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What if everything goes to zero?
To pay for the large costs of the ongoing First World War, Germany suspended the gold standard when the war broke out.
Unlike France, which imposed its first income tax to pay for the war (as an aside - this is how the majority of taxes first became apparent)... German Emperor Wilhelm II decided to fund the war entirely by borrowing.
They believed that by winning the war... they would be able to pay off their debt.
That didn't happen.
The country was left with around $26.5 Billion worth of debt after World War 1... amid a ton of economic sanctions that came as a result of losing the war.
This led to the German mark losing around 75% of its value almost overnight.
Then continued to lose purchasing power over the next year... as the cost of living rose 17-fold.
For context - that's like if gas became $68/gallon.
This continued to the point where inflation got to 20.9%... PER DAY.
Meaning that prices were doubling roughly every 4 days.
Money was replaced by barter.
Food riots broke out.
And these events were a huge catalyst that eventually led to the rise of Adolf Hitler and the Nazi party.
What's the lesson here?
Simply put that if this happened again... the stock market would be the least of our worries.
We'd be more concerned with feeding ourselves... and keeping our families safe.
But in practical terms... it helps to be prepared for a situation that gets even 1/1000th as bad.
That means owning some assets outside of stocks and bonds.
Your own home is one.
Maybe some land if that's possible.
Physical gold.
And my personal favorite - cryptocurrency.
Even 1% of your net worth in Bitcoin is an effective hedge against a broad economic downturn.
No matter what your age or personal circumstances.
So if you want a quick and easy read to get you up to speed.
Then check out our book
The Only Bitcoin Investing Book You'll Ever Need
You can get your copy by going to the link below
https://www.amazon.com/gp/product/B08X2X6SL8/
Oliver
The Investing Coach
Become a better investor in just 3 minutes a day. Daily newsletter read by 7,400 smart investors including CEOs, professional wealth managers and FAANG Executives. Recommendations are beating the S&P 500 since inception.
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