How the Banking Crisis Affects Your Money | The Gold Standard 2311

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In the latest episode of THE GOLD STANDARD, we discuss the banking crisis and its impact on your money. With years of experience in the precious metals industry, Ken provides valuable insights into how the financial system works, the dangers of fiat currency, and the role gold can play in protecting your wealth. Dave and Ken explore the current state of the economy, the risks of inflation, and the importance of diversifying your portfolio with precious metals.

People want cash when they get nervous about the economy and financial markets. When everybody wants cash at the same time, it becomes a problem. Not since the Washington Mutual collapse of 2008 have we seen such big banks fail, and it all happened so quickly. As painful as the impact of these closures may be, they are just symptoms of a deeper problem. And although their collapse happened quickly, the wheels were set in motion years before. These bank failures highlight the banking sector’s fragility and our financial system’s instability. Reckless spending and easy money have conditioned us to pretend there’s something extraordinary happening in the real economy when it’s just Wall Street artificially pushing up prices. But there are no inventions. Nothing has changed. Nothing new is driving the market or adding to the GDP. Years of costs have increased because of stock buybacks and investors gambling with easy money in the markets.

Like a meteor slamming the planet, Silicon Valley Bank, which had $212 billion in assets, reported significant losses. The news spread like wildfire and ignited a run on the bank. At about the same time, Silvergate Bank in La Jolla, California, closed its doors after fear and panic fueled a bank run. Signature Bank became the third-biggest failure in US history a few days later.

More recently, First Republic was propped up by other major banks as depositors and investors rushed to withdraw their money. The central bank of Switzerland came to rescue Credit Suisse to the tune of a $54 billion loan.

One of the big blunders of the Federal Reserve was distorting the market by suppressing interest rates for years after the Mortgage Loan Crisis of 2008. People were never able to borrow money at such low-interest rates. And it’ll probably never get that low again. Almost everyone hopped on the bandwagon to borrow money. And why not? Numerous companies took on much more debt than they would have otherwise. Since the banks are not regulated, they’re free to take risks with their customer’s money. The banks make bets with depositors’ money without paying much attention to the level of risks. If you’re hearing a bit more urgency in Ken’s voice when he talks about being more hands-on and diversifying into gold, you know why. These recent bank collapses are only the beginning. The Fed focuses on fighting inflation and using trillions of dollars to buy assets to boost financial markets (artificially). They don’t care who gets hurt in the process.

Bank failures highlight the importance of diversification. Gold and silver are often considered safe-haven assets that can protect cash and investments during economic uncertainty and financial turmoil. Their intrinsic value, limited supply, and tangibility make them less vulnerable to the risks of counterparty default and inflationary pressures.

Gold and silver can also provide diversification benefits and help reduce overall portfolio risk and volatility. However, their value can be volatile, and holding physical gold and silver can incur additional costs. It’s essential to consult with a financial advisor before making any investment decisions.

The South African Mint began its “Big 5” series of bullion coins in 2019. Back then, the Big 5 were the five most dangerous animals to hunt on land. Today, the “Big 5” refers to five endangered animals in Africa: the lion, elephant, leopard, buffalo, and rhinoceros. The first of the series is the African elephant. Ken tells us about the one-ounce Gold Big Five Elephant bullion in this episode.

The one-ounce Gold Big Five Elephant bullion coin is a limited-edition coin, with only a certain number of coins minted yearly. This rarity adds to its value and makes it a sought-after item among collectors and investors. The artist who drew the African Savanna Elephant captures the animal’s depth and strength. The elephant is a majestic creature known for its long memory, natural empathy, and tendency to make personal sacrifices for the well-being of others. The Savanna Elephant is an icon of Africa. Even its ears are in the shape of the African continent.
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