Submitted by CrownThomas.
John Williams of shadowstats.com gave an interview a few weeks ago where he discussed the pending collapse of the U.S. Dollar as the world’s reserve currency, as well as the role gold will play going forward.
He points out that the Government uses a cash based accounting method, instead of the GAAP required accrual based method. This allows the Treasury to leave out trillions in unfunded liabilities when reporting yearly deficits. Something many of us at ZH have been harping on for quite a long time.
Ultimately he believes, as ZH has pointed out, paper currency will be devalued to the point where nations turn to the barter system. Eventually returning to some type of currency that is backed by gold.
- We have no backup system to the Dollar, and when it gets dumped it will be very disruptive to our system
- The Government conveniently ignores GAAP and uses the cash based accounting method, allowing them to not talk about trillions in unfunded liabilities
- Eventually the current system will lead to civil unrest, and we’ll devolve into using the barter system for trade
- People are trying to figure out how to protect the purchasing power of their assets, which means hedging with gold
- Ultimately all of this will lead to a system of exchange once again backed by gold