Gold Market Saying Living Standards Doomed To Fall In U.S.

Gross suggests that living standards doomed to Fall in the U.S. The gold market, and experts that interpret it, has been conveying this message for years. The secular trend in gold will accelerate when the pubic finally recognizes the severity of this message. Acceleration in gold tends to be associated with some sort panic.

Headline: “No Way Out” of Debt Trap, Gross Says: U.S. Living Standards Doomed to Fall

PIMCO founder and co-CIO Bill Gross has previously said that if the United States were a corporation, no one in their right mind would lend us money. For the last decade, we’ve been “relying on the kindness of strangers” to help cover our debts, he tells Aaron in the accompanying clip.

By “strangers” he is referring to our foreign counterparts, like China for example. Basically, for years Americans have spent their hard-earned dollars on less-expensive Chinese made goods. With great gratitude, China turned around and used all those dollars to buy up U.S. Treasuries and other dollar-denominated assets.

But now after years of reckless spending, America’s debt level is nearing a breaking point and can no longer rely on foreign capital as a last resort. “When a country reaches a certain debt level, confidence in that country’s ability to repay that debt becomes jeopardized,” says Gross, citing the work of Ken Rogoff and Carmen Reinhart in This Time Is Different.

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