Things in America are becoming increasingly difficult. Every passing day becomes more and more of a struggle as the simple things we once took for granted, such as cheap food and energy for instance, are skyrocketing out of control. A gallon of milk costs over four dollars and fifty cents, and a pound of beef is nearly eight dollars, if not more in some places. Many families can testify to the frustration of watching the spending power of their hard earned dollar buy less and less each week at the grocery store.
It seems that just preparing a simple meal, buying a box of cereal and a gallon of milk costs us what it would cost to buy groceries for three or four days a few years back. In fact, it is estimated that the buying power of five dollars in 2013 was equivalent to $3.26 in 1995 with an annual inflation rate of 2.4% over this period. What this means is a five dollar bill today has the value of three dollars and twenty-six cents. I'm no economist, but I would have to say that is a bad thing. Inflation is obviously contributing to the dreadful state of our economy and rapid rise in food and energy prices. However, the fact that these necessary items are not included in the inflation index keeps many people blind to what is going on.
What is causing this rapid decline in the value of our dollar? Isn't the US the richest country in the world with the dollar acting as the world's reserve currency? While it is true that the dollar is the world's reserve currency, it has been made so artificially through deals with Saudi Arabia. As I wrote in my article "If this is true then our entire society is one big lie," the US and Saudi Arabia made a deal where they would price their oil in dollars only, and in exchange, the US will offer them the protection of our military might. It worked out pretty good for the US, as countries around the world were forced to buy their energy in dollars. Thus, they were forcing them to keep an ample supply, which in turn, artificially inflated the value of a worthless piece of paper.
The dollar had originally been backed by gold, and an economy that was producing goods and services the world wanted. That's one little detail that seems to be missing from many economic arguments today. The US is no longer producing anything. Our dollar is no longer backed by gold. Many countries are moving in what can best be described as an international scheme to drop the dollar as the world's reserve currency, and when that happens, there will be no need to hold onto US dollars. This will create an economic crisis in the United States. In fact, China and Russia seem to be working in a collaborative effort to achieve this end.
This isn't the only contributing factor to our declining dollar. For nearly two decades now, our government has been exporting our jobs to China. The United States is no longer the economic, industrial power horse it once was. Instead, we have been transformed to a service based economy where much of what we sell has been manufactured in other countries. This greatly reduces the tax revenue to the United States government, and because we are producing nothing of value, we are borrowing money from countries that are hostile to our interests in order to keep our government afloat. In fact, the United States borrows forty six cents for every dollar it spends. That means that a dollar is only worth fifty four cents; that is even worse than the comparison made in the first paragraph. This little bit of information goes a long way in explaining why our dollar seems to be losing purchasing power every day.
It is clear what is on the horizon in the next couple of years. If countries that have been forced to trade in US dollars against their will get a chance to switch to another currency, they will. When this happens we will see an already weakened dollar collapse completely because there will be no demand to keep it, and there will be nothing to give it value as the oil it is currently traded for will be assigned to another reserve currency. This will be the official end of the superpower status of the United States, and in many ways, it seems to be the end goal of those currently in power.
After all, we are being governed by a bunch of left wing fanatics who seem to think that every conceivable ill in the world is the fault of US imperialism. They seem to be more than happy to be presiding over America's economic decline while our enemies are surely ecstatic that the White House is home to a willing accomplice to our destruction. It's time to reach down and grab hold of some intestinal fortitude America because the idea of a twenty dollar loaf of bread isn't all that far-fetched anymore.
Listen to this topic be discussed with Dr. Fred and myself as we discuss Jim Rickards new book, "The Death of Money" on his program Truth Trends on WAARadio next Wednesday at http://newsninja2012.com/radiolive/Don't forget to Like Freedom Outpost on Facebook, Google Plus, & Twitter. You can also get Freedom Outpost delivered to your Amazon Kindle device here.