Watch and listen to U.S. Money Reserve's Coy Wells talk about inflation and how it is not too late to purchase gold in order to receive a greater return on your money in the future.
Inflation is Here. Buy Gold Now Before it Doubles in Value!- Video Transcription
Good morning and thank you for watching daily market insights. Today I kind of want to recap what we've talked about over the course of the past few months. And what we're going to talk about in the recap is the cause and effect of what's fixing to start taking place going forward not only the risk of the stock market but what we should expect in the next few months or within the next few years. The three key items we've been talking about for almost six months to eight months now is U.S. Treasury bonds. That's the number one key indicator we've been watching and the cause and effect of that is that it is happening. Number two, is interest rates U.S. Treasury bonds are low, they have to raise interest rates to prevent additional countries from sending those back which is hitting the Federal Reserve's balance sheet. Once they hit the Federal Reserve's balance sheet. Remember Jerome Powell on Thursday, 2 two weeks ago, talked about the consideration of raising interest rates just the talk of the consideration of raising interest rates has to be done.
The reason it's going to happen is because the Federal Reserve cannot afford to have un-purchased Treasury bonds sitting at the Federal Reserve's balance sheet. If they raise interest rates it'll make them more appealing for other countries to buy them and to prevent other countries from selling off the additional Treasury bonds that they have that they currently are worried about. Keyword they're worried about holding onto those low interest rates being paid the value in the U.S. dollar losing and it's not a winning proposition. If you take that encompassed with China in December saying that U.S. Treasury Bonds was not a viable asset to hold onto they've got to raise those interest rates. The second phase of that is the U.S. dollar. When those dollars are not being used by foreign countries or being purchased here by states or municipalities, the value of the U.S. dollar goes down.
The simple question or a simple answer a lot of people want to throw out there is well let's just print more money. They can't print money. If they could, they would have already done it. If they print more money we all know what it does to the value the dollar. Putting water into your tea. It dilutes the value of it. If you're a country that's holding U.S. Treasury bonds that's already worrying, nervous about holding onto the liquidity of those. If you print more money, It just throws fuel to the fire, they'll dump those. The interest rates just by that announcement cost three of the largest one day drops in U.S. history in regards to the stock market. It should confirm and tell you that the stock market is built on borrowed money. If we raise interest rates how will that affect the housing market in the future?
If interest rates go to a level just by raising a few points we could see levels in a housing loan or on a housing loan like we saw during the year of 2002 2003 maybe 7 or 8 percent. That will cripple the real estate market here in the U.S.. Number two, what you're seeing in the news right now you're hearing the word inflation you're hearing the word inflation over over and over again. Since January 11th until today I have counted more than 25 reports from major mainstream news sources and articles and on the news talking about the bonds and inflation. They all go together. The bonds have to be sold they have to raise interest rates. If they raise interest rates it makes them more appealing. Number two companies and corporation because the dollar starts going down inflation sets in because they have to raise the price of their services and goods to cover the loss on the U.S. dollar.
It's a vicious cycle. So inflation is the word that we have to start looking at now. That is what's most likely going to happen. Today the stock market is down around 200 points and gold's up nearly 15 hundred dollars. The safe haven with inflation and why Ronald Reagan brought gold back in 1985 and had it public for the American people in 1986 was because of the Jimmy Carter era. for those of you who are retired right now. You understand how critical and how bad it was during that time frame. That means we're talking about interest rates being high but inflation was through the roof so it was a null and void you weren't making any money even though you're paid 18 percent. Inflation was eating it up. You couldn't make any difference here. That's why Ronald Reagan brought gold back. Those who understand that, including the banks, most of you have heard that the banks have been buying gold.
They've been buying gold over the last two and a half to three years and they're buying it at record levels. The top banks and the central banks in the world are now competing with the top seven largest countries in the entire world in gold holdings. This is not a coincidence. This is done purely on the fact that the majority of the world uses and holds U.S. dollars. The only way to be able to protect yourself against a declining dollar in a crisis that is expected to last probably 12 and a half years to possibly 20 years is to take dollars that are at risk sitting at about ninety one or ninety two cents and take that money and buy gold and buy it now. Right now is a crucial point. In 2008 gold rose more than two hundred and fifty two percent and in 2000 under that recession again gold rose more than 250 percent.
2000 recession of six years 2008 was a recession of nearly five years. If you were a consumer that knew what happened in 2000 with a recession of six years those who put three hundred thousand into the gold market at today's spot price are sitting on one point sixty five million. Think about that for just a second. An individual who got ahead of the curve and put three hundred thousand dollars into the gold market in 2000, today sits on one point sixty five million dollars. Folks I've been in this business a long time. You think about where you can put three hundred thousand dollars in a piece of real estate and you tell me in 18 years were three hundred thousand can turn into one point six five million and I'll start moving my money. It happens only on a few occasions and you have to be lucky.
This is not about being lucky. This is about being smart with your money. This is not about the return on your money anymore. This is about the return of your money. There's a big difference. And right now the U.S. dollar and the government is preparing and setting up and that's what you have to be preparing for. As always thank you for watching and I always encourage you to click on the link or call the phone number below. This here will also help you understand where your state is at. The pension plans here United States are in trouble as well. The fiscal States of America is a crucial and a fantastic piece of paper and it will tell you how your patient plan is sitting in the United States. The government most likely is going to have to go get the money from somewhere and most Americans know that they have to come after our money.
Look at our Social Security. It's already at risk it's been discussed in the last week three or four times on national television by the Senate and Congress. That's an issue. Donald Trump said he believes it may last until 2023 2025 If we don't have a proper correction here. Click on the link put in a comment. Give us a phone call. We're here to help but listen to the items that we've listed here. Inflation is fixing to start setting in, the gold prices will start going up. Interest rates have to be raised and that will have a cause and effect and a direct effect on the stock market as you've already seen in the last three weeks. Thank you for watching and continue to stay tuned in.