The Great Un-Participation

May 22, 2015

“If everyone is thinking alike, then somebody isn’t thinking.”

―George S. Patton, Jr.

“Without any censorship, in the West, fashionable trends of thought and ideas are carefully separated from those which are not fashionable; nothing is forbidden, but what is not fashionable will hardly ever find its way into periodicals or books or be heard in colleges. Legally, your researchers are free, but they are conditioned by the fashion of the day.”

―Aleksandr Solzhenitsyn

“Neither a man nor a crowd nor a nation can be trusted to act humanely or to think sanely under the influence of a great fear.”

―Bertrand Russell

“Americans are so enamored of equality; they would rather be equal in slavery than unequal in freedom.”

―Alexis de Tocqueville

Of course, the common conceptualization of hyperinflation it is a pretty unacceptable exercise for most. We can only tolerate it from only safe distances. Indeed, everyone’s favorite image of what the aftermath will look like was just upgraded in the new Mad Max movie.

I’m always surprised to speak with someone ‘high net paper worth’ who has come around to gold and silver.

It is most fascinating when a former believer in the status quo comes around to the other side. Even when they haven’t come all the way.

Recently, my friend characterized it all beautifully. Bank closures, credit system glitches, a market flash crashes. He pointed out the little systemic failures that are likely to occur along the way.

Along the way to what? I wondered…

“I’m not worried about the collapse of the dollar,” he said. “I’m more worried about these little panics that shut the system down all along the way.”

Discussing the risks and reality of hyperinflation in these situations feels much like describing in detail the evidence and implications of the decades- long silver manipulation.

That it might be possible to have a truly informed conversation about silver while sidestepping the issue of price manipulation.

It’s simply not polite to speak of such things. No wonder the issue triggers such a knee-jerk reaction for many. It’s just that big of a truth. Not pretty, and certainly a (maybe the) poster child for an array of soon to be very uncomfortable truths about reality.

(Is it any wonder that the controversies (not conspiracies!) go hand in hand?)

But fine, I’ll take that as a rationalization. A concession to what will ultimately be the fall of the dollar.

He went on to enthusiastically describe and recommend a range of dollar denominated opportunities for yield, ultimately coming up short on the undeniable, yet underlying reality of what a currency collapse looks like for a portfolio.

Most of us prefer to rationalize the investment upside, comfortable with our rationalizations with the emergency hedge component. That’s fine. At least there is that one portion of the portfolio that remains. After all, everyone else will be in the same boat.

These are massive markets for money, finance, and the array of products and constant demand. Based on what essentially comes down to a broken promise, or a lie. Unsound money.

On the surface, it too is a seemingly endless (yet also fascinating) story-drama of human behavior and psychology. It is also based on a very primitive set of beliefs and morality. A complicated and fascinating pseudo-science devoted to keeping the whole thing alive.

History is peppered with examples of this primitive morality. Nevertheless, here we are in this part of the great cycle and the war machine is growing.

The majority of mainstream investors are in it for the flow. They “need” the yield. But they will warm up to the idea when gold and silver come around again. The eternal allure of precious metals is merely veiled from time to time. The understanding never completely goes away at the level of the individual.


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Spanish Conquistadores invaded the Inca Empire in 1528 to steal their silver and gold.

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