The Real World of Money
Fred Dashevsky is from Long Island New York. He attended University of New York at Albany and studied psychology, political science, and economics. Fred started in the coin business in 1984 in Northern New Jersey opening several offices in Southern California in the mid 80s. He returned to the east coast in 1989 and opened Hilton head office for SDL Inc. in 1991 with partner Andrew Gause. He has since opened his own business, U.S. Coin Capitol. Give him a call for your numismatic gold investments 800.878.2646
What is Quantitative Easing? Targeted purchases of higher interest longer-term bonds, leaving the market with only lower interest rate assets. Intended to lower market interest rates. Is used when lowering interest rates by the FED didn’t suffice. It’s a blunt instrument, a tool they don’t like to use.
The real estate market seems to be peaking. People are being priced out of housing because mortgage rates have risen.
Gen xers and millennials have never seen a stable economic environment.
We printed a ton of money to solve a problem and are now experiencing record high inflation.
Trump thought stimulating the corporate side of the economy with his tax cuts could stimulate growth. When he left office, we were starting a recession.
In contrast, the Democrats put money in the hands of the public. 40% more money printed than 2 years ago.
Dangers of FED overtightening. Stock market volatility. Stagflation.
They want to reduce the size of the balance sheet. Stopped buying mortgage bonds in March. Allowing $17 billion of bonds to mature instead of reinvesting.
Eurozone at 8.1% inflation now due to sanctions and Ukraine invasion.
Europe and Asia have it worse than the US, so a lot of foreign money is coming into the US. US is the cleanest dirty shirt.
Europe is requiring repayment from Russia in terms of dollars, but sanctions limit Russian access to dollars. Pressure from Europe to relax sanctions.
Dollar is not strong because of a strong US financial market.
Numismatic coin prices going up markedly because of market pressures.
From 1790s-1964, US coins were still being made from silver. US discontinued making gold/silver metal coins because the metal value became higher than the face value of coins.
A bag of silver coins is $1,000 in face value. Today is worth $26,000.
Advantages of pre-1965 coins vs. silver bar: Fixed supply of these coins. Government regulations different for coins minted in the US vs. bullion. Anti-money laundering rules for bullion, so govt. documentation required and no privacy, versus no documentation required for coins. Historic confiscation of bullion by US govt. Coins are legal tender, govt. can’t prohibit spending them, and legally are worth only face value.
Only as long as we believe the government will make good on its debt obligations will paper money have any value. Our paper dollars are actually IOUs.
The wisdom of the founding fathers in establishing a money system based on gold and silver has become quite apparent.
Will a central bank digital currency exist parallel with the dollar? With CBDC, how will we know how much money exists? What social engineering will we see?
Imagine the velocity if paper money was to be extinguished because of CBDC conversion. Panic to spend paper money before it became worthless.
Where did the $40 billion for Ukraine come from? Making money out of thin air, at the detriment of the public.
$10,000 payoff of each student loan. Who will not get paid? Just another $200 billion not coming into the government.
Fred has a special offer this week which includes gold and silver coins. For $4,100, the package available from US Coin Capitol is one $20 pre-1933 St. Gaudens gold coin MS65 condition, and 5 silver dollars, 1878-1921, MS65. Max of 10 sets per person, while supplies last.