For many people around the world, the choice for holding safe haven assets is between U.S. dollars and Treasury debt or gold (and, by association, silver). Estimates of how many dollars and how much U.S. Treasury debt is held by foreigners ranges from $12-$16 trillion. If the U.S. government is in trouble, or the U.S. economy is weak, foreigners tend to reduce their holding of dollars and increase their demand for gold.

The U.S. government is the world's largest beneficiary of low gold and silver prices. When precious metals prices are low, foreigners are more content to hold dollars. This helps hold down the interest rate that the federal government pays on its debt. For every 1 percent decline in the interest rate that the U.S. government has to pay on $20 trillion in outstanding debt, that reduces the federal budget deficit by $200 billion per year. If the interest rates go up, that will also boost the size of the budget deficit.