Important question for economist

[Trump Must Go]

I believe we are entering a bear market in stocks. Like everything else, stocks are only worth what people are willing to pay for them. If we are headed into an economic recession within six months (as I believe we are) the price of stocks will go down. As expected, they have done so since the end of October, but now the question is how far down will they go. They are already down 10% from their peak, so this is already a "correction" and based on last week's chart I expect it to go down at least another 10%. This will officially make it a bear market, but how far down will the price drop be, since it will reflect how severe the expected recession will be. I expect it to be bad since President Trump is a clown and a fool who will do all the wrong things and only make the recession worse.

I wanted to get a second opinion, so I went to Youtube to see what the self-proclaimed market/economic experts had to say. They fell into two schools, both of which I do not think reflect reality since they are selling something. The first is "don't worry, be happy" (as on CNBC) who make their living promoting a rising market. The second was the more common "Gold Bugs" who proclaim the sky is falling, there is too much debt in the world so the market will crash and civilization will collapse, sell all that you own and buy Gold (or Silver) from them.

Since the self-proclaimed market/economic experts had no answers, I came to DU in the hope that its collective wisdom would shed some light on my questions:

1 - Why do they say if the economy crashes you should have Gold or Silver to protect your wealth in hard times? Five thousand years ago I can see why Gold was desirable: it was pretty, shiny, not heavy, did not rot or spoil, and soft to be used in jewelry, so the rulers at the time used it as money. This was its only intrinsic value. Now, if civilization collapses and paper money is not used, I would rather have a case or two of Tuna Fish rather than an ounce of gold. The tuna fish has a greater intrinsic value because I can eat it, and not have to run around looking for someone who will trade food for this piece of shiny metal. Only the recognition and authority of government makes anything useful as money; whether it be a can of tuna, a bar of gold, or a Bitcoin credit. Otherwise, it is a form of barter with no guarantees any exchange will be made.

2 - Why is public debt or deficit considered important and something to be avoided. Unlike a family, the government can not run out of money, after all, the government is the one who makes money. Making money is one of the things that makes a government - a government! Who is going to force a government into bankruptcy? The term "too big to fail" also applies to nations. Who will not sell things to the United States because it owes too much money? A big country is not like a family and does not have to handle its finances like a family.

I believe the economic theory of John Maynard Keynes was correct. He said the policy of cutting costs and using austerity programs isn’t the way for the government to end a recession. These only result in more layoffs and end up making things worse. He said governments should encourage spending, increase hiring, and use deficit financing to spur the economy (Stimulus). 

[Sherman A1]

1. If I understand correctly

the theory goes along something like this. Ask 4 Economists what they believe and you will get about 7 opinions. I am sure that someone will have a better version of the saying, but I wouldn't hold too much stock in YouTube Economists.

[brush]

2. Trust me. Go with the gold, not cans of tuna.

[haele]

3. Actually, get a still and a couple gross of decent glass bottles with caps.

Alcohol is always a good trade commodity, and if you have access to some good fruit trees or other high sugar produce, a knack for cooking or basic chemistry, you can't go too wrong.
Just remember - the first bit and tail bit of any distillation process is basically turpentine and undrinkable.

Haele

[brush]

4. That's fine if you're so inclined but gold coins are legal, easy to carry...

in your pocket or purse and most pawn shops will give you straight up hundred dollar bills for them, no questions asked.

[haele]

5. Problem is, unless your g-g's hid a hoard, you paid $200+

For that gold coin the pawn shop will give you $100 for, as s/he also needs to make a profit.
For the average person, buying or selling gold for investment purposes is still like buying stocks. It's the economy of scale that makes a sufficient buffer for a recession economy as the transactions are still made based on the same market practices that lead to the recession in the first place.
There's a reason countries abandon the gold standard as soon as technologically feasible. Gold is still a single commodity amongst many, and valuation is still dependent on the whims of a market than, say, pegged currency.

At least with a skill or resource, the average person has the ability to survive no matter what.

Haele
On edit - I hate auto-correct.