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Currency Crisis, a Global Multi-Bubble Collapse and the Debt Ceiling

Listeners’ Questions – April 14, 2011

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Deshakthi from Ann Arbor, MI
I’m an international student from Sri Lanka studying at the University of Michigan in Ann Arbor. I have a 17 year old brother who wants to come to the US to study medicine or a related field. However, after watching your videos I’m afraid of him coming to the US to study medicine mainly because of the threats this great country is facing from a looming currency crisis. Do you think it is worth the risk my family will take by sending my brother to the US to study?

Curtis from Fort Mill, SC
I recently read your book “Crashproof 2.0.” I also read another book, “After Shock” by three authors wherein they question your foreign stock strategy. They say, “in terms of his advice for wealth preservation, we agree that US stocks are no place to put your money, but we also know that Schiff’s recommendations to move out of US stocks into foreign stocks is the equivalent of moving from the proverbial frying pan into the fire. We know for a fact that foreign stocks will crash for the same reason we know US stocks will crash. Because we have an understanding of the large forces that are driving this global multi-bubble collapse. Schiff, like everyone else is missing this because he doesn’t have the bigger picture.” I would like to know why the above is not correct in your view.

Johan from Umea, Vasterbotten
I wonder what your take is on the inflation adjusted gold price. I saw a chart showing inflation adjusted gold prices from 1914 to 2009. It makes gold prices higher than $1400 an ounce look very speculative. Or is it that inflation is really much higher than this chart indicates? And what does it indicate for non-US investors?

Henry from Brooklyn, NY
If the debt ceiling raise were to be rejected, do you think that would be enough of a reason for US dollars to rally and precious metals and commodities to sell off? Or will low interest rates still allow inflation to creep into the capital markets, pushing precious metals and commodities ever higher?

Jeff from Pasa Robles, CA
You mentioned t one point owning foreign currency. Could you recommend some that are not tied to the US dollar? I’ve heard some people recommend Iraqi Dinar. Sounds risky, but would you buy it?