With the value of gold hitting $4500 and silver around $90 an ounce respectively, the bullion markets are indicating something is up with the US dollar.  During the past year the value of the dollar has dropped around 5% compared to a basket of currencies.  These developments in conjunction with huge US debt, ongoing federal fiscal deficits, a policy push for lower interest rates, all foretell a coming devaluation of the US dollar or 'soft' default on the US debt via an increased inflation risk.  We are back in the world of the 1970s when President Nixon took the US off gold standard in 1971 setting in motion a soft default on the current debt via the double digit inflation that rampaged the US economy under Presidents Ford and Carter. As unctuous as this policy is, the ground work has been forced on the Current President by bipartisan fiscal mismanagement during the past 40 years, and a soft default is in all likelihood better than an actual default.

January 2026