The Dollar Collapse Effect

The Dollar Collapse Solution

Speculations all over the internet have been written as to when the dollar will collapse. Most agree that it is inevitable. Some even mention a specific time frame such as by the year 2012. Those written about three years ago had mentioned this year (2011) or the previous year (2010) as its supposed timeline. When no year is mentioned, predictions of as near as four months or so have been cited instead. On a good note, none of them have occurred yet.

Regardless of the time frame mentioned, the aftermath and possible solutions are more important. Globally, world currencies will also be affected in the collapse of the dollar as most nations particularly in Asia rely heavily upon the U.S. economy for survival. The United States, despite all the odds is still among the top nations of the world in terms of economic status.

Dollar Collapse Effect - China

China, now deemed as the second largest economy is still dependent upon the U.S. for its exports. A complete dollar collapse ultimately kills the hand which feeds this sleeping giant of a nation, knowing that it owns trillions of dollars in the national reserve. Some believe that such an occurence Balance(65822)Credit: Image: dream designs / FreeDigitalPhotos.netas this may force China to start a revolution or to evolve into a full military government. This of course poses potential global threat to democracy knowing how the Chinese power has supported nuclear arming ever since.

Dollar Collapse Effect - Middle East

In the same manner, Middle Eastern leftist movements may become more active. Technically, attacks from these groups have already caused economic and financial problems in recent years. The 9/11 attacks in 2001 had affected local and international businesses dependent on the U.S. It had also prompted greater federal expenditures more than ever. First, to retaliate against terrorism and second, to rebuild the nation from the ruins brought about by an economic recession of the past few years.

Dollar Collapse Effect - One World Currency

Another potential aftermath is the possibility of nominating a one world currency. A unified monetary unit is actually being utilized now in Europe. The possibility of doing the same thing for the rest of the world may occur if one of its highest forms of monetary currency, the dollar collapses. In relation to this, some predicts the emergence of other options like gold as a fiat currency the way it was thousands of years ago.

Aside from discussing scenarios which may happen in case the dollar collapses, what can be done about them should also be mentioned. Investing in assets which are not easily affected by inflation is one recommendation. Some of such assets include bonds and stocks, commercial real estate properties, agricultural and industrial commodities, and precious metals like gold and silver.

Dollar Collapse Solution - Gold

Gold is not only a strong investment, it is also considered by many as the best standard which can replace the dollar as a fiat currency.

There are many reasons why gold is highly regarded. It had been used in nations and kingdoms as a form of currency as early as 3000 B.C. As an investment, its multiple uses in different industries explains why it always in demand. This need for gold in contrast to its scarcity and the difficulty attached to mining activities related to it, increases its value. This also explains why gold prices did not experience a remarkable downfall unlike most assets the economic recession in the past few years.

As a conclusion, a dollar collapse scenario is a dilemma which may affect everyone beyond the national level. A global effect is to be expected should this scenario ever occur. How we respond to the call for change on an individual level may prevent this scenario from happening. But whether the dollar collapses or not, it is still best to prepare for it as early as now by devising your own personal financial crisis survival system. 

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