their wealth. 4. Maintain and improve your health. You cannot help anyone if you are sick. And do not forget to pray for those in positions of authority.
You cannot escape taxes, death, or inflation. However you can take every opportunity to prepare for, negate, and prosper in each area of life. And not to be overlooked, buy as much silver bullion or coins that you can afford. If you can buy gold, the better. Keep in mind that gold is hoarded, and silver is used to barter. Live long and prosper.
Never despise a humble beginning.
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I originally published this article in Ezine Articles.
