In 1963 the US dollar was pegged to gold at $35 per ounce, but the economic volatility of the late 60’s and the Vietnam War made it impossible to fix. “What would be later known as Triffin’s Dilemma was predicted when Triffin noted that if the U.S. failed to keep running deficits the system would lose its liquidity, not being able to keep up with the world’s economic growth, thus bringing the system to a halt. Yet, continuing to incur such payment deficits also meant that over time the deficits would erode confidence in the dollar as the reserve currency creating instability.1” That’s a whopping 2,500% decrease in value since 1971. I don’t believe we have even seen the tip of the iceberg yet. It seems the politicians and the American public are largely ignorant to what this really could mean.
There will no doubt be troubled times ahead. At least you will need to take a sober approach to business knowing that credit will be tighter. You should keep you credit clean and don’t over extend your business. That doesn’t mean you stop growing your business, just try to grow smart and get the most bang for your buck. Inflation could eat at your profits and that will be an extra cost you have to figure into your operations. Don’t keep cash around use it to invest in equity for your business. Look for bargains cause there could be some distressed sellers were you can buy “pennies on the dollar.”
Watch out for political solutions! There will no doubt be politicians who will try to use the public panic to further their own agenda at your expense. For me it helps to trust none of these people. Know that politicians often have their own agenda which 95% of the time is not in your best interests. Never take a politician at face value, always look for their ulterior motives. Last night I watched “Frontline” a show called “Cheney’s Law.” This is interesting how Bush and Cheney have chosen to interpret the constitution to their benefit and to the detriment of the United States Citizens. I have been calling for these men to be impeached and I think they should put on trial for treason. All I’ve learned from the last 7 years is when the government says they want to protect your freedom what they really are saying is they want to expand their freedom to do what they want.
Unfortunately, it is up to you to defend your Civil Liberties otherwise the government will take them from you. I wish it were easy but this is the reality of our current world. I happen to believe in justice and the rule of law. Without the rule of law and justice tyranny will dictate right and wrong. If your into the bible it may be helpful to to read the story of David vs Goliath(1 Samuel, chapter 17.) Basically the fight to protect your Civil Liberties never ends.
http://www.pbs.org/wgbh/pages/frontline/cheney/
http://en.wikipedia.org/wiki/Goliath
It seems the average American is too intent on watching “American Idol” than to really see what is going on. Collectively the US Citizens are so self-absorbed and our youth who is completely ignorant of US history, that they risk selling the soul of America. The National ID card will soon be implemented and the police state is now so pervasive that freedom is as close as your local government operated health clinic. But we have come so far electing a woman or maybe a black man to the presidency. We should be so proud of our huge progress as humans on this earth. Looking to the same tired establishment with preferential changes in gender or race qualities to deliver us from this collective nightmare is not in my opinion a wise course of action. But, it seems to play right into the hands of those people whose motivations are far from benign.
1.
http://www.imf.org/external/np/exr/center/mm/eng/mm_sc_03.htm
