{"id":2086,"date":"2023-07-31T11:10:52","date_gmt":"2023-07-31T18:10:52","guid":{"rendered":"https:\/\/www.lorallangemeier.com\/?p=2086"},"modified":"2023-07-31T11:10:52","modified_gmt":"2023-07-31T18:10:52","slug":"if-the-economy-collapses-is-my-money-safe","status":"publish","type":"post","link":"https:\/\/www.lorallangemeier.com\/if-the-economy-collapses-is-my-money-safe","title":{"rendered":"If the Economy Collapses, Is My Money Safe?"},"content":{"rendered":"

\u00a0\u00a0\u00a0 That\u2019s a very broad term, if the economy collapses.\u00a0 World-leading economist, and mathematician, Kelly Korshak thinks it\u2019s a matter of extent.<\/strong><\/p>\n

\u00a0\u00a0\u00a0\u00a0 If your monies are in a bank, or in a stock market account, they are protected by the FDIC (Federal Deposits Insurance Corporation), which was formed during the 1930s Great Depression under FDR, when the banks collapsed.<\/strong><\/p>\n

\u00a0\u00a0\u00a0\u00a0 If your money is in a trading account like Charles Schwab or TD Ameritrade, Fidelity, etc., those agencies will ensure your assets, cash, or securities, up to $250,000 each.\u00a0 If the economy were to collapse, like it did in 2008, the Federal Reserve will immediately lower interest rates, and stand behind the stocks and the securities of the companies that are affected.<\/strong><\/p>\n

\u00a0\u00a0\u00a0\u00a0 If the collapse is broader than this, it would devalue the dollar.\u00a0 Which means that maybe you would probably still get your money from the FDIC or SIPC (Securities Investment Protection Corp.).\u00a0 However, if it was local, you wouldn\u2019t be able to travel to Europe or abroad easily, because the value of things would become much more expensive somewhere else.<\/strong><\/p>\n

\u00a0\u00a0\u00a0\u00a0 In Kelly\u2019s opinion, the economy will have some rough times, if we try to wean ourselves off of all the stimulus that the government puts into the economy since the beginning of Covid.\u00a0 Especially now that we have to do it at higher interest rates.<\/strong><\/p>\n

\u00a0\u00a0\u00a0\u00a0 When asked how some political efforts in China, Russia, Brazil, and in lots of other countries threatening to move away from the US dollar affects the economic potential of collapse, Korshak had this to say, \u201cThis is probably one of the most serious problems of our day.\u00a0 A society is only as strong as they are united.\u00a0 If a society is bifurcated, which is what I feel it is today, then it is weaker.\u201d<\/strong><\/p>\n

\u00a0\u00a0\u00a0\u00a0 Pointing out that the US dollar may not be the best place to have a reserved currency for the world to depend on.\u00a0 This is occurring because, in this country, having the united divided society is stemming from a divided government.\u00a0 And generally, for the markets, a divided government is generally a good thing for the markets.\u00a0 But when it gets to an extreme, it\u2019s not.\u00a0 And this means that this has serious impacts for the dollar going forward.<\/strong><\/p>\n

\u00a0\u00a0\u00a0\u00a0 \u201cI think people remember that the dollar was literally above par against the Euro currency.\u00a0 Euro currency went to 96 cents.\u00a0 Most of my life, I saw the Euro at about a $1.30.\u00a0 Now the Euro is about a buck eleven.\u00a0 Which is saying that the United States slowly has the dollar, has slowly come off its high, and now that these countries are starting to unite, it will weaken the dollar,\u201d explains Korshak.<\/strong><\/p>\n

\u00a0\u00a0\u00a0\u00a0 The sum of the Russian economy, which is small, but with China, it is larger than the US economy.\u00a0 If, for example, India or even another country comes on board, then obviously we would have a potential adversary that has a stronger base set of values and currency than we do.\u00a0 And that changes the reserve requirement around the world.\u00a0 It means the dollar is no longer the stable currency.\u00a0 Monies without flow from the dollar, the dollar would get weaker, and that would also be very inflationary.\u00a0 It would mean that we would have to now buy any imported products at a higher price.<\/strong><\/p>\n

\u00a0\u00a0\u00a0\u00a0 \u201cThe first thing I would say is, at least on the iFlip portfolio https:\/\/askloral.com\/iflipapp<\/a><\/strong>, one of the things I\u2019m in the creation mode for right now is an exchange-traded funds-inspired dollar smart folio.\u00a0 Which basically means, if you were to buy it, you would be betting against the US dollar.\u00a0 This would be a portfolio where the best way to protect yourself, and the value of your dollars, your dollars have a value only in terms of another currency,\u201d answers Korshak when asked what are some protections people should be thinking about. <\/strong><\/p>\n

\u00a0\u00a0\u00a0\u00a0 If the dollar decays against other worldwide currencies, and we have inflationary problems, it may not affect what we\u2019re doing.\u00a0 However, if you want to go a step further and protect your US value, your US wealth, so that it has a commonality against the wealth of other countries, then you would want to own a product that has some appreciation, if the dollar were ever to go lower.<\/strong><\/p>\n

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