How to protect yourself

 

By Germanico Vaca

Key Points for Analysis

The United States hegemony has been made possible thanks to the power of the U.S dollar, but such power would exist on the trust of the United States being able to repay the debt. However, the United States lies about its debt to maintain its credit risk low. Only federal debt is acknowledged and ignores cities, counties, state debt, social security debt, Medicare, student loans debt, mortgage, commercials, derivatives, and unfunded liabilities. All other nations declared their entire debt and the United States has taken advantage of that to play a dirty trick, it uses the Bretton Woods agreement, which the United States abandoned back in 1970 to devalue the currencies of other nations and though that mechanism has collected in money they had lend several times over. These are some of the things we must analyze carefully.

1. Abandonment of Bretton Woods:
   The U.S. abandoned the Bretton Woods system in 1971 under Nixon, shifting from a gold-backed dollar to fiat currency. This allowed the U.S. to print money without direct gold backing, effectively removing constraints on monetary expansion.
2. Floating Exchange Rates:
   By adopting a floating exchange rate system, the U.S. gained the ability to manipulate its currency’s value relative to others, devalue other currencies, and leverage this power to manage trade deficits and influence global economies.
3. Debt Misrepresentation:
   The U.S. reports its federal debt but excludes other liabilities like Social Security, Medicare, student loans, and commercial and private debt. When combined, the total U.S. debt is about 575 trillion, indeed staggering and unsustainable in the long term.
4. Role of the Dollar:
   The U.S. dollar’s status as the global reserve currency has given it extraordinary privileges, such as financing deficits through dollar issuance and exporting its debt, deficit, and inflation to other countries.
5. Rise of BRICS:
   BRICS countries are working on creating a resource-backed currency to challenge the dollar’s dominance. This could diminish the dollar’s global influence, particularly as nations diversify away from U.S. Treasuries.
6. Counterfeiter: The moment the United States instituted quantitative easing it became a counterfeiter, for even a fiat currency must sell bonds to print money. The Federal Reserve is printing money out of thin air with no backing whatsoever and that is the definition of counterfeiting.

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Why Other Nations Have Not Yet Fully "Risen"

The majority of nations seem to be unaware that the Federal Reserve is an independent corporation of the United States. It is neither a Federal nor a Reserve institution, and its ownership is secret but through investigations, it has been determined that is owned by the most powerful families of World Bankers.

1. Dollar Dependency:
   Many nations hold significant reserves in dollars and treasuries. A sudden collapse of the dollar would hurt their own economies, creating hesitation to act decisively against it.
2. Geopolitical Risks:
   The U.S. maintains significant global influence through military, economic, and political means. Nations that challenge the dollar system risk sanctions, trade restrictions, or worse.
3. BRICS Momentum Is Building:
   While BRICS nations are taking steps, the transition to a multipolar currency system takes time. The recent discussions on resource-backed currencies signal that changes are underway, but a complete shift may still take years.
4. Latin American Factor: Over 50% of US trade is with the 656 million consumers in Latin America, if these nations abandon the US dollar the collapse will be imminent.

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What Happens If the Dollar Collapses?

A collapse of the U.S. dollar would result in:

1. Massive Devaluation of Dollar-Based Assets:
   U.S. treasuries, savings, and dollar-denominated investments would lose value globally.
2. Inflation in the U.S.:
   The U.S. would experience hyperinflation as it imports more than it exports and would need significantly more dollars to buy goods.
3. Economic Rebalancing:
   Global trade would shift toward currencies backed by tangible assets (e.g., gold, resources, or a BRICS-backed currency, currencies backed by resources. (Latin Nations being owners of 50% of the resources would flourish).
4. Instability:
   A rapid collapse would lead to global instability, with countries scrambling to preserve their economies amidst widespread uncertainty.

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Recommendations for Asset Protection

In a scenario where the U.S. dollar faces a decline, diversification across tangible assets and alternative currencies is crucial. Here are some specific steps:

1. Gold and Silver:
   Precious metals are historically safe havens during currency crises. Unlike fiat money, they hold intrinsic value and are globally recognized.
2. Real Estate:
   Real estate in strategic locations (both domestic and international) can hedge against inflation and provide stable, long-term value. Focus on areas with growing populations and strong economic fundamentals.
3. Foreign Currencies:
   Diversify into stable or emerging currencies such as the Chinese yuan, Swiss franc, or potentially the future BRICS currency. However, currency markets are volatile, so this should be a smaller portion of your portfolio.
4. Commodities:
   Invest in resource-backed commodities (e.g., oil, natural gas, rare earth metals) or ETFs that track these commodities.
5. Stocks in Strategic Sectors:
   Companies involved in precious metals mining, renewable energy, or agriculture may thrive during a shift in global power dynamics.
6. Cryptocurrency (with Caution):
   Bitcoin and other cryptocurrencies offer a decentralized alternative, but their volatility and regulatory risks make them speculative investments.
7. Global Exposure:
   Consider international investments in markets less dependent on the U.S. dollar, such as BRICS-aligned nations or regions with growing economic independence.
8. Emergency Preparedness:
   Keep some physical cash, gold, or silver in your possession for short-term needs in case of systemic disruptions.

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The Best Approach

Balancing these investments depends on your risk tolerance and financial goals:

• risk-averse, prioritize gold, silver, and real estate.
• adding foreign currencies and strategic stocks.
• explore cryptocurrencies or investments in BRICS-aligned economies.

Additionally, staying informed and adaptable is key. The global economic landscape is rapidly changing, and flexibility will be critical to protecting your wealth.