For some time, I've suspected that nations around the world will be forced to adopt some kind of gold backed currencies. This is because we now live in a global economy, and they can no longer trust one another's money.
Recall that when the US began its massive money printing programs ("quantitative easing") a few years ago, the Chinese screamed bloody murder. This was because they hold much of our debt and the money printing meant that they would be paid back with dollars that were worth much less than the dollars they had lent us. It also meant that our manufacturers here could compete with them more easily.
Japan has recently acted to devalue its currency, which has caused additional commotion. Here is a story by financial analyst John Butler discussing recent action by the G7 group of countries:
"The evidence of a major breakdown in global economic and monetary cooperation continues to mount. Just yesterday, the G7 released a statement regarding foreign exchange policies, only to be followed by a corrective statement that the market reaction was undesirable. This indicates escalating tensions within the G7. But if the G7 cannot cooperate, how on earth will the G20 do so? Or other countries? We are witnessing in real time a descent into economic nationalism that increasingly resembles the 1920s and 1930s. Then, as now, such nationalism resulted in major economic damage, with every single currency devaluing sharply versus gold, and with every single stock market underperforming gold. History is rhyming, loud and clear."
Here is another story discussing the upcoming meeting of G20 countries, which contains:
"The quantitative easing pursued by central banks around the world – including the Bank of England and the US Federal Reserve – has enraged emerging economies such as Brazil as the value of their foreign reserves dwindles, raising fears over 'competitive devaluations'."
Essentially, we have reached the point that countries around the world must print money to maintain their (artificial) economies. The EU is now doing it to avoid "austerity" and consequent riots, as they've had in Greece and Spain. China has been doing it to maintain their export advantage. The US is doing it because the economy is going to collapse as soon as it stops. The current stock market "boom" is a direct result of the Fed's QE policies. It will probably collapse when the money printing stops.
Money printing is and always has been just another kind of wealth redistribution. Whoever gets the newly created money gains and everyone else loses because of the inflation it causes. Now nations are beginning to screw one another this way so much, it is becoming intolerable.
So, what's going to happen?
Recently there have been many reports that central banks around the world are buying gold. I've posted some stories here about it. A return to some kind of gold backed currencies seems to me to be inevitable.
It may be that the heyday of fiat currencies is coming to an end. There is just no way the US and many other countries can "pay" their debts without printing money.
Let's hope so.
In any event, it seems obvious that the US dollar and many other currencies are doomed. You may as well stick a fork in them. It's just a matter of time.
I hope you have been buying gold or silver. It's not too late yet, IMO.