Consider an investment in property. You remember when the value of property started to plummet. This means that if you are an investor in property, your portfolio lost some of its value. The British housing market was not hit that badly. However, when you consider the value of the property is listed in pounds and that pounds are nearly worthless, this is not a good investment. Gold is the only real currency so it is a good idea to compare housing prices in gold. The home prices in gold have dropped as well. The prices of homes in the UK in gold have dropped from $800 to $300.
Munger stated that if you think that your country is going to kill you that you need to buy gold. He does not mean that your country is going to kill you by taking a gun to your head, but rather they are going to kill you financially.
Do you think that the United States is going to print more money to try and avoid inflation? They are going to try to print their way out of inflation which is going to create more debt. Think of it this way. If you have a credit card and you have to borrow money from another credit card to pay for it, this is called bankruptcy. The United States is currently bankrupt. The dollar is worth nothing but perception. Is China dumping their United States assets? The answer is yes. They are agreeing with the U.S. stating that they are not, but they are quietly dumping their dollars into other assets.