WHAT YOU NEED TO KNOW
- Warren Buffett warned that unsustainable federal deficits could eventually weaken the US dollar and carry serious consequences.
- The federal deficit reached $1.97 trillion through the first 11 months of fiscal 2026, while national debt surpassed $40 trillion.
- Nearly 90% of the dollar’s 1970 purchasing power has disappeared, according to figures drawn from a Federal Reserve Bank of Minneapolis calculator.
- Gold and real estate are presented as potential ways investors can protect wealth against inflation and declining purchasing power.
DISCLAIMER: GoldInvestors.news is not a registered investment, legal or tax advisor or broker/dealer. All investment/financial opinions expressed by GoldInvestors.news are from the personal research and experience of the owner of the site and are intended as educational material. Although best efforts are made to ensure that all information is accurate and up to date, occasionally unintended errors and misprints may occur.
Warren Buffett spent more than 60 years building Berkshire Hathaway into one of America’s most powerful companies. Now 96, he has relinquished the chairman’s seat, leaving investors with a stark warning delivered during his final shareholder meeting as CEO in May 2025.
“We wouldn't want to be owning anything that we thought was in a currency that was really going to hell, and that's the big thing we worry about with the United States currency,” Buffett told shareholders.
Buffett was not saying that the dollar had already collapsed. His warning focused on what sustained government spending and borrowing could eventually do to the currency’s value and the purchasing power of Americans who depend on it.
“Fiscal policy is what scares me in the United States,” he said. The federal government has spent more than it collects for decades, financing the difference through additional borrowing and accumulating debt.
Buffett argued that the pattern cannot persist forever without consequences. “We're operating at a fiscal deficit now that is unsustainable over a very long period of time,” he said.
“We are doing something that is unsustainable, and it has the aspect to it that it gets uncontrollable to a certain point.” Since Buffett delivered that warning, the government’s fiscal arithmetic has grown even more alarming.
During the first 11 months of fiscal 2026, the federal government recorded another $1.97 trillion deficit. The national debt, meanwhile, climbed past $40 trillion, a figure whose implications ultimately reach household finances through the value of money.
Buffett acknowledged that governments “can issue paper money,” but he also warned that “the natural course of government is to make the currency worth less over time, and that's got important consequences.”
Inflation has steadily reduced the dollar’s purchasing power for decades. According to the Federal Reserve Bank of Minneapolis inflation calculator, $100 in 2026 carries the same purchasing power as only $11.61 did in 1970.
That means nearly 90% of the dollar’s 1970 purchasing power has vanished, even without the currency approaching the extreme scenario Buffett described. Investors seeking protection from further erosion have historically turned to assets including gold and real estate.
Gold’s attraction begins with supply because central banks cannot print the metal at will. It is also not tied to one country, currency or economy, and investors often seek it during economic turmoil or geopolitical uncertainty.
Bridgewater Associates founder Ray Dalio has repeatedly emphasized gold’s place in a resilient portfolio. “People don't have, typically, an adequate amount of gold in their portfolio,” Dalio told CNBC last year. “When bad times come, gold is a very effective diversifier.”
Gold climbed 149% during the past five years as inflation continued weakening the dollar’s purchasing power. JPMorgan CEO Jamie Dimon has said that gold could “easily” rise to $10,000 an ounce in the current environment.
The source also presents gold IRAs as one route for holding physical gold or gold related assets inside a retirement account. Newport Gold offers a free gold guide, a buyback program with no fees and as much as $20,000 in free silver with a qualifying purchase.
Real estate represents another potential inflation hedge because property values and rental income can rise as costs increase. During the past 10 years, the S&P Cotality Case Shiller U.S. National Home Price NSA Index advanced 87% amid strong demand and limited housing supply.
Elevated mortgage rates and high property prices can make direct ownership difficult, while tenant management, maintenance and repairs require time. Arrived offers access to SEC qualified rental homes, vacation rentals and diversified funds, with more than 596 properties across at least 67 markets.
Arrived investors can use its secondary market after six months once a property is fully funded. The platform also offers a 1% account match for a limited time when an investor opens an account and adds at least $1,000.
Lightstone DIRECT offers accredited investors access to individual multifamily and industrial deals, with minimum investments beginning at $100,000. Moneywise and Yahoo Finance LLC disclosed that they may earn commissions or revenue through links in the source content.
Despite his concerns about the currency, Buffett was not presented as betting against America. In his final annual shareholder letter as CEO, he distinguished between holding paper money and owning productive businesses, drawing a clear line between currency risk and business ownership.
DISCLAIMER: GoldInvestors.news is not a registered investment, legal or tax advisor or broker/dealer. All investment/financial opinions expressed by GoldInvestors.news are from the personal research and experience of the owner of the site and are intended as educational material. Although best efforts are made to ensure that all information is accurate and up to date, occasionally unintended errors and misprints may occur.
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