How to Protect Yourself From Rising Interest Rates
During times of low interest rates, the prices of assets tend to rise. These assets include stocks, bonds, real estate, commodities, natural resources, and food. Much of this also has to do with the ever expanding money supply (currency devaluation); thereby, giving the appearance that asset prices are rising AKA inflation. In reality, the money has gone down in value as more saturates the economy. In this article, I will cover the history of America’s interest rates since 1980, stock market, best investments to own during rising interest rates, the best hedges, and ways to protect yourself.
Since the early 1980s, America has enjoyed consistently lower and lower interest rates. In the last decade alone, interest rates reached near zero levels. Most of the stock market rallies we saw in the 80′s, 90′s, and today all were largely thanks to record low interest rates. When interest rates are lower, money is easier to borrow, cheaper to borrow, liquidity is readily available; thereby, fueling fast expansion as businesses can leverage rapid growth not possible without these low interest rates. Also, as interest rates are lower, the money supply is expanded as with each new loan or debt instrument created, the money borrowed never existed before. Thus, the money is created out of thin air, literally. This is inflationary!
Give Us Back Our Sovereign Economy!
If the majority of rank-and-file American citizens continue to buy gasoline at unreasonably exorbitant, continually rising prices, the current fuel dilemma is only going to get worse. By docilely doing exactly what the federal government wants Americans to do, to just buy the gas, it’s only a blatant admission that the global economy has whipped the sovereign People of the United States; and it is evidenced when gas prices are over 4 dollars per gallon and the gas lines are filled and overflowing. It’s a statement of concession to the gas moguls, to the Federal Reserve, and to an impotent U.S. Congress that the Constitution of the United States is no longer in force, and that Article 1, Section 8, Clause 5, which gives the Legislative Branch the exclusive right, and power, to coin money and to determine its value, is dead language. The sovereign independent American economy worked just fine until U.S. Presidents, starting with Woodrow Wilson, began clandestine efforts behind the Peoples’ back to create the new world order that pundits, such as Samuel P. Huntington, extolled, and that President George H. Bush first publicly acknowledged during his administration.
As Rep. Ron Paul (R. TX) has said, reflecting the wisdom of Presidents Thomas Jefferson and Andrew Jackson, there does not have to be any sort of monetary inflation in a sovereign political economy based on a gold or silver standard, which is not inextricably connected with the money systems of other nations. A current self-professed Internet philosopher, Harley Hahn, has proposed that, “… aggression, politics, greed and hatred are inevitable expressions of human nature. What the lessons of history have really shown us is that the best way to ensure world peace is to create a stable (world) economy in which people, countries, and regions are economically dependent on one another.” What Hahn left out of his statement, which is definitely reflected in his other ramblings and those of John K. Gailbraith and other international economists, is the word “world.”