In today’s economic climate the average person is inundated with conflicting information based on the presenter’s point of view. What happens is that most people do not understand the Federal Reserve and the reasons for printing more money. Most people do not really understand how banking works; all regular citizens understand is how all of this affects them after all the dust has settled. While many of the explanations are easy to state and easy to understand, the implications get more and more complex and difficult to understand making this entire process nearly impossible to make sense of. At the end of the day the normal citizens are not only the ones that fuel the entire process, but they are the ones that suffer the final consequences of the process. When discussing these bailouts and how they affect the people of the United States the first thing that needs to be made perfectly clear is that the amount of tax money collected does not and has not covered the expenses of the government for a very long time. Ever since we went off the gold standard, the system where money actually represented the same amount of gold or silver, the country has basically printed the money it needs in order to pay its bills so to speak. This system has been done by conservatives and liberals, and it is designed with the thought that as long as there are people borrowing and actually repaying their debt, everything will continue to work and there will be no real problems. This systems is based on the fact that every time someone takes out a first generation loan, like a mortgage, new money is printed, then when the loan is paid off, that amount of new money is destroyed, leaving behind the interest and keeping the money supply in a place where there is not so much cash in play that it causes inflation. The part that most do not understand is that there is really nothing backing the money. What has happened as of late is that the government has started taking out loans from other countries, meaning that instead of $150,000.00 for a new home being printed, one billion or one trillion dollars is being printed and not only that but the US has no way of paying that money back. Meaning instead of the cycle of the new money eventually being taken out of the economy that money will just stay in the economy causing inflation, or in the case of these kinds of dollar amounts, hyper inflation, which triggers recessions and depressions. This then causes people to believe that the government needs to step in and help, but the only way to help ends up being to print more money and the situation gets worse and worse until someone steps in and stops it. If you are looking for a way to ensure you and your money does not begin to disappear the only real asset you can buy is gold and silver, but if the dollar completely falls apart, there is no guarantee that this real asset will survive.
