THIS is where our Monetary System is Headed

Capitalist Exploits's picture

By: Chris Tell at



I've never been trapped in a fire before and trust me, I have had plenty of opportunity. Yes, I was THAT kid, the one who played with fire. The trick was, and still is to steer clear of the flames, to anticipate what and where. Fire is however notorious for doing what it wants and once its out of control even the best firefighters don't stand a chance.

  Each day that passes we come closer to the arrival of a monetary fire that threatens to dwarf anything in our collective living memories. Watching the Australian bush fires in New South Whales recently made me think of our monetary system. Funny that.

The Australian bush has been burning long before the Brits began exporting their best and brightest to the “lucky country.” Right now the fires are raging. It was inevitable. Like the business cycle nature too abhors excess and steps in to correct it, clear the dead wood and prepare for rebirth.

What is often forgotten is that nature has evolved to rely on bush-fires as a means of reproduction and new "birth." Fires are an integral part of the ecology of the planet's surface. Humans can try and prevent these inevitable fires by “controlled burnings”, clearing out much of the dead underbrush, but it's not foolproof.

The fires now raging in New South Whales are in part due to an extensive build up of dry brush which is likely overdue a good burning. The longer the dry bush remains unburned, and the more that accumulates the greater the risk of an inevitable fire. The result will be much greater than that which would have preceded it should a fire have taken place sooner. This is a basic, easy to understand law of nature.

Financial markets are NO different. The dry brush of excessive credit, monetary stimulus, rampant fraud, and government interference, which has caused the largest sovereign bond bubble the world has ever seen, has not been cleared or burned to allow for regeneration. In contrast we've actually been ADDING to it, doing the exact opposite of the "controlled burn."

The market, like nature, has attempted to correct these excesses many times, only to be met with central bankers fire hoses spraying liquidity at ever increasing volumes and velocity. As the outbreaks of financial fires increase so too do the tools and technologies used by the central bankers. This postponement of the inevitable leads to massive mis-allocation of capital. monetary bsae

That's a lot of dead wood buildup there

The above graph shows all the dead wood build-up. Quite a bonfire awaits us.

It is possible that the fires will continue to be contained, central bankers promise that this is indeed the case. We DO know however that it is not possible to contain it forever. This time is not different...or is it?

Let's compare what's different this time around in Australia and the world's monetary system?

  • The bush fires have invaded the suburbs. So too have the monetary bush fires directly impacted most western "suburbs".
  • The “tools” available to the firefighters are more advanced than at any time in human history. The tools that are at the disposal of central bankers are more “advanced” than at any time in human history.

What's happening in New South Wales right now provides us with an instruction manual for how to proceed forward in a world of monetary madness. We need to BURN THE UNDERBRUSH. Simply hoping that the fires will fail to erupt simply defies history and mathematics. "Hope and Change" be damned.


The likely outcome is that we're heading deep into asset confiscation mode. Government meddling will fail, it always has and it always will. The playbook from throughout history tells us that governments will steal anything and everything from the most productive before they default.

This happens either overtly (taxation, fines, penalties, asset seizure) or covertly via destruction of currencies (quantitative easing). Everything not nailed down is up for grabs. Don't say you weren't warned! If you need an example look at what's happening in France. Hollande is insane, but he's not unique.

As such, aside from structuring myself in order to protect what I have, which I hope I've done, ensuring that what I invest in going forward is structured properly is just as important. It makes no sense to invest intelligently only to have some thug steal the proceeds because I failed to set myself up to deal with the inevitability just mentioned.

So, how are Mark and I choosing to allocate our capital:

  • Investing in private equity. We like businesses where we can get to know and deal directly with CEO's and management, and where we are not at the whim of black box trading systems, plunge protection teams and assorted other “firefighters”. This is by far our most overweighted asset class. If you want to know more about how we do this, drop us a line.
  • Trading the volatility created by these madmen. Our friend and colleague Brad Thomas, the new editor of our Trade Alert service, "The Capex Options Alert" is our guru in this area. You can get to know Brad a bit and sign up for this complimentary service for a limited time HERE.
  • Continuing to buy and store physical precious metals. This just seems a long-term no-brainer.
  • Investing in agriculture. A guy's gotta eat, right!
  • Select real estate. Maybe some premium scorched earth in New South Wales, Australia. After all, the risk of a devastating fire is now significantly reduced! But seriously, a nice piece of land where you can escape the madness and "grow your own" if need be.

The above is neither a recommendation nor an endorsement of any particular asset class or strategy. Obviously everyone's situation is different, and we don't know yours. Some could probably do just fine with a couple hunting rifles, some ammo and a nice piece of land to grow food and run a few livestock. Albeit that's not going to work for urban dwellers.

The bottom line is that we are just encouraging you to consider how to prepare for a monetary firestorm. Do it your own way, use common sense, but just don't be the dupe who ignores the obvious.

- Chris

"So just as I want pilots on the planes that I fly, when it comes to monetary policy, I want to think that there is someone with sound judgement at the controls." - Martin Feldstein

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GottaBKiddn's picture

The similarities of natural brush and forest fires with monetary policy are interesting to a point. I must remind you that monetary policy is more like ARSON, which has litlle similarity to natural fire.

Let me give an example of arson for profit. One fellow burns his neighbor's farm in order to buy his burned property for pennies on the dollar. Now there is a firestorm that we all see and yet so many call it a mistake, or stupidity on the part of the banksters and economists.

The economic tinderbox has been filled for a reason, theft. Nothing new here.

zot23's picture

I'm going to just agree with the central premise: this guy has never been in a real fire.  The flames don't kill you, they never do.  It's the omnipresent smoke that chokes your lungs while you are LOOKING at the flames that kills 98% of people in fires.  I'm sure this oversight has no bearing on the overall thrust of the greater piece.  Investing in large, corporate agriculture while the entire societal structure is in flames is pure win with cherries on top.  I'm sure there is no smoke during complete financial wildfires.  Just dodge the flames and set up your chaise lounger on the flameless roof.  What me worry?

Element's picture

As it turns out a 4-Corners report this week made clear that almost all of the really serious bushfires that have occurred, since the 1960s, to present, have been caused by electrical transmission powerlines clashing, and trees falling on powerlines. Worth a watch if you're interested in why so many bush fires are occurring. This may be relevant to the epidemic US wildfire experiences as well.

no more banksters's picture

"The supposed Federal Central Bank of the US (Federal Reserve or briefly Fed), controls completely the monetary policy and the money flow in the country, while being under control of large private banks. It is characteristic, that one of the largest lenders of the US government is Fed, which holds a significant share of public debt. The debt of the Federal Government to Fed, is due to quantitative easing policies, i.e. mainly, printing new money.

Similarly, the ECB becomes a corresponding Fed in the European area, “serving” the problematic economies that are excluded from the bond markets, through the print of new money. Therefore, the problematic economies will be loaded with more and more debt which the ECB, i.e. the largest private European banks will hold."

d edwards's picture

Three precious metals: gold, silver and lead. With appropriate delivery vehicles for the latter. ;-)

Razzle Dazzle's picture

I don't think the scrub burning in Oz is the only problem. Check out the rose coloured glasses this joker is wearing...

I don't know what he is smoking but it must be the same stuff market pundits are huddled around at night.

Coldfire's picture

If only D.C. would burn to the ground.

Truthseeker2's picture

*** "DC Political Plutocracy has US Government in Stranglehold"


TNTARG's picture

I think Humanity has to face deeper problems.

Tokyo Mother: “Total media blackout” in Japan of lots and lots of people developing symptoms related to Fukushima disaster (VIDEO) — “Many cases of sickness and death among young generations” not reported

Widowmaker's picture

This author assumes that present synthetic markets, currency and economics are anything but a bucket of bullshit.

Pissing up the rope of fraud.

Radical Marijuana's picture

Interesting article, up until the end when it pretends that there is something which is actually possible to do to adapt to firestorms of that magnitude!

rsnoble's picture

Make no mistake if nukes are dropping on the west coast the bill collectors will be calling from the east coast.

If worst comes to worst burn your house down and hand the motherfuckers a pail of fucking ashes.

Zero Point's picture

Fuck that.

They can scoop the damn ashes into their own pail.

Schacht Mat's picture

Is money the root of all evil.  Well, evil is certainly at the root of all money.  What is most often taught at business schools is that the origins of money were the need to bring efficiency to barter; however, historical accounts seem to suggest that the true purpose of money was to enable ambitious monarchs a means to concentrate their wealth in order to redistribute it for goods and services - in these instances, to raise armies that would invade a neighbouring kingdom / state / city / village etc. and plunder its wealth to such an extent as to increase the monarch's wealth by a larger amount than he had expended in the creation of his army of conquest.  This action had the further benefit of, at least for a while, distributing the wealth of the invading kingdom across a significant section of its population; thus making this wealth harder for a competing king to plunder (not to mention the prepared army that had already been raised which could provide organized resistance to any such incursion). 

In other words, the death of others appears to have been the inspiration for the creation of money (when you plunder some other kingdoms wealth, then its citizens will starve, unless you have killed off enough of them during your incursion to make it possible for the rest to survive on their reduced wealth).  Most of world history is a study in the brutality and greed of man (mostly man - only the occasional woman) and thus the attainment of these goals have historically been the greatest drivers of innovation - including the invention of money.

As to the other point - is money really that critical to survival - in major urban environments we know no of other way; however, many rural and small settlements have always helped each other out and just kept a tally of who owes whom how much (you owe me a couple for clearing out your drainage ditch with my hoe ... ),  and the debts are typically repayed in kind.  Where there exists a feeling of shared responsiblity for a community, coupled with mutual trust and a strong work ethic, money is not a "got to be", but rather a "nice to be".  I've had the priviledge of staying in a few such places in North America - not many left - but they are the ones that will remain standing in the end.  This is what it means to have "timeless" attributes of character.

Widowmaker's picture

Money exists for one purpose - confiscation.

That occurrs through one of only two methods - a market, and/or taxation.

One of these is already completely dead and buried, leaving only the other.

Geruda's picture

So much fretting over what is so trivial in the end...


The Permian–Triassic (P–Trextinction event, informally known as the Great Dying,[2] was an extinction event that occurred 252.28 Ma (million years) ago,[3] forming the boundary between the Permian and Triassic geologic periods, as well as the Paleozoic and Mesozoic eras. It is the Earth's most severe known extinction event, with up to 96% of all marine species[4] and 70% of terrestrial vertebrate species becoming extinct.[5] It is the only known mass extinction of insects.[6][7] Some 57% of all families and 83% of all genera became extinct. Because so much biodiversity was lost, the recovery of life on Earth took significantly longer than after any other extinction event,[4] possibly up to 10 million years.[8]

nofluer's picture

Geruda... suggest you read a book called "Ubiquity" by Mark Buchanan. Highly informative re extinction "events". (In short, most extinction "events" were not... "events" that is... but rather a chain of connected events. For example... A small single cell creature goes extinct because of a minor change in the local temperature which kills off it's only food source. The small creature was a major food source for a larger creature, which fed other creatures etc...)

Eeyores Enigma's picture

Money by definition must become more money.

We have created a monster. 

Please no "money is just a medium of exchange" bullshit. We are so far beyond that.

Money is the reason for all the bad things that are happening in the world right now. 

Money is the reason why no one will do anything about all the bad things that are happening in the world right now. 

Money = the right to live. No money - you must die.

Everyone in persuit of money which includes ALLmoney which by definition needs to become more money is complisit in the destruction of life as we know it.


Calmyourself's picture

Your a poorly read fool.

Real Money is condensed work, effort, sweat, toil..

"So you think that money is the root of all evil?" said Francisco d'Anconia. "Have you ever asked what is the root of money? Money is a tool of exchange, which can't exist unless there are goods produced and men able to produce them. Money is the material shape of the principle that men who wish to deal with one another must deal by trade and give value for value. Money is not the tool of the moochers, who claim your product by tears, or of the looters, who take it from you by force. Money is made possible only by the men who produce. Is this what you consider evil?
     "When you accept money in payment for your effort, you do so only on the conviction that you will exchange it for the product of the effort of others. It is not the moochers or the looters who give value to money. Not an ocean of tears nor all the guns in the world can transform those pieces of paper in your wallet into the bread you will need to survive tomorrow. Those pieces of paper, which should have been gold, are a token of honor--your claim upon the energy of the men who produce. Your wallet is your statement of hope that somewhere in the world around you there are men who will not default on that moral principle which is the root of money, Is this what you consider evil?"



Eeyores Enigma's picture

Oh if only I read more Ayn Rand I would understand it all.

"Money is a tool of exchange, which can't exist unless there are goods produced..."

If you believe this is how money exists you sir are certainly the greater fool.

And no it is not just about the love of money aka greed.

It's about the love of being alive which money is the ONLY thing that guarantees that.

Because no money = you die - Greed is not only good it is essential.


n8dawg84's picture

"It's about the love of being alive which money is the ONLY thing that guarantees that.  Because no money = you die - Greed is not only good it is essential."

I think there is some truth to this, although you're making it a little too absolute.  Our goverments are greedy for money and make us pay taxes and tribute to them with money.  If we don't give them a portion of our money then we are kicked off the land or thrown in jail.  So in the eyes of governments today, money essntially exists for them to leech from the producers.   In that regards, it makes sense for us to be "greedy" in order to avoid being evicted or incarcerated.  However, that's not how or why money came to exist in the first place. 

I'll follow FOFOA (or Another or FOA) and say that money is just a mental concept to begin with.   The medium of exchange, i.e. gold, silver, fiat etc. are just a physical representation of money.  Let's say I produce apples and you produce wheat and we trade a dozen apples for a bushel of wheat.  That idea that my dozen apples are equal in trade to your bushel of wheat is what money actually is.  Money is the mental number,  the produce is the medium of exchange.  If I was a fisherman, I'd transact in fish.  If I was a potter, I'd transact in clay pots.  Anyway, that's why the other poster was correct when he said, "Money is a tool of exchange, which can't exist unless there are goods produced"

dunce's picture

I never read that book, but he nailed it. I have met dozens of poor slobs that went to 4 years and more of college that could not grasp the idea in those two paragraphs. One that i have never met is our president.

MisterMousePotato's picture

Not money. It is, according to the Bible, the *love of* money that is the root of all evil.

Schacht Mat's picture

What do you do with wealth during a firestorm.  Well, first of all, forget all fiat - paper / plastic burns!  That means stocks (overinflated), bonds (default risk not priced in), currencies (all of them are too easily manipulated by central banks and other artifical drivers of monetary policy).  Next, be very careful of commodities, as many are mispriced due to market manipulation by the large investment banks (although mispricing can include artificially low valuations such as is found today in the precious metals market - these are bargains waiting to be snapped up - just remember, paper anything is fiat).

This only leaves producing and appreciating assets.  Producing assets need to reflect what people must have - electricity, nat gas, water, telecom (careful on this one - some telecom is just frivolous), basic food stuffs destined for local or regional markets, basic hygiene products (toilet paper - yes, high end perfume - male or female - no), mass transit (some of it) and decentralized security.  Appreciating assets need to be rare and authentic; antique cars, higher end paintings, historical relics of various sorts and flavours, rare high end articles that are highly valued by far eastern and middle eastern cultures, truly unique and sought after real estate (careful with this one - tough to secure most land and real estate when a mob decides to move from providing you with entertainment to making you the entertainment) and of course, Class A agricultural land with readily accessible and available turaly replenishing water supplies.  Just remember, buying stock in these sorts of assets is not helpful if the rule of law is not around to enforce your paper property rights, and self defence, while somewhat useful in defending physical property, does nothing to reflate the value of unenforcable stock certificates.  Buy the asset, singularily or together with a bunch of like minded people you can trust (if you don't know of any such people, then unfortunately you are doomed - nobody can fight a firestorm alone - ask a smoke jumper) and then you can at least defend it physically if it comes to that - that sort of ownership is 90% of the law.

Chris has hit a good number of these opportunities - nicely done.  If anyone can suggest other flame proof (or at least strongly flame resistant) wealth shelters for the coming storm, I'm sure this thread will welcome them.


scrappy's picture

SM, great thinking!


honestann (Below Comment)


We all interpret in different ways.


For example, ask your spouse to take a list of 5 words and give her meaning to them. Like, love , ethics, marriage, life itself, happiness - a big one - the meaning. Each of you secretly write down you definitions to begin.

You write down yours and your other writes (his or hers)

I am unsure if you are a male honestann.

You will be suprised at the results when you share them and discuss your inner meanings, ask cog-dis, he is the expert.

The study of language and symbology matter in these days.


We stand on the sholders of GIANTS.


The Book - On Symbols and Society


Time to get goin folks, it's the 21st Century!


- Where's George Jetson? and "Where's the beef?" The Matrix.

3 examples of symbology in our era, does it mean anything to you?. And if so what?  Will it match my interpretation? Hmmm.










honestann's picture

Mostly valid article, but your metaphor is BACKWARDS.


Just the opposite!  A few humongous trees (government and TBTF) have spread their limbs, branches and leaves over the entire forest, and their roots have spread deeper and wider than any other living thing.

Those trees need to burn down, die, vanish... and let the natural rich diversity of the underbrush (productive individuals) grow, expand, shrink, die, adapt, collaborate in endless natural ways.

So just as I want pilots on the planes that I fly, when it comes to monetary policy, I want to think that there is someone with sound judgement at the controls.

Also completely wrong!  Each productive individual must be left at the controls of his own endeavors.  And we must return to the time when the goods and goodies individuals produce replace what you call "money".  There should be no "monetary policy", there should be 7-billion "goods policies", goods being the useful stuff individuals produce.

Clowns on Acid's picture

honestannie - agreed. But the probability of that happeningis becoming increasingly less probable every day. When Kyle Bass throws in the towel for a possible "sensible" way out of this immoral, leftist Keynesian mess, one has to think that the fire will burn everything .... and that which grows back will be productive. 

Radical Marijuana's picture

The coming firestorms are unprecedented! They are not like the forest fires which had millions of years to allow life to evolve to respond to. The article above provided an insightful analogy and analysis, except for not facing the facts that things are trillions of times worse now than ever before!

nofluer's picture

The coming firestorms are unprecedented!

I disagree. I believe that the collapse of the American Empire can be very easily modeled by overlaying the collapse of the Roman Empire. There won't be a point for point correspondence, but the general trends and overall progression of the collapse (and the effects on the society and the people) can be used as a good indicator of what's coming.

moneybots's picture

I don't think much of anyone has a chance against what is coming, if it will be as bad as is being advertised by some.

scrappy's picture

It's up to US, the people.


Don't give up is a good place to start.


You only fail when you give up and not persevere.




dontgoforit's picture

Semper fi! Scrappy.  Never give up!  My wife and I had this conversation (again) last night and when she asked 'what would we do, really?'  I looked her in the eye and said, "the best we can, but we will never give up."

Jumbotron's picture

You know.....I suppose this kind of observation and then investing advice is good on some level.  Information is always good.....even if it is bad information, if you know it to be bad, so as to judge the varacity of the person doling out such info.  Not to be a better judge of both good and bad info.

That said.....this kind of info is only good if you have enough cash at hand to do these things.  I suppose someone young stumbling onto this site and have a good head on their shoulders could take this info and start planning....slowly but surely.

But then....of the time they get a cash stash to do these things......and every body else has already taken the will find the prices too high.....and the scarcity too great.

It's too late for the 99% .



the wet spot's picture

Let's not kid ourselves here.  You can have all of the assests, agriculture and precious metals you want but when the world starts burning it will be he with the most powerful weapon and most ammo who wins.

nofluer's picture

it will be he with the most powerful weapon and most ammo who wins.

Ummm... wins WHAT? Oh... I get it now. They turn the claymores on edge to disc the fields so they can eat. Right?

Weapons are for distruction. Filling a field with lead will only give you lead poisoning. It is not the armies that will FEED the people - and if the armies are killing the farmers, how do they plan to eat? I don't know if you know this or not, but there is a lot more to growing real food than poking a seed into the ground and watering it. And the chemicals that MegaAg are putting on the soil now is not making it easier to grow real food. If the "farmer" has been using the reccomended dosage on his corn/beans, it takes between two and four years to let the chemicals leach out of the ground before you can grow anything but weeds without adding more chemicals. If the world goes up in flames, where do you think you will get Ag chemicals?

Radical Marijuana's picture

No, that is another delusional and irrational hope. More powerful weapons and ammo will only add fuel to the firestorm which engulfs us all.

RafterManFMJ's picture

That's why I plan to feed the EBT zombies with rational discourse and love.

the wet spot's picture

Let's not kid ourselves here.  You can have all of the assests, agriculture and precious metals you want but when the world starts burning it will be he with the most powerful weapon and most ammo who wins.

SeattleBruce's picture

"Let's not kid ourselves here.  You can have all of the assests, agriculture and precious metals you want but when the world starts burning it will be he with the most powerful weapon and most ammo who wins."

Aha.  You call that winning.  I see.

HardlyZero's picture

Prep in all ways that you can.  In the city or in the country there are different ways to stock up and get ready for the times ahead.  There might be a muddle through period lasting many years (or decades) so its very difficult to predict ahead of time, and local conditions will always prevail unless there is some massive event that overcomes all.

Do the best you can, and there will be winners and losers, and some lucky and not.

hootowl's picture

If there is going to be decades of bare survival, near-starvation and shooting and being shot at, who the hell would want to survive the initial onslaught.

Better to go down in a hail of gunfire and take a few Demoncraps with you.

indygo55's picture

Shutting down those SNAP cards will trigger massive riots. In a week there will be tens of thousands dead. In a month millions.

SunRise's picture

Isn't fire pretty rough on agriculture?

indygo55's picture

A good brush fire actually clenses the soil and releases nutrients for new growth. Some plants require fire to reproduce. Hummm.

nofluer's picture

A good brush fire actually clenses the soil and releases nutrients for new growth.

Ummm... actually all a fire does is turn the vegetable matter into carbon/nitrogen, and encourage errosion by removing the ground cover that prevents it..

Some plants require fire to reproduce. Hummm.

True.... to a point. Like some coniferous trees require fire to release their seeds. But most seeds just get toasted to death.

"All fires, regardless of whether they are natural or human-caused, alter the cycling of nutrients and the biotic, physical, moisture, and temperature characteristics of soil. In many cases however, these impacts are either negligible or short-lived and thus have little, if any, impact on the overall ecosystem."

shovelhead's picture

Like the B-52's in Vietnam?

screw face's picture

...Vietnam...dang if i didn't see something about them getting a reactor...the French are back.

RafterManFMJ's picture

Um, the B-52s didn't form until 1976 and Vietnam ended in 1975. You FAIL sir! Ann-Margaret went to Vietnam, but the B-52s never did..