What would happen if the economy really collapses?

First of all,

Currencies will definitely collapse.

Because, in essence, money has no intrinsic value,

It reflects the credit of the government.

And if an economic collapse occurs,

It means that this credit has also collapsed.

At that time,

The country’s currency will depreciate significantly externally,

And experience hyperinflation internally (this inflation is not due to excessive demand,

But because of a credit collapse).

How severe can this be? The purchasing power of money shrinking by half is just a standard move,

Shrinking to a fraction of its original purchasing power is not uncommon,

And this process can be very fast,

Depending on how thoroughly the economy collapses.

The so-called holding cash to survive an economic collapse,

Is very wishful thinking.

Banks will offer extremely high interest rates,

For example, over 50% annual interest,

But it’s meaningless,

It will definitely lag behind the speed of currency collapse.

And at that time, whether you can withdraw your money from the bank

Is a very mysterious issue.

Everyone knows that the later you withdraw, the more you lose,

Bank runs and capital controls arise in this context.

From the perspective of surviving an economic collapse,

Asset allocation needs to be prepared in advance.

Here, assets are divided into several categories:

First,

Assets that can be redeemed worldwide at standard value,

Only two and a half qualify.

One is gold,

One is the US dollar,

Half is Bitcoin.

Half is because it is still evolving,

But it has already acquired some basic characteristics.

For this situation, physical gold bars are a must,

It cannot be paper gold.

Under the control mode after a crisis,

Any assets not in your own possession,

Should not be expected to be smoothly obtained according to commercial contracts.

But what needs special attention here is,

Accumulating a large amount of gold bars is pointless.

Because exchanging for supplies, etc., is not convenient,

And it’s also difficult to carry and move in large quantities.

The significance of gold bars in historical crises,

Is not about enduring long years,

But about playing a role as a “buying passage” at critical moments,

Sometimes it may be a chance for survival.

This cannot be elaborated here.

The US dollar is currently the only safe-haven currency in the world,

It has many problems in the long run,

But here we assume the near future situation.

It’s also quite emotional to say,

The US dollar as a hard currency in times of crisis,

We have seen many examples decades ago,

And it still remains effective today.

How we wish,

One day, the best safe-haven currency would be the domestic currency.