Obama can ignore the laws of economics, but the laws of economics won’t ignore him. This is the trouble with being wrong about everything you believe about economics. When your party takes over, it becomes obvious after none of the promises or predictions come true.
With Obama’s last 3 and a half years, he’s been wrong on such a level that it’s been kind of embarrassing.
Unemployment is worse, full-time jobs have been replaced with part-time jobs, the national debt has exploded, gas prices are worse, the dollar is weaker, food prices are higher, the world doesn’t respect or fear us, and I could go on for several pages with everything that has crumbled in less than one term under Obama. But let’s focus on one particular sign of his failures: gold prices.
The price of gold was about $850 per ounce when he first became president. Now the price of gold costs more than $1700, more than doubling. Why has the price of gold increased so much? To answer that, we first have to understand what motivates gold investors in the first place.
What Gold Tries To Tell Us
Gold is an alternative currency, in a sense. In other words, it’s going to go up when people don’t want to keep money in the other currencies over time. Considering other currencies experience inflation and gold increases in value slightly over time, this makes sense. Whenever there’s a surge of distrust in the main currencies, gold always picks up steam because it’s the alternative to the government currencies.
Under Obama, that distrust has been spiking like mad because he’s increased our national debt by $5 trillion and has put so many people on the government dole it will take a decade to get back to pre-Obama levels — if ever. He’s systematically pushing more people toward a life of consumption and government checks. It’s unsustainable. It’s systematically designed to destroy the dollar over time.
The problem, of course, is that we can’t pay for it all with taxes. Not possible. It’s not that we wouldn’t if we somehow could — it’s that it’s literally impossible to pay for Obama’s America with tax revenue. There simply isn’t enough to go around.
What Gold Is Telling Us Now
Back in the more primitive coal-mining days (before the president decided to wage war on the companies that keep our lights on), miners would often lower a canary in the coal mine. The general theory was that the canary would go down, and if there were poisonous gasses, then the canary would bite the dust and the miners would be warned.
That’s what gold is in the context of the economy. It’s the canary in the coal mine. It’s spiking price is warning us of something horrible that will happen if we don’t change something — and change it fast.
Just yesterday, gold prices lept once again. The data keeps getting worse. And the canary in the coal mine keeps warning us of worse things to come unless we change course. What’s being warned of down the road doesn’t have to happen. We just have to change course.
Shaun Connell is the founder of Capitalism Institute and the editor of LiveGoldPrices.com.