The tipping point is upon us!
A “tipping point” in sociological theory is defined as “the level at which the momentum for change becomes unstoppable.” An idea or a movement has reached “critical mass.”
I believe the global economy has reached that point.
After publishing my book Rich Dad’s Guide to investing in Gold and Silver in 2008, I have spent the last few years touring the world and educating people on investing in cycles, and why, this time, the cycle benefits gold and silver. Understanding these cycles and investing on the right side of them can make you very wealthy.
Over the past year I have had the privilege to take part in various speaking tours in numerous countries throughout Latin America and Asia-Pacific. During my recent partaking in the first Silver Summit in Singapore I had a strong sense that the second phase of the greatest gold and silver bull market in history is beginning. Here’s why:
Never before in history have all the world’s currencies been fiat currencies at the same time. Remember fiat currencies are established by government decree and have no intrinsic value.
Because every currency in the world is a fiat currency, there is no place to run to protect your wealth against government confiscation by continuing to print more and more currency—nowhere to run, except to gold and silver.
The same phenomenon exists, everywhere in the world. The number of Australian dollars in existence has multiplied 180 times since 1960. There are 389 times more Taiwanese dollars in existence today than there were in 1962. Every government in the world is pursuing the same policy of currency debasement—and as a result—there is more than 10 times the currency circulating world-wide than there was in the 1970’s.
Here’s another big change between then and now: In the 1970s, during the last great gold and silver boom, 90 percent of the global population had no way of participating in the bull market. That’s because in the Communist Soviet Union and in Mao’s China, no markets existed, and there was not a single individual investor among those enormous populations. It was only America and Western Europe that drove gold and silver prices to their stunning heights.
This time around, the world is very different: there are billionaires in Russia, China, India, South America—every continent (except Antarctica) has its billionaires. The richest man in the world, Carlos Slim, lives in Mexico City.
Today, there are 10 times more people on the planet who have the freedom and the means to chase the next big thing, driving up market prices in the process.
Not only are there 10 times more people with the ability to participate in the market, there are somewhere between 10 and 100 times more people today who have an investment mentality than in the 1970s. Back in those days, before Nixon took us off the gold standard, people were savers. You could go to work in your teens or early 20s, save 10 percent of your income each month, and by the time you were in your 60s, you could retire and live the rest of your life off the interest on your savings.
That saver mindset evaporated the second Nixon ended the gold standard. From that day on, if you planned to enjoy your retirement, you were forced to become an investor or a speculator. The NASDAQ tech bubble of 1999 turned everyone into a day trader. The real estate bubble turned everyone into a flipper. Today, I hardly know anyone who doesn’t have an investment mentality.
This philosophical shift didn’t just occur in the United States; it happened everywhere. In modern China, investing is a sport, and Shanghai has its own riotous stock exchange.
Stock investors in Wuhan City, China. (AFP/Getty Images)
And with the explosion of deficit spending and fiat currency creation, all over the planet, the next great bubble is destined to be precious metals.
As people rush back to gold and silver to protect their wealth, they are going to drive precious metals into a bull market the likes of which the world has never seen. Those on the right side of the bubble will profit immensely.
The 2010s will be an exciting decade. For years I have been saying we have been presented with the greatest opportunity in the history of humankind, because global economic conditions are setting up the greatest transfer of wealth in history.
So, in a nutshell, in the gold and silver bull market of the 2000s compared to the metals bull market of the 70s, you have 10 times more people able to invest, of whom 10 to 100 times more possess an investment mentality and ready to pile onto the next big thing, and there’s 10 times the money (currency) in existence.
A critical mass of world investor’s are recognizing the unsustainable nature of the fiat system. And the second phase of this bull market is beginning right now.
The tipping point has been reached!
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