FIAT MONEY VALUE SECRETS: What You Need to Know...HEADLINE NEWS with LYNETTE ZANG

FIAT MONEY VALUE SECRETS: What You Need to Know...HEADLINE NEWS with LYNETTE ZANG

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have you seen the headlines lately about the really strong dollar has that been reflected in anything you've been buying we're going to talk about this and so much more coming up i'm lynette zhang chief market analyst here at itm trading a full service physical gold and silver dealer and we help you create these strategies to get you through the reset that should be pretty darn obvious has already begun we're already walking through it and i do indeed love those headlines that talk so much about the strong dollar but you know there are really three basic ways to value any currency let's take a look at all three of them and you can determine which one really impacts you the most i mean they all definitely do impact you so let's look at that because this is really what you need to know the number one way the way that they're talking about when you hear about a really strong dollar is against one fiat currency against the other so the dollar raises against the yen right now happens to be the yen or the euro or any other fiat currency this has an impact on imports and exports because in theory if your dollar is stronger then it costs you more or it would cost your exports would rise in price to all of those other currencies buying it and that's not really a good thing if you are an export driven economy so for you and me the consumer it will have an impact on what we buy at the stores and you guys if you've been if you're old enough if you're my age or even a bit younger than me you might remember how amazing it was to see the quality of what was coming in from china at such cheap prices so the value of one fiat currency another fiat currency definitely has an impact on that well just the other day the dollar index hit its highest level since 2002. let's take a look at that because they say the dollar index hit its highest level since 2002 on thursday as the dollar shot to two decade high on the yen after the bank of japan doubled down on its super low yield policy by offering to buy endless amounts of bonds every session as needed bank of japan has been and japan itself has been in another never-ending stimulus since the 90s and has it really stimulated their economy no it has not the bank of japan basically owns all of the indexes and they are helping subsidize and actually they are actually funding government spending but the general population is not doing so well but i want to take a look at that because what you're looking at here is the u.s dollar index and what you can see is that it is in a negative trend and you know that because you see a series of lower and lower highs but what i really want to point out to you is what happened in 2007 because i personally will never forget that when the dollar fell to its lowest level ever this graph goes back to 1971 or in the 60s 1960s right as we made that transition to from a gold back currency or at least a quasi-gold-backed currency to a full debt back currency so you can see that this can you see how many times the dollar index hit this level well that when that happens that becomes a support level so it bounces off that and goes back up but in 2007 that did not happen and it fell to new lows and for me that was a precursor to the crisis that you know was unfolding right then and there now the fact that it's lifted it up i mean you go to the grocery store have prices gotten cheaper no have even imports seem to get any cheaper no it was very obvious back in the uh in the early 2000s when china started to become the manufacturer to the world but ever since then it's sort of all become a wash and you can see this was a dangerous signal now does this mean that we're out of danger no but we are the one of the best horses in the glue factory we're all in trouble and the other part of that is with the federal reserve raising rates that attracts more buying of the currency and that's what helps lift it up but you can see this line here let me make that red so you can see it better you see how it's hit this resistance level so it's in a trading range we'll see if it breaks out maybe i'll go to there 120. i don't

think it will but this is really if you're going to travel if you're going to buy imports this is what impacts that and when they talk about a strong dollar on main street tv this is what they are referring to however what we've also seen over all this time this is the fed funds rate okay so that's the overnight rate that the federal reserve controls and that too has been in a negative trend since the 80s really since the early 80s so when that shifts you've got some problems but the higher rates do attract debt or currency buyers and that makes the currency appear stronger this is a key tool of the federal reserve and actually all central banks are the interest rates however lower rates attract debt accumulators and it hides systemic risk we've talked so many times about zombie corporations because these are corporate zombie corporation has not been able to pay all the interest on their debt let any of the print let alone any of the principal for at least three years but the banks don't want to show those losses on the books so japan kind of you know coined this or created this and then everybody else has been following suit so instead what the banks do is they keep loaning the money to pay the interest in the debt on the old debt they just keeps rolling them over and loaning them more and more money but with interest rates rising now you know we talk about the zombie apocalypse well maybe it's not the walking dead that's walking around maybe it's those walking dead corporations that are walking around and that's really the danger to all of us in this but just keep in mind all of that new debt creates all of that new money and so interest rates have had to decline over time just to keep the debt machine the money creation machine working and i don't know how well it's working but you can see a negative trend here so we saw the negative trend in the dollar we see the negative trend in the interest rates who is going to be pushing those rates up so far it's been the markets that have pushed them up and we saw the 10-year yield breach 3 percent briefly just the other day but the central bankers globally or most of them not all of them but most of them are also now trying to push rates up or they will push rates up because of all of the inflation all of this behavior has created over time what's going to happen to those zombies maybe they will die do you have wealth in there you might not think you do but if you're sitting in a 401k or you're sitting in an ira mutual fund dtfs etps all this crap you very well may be holding them and you just don't realize it now the number two way is fiat money versus spot gold now when you're listening to mainstream tv what they do is they refer to this as gold but these are simply contracts and their their function really aside from the trading function but their main function the reason why they were really created was to manage your perception on gold so they can create of these contracts as many as much gold that does not nor ever will exist as they want but this was back in 20 in june 29th of 21 gold heads for worst months since 2016 on dollar strain really because there's another way which we're going to talk about in the min in a minute and this was just the end of last month gold waivers as traders weigh fed tightening path in other words since gold does not pay you interest their theory is is that you will gravitate to something that does pay you interest but they pay you the interest in fiat money in the u.s it's dollars but anywhere else it could also might also be dollars we'll be talking about that next on thursday but um they'll pay you in dollars and we're going to talk about the third way to value a fiat money but just stay with me for a minute here gold fluctuated hovering near little change as investors weighed the federal reserve's monetary policy monetary tightening path raising rates and a surprise contraction in the u.s economy last quarter which we talked about the economy shrunk 1.4 percent

now have you noticed how many times the word surprise has been for the inflation numbers the gdp numbers for all of these numbers the pmi numbers for all of these numbers so these brilliant economists cannot see this coming they're surprised by all of these things that's garbage but i think maybe they are surprised in which case why are you listening to them anyway so let's take a look at that because there was a pattern that we were used to seeing with gold spot gold contracts and the dollar and this particular graph goes to from january of 99 so just before y2k through 2003 and it's really interesting because you can see that it was pretty much a mirror image of the us dollar of course y2k people got nervous and tried to buy the gold but don't worry you can create as much gold that doesn't exist as you want and you can see that it was easy to suppress the price so you had two price spikes in the spot contracts but hey no big deal we don't want people to protect themselves with gold however i came to itm on actually june 28 of 2002 and the final formula that confirmed to me though i was very convinced just like i am convinced that we're at the start of hyperinflation i haven't had that technical confirmation yet i came to itm in june of 2002 and i was still waiting i knew that this was the end of the cycle and i was waiting for the final confirmation and there it is when the spot price of gold which is this blue line went above the dollar okay the dollar contract that was a key pattern shift and once it did that breakout well you can see this goes through 2006 you can see that we had a lot more room to run so here's the dollar down here and here's the gold up there you can see the breakout and then the move upward but guess what that mirror pattern has been broken since 2005. so here's a long-term view going back to 99 through pretty current where we are right now in 2022 and this is the dollar down here and this is a relative performance chart so this is the dollar down here and how the dollar has performed over that period of time versus spot gold and of course we've had corrections of course we have but you can clearly see [Music] that spot gold has outperformed the dollar over time okay and this is the the area of the charts that we were just looking at and it looks dwarfed now but can you see that that pattern that people think oh well if the dollar goes up then gold has to go down and vice versa no not since 2005 really it might happen as a matter of a day or what have you but what they're talking about you know the dollar strength pushes gold down well you can see that that's not really true and hasn't been true on a consistent basis since 2005 and how much of this this just goes back the last year this does not look like a mirror at all does it no because there's so much i mean i'm not saying there wasn't manipulation in it back then because there was yes there was but now there is so much even more manipulation why because a rising gold price is an indication of a failing currency and once you realize that the currency is failing you make different choices i know i've made different choices how about you can you see this major pattern shift so that is the second way that you can do it now the third way and this is the one that really impacts us the most because it's about our pocketbook so we saw the imports and we saw the market cost now let's look at the purchasing power because it matters what you can buy with it and over time going all the way back 6 000 years an ounce of gold would always buy you a man's suit or anything else so yeah you can have the manipulation in the short term like we just were looking at spot gold which is an easily manipulated contract now we're talking about the physical world and part of the spot world too but i'm telling you right now without any doubt in my mind no doubt whatsoever gold the true value of gold against fiat currency against the us dollar is severely suppressed but let's take a look at that because what we know for sure history has shown us over and over and over again you can see it right here one simple chart gold holds its purchasing power so let's take a look at the official purchasing power of the consumer dollar according to the federal reserve april 1913 you had your dollar 1.0 almost two cents worth of goods for one dollar so actually a little bit of a premium now 0.034 and this is official so that means that it's probably a lot worse than this and by the way it really is you can see this massive decline because that's the way the fiat money was designed your this is now based on debt and when you have debt you have interest on that debt and so this is all all of the things and more that create that inflation that has an impact on your purchasing power i mean this is not rocket science but it is on its you can see that the dollar's value purchasing power value has been on a relentless decline to zero unlike what we saw excuse me unlike what we saw with a really strong dollar this is the one that is most important to you and this is the one that has shifted its pattern and that loss of purchasing power is severely speeding up this is the trend line you can see where it started when the inflation started to kick in that is a pattern shift that's one of the reasons why i think i do believe that we've started the hyperinflation we still have some opportunities to get into proper position if you haven't but can you see why you don't want to waste any more time if you've been procrastinating or putting it off or what have you that is not a really good thing to do because i don't see this magically changing no matter how many times that we say that because it's all about confidence right fiat money products can only protect purchasing power as long as they appreciate so they go up at the same or faster rate of the real inflation not the garbage government numbers and we're going to be talking about that very shortly probably next week in fact not the garbage government numbers that they massage to make them look away so that you go okay well there's no much inflation even though your personal experience is telling you differently you is it your personal experience that we have eight and a half percent inflation or when you go to the grocery store you're seeing that 40 percent inflation or when you go to rent or buy a house you're seeing that 20 and 30 percent appreciation or appreciation it's not appreciation it's inflation it's those prices going up not because the value of those things have gotten that much stronger but rather this is why it's because the purchasing power has gotten that much weaker and once all confidence in this system is lost that's when you will see the major hyperinflation and once that confidence is lost it's not so easy to get back again so any wealth that you hold that you can only convert into fiat money trillion times zero is zero stock market i'm sorry crypto markets you got to be able to convert it into something else and the reality is is when we go into hyperinflation and we'll see what happens i mean there are some new players in the field i don't know how that's going to play out nobody does because it hasn't happened yet ever but we know how it plays out with gold and silver because they've been around for thousands of years they have the broadest base of buyer the greatest level of functionality and when you need to sell something what do you want you want one buyer or you want lots of them to compete with it i want lots and i know that i've shown you this many times and guess what i'll continue to show it to you because i want you to integrate this into your very thinking because this is how the central bankers think about gold thanks to the bis the central banker central bank gold bullion is the only case of a financial asset with no counterparty liability now i am not telling you to go out and buy gold bullion personally i do not buy bullion because i believe that we're going to see an overt confiscation what i've just shown you is a covert confiscation of your wealth of your work of the true value of gold so since i'm since i believe that then you don't get me to buy any bullion but gold oh yes my dear lots and lots as much gold as i can possibly get and then enough silver to make sure that i can maintain my day-to-day living and so can my children second gold kept at home this is my favorite one by the way if you don't know that gold kept at home is not subject to political manipulation if you don't hold it you don't own it and when you're looking at contracts that's easy to manipulate for the current political climate easy easy peasy but i have my gold at home i don't give a crap what happens to the day-to-day spot market that's a trading market that's designed to to fog my thinking but i know the truth so it can't doesn't work for me and i hope it doesn't work for you gold has been empirically proven to serve as an inflation hedge i don't know how important do you think that is going into hyperinflationary environment how about just a regular environment remember nineteen hundreds gold was fixed at twenty dollars an ounce that's why those pre-33 coins have a twenty dollar face value on them now the bullion coins have a fifty dollar face value on them because the us official price of gold is forty two dollars and twenty two cents even with spots somewhere around nineteen hundred and that is way too cheap but its most widely recognized feature is its potential value in highly adverse scenarios yep do you think we are already in a highly adverse scenario because i do you look at all the crisis we're being thrown from one crisis to the next crisis to the next crisis to the next crisis this is why gold primarily needs to be the foundation of your portfolio because it's the only thing the only financial asset that can really protect you and frankly these functions show the true value of holding physical gold versus any kind of fiat money and u.s dollars or anything that you can only convert into those u.s dollars

because the beauty part about gold is you know yes there'll definitely be cases like to say pay your property taxes where you're going to have to convert them into u.s dollars but what we know is that this will appreciate once the government wants the cop i should say this once the public has lost all confidence in the central banks we go into hyperinflation you will see the price in terms of dollars in this country or wherever you are in the world you're going to see that reflect the loss of confidence so in venezuela overnight the first time they did their overnight revaluation went up thirty five hundred percent is that what you think is going to happen to gold because yeah i mean i don't know what percentage it's going to move up but understand it's not because wall street tells me how much something is worth that's a contract and they're about they're just about trading that means nothing to me but it does mean that it will hold its value so that you can always convert it into that fiat money that you need to pay those property taxes it will maintain its value and keep you in the right position so i think that this is like the last week that we have uh to do the graham waialea maui on saturday june 11th i'm going to be there for a much needed vacation but i really wanted to have a very small and intimate group with fans out there so um we just have i think a couple a couple seats left i'm telling you i'm keeping this teeny tiny so that there's lots of one-on-one time lots of discussion and today i'll be interviewing david dubai from adapt2030 the video will be posted later this week on the beyond gold and silver channel so stay tuned and we'll let you know when that's going out and if you haven't already get your gold and silver strategy started the calendly link is in the description below or you can give us a call but set up a time do not procrastinate things are heating up and if you like this please give us a thumbs up make sure that you leave a comment and share share share this video this is critically important so that somebody's not hearing what a strong dollar we have and believing it i don't know how anybody can believe it but i get it so that's my job to help you make that paradigm shift and also to translate all of this financial noise into understandable language so that you can make educated choices that frankly put your best interest first what a concept so that's it for today and i hope you got a lot out of this and maybe you have to look at it a couple times sending questions and until next we meet please be safe out there bye bye you

2022-05-05 13:10

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