Wow, isn’t it amazing what a difference one month makes? Now that voters have spoken and said, “Yes, it’s the economy, stupid!” America’s small business owners are fired up. Look at how optimism jumped when Donald Trump was elected in my chart below. The most recent uptick was tied for the sixth largest in history, going back to the 1970s. Small businesses know exactly what Joe Biden’s legacy will be, and it’s not good.
Your Survival Guy urges investors to beat inertia and act by investing in rates you can sink your teeth into. Sometimes over thinking can be costly. I like Treasurys for their current yield and safety for your lazy cash.
Americans have been hammered by the inflation tax. Biden and his friends in Washington, D.C., borrow dollars today, inflate the money supply, and pay the debt back with less valuable dollars later. That’s not good for savers and retirees who work their tails off and build wealth only to see the value of that wealth erode over time.
Trump has a chance to protect American savers by protecting the value of the dollar and has even brought on former congressman and presidential candidate Dr. Ron Paul as an advisor to the new Department of Government Efficiency (DOGE). The most efficient way to protect the dollar would be to eliminate the Federal Reserve, and back it with gold.
You know Your Survival Guy thinks America needs a gold standard. The value of the dollar has plummeted since gold convertibility ended in 1971. Look at my chart, which shows the plight of the dollar.
That chart generously measures inflation using CPI, which many economists believe undercounts inflation. The damage is far worse.
But the idea of returning to the gold standard isn’t a new one. Here in the October 2015 issue of Richard C. Young’s Intelligence Report, Dick Young recounted a story shared by Richard Russell about President Ronald Reagan’s response to Congressman Ron Paul when the latter brought up the plight of the dollar. Dick wrote:
Richard Russell is now 91 years old. In a recent Dow Theory Letters, Russell wrote, “I spend most of my time in bed, which gives me plenty of time to think,” an activity that, over the decades, few in the investment industry have done in greater depth than has RR. Russell has been writing Dow Theory Letters since 1958. For decades, Russell, Ben Graham, J. Anthony Boeckh, and Harry D. Schultz have been primary sources of investing wisdom for me. Russell recently wrote about 12-term Congressman Ron Paul, who tells the story of once riding alongside President Ronald Reagan on his helicopter. When the subject of what was happening to our money came up, here’s what Mr. Reagan said: “Ron, no great nation that abandoned the gold standard has remained a great nation.”
You have read about America’s Forgotten Men and Women on Yoursurvivalguy.com (See here, here, and here). Trump was able to galvanize support from Americans who do the “dirty jobs,” those who want a shot at the American Dream and feel like the out-of-touch left-wing radicals have forgotten them entirely. At Spiked, Joel Kotkin explains Trump’s success and what that means for America:
For a generation, America’s working class, as well as much of its middle class, lost political power. Rather than build their appeal on class interests, politicians kowtowed to Wall Street, Big Tech elites, university ‘experts’ and identitarian interest groups. But, as the 2024 presidential election clearly showed, the working class still has the clout to decide who gets put into the White House. Their choice of Donald Trump was a slap in the face to the ruling class.
The shift of working-class voters to the right, particularly those who work with their hands, has been developing for almost half a century. It accelerated during the pandemic, when their work largely kept the country functioning.
It’s hard not to be optimistic about the future, especially when government spending can change dramatically from Biden’s terrible instincts to Trump championing the forgotten Americans on Main Street. Buckle up; this could be a good ride. But based on my RAGE Gauge, Your Survival Guy will proceed with caution.
If you or someone you love wants to talk about your financial plan, email me at: ejsmith@yoursurvivalguy.com. But only if you’re serious.
