THERE IS A ODD NOTION OUT THERE THAT CASH IS NOT AN "INVESTMENT"...
THAT CASH IS SORT OF "ON THE SIDELINES" WAITING TO BE INVESTED...
THIS IS NONSENSE...CASH IS AS MUCH OF AN INVESTMENT AS ANY OTHER ASSET CLASS...
CONSIDER:
IN A DEFLATION...AS NOW...WHERE ASSETS ARE GOING DOWN CONSTANTLY...
THE VALUE OF CASH IS GOING UP EVERY DAY...
YOUR $1 BUYS MORE GOOGLE TODAY THAN IT DID LAST YEAR...!! YOUR $1 BUYS A BIGGER HOUSE TODAY THAN IT DID 6 MONTHS AGO...
SO CASH IS AN INVESTMENT...AND A GOOD INVESTMENT IN A DECLINING ASSET MARKET.
NOW...HERE'S THE PROBLEM... DUE TO OUR PREVAILING "KEYNESIAN" ORTHODOXY IN WASHINGTON...WHERE THE DOLLAR "ORIGINATES."
TOO MANY DOLLARS "BEING PRINTED" CAN MAKE THE VALUE OF CASH GO DOWN...
HERE'S WHERE THE GOLD HEDGE COMES IN...
YOU SIMPLY MUST HAVE GOLD TO PROTECT AGAINST THE DEVALUATION OF THE CURRENCY DURING HARD TIMES...
THE FED IS PRINTING MONEY WITH RECKLESS ABANDON...THE FED MAKES DRUNKEN SAILORS LOOK LIKE A TEMPERANCE LEAGUE...!
SO AS THE CRISIS DEEPENS...AND PEOPLE START TO NOTICE THE PROBLEM WITH THE DOLLAR...
WHICH, BY THE WAY .... IS SUDDENLY A "FRONT BURNER" ISSUE AGAIN...
MORE CASH HAS TO GO TO GOLD...
SO BOTTOM LINE...CASH IS BETTER THAN US BONDS...DURING BIG PLUNGES IN ASSET PRICES...
BUT IF THE GOVERNMENT STARTS PRINTING MONEY...GOLD KICKS IN AS A HEDGE ON HOLDING CASH...
TO DATE CASH HAS BEEN THE "INVESTMENT OF CHOICE" IN THE GLOBAL ECONOMY...HENCE THE SO CALLED "STRONG DOLLAR" NONSENSE LATELY.
BUT THE DOLLAR...MUCH LOVED AND HELD OUTSIDE OF THE US BY "ORDINARY PEOPLE"...IS BEING PRINTED LIKE MAD...
YOU KNOW IN FOREIGN COUNTRIES...CASH EXCHANGES ARE ON EVERY BLOCK!!
WHEN I WAS IN THE UKRAINE RECENTLY...I COULD PAY WITH DOLLARS OR UKRAINIAN MONEY... NO PROBLEM IT WAS 5 TO 1 FOR THE DOLLAR... AND THE CURRENCY EXCHANGE WAS ABOUT 500 FEET AWAY...FOR ME OR THE VENDOR...WHO PROBABLY PREFERED GETTING DOLLARS ANYWAY!
MOST PEOPLE IN NON-EUROLAND...DON'T REALLY TRUST THEIR MONEY OR THEIR BANKS... AND MANY OF THEM HAVE MORE DOLLARS IN THEIR POCKETS AND SOCK DRAWERS, THAN RUBLES OR DINARS OR WHATEVER...
I LOVE THE EURO...BUT I CAN'T PAY MY US ELECTRIC BILL IN EUROS...YET!
I WISH WE HEREIN AMERICA HAD A CASH EXCHANGE ON EVERY BLOCK LIKE IN THE REST OF THE WORLD...THEN WE COULD "VOTE ON" THE DOLLAR EVERYDAY...LIKE THEY DO IN MOST PLACES IN THE WORLD...
SO THE FED CAN ABUSED THE DOLLAR FOR A WHILE...
BUT GOD HELP US IF THE "MAN ON THE STREET" GLOBALLY...DECIDES TO HOLD HIS OWN COUNTRIES CURRENCY ... OR THE EURO...
AND TAKES THE DOLLARS OUT OF HIS WALLET ... AND SOCK DRAWER...!
