Retirement Planning

Jim Rickards on How Gold IRAs May Protect Your Retirement Savings

It is no surprise that most investors today are anxious about the political and financial uncertainty of the future. Rising inflation, a war in Ukraine, tumultuous energy markets and weakening economies could culminate into a worldwide economic crisis. For many retirees, now is the time to take proactive steps to protect financial assets in the wake of a potential global monetary meltdown.

Jim Rickards, an American economist, media commentator and author on matters of finance and precious metals, shared his thoughts on a pending monetary collapse. Rickards also shared his recommendations on things to consider when investing in gold and silver to protect your retirement savings.

Is a Market Collapse Imminent?

When I talk about periodic market collapses, it sounds like some impossible or draconian or extreme event, but the fact is it has happened three times in the past 100 years. In 1914, just on the brink of World War I, again in the late thirties, leading up to World War II and then in the mid seventies, most prominently in 1971, when president Nixon suspended the redemption of overseas dollars for gold.

We are getting close to one of these periodic monetary collapses. The last one was 1971, and was a catalyst. It played out over a couple years between 1971 and 1973. It’s been over 40 years since the last one. If you look at the tempo, 1914, 1939, 1971, they happen every 35 or 40 years. They’re not that rare. So I’m not saying it happens like clockwork tomorrow, but no one should be surprised if it does. That’s really the point. So my message to investors is that it could be tomorrow, it could be next year. I don’t know exactly when it’s going to happen, but we’re getting close.

When it happens, the system will be reformed. What I’m trying to do is to say, okay, what will that new system look like? What will the role of gold be? If it has an important role, which I expect it will, now’s the time to get some gold, because when this happens, you might not be able to get it, number one. Number two, the price might be so high that you’ve missed the opportunity. Now is a good time to do that. Looking at what the new system might be… By the way, there may be many collapses before the big one. Think of it as an earthquake. So what’s a big one? Well, eight on the Richter scale is off the chart. That is devastating.

But you can have a series of sixes or sevens, which are pretty powerful earthquakes leading up to that big one. Well, maybe we’re all worried about the eight, let’s call it on the Richter scale. The one where the gold goes up by a factor of 10, which it would not surprise me at all, $10,000 an ounce, etc. The value of currencies in real terms, collapses, we have something like hyperinflation. So let’s call that the eight on the Richter scale. There could be many collapses along the way. The problem with retirees in particular, you don’t have time to bounce back. If you’re 30 years old and you’ve got some savings and maybe you take a beating, the stock market crashes or whatever. Well, that’s not a good outcome. I’m not suggesting that. You do have time to make it back.

If you’re at a retirement age and you get caught in one of these downdrafts, you don’t necessarily have time to make it back for your own retirement or for your children. That’s why I recommend gold as part of a portfolio, not all in, not a hundred percent by any means, but 10% of your investable assets in gold will preserve your wealth in these kinds of collapses that I’m talking about. We can definitely see it coming. I would say the big one will definitely be bigger than, or worse than 2008. Why do I say that?

There are metrics. This is not guesswork. I don’t have a crystal ball. We actually use scientific models to make these kinds of projections. Nothing was solved in 2008, nothing. We got through it. We’re still standing, but the banks that were too big to fail are bigger. They have a larger percentage of the banking assets. They have larger derivative books. Everything that was wrong in 2008 is worse today. Now, yes, the government propped it up. I understood that and kept the game going. We had an expansion and so forth.

All that embedded at risk is there. It’s bigger. It’s just a matter of time before it collapses. There’s a relationship between the size of the system and the size of the collapse and it’s exponential. If you double the system, you don’t double the risk, you increase it by a factor of five or 10. That’s what we’re looking at. So I do expect this sooner than later. I’m not saying tomorrow. I’m not even saying next year, but sometime in the next several years. There could be smaller collapses along the way. That’s highly likely. For retirees in particular, you don’t have time to bounce back. You have to prepare today.

Now Is The Time to Take Action

Are you prepared to defend your wealth? If you were thinking of investing in gold, now is the time to take action. With a gold IRA, you can roll over your existing retirement assets into a gold-backed IRA account that offers the same tax advantages as your existing retirement account. If you have investments in stocks and bonds and you are worried about them losing their value, then maybe it is time to consider rolling over your assets into a gold IRA.

 

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