Back in November 2011, TBP predicted the current flood of foreign investment into the United States in response to an ongoing and deepening Euro crisis, including the subsequent drop in gold and silver prices due to the appearance of a strengthened dollar [1]:

The surging U.S. dollar is great news if you are prepared to take advantage of it.  The value of the dollar, I fear, will wind up being nothing more than a paper gain, as the budget deficit continues to explode here at home, too.  Ultimately, the United States will be facing the same currency collapse that Europe is now neck-deep in.

When the Euro collapses, foreign investors will rush to put their money into the safest place possible – U.S. Treasury bonds.  This will cause the value of the dollar to skyrocket as cash is pulled out of Europe and sent into our own vaults (or rather, giant money holes).  When the dollar value increases, the price of tangibles such as gold and silver will most likely drop, at least to some degree.

When the value of gold and silver drop, I strongly suggest that you consider buying in.  I tend to think that silver is the better option of the two as it is more affordable to the average American (currently at about $30 an ounce) and it is an industrially useful metal.  Everyone recognizes a Morgan silver dollar.  Divesting yourself from paper currency is the only guarantee of having any store of value – if (and more likely when) the U.S. dollar suffers a Euro-esque collapse, the price of gold and silver will skyrocket.  Having bought in at the lowest dip in recent history, you will be well prepared to hold value in your savings as much as possible.

The same theme was brought up two months earlier in September [2]:

Should the Euro collapse, the American dollar will skyrocket simply due to the U.S. being the only remaining reserve of wealth left.  With the Germany Constitutional Court’s decision today allowing the German bailouts of other Eurozone countries to continue largely unabated [a], this facade may continue somewhat longer until the German people tire of rescuing the rest of Europe.  Whenever that happens the Euro will collapse, the dollar will rise, and investment money will flood back into the United States.

Lo and behold, the Euro crisis is once again front and center in the world lens with the recent anti-austerity elections in Greece and France [3] [4] (France being one of the two last best hopes for Europe, the other being Germany) and while the rest of the world is wetting themselves over where the next welfare check will come from, TBP readers should not be the least bit surprised.  As predicted, the price of silver has dropped significantly - it current sits at $27.35/oz, down from the recent 'norm' of $32-34/oz, or a drop of nearly 20%.

The larger issue here, however, is that the current magnitude of the Euro crisis illustrates the fallacy of central banking and fiat currency.  Remember way back in February and March of this year when the European crisis was "saved" at the last minute by a rescue package which included backing from American taxpayers [5]?  How about the European bailout which entangled the Fed back in 2011 [6]?  After the European Central Bank injected $672 billion into Europe in late February [7], the party lasted all of two and a half months before we found ourselves back in crisis.  The impact of central bank printing presses is becoming more and more muted by the day - a key attribute of a collapsing empire.

Economic circumstances are so bad in Greece that the banks are currently experiencing an ATM and bank run circa 1929-magnitude [8].  Greek citizens, rightly afraid that they're about to lose everything they have saved, withdrew $898 million in a single day [9].

Make no mistake - unless our circumstances change substantially, the train the world is currently riding makes a stop in the United States as well and it won't be pretty when it arrives.  Our own debts are monstrously out of control and a giant, bloated, nanny-state government has refused to do anything about it to lessen the impact of the coming catastrophe.

This is not going to get better any time soon.  While the appearance of stability will ebb and flow with world events, the wise might pay a visit to their local bank, put away a little bit of extra food, take a second look at that shotgun, and forego the Facebook visits while at the office.

In love of liberty,

The Bulletproof Patriot

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Disclaimer:  Investment decisions are yours to make and yours alone.  While I have made my own opinions known here, any investing you do is your own stupid fault.

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TBP supports the Convention of States project to call an Article V convention for the purpose of amending the Constitution to limit the powers of the federal government.

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