Is Mexico Going to Back the Peso up with Silver?

A silver backed peso has been talked about for a few years but now maybe things are heating up again.  Mexico has vast silver mining capacity compared to many other countries and a silver backed peso could give Mexico a huge economic advantage.  In fact, any country backing their currency up with a precious metal would have a large economic strategic advantage because of the rampant devaluations going on around the world by each currency’s respective government (or central bank).  A precious metal backed currency would be a safe harbor.  The U.S. dollar used to be the safe harbor for the world because of the size and health of the American economy, and the America’s superpower status.  Today, things have changed, U.S. government has gone from the world’s greatest lender to the world greatest debtor.   The U.S. government is trillions in debt and is seen as totally corrupt not only by many of its own citizens but from people around the world.  The last 20 years have seen boom after boom created through monetary inflation.  Each boom has resulted in a bust that has destroyed trillions in capital through the misallocation of resources through Federal Reserve manipulation of interest rates.  This has not only affected our economy, but it has affected the economies around the world as well.  Now, America’s major export is cheap dollars sent around the world to buy goods that American’s would not be able to afford in a real world economy.    The U.S. dollar is artificially demanded because of its role as the world’s reserve currency and its petrodollar status.  Now things a changing, the tide is turning.  There is no way out. The economic day of reckoning is coming.  The U.S. Federal Government has no way to pay off its debt and its future liabilities. Governments around the world know this.  No government wants to be the first country to pull out of the dollar but no country wants to be the last either. Mexico wants out.  Mexico has a way, a silver Peso.   Will Mexico’s banking interests allow this to happen?  Will the U.S. government?  I remain doubtful, I think it will come from the east.  Either Russia or China, but who knows.



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