The War on America's Retirees (CRESY)

• You are a liability
• War, not on Libya, but against you
• How to fight back

For 60 years it worked nearly flawlessly. You work hard, you save any excess earnings, invest prudently, you pay your taxes, and you pay into Social Security. Then when you retire, you have a nice pillow-cushion of savings, investment income and social security checks to fall back on.

But that's clearly not the case anymore. The social contract is broken – and it wasn't broken by the average retiree. The average retiree held up their end of the bargain. But now, every single penny sitting in savings accounts, 401(k) plans, mutual funds, and being held in what remains of the Social Security coffers is a huge liability for the Federal Government.

Why? For a Federal Government that demands never-ending bureaucratic AND economic growth, money that just sits in a savings account or in a retirement fund could be better spent on war-machines and/or frittered away on stuff from China, Japan or Indonesia.

Every dollar that needs to get paid out in Social Security funds only further depletes a reservoir that's supposed to get smaller every year after 2015.

American retirees and their savings are a liability.

And what does the Federal Government do when it's faced with a liability?

It wages war.

Right now, the Federal Government is waging fiscal and monetary war against your savings and your Social Security payments.

It has the ability to do so because it can print as many dollars as it wants in order to achieve its own goals. Printing money hurts the diligent savers. Every dollar it prints incrementally devalues the money you've saved. Under normal circumstances, you might be able to outpace this devaluation by collecting a higher savings yield – but the Federal Reserve undermines higher interest rates by controlling the Federal Funds rate AND by buying Treasuries – which has the effect of lowering the interest rate on bonds.

The tacit hope in Washington DC is that this policy of printing money will force the diligent savers to spend spend spend the country out of this economic downturn. If you won't spend your savings, then the Federal Reserve will do it for you. But the message is clear: save your money and live responsibly at your own peril.

It can also cherry pick its own statistics in order to say to Social Security recipients, “No, the cost of living has not increased. According to OUR numbers, inflation is low, so you will not be receiving a cost of living increase.”

And for the past two years, that's exactly what happened. Food prices have nearly doubled, gasoline prices have almost tripled, but since the Federal Government gets to pick its own statistics, this nation's Social Security recipients haven't received any cost of living increase.

This war on savers, retirees and Social Security recipients isn't going to end anytime soon, and the Federal Government is only going to adopt more stringent policies to remove you from your savings. It has to. It's completely broke, and it needs to milk this nation's producers for every penny it can while it can.

If you're tired of this kind of treatment, I recommend doing a few things.

If they sound familiar, it's because I've been repeating them, mantra-like, for more than a year.

1). Buy physical gold and silver. Many Resource Prospector readers have requested my guide on how to do so. I'll be sending out instructions on how to get this report later this week.

2). Buy precious metal mining companies. These companies, especially the junior ones, have the ability to return your investment to you many times over if you buy them at the right time. My colleague Tyler Laundon has put together a excellent research report on some of his favorite mining companies. You can read more details about these companies by clicking here now.

3) Buy farmland. I know that's a difficult proposition for many investors today – but there are a few unique stock investments that allow you to buy farm acreage with a regular brokerage account. My favorite way to do so is to buy a Brazilian company called Cresud CRESY. It owns substantial acres of productive farmland in South America.

4) If you can, open up a bank account in another country. I recently did so in Canada during my visit to Toronto. Think of it not as an unpatriotic, seditious expatriation of funds, but rather, as a diversification of cash savings. The Federal Government doesn't own you or your property. Act accordingly. 

Here's to fighting back,

Kevin McElroy

Editor

Resource Prospector