Why Gold Is Such an Effective Weapon against the Government’s Monetary Schemes

The comments below are an edited and abridged synopsis of an article by Joshua Glawson

Buying physical gold is a proven method of securing generational wealth, and a security measure in times of economic turbulence. Gold is a hedge against inflation and a store of value against currencies. Throughout history, as coins and currency became debased, those who had precious metals had many more options for purchasing what was needed, and for investing.

Why Gold Is Such an Effective Weapon against the Government’s Monetary Schemes - BullionBuzz - Nick's Top Six
Bar of gold in the mold. Production of copper foundry.

Investing in gold also acts as competition to paper currency and any attempted coercive monopoly of currencies. When currencies are strictly controlled, the power of government is buttressed.

Currency debasement is intentionally lowering a currency’s value through various monetary and fiscal methods. In the past, debasement was associated with substituting precious metals with base metals: using less gold or silver in coins by replacing it with copper or nickel, while keeping the face value the same. Today, debasement primarily occurs by printing more money in the form of fiat currency (monetary inflation).

Governments typically initiate currency debasement to extend government spending and purchasing power. It comes at the expense of citizens who are stuck with less wealth, higher costs and lowered purchasing power. Currency debasement, as well as monetary inflation in general, tends toward price inflation. Simply put, currency debasement in the form of monetary inflation is legalized counterfeit.

Since the US began removing itself from the gold standard in 1933—and eventually removing that gold backing altogether in 1971—the value of the dollar has fallen significantly when compared to gold. As of 2023, the value of US currency is being challenged as the dollar is slowly debased. The purchasing power of a dollar in 1913 would be worth around $30.22; a dollar in 1933 would be worth around $23; a dollar in 1970 would be worth $7.71; and a dollar in 2003 would be worth $1.63.

Up for discussion: How does gold hedge against inflation; is gold volatile, and can investing in gold improve the dollar?

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