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Linked In/Ray Dalio/5-7-2020
“While people tend to think that a currency is pretty much a permanent thing and believe that ‘cash’ is the safe asset to hold, that’s not true because all currencies devalue or die and when they do cash and bonds (which are promises to receive currency) are devalued or wiped out. That is because printing a lot of currency and devaluing debt is the most expedient way of reducing or wiping out debt burdens. When the debt burdens are sufficiently reduced or eliminated, the credit/debt expansion cycles can begin all over again … “
USAGOLD note: Dalio goes on to offer a well-structured history lesson that begins with an observation: “Of the roughly 750 currencies that have existed since 1700, ” he says, “only about 20% remain, and of those that remain all have been devalued.” From there, he addresses the historical benefits of gold ownership. As most who frequent this page already know, Mr. Dalio, who heads up the world’s largest hedge fund, recommends gold ownership as a safe haven and store of wealth.
Chart courtesy of VisualCapitalist