The Problem With Paper Assets
Without getting bogged down in specifics, paper money is in trouble.
Like all true fiat currencies, world currencies like the Euro and the US Dollar are in very real trouble, weighted down by the exorbitant borrowing and active inflation being performed by their respective governments.
In short, a crisis of confidence cannot be far behind, pushing these currencies into oblivion. And as we’ve already seen, the reaction to a fiscal crisis is to essentially print more money, which will only speed up this process.
As a result, the only truly effective way to protect those assets is to convert them into a more stable form.
While it is impossible to ever completely remove risk from your portfolio, we can reduce it substantially by diversifying your holdings away from US dollars and Euros.