This Silver Shield Report is a rare look into David Morgan’s Mastermind Series. I was honored to be the guest speaker for the month of November. I know other speakers like Eric Sprott and Jeff Christian have spoken to this group before.
David invited me into speak as he knows that I am a pure physical investor and many of his clients are mostly paper investors. (David is about 50/50 in his positions.) David and I have had many, many discussions since I wrote the Silver Bullet and the Silver Shield about the virtues of going all physical. I have not been able to get David to move more into the physical, but I feel he is leaning more towards that now as he gave me a very prominent place to make my case in front of many fund mangers and paper traders.
I was very excited as I feel the time was right with the MF Global scandal fresh in everyone’s mind to make a strong case for 100% physical. Even if it does not result in immediate physical purchases, I know this presentation planted a lot of seeds with some very deep pockets. Enjoy the show.
If you are interested in joining this positive, aware and prepared group, click here.
If you are interested in what the Silver Shield Report is all about, hear from those that have joined.
0:00 David Furhman’s insider review of MF Global Scandal
5:48 David’s master plan of investing
11:38 My Awakening
13:26 How to make tremendous money right now.
20:00 Creating generational wealth.
23:30 This the core of what will rip the world apart…
25:14 Our formula to protect your assets.
27:20 Survivalist mentality and the 4 main pillars of our paradigm.
32:50 What we are really up against.
38:27 Community, Self Reliance, and Shifts
41:34 The Buffer
45:49 The Generational Revolution
53:15 How the system will collapse.
56:24 How to be part of the solution?
Robert Furhmann: Hello, and welcome to this month’s installment of the MasterMind Series. As most of you know, I’m Robert Furhmann. I’m one of David’s recommended brokers. David asked me to talk a little bit about the recent events that are going on in the futures industry in regards to the MF Global bankruptcy and just a brief overview – I’m sure most of you have heard what had happened. But, it seems that there was some co-mingling of corporate funds with customers’ segregated funds, and because of that, there’s a shortfall.
Shortfall over the last few weeks since this all started November 1st had been originally reported as probably somewhere around $1.2 billion. Again, the bankruptcy trustee yesterday announced that it might be as much as $1.2 billion, and so that’s been not confirmed yet. They’re still going through the process of trying to find all these misallocated funds, and there’s really not a strong timeline as to when we’re going get all this sorted out. Now, late last week, customers’ funds had been on hold over the last three weeks. Late last week, the trustee petitioned the court to start releasing some of the funds in phases, so the first two phases have begun where they’re actually now releasing 60 percent of the equity in the accounts that were cash only. They also petitioned to have 60 percent of the equity of accounts that had positions to be released as well.
That’s not been definitively stated that they will, but I must imagine if the trustee’s petitioning the judge for that, there’s nobody out there that’s really opposing that. So, it looks like over the next week or two we should start to see 60 cents on the dollar start to be released for the customers that had funds with MF Global, and that’s kind of where we stand right now. And I think that covers what you wanted me to touch on a little bit, David. Did you have any questions?
David Morgan: Let me add, that no one knows how big this is going to get, and I did want to ask one more question, actually, and it is how has it affected the futures trading on the short-term basis, and what are your thoughts on it affecting futures trading on a longer-term basis, Robert?
Robert Furhmann: Well, on the short term, it’s definitely had an impact. A lot of – we know a lot of people industry here that actually worked for MF Global that were executing brokers for them down on the floor or individual traders that were trading for themselves, but with MF Global credentials, and they all were escorted off the floor the day of the bankruptcy and not allowed to get down there. Their memberships were revoked. The point of that is that it does cut into liquidity. We’re seeing fewer market participants not only because of those who work for MF Global, but when you have that much equity that’s being locked out of the market, unable to be used or traded with, that also is a big impact.
A lot of big funds used MF Global for clearing, so a lot of big-market participants aren’t in the market now, so short term it has and continues to have an impact on liquidity. Long term, you know, nobody’s certain, and, David, I think it goes a lot to your point about how deep will this problem run. This co-mingling of funds that we’ve never seen before, it’s the biggest no-no of all the no-no’s out there from a regulatory standpoint, and MF Global was able to breach this, so now it looks like it happened in a very short period of time. It doesn’t, at least initially from what I’m hearing, doesn’t look like it was recurring over months, but nobody’s sure yet. Regardless, well, are there other funds that may be doing this or have done this or will do this?
And if MF Global did and could, it begs the question, then, yeah, could other firms be doing that? And so, it’s really important to make sure that anybody you’re dealing with has a very strong balance sheet. I wouldn’t want to work with anyone that is doing anything as far as proprietary trading or taking on additional risks in other asset class or trying to make profits on trading or investing, so I’d be very cautious of that.
So, long term, I look back to what happened with Refco years ago. They were the biggest at that time, and they went under. Now, there was no co-mingling of customers’ funds in the Refco bankruptcy. It did have the same short-term impact on the markets, but longer term, it didn’t, but the difference was that there wasn’t this destruction of confidence that we’re potentially seeing now as people become less confident in the security of the industry. People will be less inclined to participate, and with that, we’ll probably continue to see a lack of liquidity until confidence is built back up down the road.
So, I think the short-term effect is obvious. Intermediate term, yeah, it’s probably going continue to have lingering liquidity issues.
David Morgan: This month we’re going to explore what goes on in this financial debacle that we’re in and looking ahead with different scenarios. I think everyone that reads my work realizes that I’ve emphasized from the beginning that the only way to start a precious metals portfolio is with precious metals. You need to have the physical, first and foremost.
I referred to it many ways. One of my favorite ways with a little bit of tongue in cheek is you’re outside the matrix or outside the paradigm of any other financial asset you can name. Put a fence down the middle of the road or down your yard or anywhere, there’s only one asset class, and that’s physical metal, precious metal on one side of the fence, and anything else you want to name, a stock, a bond, a futures, an option, a private contract with somebody else, everything else has to – is dependent upon a bank, a clearing broker or some kind of maneuver that must take place in order to move that asset quote/unquote into a cash position. In other words there is counterparty risk involved. As a thought experiment, imagine a total collapse where you cannot use a bank or you cannot use a broker. It could be for an hour, a day, a month or a year; it doesn’t matter.
For that timeframe, whatever timeframe you choose, the only asset that you’d actually be able to do business with – and that would be on a voluntary basis, obviously, because some people probably wouldn’t accept silver or gold, but many would – would be money outside the system. So, that’s why I’ve emphasized it. It’s basically the worst-case scenario from the aspect of the paradigm that we’re living in now, and yet it’s also very realistic scenario if you look at monetary history, which I’ve devoted a lot of my life and a great deal of time to doing just that. Moving forward, I met Chris Duane through one of my subscribers, and he is going to be our featured guest this month. He’s created the Silver Shield Report, and the way I met him was one of my subscribers said, “You’ve must read this,” and what I read was, I think, one of his first articles about the silver market, which basically was a brief, but it was not a brief read, that was the history of silver past, present and future, and probably one of the most well-thought-out and clear-written pieces on the silver market I had ever read.
And I was very much intrigued, and I contacted Chris very shortly thereafter, introduced myself. Of course, he recognized my name from – being in the silver market so heavily, and we developed a friendship. And we’ve had many discussions on the phone, and I decided that it would really be important to get him on this month’s Master Mind series. So, before we start, I just want to make a distinction between his view and mine, and they’re not that much different. But, for the time being, I do think that we will have a few years left where we can make a great deal of financial gains relative to the paper markets in the underlying mining equities, and if I really am free market, that means you get to make your own decisions, and I’m here to help you with that.
A lot of people on this call are high-net-worth individuals or fund managers, and it’s also my strong belief that some of you do not have the proper allocation to the physical side of the market. Now, Chris is going to give you a scenario that he’s thought through, and he’s going take questions at the end. My belief is that the biggest move in these metals markets will be actually on the equity side once what I call the panic or fear portion of this market takes place, and that’s where people wake up and say, “My retirement’s not going be worth anything. My pension isn’t there. The government’s breaking down.”
Stick any scenario, all three combined or several others that you’ve thought of, and people are going rush into the metals markets, but I have studied human nature, and most people are somewhat lazy. That’s my very studied view, and so when they see gold above $2,000, silver above $65, or anything along those lines, most people will think they’ve missed the move. But, what they will do is they’ll seek out the cheapest, crummiest, penny stocks that you can imagine that they’ll find on the Internet quite easily that have gold or silver in their names, and they will panic into these stocks, because they’re going to try to make up for lost time. They’re going to try to make up for that 30 or 40 years that they have worked for, and they want to make it all back by buying some of these stocks. Now, this will take place at the top tier as well, in my belief, and the reason for that is it’s more savvy, sophisticated people that run big money.
Well, look at the same paradigm shift, and they’ll be getting into the Pan Americans, the Goldcorp’s, the Newmont’s and everybody else, because they got to move billions of dollars into the precious metals sector, so these bigger stocks will act like penny stocks for awhile. So, this is what I see going forward. Just because I believe it does not make it true. For my personal portfolio, I’m a mix of about 50/50. In other words, I have about 50 percent in physical metal and 50 percent in high-end equities, what I put in The Morgan Report.
Pretty much what you see (in The Morgan Report) is what you get from me. If the stock market were to unravel or close down for some amount of time, I would be upset, but I wouldn’t have lost everything I’ve worked for. I would’ve lost half of it, and certainly I wouldn’t like to lose any of it, but nonetheless, that would be the case. Again, we’re going to explore even deeper down this rabbit hole with Chris, and Chris, I probably gave you too big an intro, but I wanted to get my groundwork down for everybody and the reason why I think it’s so important that we visit this situation as things continue to deteriorate. So, Chris, let me turn it over to you.
Chris Duane: David, thank you first for allowing me to speak here today. I actually read about you back at a very important part of my life, which was 2005. And just to give you a background on me, my family owns seven car dealerships in New Jersey, so I came from a very wealthy background, and unlike most people who usually wake up when they hit rock bottom, I actually woke up when I was on top. At 31 years old, I was a multimillionaire. Life was really good.
We sold a lot of cars. We were living very high on the hog, and in 2005 I said, “Wow, this doesn’t seem real,” and I really started exploring what – how I was benefiting so much off of this paradigm, this lifestyle that I was living, and it came down to the very simple fact was I didn’t understand what money was. Here I was a multimillionaire at 31 years old, and I had no clue that money was actually debt. And that just blew my mind, and once I came onto that simple, little fact, knowing that our money was debt, knowing that our monetary system was privately owned, Federal Reserve is privately owned bank, it woke me up to this new reality where I understood that in order for our monetary system to work, more money has to be created, more debt needs to be created every year in excess of the debt and interest accrued the year before. It’s an absolute fact that is the very fundamental case of our life, and there’s no way around it, and there’s no debating that.
Our paradigm system, there must be more debt and – more debt that needs to be created every year in excess of the debt and interest accrued the year before, and as a result, if anybody knows anything about compounding interest, we start seeing this hockey stick effect, and that’s why if you look at our debt chart, our national debt chart, it’s actually growing just like that hockey stick. And when I came to terms with that, I was like, wow, here I am living in New Jersey. My house doubled in value in less than four years. My business is growing tremendously ‘cause with more money around, more debt around, there – people are buying nanny – $40,000.00 cars for their nannies, and there’s just a lot of money flowing around. I’m like, “Wow, no wonder I’m rich, because I’m in an area, Summit, New Jersey, where that’s all they did was create debt.”
And I really looked at my business. I totally changed my mind on what I was doing. Here I was, thought I was a retailer. I was the middleman, stuff like that, and the reality was all I was doing was creating debt on a massive scale, because when people come in to buy a car, they don’t buy it with savings or silver or cash. They create debt every time that they trade back the vehicle, so it was no wonder to me that we were doing really well, ‘cause we were creating a ton of debt, I mean, millions upon millions of dollars every year, every month selling these vehicles.
And because this debt is created, the average individual pay – over three to five years, paid off that debt, but as soon as that debt comes into my – I have it in a contract, I’m able to monetize that instantly. What somebody’s going to pay off in three to five years, I get my profits instantly up front, and that is a very powerful force inside this paradigm, and when you take that and understand, well, that’s what Wall Street does, well, that’s what Washington does, that’s what big corporations do, they’re able to monetize what takes the average individual years to pay off instantly, and they get that cash first, and that feeds back into the system. So, I took this new knowledge, and I said, “Wow, what am I gonna do with this?” Well, the first thing I did was I sold my house at the top of the housing bubble. When everybody in the area was going nuts for real estate, I was the guy that sold out.
I rented for three years. I then spent, from 2005 to 2008, trying to convince my baby boomer partners and parents to do the exact same thing. We had hundreds of millions of dollars worth of properties and franchises and real estate and stocks and all sorts of stuff all over the world, and I said, “Guys, this is never going to get any better than it is right now. Get out. With the amount of money that you have, do whatever you want. Take years off. Come back in a business, but,” I said, “this is all going to go down.”
So, it fell upon deaf ears. Being the young guy, and I was in a panicking stage where I was like, oh, my god, and I spent so much time trying to educate them, and it fell upon deaf ears. Finally, in May of 2008, it got to a point where I said, “Well, if they’re not getting out, I want out.” I had $2 to $4 million worth of equity inside – there’s the dealerships and that’s – all the properties entailed with the property, and I was the only son, and I basically went to my father, I said, “If you guys aren’t getting out, I need to get out.” And he basically gave me a choice of saying, “Okay, well, you can leave, but you’re not getting anything.”
And I took that ticket, David. I did something that – again, I sold my house at the top of the housing market when nobody else would. I left my entire family’s inheritance, millions of dollars, and I walked away from it because of this realization of where I was in this world, and I walked away from it in May of 2008, moved to a whole different state, now in Ohio, and now I got to the point where I realized, well, yeah, I’m walking away from a ton of equity. But, the reality is, as soon as that market crash happened, all that equity that I think that I have, you know, that I’m holding onto that I worked for is actually a debt, because there’s tons of debt associated with that equity. And so, as I walked away from $2 to $4 million, in my mind, I was actually walking away from tens of millions of dollars of liabilities, and so I settled down here in Ohio, September, and October we all know what happened 2008 with the market crash.
GM and Chrysler filed for bankruptcy. Pontiac and Saturn, which were some of the biggest franchises that we had, we lost eight dealerships – or my father lost eight dealerships. The franchises don’t exist anymore. And I dodged that bullet, so I moved out here, and I was like, wow, this is very powerful information that is – had dramatic effects on my life, and yet I still could not get my mind wrapped around that this information is not more commonly known, was not more formalized and that there was no really telling about this. And I realized, well, no, people that own and control this paradigm have no interest in educating people about this.
Our school system, I mean, we teach kids sex, drugs and all this stuff in third, fourth and fifth grade, and yet no one talks about debt, our constitution, all this stuff that’s so important to our way of life. So, I set about creating a formalized, a waking process which came into the Sons of Liberty Academy where I took three years of all this research that I put together, and I put it into an order that I wish I had learned it. And what came of it was this huge program. It’s called the Sons of Liberty Academy, and the – I mean, it breaks down where we are, where we’re going, who controls this and what can you do about it. And it’s not so much a doom and gloom thing.
It’s really just a stop and _____ where you say, “Hey, we’re living a dream here, and here is fact after fact after fact on how it is an illusion that we’re chasing after and that we can come to terms with this new reality.” So, I put together this whole big program. It’s a massive program, and it’s 48 hours of video lessons. It’s got thousands of reference materials. David, you know I am a passion about all this information, so I put together this huge program, and I put it out there.
And I did, again, did this other crazy thing where I left the six-figure job that I ended up landing out here in Ohio and gave away my life’s work with Sons of Liberty Academy. I gave it away for free, because I want people to see this, and as a result, I started to go about writing articles and syndicating these articles so that people could find this academy. And one of the first articles I wrote was the Silver Bullet and Silver Shield, ‘cause I believe that if people knew what I knew about silver, this whole way of life would be over, and the people that didn’t wake up to this reality of owning physical silver would have created generational wealth far in excess than any other thing that they could possibly be doing right now in their life – starting a business, playing the stock market, anything else – because I learned through my experience that this dollar collapse that I have been talking about and understanding that our debt-based monetary system is mathematically inevitably going fail, this is an event in my mind that is a 100 percent, absolute certainty, okay.
So, where a lot of people go, “Well, this – we’ll stumble through this. We’ll do this. We’ll do that.” In my mind, it’s a 100 percent mathematical inevitability. I’ll give you a couple reasons for it.
No. 1, the dollar is the world’s reserve currency. There is no other currency out there that can possibly replace the dollar in terms of the amount of capital that’s accumulated. The marks that are associated, it’s just – it’s without question the largest currency out there. Knowing that our debt-based monetary paradigm that we have to create more debt every year in excess of the debt and interest accrued the year before, knowing that we have to do that leads to two – only two scenarios where this could possibly happen. Either this debt becomes so large that we cannot even afford to pay the interest on it and we default on it.
I don’t believe that’s going to happen, because any major nation that is able to print their own debt never defaults upon it. They take the second road. The second road is where the debt does become so large and the interest payments do become so large that they monetize and they create more debt to pay for the interest, and that leads to what, a hyper inflation, where the currency that this debt is measured is destroyed. Either way, the dollar/debt paradigm that _____ is going to end, and it’s a mathematically inevitable event. That being said, and if you follow that line of thought, this leads to a tremendous change in our way of life.
Everything we do, David, it has to do with the dollar, and I don’t care if it’s your job, your food, your security, your relationships, everything has to do with money, and if the dollar ends, whether we default upon this debt and everybody just gets wiped out or the currency itself becomes worthless and everybody gets wiped out, our entire way of life ends. Here we are a nation that’s probably 3 or 4 percent of the world’s population consuming 25 percent of the world’s oil, up to 50 percent of some other resources, has the ability of printing unlimited amount of debt to fund the world’s largest military power throughout all the world, securing all the resources for our corporations, securing all the trade lanes, and we have all this money flowing back into the United States and all these profits, and if our dollar doesn’t exist, we cannot fund the military the way we have. We cannot create the amount of debt that we have. We cannot have the amount of power that we have.
We cannot have the amount of control we have over the world, and what happens? The world gets incredibly smaller for us, and the rest of the world is not gonna be too happy with us, and knowing that, again, that, in my mind, this is a 100 percent mathematically inevitable event, that the dramatic effect of that single event happening is going to result in a tremendous life change for everybody, you have to go, okay, well, what’s next? Well, the main problem with this MF capital, all these stock markets is a very simple thing that no one’s thought about is counterparty risk. Counterparty risk is all paper assets are only valuable to the level of which the other party that you’re contracting with fulfills their obligation.
Well, if we’re in a paradigm where the government, the banks destroy the actual currency that all these paper contracts are done in, well, it renders all paper assets worthless, okay, ‘cause either we’re going to have this deflationary collapse where there’s just no money and we have the mother of all margin calls where everybody’s scrambling around for capital, selling assets in a waterfall scenario and blows up the market that way, which, again, I don’t believe that’s going to happen, or we have the scenario where there’s just keeps on chucking this debt. And it’s not $15 trillion out there. We have $140 trillion of unfunded liabilities, and that’s just the United States, okay. At some point, all these bills will get paid in my mind, where the central banks and politicians are just going to keep kicking the can _____ and print more and more. And the problem is, the times that they print the most amount of money are the times that you can’t move, okay.
So, when we had the collapse in 2008, what did they do? They flooded the market with money. We had that $700 billion from Paulson. That was nothing. Talk about the $14 to $20 trillion that the Federal Reserve put out into the market over those next couple years, trying to liquefy the market.
This time around, and this is the scenario that I’ve been playing with my subscribers, we’re going to see what we saw in 2008, except we’re not going to have institutions like Lehman Brothers, like AIG. We’re going to have nation states bailing on their debt, and when that happens, the counterparty risk is – it’s global. It’s systemic. It’s huge, and there’s – and when this start – when this reality starts coming, there’s not going be time for people to move money around and play cute with this. And I try to tell people, why put this at risk, okay?
David brought up a very good point when I discussed it with him earlier. Your metal allocation in your portfolio should reflect to the tee the amount of risk – or the amount of probability that you think that this scenario is going to happen. If you think that it’s a five percent chance that we could have a dollar collapse scenario, you should at least have five percent of your money in physical metal, okay. David is at 50/50, and I’ve razzed him, and we’ve talked about this for a long time. He’s got a 50/50 scenario, okay, so he’s – and in your future it’s a 50/50 chance something’s going to happen.
I have been under the operating system of being 100 percent physical metal from 2005. I mean, I sold everything I had to get into physical metal, silver, _____ 2005, because I know that I’d rather be six years too early for this single event than one day too late. And all my studies have shown to me over and over again that this is a 100 percent mathematical inevitability and that if you look at where the biggest wealth is made, the biggest wealth is not made in chasing markets and trying to churn your way to higher profit. The biggest money are the guys that saw what was coming, got there before the rest of the crowd, where they panicked early and they got to the – got the last seat in the musical chairs thing, and they created a massive amount of wealth. And that’s kind of the scenario and the background of where I am. David?
David Morgan: Well– Let’s go with a different scenarios, the survivalist –
Chris Duane: Sure.
Chris Duane: Well, the survivalist mentality is this, the world’s coming to the end. They tend to focus not on the financial aspect of it, but more of like the government intrusive aspect of it. And there’s a lot of people out there who don’t like the collective power of government, and if you look at our paradigm, it’s really got four main pillars to it. The first is collectivism, the idea that the individual should be sacrificed for a collective, and I don’t care if it’s socialism, communism, fascism, state capitalism, too big to fail, Social Security, corporations, they’re all based off of collectivism, where the individual is fed a story so that they run and spend their time and energy and money supporting the paradigm that they think is going to benefit them. And in this paradigm, the collectivism that is being built here revolves around the further creation of debt.
So, if you have a socialist state and any state that’s going to come in and save you, which is, apparently, what all these occupy Wall Street guys want. They want the power taken away from the fascist, state capitalist Wall Street guys and say, “Hey, spread the wealth to us,” but they want collectivism. And then, we have this fascist, state capitalism model where we have too big to fail, and then we’re going to take from all and bail out the few. We have these two paradigms working together, and I see people who spend their time – good-natured people spend their time with this Tea Party movement and the occupy Wall Street, but I can tell you, nothing’s going to come of that, because in order to solve a problem, you cannot have the same consciousness that created the problem. And if you see that the problem is collectivism and some sort of collective action, the only way to solve that problem is individual action.
So, a lot of this stuff that I’ve been teaching in my Silver Shield Report is about taking individual action to free yourself. One of the lines I like to use is you cannot change the outside world to make you happy or free. It’s a absolute impossibility. It’s insanity that has plagued humanity for 6,000 years, where we all try to go out and try to change the outside world to make ourselves either free or happy. Well, David, think about what that does.
All that does is create enemies, because not everybody has the same background values, same operating system. Even religious dictates, I mean, you can’t, even in your own family, get somebody to agree on something, so why is it that we’ve been compulsed into thinking that we can go out and somehow change the outside world to make ourselves free or happy? And yet, that’s what we’ve been taught to do. What I try to tell people to do is to seek inner peace, and the idea that I have is this total freedom concept, which I go over in this project that I’ve been working on called The Greatest Truth Ever Told, and the total freedom concept is an individual’s answer to a collectivist problem. So, the individualist, in order to become your highest and best self, you need to be free on six different levels of your life.
You need physical freedom, so that means that you need to have a warm place to eat, food, air, water, the basic necessities of actually being human. The next after that, you need financial and political freedom, so you need the ability to be able to support yourself financially, having the ability to be – have political freedom so you’re not Gulag. Beyond that, you need intellectual freedom to think beyond what is told you. Then, you need emotional freedom so you’re free of toxic ideas and toxic relationships. Then, finally, spiritual freedom is connecting to a higher power, a higher source, why you’re here on earth.
If you’re able to spend your time, energy and money, pursuing those freedoms in your own personal life and not trying to protest, write editorials, march on Wall Street, occupy Wall Street, create some other thing out there where you’re trying to affect the world and only focused on yourself, you can become totally free. And the best part about it is, nobody can top you, because I tell you what, when you’re physically, mentally, politically, financially, emotionally and spiritually free, who can touch you, David? I mean, I don’t care who – what bank or whatever thing out there. I’m at a point in my life where I can’t be touched, okay. Sure, a criminal could come in, but I own a lot of guns, and I was in the Marines, so I’m not too concerned about that.
But, the best part about this is, if everybody started pursuing this individual way of seeking freedom and not falling for some other collectivist trap, this is something that we can all do individually, can’t be stopped and eventually be a way for all of humanity, ‘cause it comes down to two things. There’s two people in this world that – two kinds of people in this world. If you’re willing to really look at humanity, there’s people who wants to be left alone and there’s people who won’t leave you alone, okay. That’s if you divided humanity in half into two different kinds of people, take out the religion, take out the politics, take out the sexual orientation, whatever way where we divide people, just look at it that way, okay. We have a a group of people, 90, 95 percent of the world that really just wants to do what they want to do, love if they want to be loved and live and be left alone.
Then, there’s these small group of social predators who feel that it’s their right to impose their will upon everybody else and physically change the world, and they like to divide us up into all these intellectual camps and pit us against each other and sell illusions that don’t exist, and that brings us to all the trouble that we have. That covers the first pillar of this – that supports this paradigm. Then, we have debt. We’ve already covered debt with the mathematically inevitable event, we have to create more debt in excess of the debt and interest accrued the year before. Well, if debt is a problem, you can’t solve debt with more debt, where you’ve structured debt bail-outs, all that other stuff.
That’s another – you can’t solve that problem, ‘cause it’s of the exact same consciousness. You can’t solve debt with more debt. So, the answer to the debt problem is equity. Well, what is equity? Equity is something that has real, tangible value, okay, that there’s real assets behind it.
And in a world where there’s going to be massive counterparty risk, getting money sitting in higher rates, 401(k) can be confiscated, banks to be – your checking and savings account have problems, because the FDA – the FDIC does not have the money to back up all these banks, okay. So, there’s massive counterparty risk in just having that money sit there, so the beauty of precious metals is it has allodial title, which means that there’s no lien against it. It has no counterparty risk. It is what it is, because it’s rare. It has utility.
It has timeless value to it, so the answer to this inevitable debt crisis that’s coming – and we don’t know when it is. That’s the key. This is going to come like a thief in the night. You could wake up Monday morning and it’s all over. There’s no way of getting around it, so if you’re thinking about this the right way, this is something that you need to be able to prepare for right away and have your money into physical assets.
The second – or the third part of this paradigm that is supported by this is war. Guys, we’ve been at war for ten years. We got five or six wars. This is a trillion-and-a-half-dollar drain on our society. We don’t physically see it, but it’s a huge drain nonetheless, and it’s spreading debt and death throughout the world.
That’s what our foreign policy is. We go out and spread death, and our corporations come in and contracts and debt and get all these poor nations into debt. And then, the fourth pillar of this paradigm that has to end – oh, and the answer, obviously, to the opposite consciousness of war is peace, so I propose nonviolent ________, educating yourself, freeing yourself from this paradigm, seeing things for what they are and not watching the mainstream media, because they’re supporters of the paradigm. Again, you have to have the opposite consciousness. You can’t have anything close to the same consciousness if you hope to solve these problems, or at least get ahead of the curve.
This has been something that we’re trying to bring about real change. This is something to get yourself out of. I mean, the rest of the world’s going to do what it does. Your only choice is to deal the best with what you’ve got. And a final thing is fear.
I mean, you look on the news and you think about it, everything is based off of fear. You have to fear the water, fear craigslist. You have to fear Iran. You have to fear the stock market. You have to fear. You have to fear. You have to fear.
Yet my own personal life and what I know is most of the people out there, I don’t fear. We don’t need to fear. We need understanding. We need education. We need love. And this all happens when we just start respecting each other, and the founding fathers, they did all the hard work for us.
All we have to do in humanity is have life, liberty and a pursuit of happiness and have everybody have – respect each other’s freedoms and not feel compulsed to enforce our version of freedom upon them. If you truly believe in freedom, somebody burns the American flag, you almost want to slap to them, because they’re expressing their freedom, if you really believe in it, okay. So, I get – I’ve had a lot of people – ‘cause I was in the Marines for seven years, and I fell for all this stuff, and yet they go, “Well, how could you support burning the flag?” Well, what did all these men die for?
Did they die for this fabric? No, they died for the idea that the flag represented, and that is, unfortunately, being able to burn that flag. So, the opposite consciousness, again, is education, understanding, love, not fear and gore and debt and all this stuff, so that’s the kind of mentality shift that I try to teach for people.
David Morgan: Very good. Can we explore a little bit on the – since you’ve touched a great deal on the financial side and – preparation as far as being more self-sufficient, self-reliant and how to build community? And one area that I get criticized for, but for me it’s a no-lose bet. I have, from time to time, even in the public domain and my speeches, although it’s only been rarely done, I talk about building some kind of a spare food supply, and this doesn’t only apply to a situation where there might be stores closed for a while or something like that that’s a possibility, in my view, but also an emergency situation, if you have a fire, earthquake, something in your neighborhood, your own house, for example, whatever. So, can you touch on that a bit as far as what your thinking is in that area?
Chris Duane: Again, it comes back down to the idea of intangible law versus tangible laws. It’s funny that the people that I discuss – and I deal with a lot of heavy-net-worth individuals, and I tell them to walk into their brokerage account and see where they are today. And I said, “Now, look at that screen. Tell me, how is that a reality?”
It’s scary to me that we somehow think these digits on our computer screen somehow represent a real reality, and, unfortunately, people at MF Global and Lehman Brothers and all these other institutions, it’s an illusion on there, okay. Real wealth is something that you can hold, touch, feel, has value, and I try to tell people in this shift – and this is a major shift. There’s a couple major shifts that are happening. We have political shifts from east to west, I mean, no – or west to east, where the Anglo-American empire has been having it good for the last 400 years or so. But, before that, most of the wealth belonged back in Asia.
There’s a major shift going on there. There’s a demographic shift. We have 80 million baby boomers who are trying to retire at the same time, but, folks, it’s a Ponzi scheme. You can’t have the people who have been paying into the system start to take from the system when my generation, Generation X and the generation below, are without any hope of ever supporting that system. You can’t have a system where there’s only five, four, three, two, one workers per retiree.
When the system was created, it was 25 workers per retiree. And then, there’s also an energy shift. We have this declining oil price – or declining oil crisis that we’re going to have where in order to find more oil, we have to go more extremes and spend more time, energy and money in finding a depleting resource in oil. So, I tell people, knowing that all these trends are coming – we have this mathematically inevitable event, we have this demographic shift, we have this power shift from west to east, we have a declining resource base of petroleum energy – it’s starting to – and all those things – the demographics, the oil, the ability of the United States to have a relative peace over the world for the last 40 years – all of those have supported the dollar asset, the dollar power. And when those foundations start cracking or the dollar collapsing, and it’s not something that’s going to deteriorate over a decade, or centuries like the Roman Empire.
It’s something that’s going to happen overnight, and we don’t know, again, when it’s going to be. So, I try to tell people, I said, “Wrap your mind around this. Get ahead of the curve. Get in the – be in the right place at the right time.” And it’s simply by having real wealth in something like gold and silver, but the most important thing that you’re going to need immediately is food.
I can go my whole life and never really need silver or gold, but I can’t go a few days without food or water, and I view food supplies as simply a bank. Instead of denominating your account in dollars in some brokerage account, you have calories in there, and it’s – you need it. Do you need three years’ of it? No. Do we need a year of it?
Oh, maybe. But, the idea is to at least fill the buffer, David, at least have a buffer there just in case something happens. I can’t tell you how many people I have gone to and I work with and I ask them, “If food was shut down today, how long could you go?” And most people can’t go the end of the week. That’s how dangerous it is, because I tell you what, if there’s a dollar crisis, immediately, credit’s going to get shut off.
Or it’s just – or the system’s flooded with so much money that all the store shelves will be empty and the fuel lines are going to be empty. There’s only three days of food in the average grocery store, and there’s seven days’ worth of fuel in the system, that’s it. Anything beyond that, you’re at caveman level, and the idea is that food’s just not going to disappear. Even during the collapse of Russia, food just didn’t disappear. It got scarce.
It wasn’t in the quantity that you wanted, and prices became relatively much more expensive. But, the idea is of having this food buffer that you’re talking about, David, is the idea that you then have a buffer, so if food does become scarce for a week or two, you have something to live off of. It’s also going to be extremely valuable and a new paradigm, because as we shift from this intangible wealth to real wealth, well, you know, if you know from any collapse scenarios, like post World War II Germany or post any war, it’s always been alcohol, cigarettes, food, candy, chocolate – those type things hold tremendous value in the real world.
Meanwhile, income-producing properties and stocks and all these other things that we’ve been so enamored with are worthless. During the Weimar collapse, college students that were studying over in Germany took their allowance that they got from their parents and bought up whole tracts of housing in Germany, because their cash was worth so much more than those income-producing properties. And $1.00 could take eight people out onto a night on the town, because they had money. Well, that’s the way it’s going to be with silver. That’s the way it’s going to be with gold.
There is no – let’s put it this way, there is no credit system if there is no dollar system. If there’s no currency available, what’s your house worth? What’s your house worth without a 30-year mortgage? What’s your house worth without a 3.9 percent interest rate? What’s your house worth with a – without a functioning economy? What’s your house worth with a government that wants to seize properties?
And I tell – I gave – I wrote an article, “30 Reasons to Get out of Real Estate and into REAL Assets.” I think people are way too complacent about where they are today, and I hope that this call and a lot of the work that I do is a wake-up call for people to at least take in consideration that, you know, could be something else out there, and maybe I should be a little bit more proactive, because I can tell you what, there are worse things I can think is all these people out there who are aware of it and did not prepare for it, knowing what a dramatic life change it’s going to be, not taking any massive, dramatic action, No. 1, educate yourself, and No. 2, to take action. I don’t know how people are going to live with that themselves.
David Morgan: Let continue –probably ten minutes longer.
Chris Duane: Okay.
David Morgan: One side of this question that I’ve thought about a great deal and really don’t discuss too often is what I call the spiritual side or the human side, depending on your own beliefs, and I’m definitely free market there as well. You’re allowed to believe whatever you want to in this country, and I still uphold that. Regardless, this country, from my study and belief, is that what made us so great was individual responsibility. Your word meant something. You did what you said, and it basically came down to basically not infringing on anyone else’s freedoms and doing what you said, and we’ve gotten so convoluted in the law presently.
We don’t need more regulation. We need less. We need to free the people, but what I’d like to press on with Chris, with you is how do you see your generation and generation under you, what kind of world do you envision a year, five years and ten years from now when, without a doubt, in my opinion, you’re going to see a great deal of responsibility shifted on your shoulders because of the breakdown. In other words, I don’t see a way out of it, and people are going to– get a slap in the face. The people are certainly unawake, which isn’t this group, but a lot of people that believe the current paradigm’s going to go on forever, and they will be forced into taking care of their own health, their own bank account, their own source of income, et cetera.
So, how do you see it playing out in the short term, medium term and let’s say ten years as a long term?
Chris Duane: Yeah, it’s – again, I’m not big on timetables. I just know that this is a mathematically inevitable event, and this could happen, again, Monday. I try to tell people, I said, “I would not be surprised if it happened Monday, but I would be surprised if it happened three, four, five years from now, because this is such a massive event.” We’re three years beyond the 2008 crisis. The next crisis is a national confidence level event, and whether it’s tipped off by the Greece, Spain, California, Illinois, China, any one of these major entities, it’s going to be a big event.
But, I’m glad you touched on this generational thing, because I really feel we’re generationally ripe for a new paradigm, and it all goes back to the baby boomers. Baby boomers have been the driving force for the earth for the last 40 years. I mean, without the baby boomers, without these 80 million people coming into this workforce, we could not have grown as big as we have. We could not have exerted so much power. We could have not have dominated the world as much as we have, and yet I feel that the baby boomers have the idyllic lifestyle.
I mean, they have that ‘50s Leave It to Beaver, post World War II boom years. I mean, talk about a great time to be a kid. And then, they also had the best coming of age time, I mean, to come of age in the ‘60s and ‘70s and being free and exerting your power there. The major problem – or and then you have the ‘80s and ‘90s where then the boomers then entered the workforce, created families, created a massive amount of debt, both personally, institutionally, governmentally, that fueled this boom that happened that then vaulted us to this position where we are today. But, now with the way boomers are, I know my parents, they’re in their 60s now, they have no need for another house.
They have no need for another car. Their kids are through college. They have achieved all of, probably, their financial goals that they probably started out when they were 20 years old, and now we’re talking fear. Now it’s starting to become, “Wow, do I have enough? Is the system going to hold up? Can I rely on Social Security? What institution do I even hold the checking account with?”
And I think the boomers are going to have the hardest time, because you guys had the best first 60 years of life, but I can tell you what, there’s going to be a reversion to mean where I really feel the later half of the boomer’s life is just going to be absolutely abysmal. They are going to be too late in life to start all over again. Mentally, they’re not going to be able to get their heads wrapped around this new paradigm. Their whole world’s going to change around them, and they’re not going to know what to do or how to do it. They’re already seeing that now.
I mean, I feel it’s, in my group, boomers who have had tremendous amount of money, they’re trying desperately to fall in that same consciousness. You have these real estate developers and agents and stock brokers and car dealers and all these people who made a ton of money when the paradigm was cooking for them, and yet they keep trying to truck along, trying to make more money using the same consciousness even though the system’s collapsing. So, my hope is through all this education that I can get enough boomers to wake up ahead of time, because if they’re able to get their assets in place, get their mind wrapped around this ahead of time, we can – or the boomers can – those boomers can lead the charge and be the wisdom that their generation didn’t have in the ‘60s and ‘70s. So, I look at what the boomers were doing in the ‘60s and ‘70s. They were protesting bigger government. They were protesting the war.
They were protesting this idea that the collective can force the individual to sacrifice their time, energy and money, and the draft is all about a collective really sacrificing individuals where they have no say. And yet I felt that the boomer – or the revolution that they had in the ‘60s and ‘70s lacked the wisdom, lacked the understanding, lacked the depth of what they were actually fighting for, and they didn’t have the language, the financial backing, the intellectual foundation to support from the higher generations, because the higher generations saw them as a threat. But, the reality is, those – the boomers that did rebel, the whole revolution degenerated into sex, drugs and rock and roll and to this narcissistic me generation that happened. And that totally changed the consciousness of that generation.
You see in the early ‘60s they had these protests, “Why the war?” and then five years later they’re all doing drugs and Woodstock and all that other stuff, has degenerated. And my hope is that the boomers will provide the wisdom, the financial backing, the intellectual foundation, the maturity to provide the younger generation, my generation, Generation X and, most importantly, this millennial generation, what an awful time to be coming in – be coming of age. I mean, here these students are. They’re not lazy kids. They excel inside this paradigm that they were told to work in.
They went to school. They took on the student debt. They followed the path that the boomers sold them, because the boom – what made the boomers successful was following that path. Well, the paradigm shifts, folks. The college diploma is not worth a napkin.
David Morgan: Right.
Chris Duane: I have a $240,000.00 diploma on my wall from Boston College. It’s worth nothing to me, because –
David Morgan: Right. Let me interrupt you there, ‘cause I’ve got a few questions.
Chris Duane: Sure.
David Morgan: And this will take some time probably to develop them. How do you see the banking system going down and re-resurrecting?
Chris Duane: All right, so the banking system, it’s all built off of debt. And, again, this is a mathematically inevitable event, either we’re going to have an outright default where there’s the mother of all margin calls and everybody has to show what cards they have, and this system is so leveraged on so many levels with derivatives and _____ _____ banking, there is not enough capital out there to support all this debt. If we do have an outright default, it’s four days of just absolute terror, because all the – the only capital that’s available is in the markets, and with the markets all selling, you have that waterfall effect. That happens, the institutions are gone, and I know that the guys that run the system, the Bernankes, they don’t want that. That’s the absolute worst-case scenario for them.
The way I see it happening is, at some point, and I don’t know what it is, there is going to be something in the real world, whether it’s a political event or a – I like to tend to think silver. Like one ounce of silver is not delivered at the _____. Like that’s like a real, physical thing that they can’t paper over with debt. They can’t make it go away, that somebody stands for delivering on one ounce of silver and they can’t get delivery of it, that changes the mentality of the whole market, because now it’s like the illusion’s over. They don’t have billions of ounces.
I mean, when we saw these market crashes in silver in May and recently, there’s billions upon billions of paper ounces that were traded on this market, and yet there’s only, what, 20, 30 million ounces of physical metal in the registered inventories? I mean, it’s insane. But, at some point, somebody will stand for delivery, and they’re not going to get their metal. Or you could have a political event where you do have a nation like Greece who just outright defaults on their debt, and once one nation does it, it makes it easier for another nation to do it.
And that could cause all this. My feeling is that as we go along, these – the banks may _____. The central banks get power from loaning and creating debt money, and politicians get power from spending money debt. It’s a sick symbiotic relationship that we have developed here, or that they have developed for themselves, where they always find a way of spending more money. I mean, it’s now like a trillion dollars.
It doesn’t mean anything anymore, and if you went back in 1980, you’d be like, “Oh, my god.” So, I really think that at some point we’re going to see an event where it happens in the real world where it can’t be papered over like a Lehman event, like a MF Global event. It could be Israel attacking Iran and Iran shutting down the oil market, where the physical oil stops trading. It could be something like that, but I could tell you what, it’s going to happen like a thief in the night.
It will happen when nobody knows about it. And it’s much better to be years, days, months early than one day too late.
David Morgan: Very good. Last question is how can I help? In other words, I’m listening to you out here, and you’re resonating with me, at least to a certain level, and I (the listener of this interview) be part of the solution, not part of the problem. There’s lots of ways. We could probably talk an hour on that alone, but if you could try to be concise, what would be the top three things that you would recommend people do?
Chris Duane: First and foremost, get educated. I have tons of free stuff on my website, but I really started a group, because I feel that there’s a lot of other individuals out there who get what’s going on and say, “Okay, I want to do something positive to move forward into this dark time.” So, I put out a video called “The Ultimate Exit Strategy,” and it’s basically a one-hour video about how I feel we can move forward positively and create our own paradigm. Like you and I, David, honestly, we don’t need to be doing this. We could hang up our hats, head to a mountain, stock up with all the food and water resources we want and live up there, but that doesn’t really resonate with me, because life isn’t about possessions and that.
Life is about working with others or resonating with others, doing things with others. I said, “Well, if we can – guys like me and you could create our paradigm, why can’t we take 100, 1,000, 10,000 individuals and say, ‘Hey, we all believe in the same principles. We like honest money and honest people. We don’t believe that we have the right to infringe upon – our views onto each other. Why can’t we collaborate? Why can’t we invest with each other? Why can’t we create a paradigm?’”
And I said that the scary thing is, David, and this is the thing that makes me the most excited about this, is I truly believe that silver is going to be so dramatically overvalued that it’s going to be like a lottery ticket and that we have all these individuals who did all this hard, intellectual thought process and actually investing in physical silver. It’s not something you just do on a whim. You really have to think about it and really have to commit to it, because it’s not something that the rest of the world is doing. But, we have all these individuals who all have the same feeling inside of us, that the world’s not going the right way. It’s not something that resonates with me.
I’m not going to support it by either having actively or passively by having my time, energy and money inside the system. I want it outside and that we have all these cool individuals. Why can’t we do something special? So, I gave an example of Conrad Hilton, and most people don’t realize that Conrad Hilton was a very successful hotelier in the 1920s.
He was a millionaire back then and got totally blindsided by the market crash in 1929. He scrambled for three or four years. Got so bad this bellhop had to give him money to feed his family when Conrad had lost everything. He scrambled through it and made it through, but Conrad came out of the Great Depression with three of his eight hotels and no debt, and he was able to buy these hotels at one times earnings and five years into the Great Depression. So, if you can imagine how thoroughly depressed those asset values were, had Conrad done what I had talked about in this Ultimate Exit Strategy, taking his money out of the paper paradigm before the market crash, which is I think we’re gonna see something much more dramatic than the Great Depression coming up, and had his money in silver, he would have been able to buy paper assets for pennies on the dollar and that the real, tangible value of that silver would have been dramatically more.
So, I put out an idea where we can do – I don’t want to spend too much time on it – put out an idea where we can create our own paradigm at a very personal community and possibly a national and global level. It’s a very simple, one-hour program, but that led to the Silver Shield Report, which is what I’m most proud of, and that’s what I’m spending most of my time these days is starting to create the intellectual foundation and the discourse for this community to start getting this conversation going, getting to know each other, having meetings, starting to do this, because I can tell you what, after this happens, whenever this event happened, those people who saw this coming are going to be so far ahead of the curve, because they already did all the mental hard work. They already did all the physical preparation, the financial preparation, spiritual preparation to do this and that these people are going to be so far ahead of the curve while the rest of humanity is going to go through these five stages of wakening, getting out of denial, going through anger, going through bargaining, going through depression and finally coming to acceptance 3, 5, 10, 20 years later.
This group of people who saw it coming will be able to say, boom, game on, because at that moment, all these paper assets are going to be completely worthless, because the world is going to be looking for real, tangible value and –
David Morgan: I will interject there, Chris. It’s been a true pleasure, and it seems like it’s been a ten-minute conversation rather than an hour. What I’d like you to summarize is just how people can get in touch with you.
Chris Duane: Sure.
David Morgan: – phone number, e-mail, give as much information as you possibly can.
Chris Duane: Sure.
David Morgan: And for all listeners, this will be transcribed. Please give us some time. I have to take the audio, have it transcribed, and I have to proof it. Then, I have to edit it, and then I have to pass it by Chris to make sure everything in there is basically what he said and agrees with, and then we’ll post it on the website. So, give us, especially with this holiday coming up, give me probably ten days.
I’ll get it as soon as possible. I do pay extra to have it expedited, but regardless, it isn’t instantaneous to get that work done. So, having put that interjection in there, Chris, please tell us how we can get a hold of you and get more information and get in contact with you.
Chris Duane: Yeah, and it’s a lot of stuff, but the main site is dont-tread-on.me. That’s my main blog. I also have the sonsoflibertyacademy.com, which, again, is that educational site. It’s completely free. There’s places to donate if you find the information valuable and you want to support the cause.
I also have this new project called the thegreatesttruthnevertold.com, which is also a new YouTube channel. I posted – I think David shot out one of the videos. We’ve already had 22,000 hits on this one video talking about the mathematically inevitable collapse of the dollar and the ramifications of that. And if you want to move forward and start talking more on this level and conversations like this, you can join the Silver Shield Report very cheap. I think it’s only like $35.00 a month or $350.00 a year, and we’ll have more conversations like this on a weekly basis where I discuss all the issues that are going on, what we can do to move this conversation forward more positively.
And if you want to reach me, you can reach me at email@example.com, C-H-R-I-S-D-U-A-N-E at me, M-E dot com, if you have any questions, and I’ll be more than happy to help you out. David, thank you so much for having me on.
David Morgan: Well, my pleasure. I think it’s important, and I just want to summarize a bit here at your end, what you talked about and how important it is to be of service to others. I learned – fairly early on, and this is my worldview, that to really have a purposeful life, you have to have something of purpose, something that is valuable to others. And my industry is the newsletter (service) industry, and I really do have my head and heart in a place where I really do want to serve others. And what you said about something similar, it reminded me of the way I wrapped up one of my speeches – actually done it in two.
It’s on the website, in fact, how I closed out the speech at the – as a keynote in the Chicago Resource Conference, and I had given that same ending here in Spokane a year ago, not in the most recent Silver Summit, but the one a year previous. And I talk about it’s not what you’ve got, in other words, what’s you’ve bought, et cetera. It’s what you gave in life, and that, to me, resonates. And it’s not what you learned; it’s what you taught. And, Chris, I think you’ve come to the floor as being one of the best teachers on this paradigm shift, why silver’s important to it, that it’s more than just keeping your wealth intact.
It’s also what you can do to contribute to others as we go through, I think, one of the largest transitions we’re ever going to face in – this is going to go down in not only the financial record books. It’s going to go into the history record book, and exactly how it unravels, I’ll come back to how I started. I don’t know. To be intellectually honest, Chris doesn’t know exactly. I agree with most of his views.
I do believe we still have time to remain in the paper paradigm, but that’s an individual choice, so don’t let me sway you. Don’t let Chris sway you. Evaluate all the information, and let your own decision, critical-thinking process work for you to your best advantage. What I don’t want to see for anybody that’s on this membership service is to come out and say, “You know, I really didn’t get the message. I wish I would’ve bought more physical.”
You MUST make that decision, and you must take action. So, with that, Robert, could you please close us out?
Robert Furhmann: Absolutely. Thanks again for another wonderful installment of the Master Mind Series, some great information and ideas here from Chris. As always, it’s a pleasure. We appreciate the opportunity to host these events and wish everybody well. Thank you.