What Happens When Money Loses its Value?

What’s the difference between wealth and money?

Not sure?

In Plain English, Wealth is something tangible (real estate, hard assets, gold, agriculture, etc.) that’s measured in terms of money.  Money is usually perceived as a piece of paper (that’s backed by someone’s promise).

Your “Federal Reserve Notes” are NOT guaranteed by Uncle Sam.  They are backed by a promise of the Federal Reserve which is a corporation often thought to be a Government agency.

Reality check…our dollars used to be backed by gold.  Remember “Silver Certificates?”

That all ended when Nixon took us off the gold standard in August 1971.

So, let’s look at the value of your money today compared to back then.

In a nutshell, your $1 today has lost over 95% of its purchasing power.  That means what used to cost a nickel now costs you $1.

For those of you old enough to remember, take a candy bar as an example.  Or how about a meal at McDonalds?

My point is simple.  It takes a lot more money to live today than it did in 1971.  And when money loses its value it is eventually replaced by something else.

That’s why we’re seeing a surge in the use of “cryptocurrencies” like Bitcoin.  They’re digital money creations based on “blockchain technologies.”

Are you confused yet?

The future impact of these technologies is mind-boggling.  And you need to understand how it affects our world (and especially the investment world) going forward.

Money is not going to disappear.  But it will be transformed.

Be sure to see next month’s Simplifying Wall Street in Plain English newsletter.  In it we’ll show you how the banksters are desperate to get control of the “crypto market.”

Get exclusive access (HERE).