The Little Book of the Shrinking Dollar: What You Can Do to Protect Your Money Now

Chapter Two

Serial Bubble Blowers

Who Controls Our Economic Destiny?

The shrinking dollar is a modern problem. The U.S. dollar has been shrinking since the inception of the Federal Reserve—the very crew assigned the task of maintaining its value. Of late, the decline is accelerating at an alarming rate.

For many Americans, the suggestion that the dollar is losing value is unthinkable—even unpatriotic. The problem is not simply a lack of understanding about the nature of wealth and investment used to sustain it. Our policy makers and economists make no distinction between wealth created through savings and investment in the real economy versus “wealth” created in the markets through asset bubbles brought about by credit policies.

When I tell people this, I feel like I’m addressing a meeting of folks who want to lose weight at the local burger joint. We as individuals—and as a nation—are addicted to cheap, easy credit. What the government gives, we’ll take. We spend at a high level, and we want to accumulate wealth on the same fast track.

Forget hard work, we’d rather our house go up in value like magic! Traditionally, economists recognized that it took time to build an estate. People and countries could build wealth slowly. Those days are far, far behind us. Now we are at the mercy of what I call serial bubble blowers.

All the U.S. economy’s so-called improvements stem from one main reason: all economic growth during the “recovery” since 2001 can be traced to a seemingly endless ...