What the 20 Trillion Dollar National Debt Means for Investors

National DebtHard as it may be to believe, the United States is now carrying a debt of 20 trillion dollars. How did this happen, and what is President Trump going to do about it, if anything? What does this debt mean for investors, and for precious metal investing in particular?
 
How Did We Get Here?
 
We got into this debt the same way anyone gets into debt: By spending above our means. In the case of the country, this overspending has been on a much grander scale, but the idea is the same. Whether it’s extravagant military spending or misdirected corporate subsidies, the United States has budgeted poorly — and because the consequences have been few and far between, each President seems to feel free to spend more than the last.
 
Some point to Nixon’s removal of the gold standard in 1971 as the precursor to the current crisis. Back then, you could exchange dollars for actual gold, so the amount of dollars was controlled by the amount of available gold.
 
Now, we can print as much money as we want, but we have a “debt ceiling,” which is basically a credit limit. But what do you think would happen if you were in charge of deciding whether or not to raise your own credit limit? You guessed it — you’d keep raising it and raising it until you were 20 trillion dollars in debt.
 
What Happens Next?
 
All indications suggest Trump may just go ahead and hit the gas. His latest budget proposal asks for $52 billion in military spending and he’s looking for another billion to build his wall. He’s paying for some of it by cutting funding to agencies and programs popular with progressives, environmentalists, educators, healthcare professionals and consumer watchdog groups — like the EPA and funding for public education — but it looks like he’s planning to spend a lot more than he saves.
 
The result is that he’s likely to come up against that debt ceiling sooner rather than later.
 
What Do the Experts Say?
 
Some experts think that when the time comes, Trump will demand that Congress raise the debt ceiling or face a government shutdown. This situation has happened before, but every time it does, it destabilizes the world economy.
 
Furthermore, while the debt ceiling is in play, chaos can reign. The government could shut down for a while as they come up with the solution, and that solution is typically an agreement to raise the debt ceiling in exchange for a lot of concessions, like chunks of the newly available credit going to the states of the members of Congress who voted for it.
 
What Does This Mean for Investors?
 
If Trump lets the deficit continue to rise, and if he has to force a vote on raising the debt ceiling, it will probably reduce consumer confidence in an already uncertain administration. Based on past events, this is likely to be very good for gold. One of the great benefits of gold is that it acts as a hedge against unstable markets. Even if dollars dramatically lose their value due to a massive national debt, gold will remain gold and will still be valuable.
 
You can’t just turn your dollars in for gold anymore — you’ve got to buy it at wherever the market sets the price, which may well go higher and higher as confidence in this administration’s economic policies waver.
 
How Can You Take Advantage of the Debt Situation?
 
None of us want the country to be 20 trillion dollars or more in debt. But since you’re not in charge of the national budget, all you can do is take advantage of the situation. To find out how buying precious metals can help you do that.
 
For more information, call 800-777-6177 now, or request our FREE guide.

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