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The modern American economy is a consumer-driven machine, and the foundation of that machine is your spending. It may seem normal, but when nearly 70% of the US GDP is dependent on consumer spending, this reliance creates significant vulnerabilities.

In recent months, warning signs have become undeniable:

• US consumer spending is slowing.
• Credit card debt has hit over $1 trillion.
• Delinquencies are at their highest since 2007.
• Savings have dwindled, leaving many Americans struggling to afford their basic cost of living.

This isn’t just an individual problem—it’s a systemic risk. The US economy could unravel if the consumer, the engine of this economic machine, is unable to keep up. We need to ask ourselves: what happens when people stop spending?

The Consumer-Driven Economy: A Double-Edged Sword

America’s dependence on consumer spending didn’t happen overnight.

• After World War II, economic growth surged, fueled by patriotism and a desire to rebuild.
• By the 1950s, America had fully transitioned into a consumer culture, with credit cards, modern appliances, and suburban homes becoming symbols of success.

However, what began as a post-war economic boom turned into an unsustainable reliance on consumerism. Unlike other economies, such as China, which rely on infrastructure and manufacturing, the US economy depends almost entirely on individual spending.

While this has driven economic growth, it has also created significant risks:

• Rising inflation
• Wage stagnation
• Excessive debt
• Increasing government intervention (e.g., stimulus checks)

Continual government interference can only go so far. In the short term, it may keep the economy afloat, but long term, it leads to rising debt, more inflation, and a dangerous cycle of dependence.

A History of Spending and Debt: The Warning Signs

The pressure on the US consumer today isn’t new. The seeds of today’s problem were sown decades ago when consumer spending became synonymous with prosperity. Over time, Americans financed their standard of living through debt, and the system became fragile.

• Credit cards turned into financial burdens for many.
• High interest rates, inflation, and stagnant wages have left people unable to keep up.

Recently, there’s been an alarming rise in:

• Auto loan delinquencies
• 401(k) hardship withdrawals

These warning signs tell us that Americans are struggling to finance their lives, and if spending stops, the entire economy is at risk.

The Role of Central Banks and Inflation

Adding to the pressure is the role of central banks. Since the 2008 financial crisis, central banks around the world have intervened in the economy by:

• Cutting interest rates
• Printing money
• Injecting liquidity

But these actions come at a cost. Rising inflation is a direct result of central bank policies. As the money supply increases, the value of the dollar decreases, eroding the purchasing power of everyday Americans.

Not surprisingly, central banks are now turning to gold as a hedge against inflation and currency devaluation. Gold, unlike fiat currency, cannot be printed out of thin air. It retains its value over time, making it a reliable store of wealth.

More people are also turning to tangible assets like gold and silver to protect their wealth from inflation and the potential collapse of the dollar.

What Comes Next?

As we look ahead, it’s clear that the US economy cannot continue to rely on consumer spending at its current levels. The consumer debt crisis has reached a tipping point, and rising inflation is showing no signs of slowing down. This creates an environment of extreme vulnerability.

If consumers run out of options to finance their lives, we could face:

• Layoffs
• Business closures
• Rising unemployment

These are all classic markers of a deep recession. The government’s response is predictable: more debt, more spending, and more intervention. But each layer of intervention only accelerates the decline of the dollar’s value. As Taylor Kenney from ITM Trading explains:

“The value of your existing dollar will be worth less in the future than it is today.”

The implications for anyone holding dollar-denominated assets are severe.

Protect Your Wealth Before It’s Too Late

If this all sounds concerning, that’s because it is. But there’s still time to act. At ITM Trading, we specialize in helping people protect their wealth from what’s coming next.

With over 28 years of experience, we offer tailored solutions to help you diversify outside of the dollar and into assets that will hold their value, such as gold and silver. Our expert analysts are well-versed in macroeconomic trends and can help you:

• Protect your wealth
• Navigate these uncertain times
• Ensure your retirement and savings are secure

Take Control of Your Financial Future

As the US economy continues to rely on consumer spending, the risks only increase. With rising inflation, government overspending, and a looming debt crisis, now is the time to take control of your financial future.

Don’t wait to see what happens next when the signs are already clear. Contact one of our expert analysts today and learn how you can protect your wealth in an unpredictable world.

Schedule Your Free Strategy Call Now