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U.S. Dollar Devaluation by 2024

Gold Safe Exchange

Devaluation is Heavily Predicted by December 2024 Since 2019, there has been an expectation that a new recession will hit the U.S. markets and devalue the dollar. However, every year since, the American economy has defied the odds, continuing the climb it started in 2013 after the real estate bubble popped and the capital letter Recession happened in 2009. That said, the experts at Gold Safe Exchange speculate that 2023 may very well be the year the U.S. dollar finally sees devaluation, mainly because of internal inflation versus anything else.

The U.S. government flooded the domestic market with cash in response to the momentary slump during the COVID pandemic.

The U.S. government flooded the domestic market with cash in response to the momentary slump during the COVID pandemic. Both at the individual level as well as the business and corporate level, multiple subsidy programs were at work, pumping liquidity into the market to stimulate spending and revive the economy again. While short term, there was spending, folks mainly put their funds into paying down debt or just handling everyday bills. No surprise that much stimulus money flooding in ended up devaluing the dollar and bringing inflation levels to the highest they’ve been in decades.

Now, the Federal central banks are struggling to reign in inflation, increasing the cost of borrowing money, which in turn constrains its liquidity and the availability of the dollar. As a result, many analysists believe that the reckoning delayed for so long will eventually arrive in 2023 as the U.S. economy’s good luck finally runs out. No surprise, the same experts expect that the dollar will get a slight bump off the holiday spending so typical around Christmas before it does a nose dive in valuation by the spring and summer of 2023.

Why would that happen? The combination of high inflation, high staple prices, no actual growth, and constraining of the dollar with expensive borrowing rates will combine to depress the economy versus help it grow. Companies, in turn, will cut back via layoffs to create internal liquidity with less payroll. That will also result in less consumer spending as fewer people are working and struggling to find a replacement job. The same dynamic repeats itself again and again in a vicious downward circle until spending demand finally pushes companies to grow again.

In the meantime, the U.S. dollar, no longer backed by widespread strong income, will weaken, and foreign currencies will become stronger as a result. This devaluation isn’t necessarily a bad thing on the international stage; it generally means increased international spending coming into the U.S. versus the other way around as the U.S. dollar becomes cheaper.

the U.S. is well overdue for a correction!

In short, the U.S. is well overdue for a correction, and it will be seen in a weakening of U.S. dollar buying power at both a corporate and individual consumer level. However, as the Federal banks are hoping, the waning of the economy will force prices down to continue sales, which in turn reduces inflation. It’s a short-term pain in their eyes to realize long-term stability again.

Long-term prognosticators expect that the dollar will weaken in strength by as much as 10 percent by December 2024 as the above dynamics shake out. At that point, the risk of recession weakens, and the correction takes full effect on another cycle of economic growth. Whether that will play out as nicely remains to be seen in reality. It’s one of the reasons why alternatives such as buying gold through Gold Safe Exchange make so much sense. Time and again, economic change has been messy, usually at the expense of the consumer’s buying power via the dollar. With gold as an offset, consumers can retain savings value and come back into the dollar market when it’s more favorable.