The world of finance is extremely interesting. It changes everything just by transforming the story that we tell ourselves. Here’s an interesting example. Let’s compare the year 2007 to the year 2009, which is before and during the great financial crisis of our time.
If you were in the sky over New York on New Year’s Eve in 2007, you would see a lot of happy people dancing to music and having a lot of fun. If you were in the same place two years later, in 2009, you would see the same thing. Click here to read more.
There would probably be a lot more billboards, and more people would have mobile phones in their pockets. If you were to take a stroll around the world, then everything would be almost the same as it was two years ago. Some people got new television sets; others installed an internet connection to their home.
All of the factories look pretty much the same, people are going to work, and students are still learning about the same topics in school. In the meantime, cars got a little bit better, and we’ve become more cost-effective as a society when it comes to using oil and gas.
However, if you were to look at the numbers, you would notice that more than ten million people in America lost their jobs, the stock market had crashed and dropped more than 50 percent, and the housing market was a disaster. All of the cities are the same. The same knowledge is being taught, so what could have made the entire world poorer? Anyone would think that, right?
Well, the only thing that changed was a simple story that was being told. Before 2008, everyone believed that the housing prices would keep on rising, and bankers were to be trusted. After that narrative changed, people started to wake up to the fact that a massive mistake was made, which led to reduced lending, layoffs, less money being transacted, slower markets, and the worst hit in the past century.
This was an invisible hit to the economy, compared to some states after the Second World War, when it was quite obvious what had happened. This leads to one important principle. Stories are much more important than we think, and here’s why. Visit this page for more info https://www.cnbc.com/2022/02/09/gold-markets-inflation-concerns-russia-ukraine-tensions.html.
What is money?
A hundred-dollar bill is just a piece of paper without the story behind it. If you were an alien that came to this planet, then a hundred dollars would mean absolutely nothing. The best story that humanity has ever told is the story of money. And this is where it gets interesting.
When people think about the growth of an economy, the first couple of things that come to mind is tangible. More people were working, more real estate being built, more businesses, technology advancement. Essentially, we all like to think about how much stuff we have at our disposal and what we can do with it. Well, a single change in the story can change all of that, just like it happened in 2008.
Is money a story?
Money is the oldest story ever told. Before using the dollar, people were using precious metals to trade. Before precious metals, there was something called barter. If you had a lot of apples, you could trade them for pears or a bag of wheat.
Since not everyone wanted to have your apples, you needed some form of medium that could help the exchange, and everything would be measured against it. That’s how gold became the number one money system in the world. Since it’s difficult to mine, it’s scarce, and not a lot of people have it. This made it perfect to use as a currency, with the only downside being the transport issue.
If you carried a kilogram of gold, it could easily be stolen from you. Paper certificates that could be reimbursed for gold entered the market, which eventually replaced the precious metal. When you mix politics into the mix, as well as a bit of human greed, you get rid of the gold completely, and you’re left with just paper. That’s the state where we are today. The circulating supply of dollars is a representation of trust in the government of the United States, and it’s headed for destruction.
What’s the solution?
The solution is to transform paper money into something with real value, like silver and gold. That’s why so many people are going for gold investing ira companies, which are based on physical assets. Since you’re already saving money, why not do it in the best way possible?
Gold and silver are the hardest forms of money that were ever used, and they’re eventually going to be introduced into the economy again. This makes them incredibly lucrative for every type of investor. Additionally, the Pareto principle states that 20 percent of your actions and investments are responsible for 80 percent of your results.
That’s why it’s important to keep a fifth of your entire net worth locked as a precious metal. In the case of a market crash or a downturn in the economy, that safety net will serve as a blessing. Every expert economist is noticing that the world is headed toward hyperinflation, which is one of the biggest reasons for believing in the power of precious metals. You wouldn’t want to remember having the chance and not taking it.