Will Money Expire?
By: Cheewee Ng
Tags: Gold Standard, Precious Metals Investing, Money Mindset, Bullionstar, Fiat Currency

It is the Lunar New Year season and my kiddos are at the age when they start getting excited for the very first time about the accumulation of money from their ang pows (red packets).

As a parent, I have no qualms about them developing an understanding and appreciation of money at a young age.

For far too many generations, we’ve been brought up to have all kinds of weird relationships and pre-conceived notions about money.

Money is evil. Money is not important. Money can’t buy you happiness.

Broken beliefs about money. Image Credit: Realsubliminal

All these scripts that we’ve downloaded into our mind in one form or another limit ourselves into staying at the same level of scarcity that powerful social engineers would love to have us at for life.

I was totally “unschooled” about money, even when I started running my own businesses more than a decade ago.

Concepts like the Gold Standard or the Bretton-Woods Agreement were alien to me. In fact, I didn’t even know what fiat money was…!

Until around 2016 when I came across a Youtube video series called “The Hidden Secrets of Money” and started reading a book on “The Death of Money”.

That was my rude awakening to the idea that money (fiat currency) will expire.

But I had a hard time getting people around me to wrap their minds around the possibility that money will expire.

It’s a reflection of how deep-seated some of our engineered beliefs are that we sometimes find it hard as adults to open our minds to alternate versions of …truths (for the lack of a better word).

Young kids, in contrast, are still free from such heavy mental conditioning.

After counting her ang pow money, my five-year old kiddo came running to me and asked, “Will money expire?”

This was out of a pure, innocent worry that the money she was having at that moment might expire before she could use them all.

It was a brilliant economics question to me.

If you think about it, how many of us actually grew up entertaining the possibility that the money we own would actually expire and become worthless?

I explained to her that money is printed by governments (central banks).

So, if the government decides to replace them with a new set of notes, what you have now may expire.

Or, if the government decides to print a lot and a lot of these notes, then the money you have is also of zero value.

Imagine the shock on her face when I told her that.

I had to assure her that there’s still enough time for her to spend the money before that happens and she was happy again.

Ever heard of the term “banana money”?

We probably heard of it from our history books — the new money notes that the Japanese printed for circulation in Malaya in 1942.

Banana Money from Japanese Occupation in Malaya (1942 — 1945), selling on Carousell.

These money notes gradually lost all their value in less than three years, not due to them losing the war, but because of frivolous money printing to fund their military expansion.

A more recent example would be Rs1000 or Rs500 notes from India. If you still have any in your possession right now, I wouldn’t even trade with you for a plain white sheet of paper. I could at least still do some doodling on the latter.

India’s surprise announcement to withdraw these two highest-denomination notes from the market in Nov 2016 made US$320 billion worth of notes worthless overnight. In just one simple act of declaration.

Last year, the new Malaysian government was also talking up the possibility of replacing their current currency notes to combat corruption, raising fears that the Ringgit dollars might become the next Japanese Banana Money.

And if you start observing how the value of currencies are going on free-fall in countries like Venezuela, Brazil, Turkey… and even Indonesia, you have to be awaken to the idea that “money will expire” one day or another.

The defunct Venezuelan dollar notes. Source: Youtube

When the next great reset hits the global economy, all fiat currencies will gradually start calibrating to zero, one after another, as a result of hyperinflation.

Given that the global economy is built wholly on debt and global debt is now three times the size of the global economy, it makes sense to think that there is a far greater chance that our dollar notes will expire much earlier than the first batch of 99-year leasehold public HDB flats in Singapore.

So, if neither fiat nor flats will hold their value, where should we be storing our money?

This is a question I would prepare myself for a ready answer in case my kiddos come running again next lunar new year season.

I would probably tell her the answer lies in a Khong Guan biscuit tin.

The Classic “Granny’s Money Tin”

Remember those biscuit tins in which your grannies used to store their precious gold and jewellery wrapped in a hankerchief?

The older generation has a stronger penchant for buying gold than us and some also found better trust in keeping their money in those tins than in a bank.

I’ve come to realise that the granny’s wisdom in money is probably more enlightened than most millennials’ attitude towards money.

If you were to carefully study how the monetary system has evolved in the last century, it seems that there are no better store of value of your money than in precious metals right now.

To our grannies, the only real money is gold. Now, even the central banks are stocking up on its gold reserves, with their gold-buying activity peaking in the last quarter to the highest level in almost three years.

It may be time we follow the “smart money” or our granny’s advise and start buying real money in the form of gold bullion or coins while prices are still in the trenches.

I’m not qualified to be giving you any financial advice. But you can check out these three life stories that illustrate why precious metals like gold and silver are the best store of our money currently.

In the meantime, if you are convinced by now that money will expire, give this article a clap and share it with others.

Keep a lookout of my next articles, where I may try to convince you of other stuff that I never realised till I hit 40 — such as how the latest development in science are suggesting that the Earth could be flat afterall, and that… time actually travels backwards.