A Preview of Jim Rickards’ Latest Book ‘The Road to Ruin’

I’m a prolific note taker. I go through about 10 notebooks a year. To you they’d look like chicken scratches in the shape of random words. To me it’s an idea, or simply a reminder.

I’m no different with my textbooks. If you ever borrow a book from me, you’ll find it dog-eared with a bent spine and brittle pages from flicking at an awkward angle. Inside, the margins scribbled with pencil or pen marks, and chapters or quotes highlighted. It doesn’t only apply to text books. Any book of mine will have some form of marking.

So when I sat down to read Jim Rickards’ latest book, I did so with a fresh highlighter and a sharp pencil.

Inside that first chapter, I had noted no less than six separate paragraphs. Oddly, I highlighted the title of the first chapter, ‘This is the end’.

Ah, that’s a tad dramatic, I thought at first.

Several pages later, I realised Jim wasn’t throwing headlines around for a little flare. When I got to page 27 however, I highlighted a quote that shocked me to my core: ‘No, it’s not that. They want to tell us what we can’t sell.

It dawned on me that this book wasn’t a theoretical scenario. This was serious. It was a warning.

And that’s pretty much what The Road to Ruin is. A warning of what the financial system will look like…soon.

I’m going to share an excerpt with you from The Road to Ruin today. Jim has complied one giant warning for you. In this book, Jim outlines exactly what the elites are going to do, and how they are going to do it. And this isn’t some vague time in the future. What he explains is actually happening right now.

Excerpt from The Road to Ruin

I’m going to hand you have to Jim now, so he can explain how Ice-Nine starts.

Ice-Nine is a fine way to describe the power elite response to the next financial crisis. Instead of reliquefying the world, elites will freeze it. The system will be locked down. Of course, ice-nine will be described as temporary the same way President Nixon described the suspension of dollar-to-gold convertibility in 1971 as temporary. Gold convertibility at a fixed parity was never restored. The gold in Fort Knox has been frozen ever since. US government gold is ice-nine.

Ice-nine fits with an understanding of financial markets as complex dynamic systems. An ice-nine molecule does not freeze an entire ocean instantaneously. It freezes only adjacent molecules. Those new ice-nine molecules freeze others in ever widening circles. The spread of ice-nine would be geometric, not linear. It would work like a nuclear chain reaction, which starts with a single atom being spilt, and soon splits so many atoms that the energy release is enormous.

Financial panics spread the same way. In the classic 1930 version, they begin with a run on a small-town bank. The panic spreads until it hits Wall Street and starts a stock market crash. In the twenty-first century version, panic starts in a computer algorithm, which triggers preprogrammed sell orders that cascade into other computers until the system spins out of control. A cascade of selling happened on 19 October 1987, when the Dow Jones Industrial Average fell 22 percent in one day – equivalent to a 4,000 point drop in the index today.

Risk managers and regulators use the word ‘contagion’ to describe the dynamics of financial panic. Contagion is more than a metaphor. Contagious diseases such as Ebola spread in the same exponential way as ice-nine, chain reactions, and financial panics. 

Eventually a pandemic results, and a strict quarantine is needed until a vaccine is found.

In a financial panic, printing money is a vaccine. If they vaccine proves ineffective, the only solution is quarantine. This means closing banks, exchanges, and money market funds. Shutting down ATMs, and ordering asset managers not to sell securities. They will quarantine your money by locking it inside the financial system until the contagion subsides.

Ice-nine is hiding in plain sight. Those who are not looking for it cannot see it. Once you know ice-nine is there, you see it everywhere.

The elite ice-nine plan was far more ambitious than the so-called living wills and resolution authority under the 2010 Dodd-Frank legalisation. Ice-nine went beyond banks to include insurance companies, industrial companies, and asset managers. It went beyond orderly liquidation to include a freeze on transactions.

Ice-nine would be global, rather than case-by-case.

The Cyprus bail-in was the new template for a global bank crisis.

A G20 summit of world leaders including President Barack Obama and German chancellor Angela Merkel met in Brisbane, Australia on 15 November 2014, shortly after the Cyprus crisis.

The meeting’s final communique includes reference to a new global organisation called the Financial Stability Board, or FSB. This is a global financial regulator established by the G20 and not accountable to the citizens of any member country. The communique says, “We welcome the Financial Stability Board (FSB) proposal…requiring global systemically important banks to hold additional loss absorbing capacity…”

Behind that bland language is a separate twenty-three page technical report from the FSB that provides the template for future bank crisis. The report says bank losses “should be absorbed…by unsecured and uninsured creditors”. In this context creditor means depositor. The report then describes “the powers and tools that authorities should have to achieve this objective. This includes the bail-power…[and] to write down and convert into equity all or parts of the firm’s unsecured and uninsured liabilities…to the extent necessary to absorb losses”.

What the Brisbane G20 summit showed was that the ice-nine policy as applied to bank depositors was not limited to out-of-the-way places like Cyprus. Ice-nine was the policy of the largest countries in the world, including the United States.

What Jim is telling you is that Brisbane is effectively ‘ground zero’ for the ice-nine plan. Tomorrow, I’ll show you how it’s already started. And I’ll explain how something called ‘The Shock Doctrine’ represents a wish list for policymakers which you should be aware of.

To read Jim’s urgent warnings firsthand, along with his recommendations for how Australian investors can protect their wealth from the Ice-Nine plan, you can learn more here.

Shae Russell

Since starting out in the financial markets over a decade ago, Shae has extensive experience across various aspects of the industry. Shae cut her teeth in the derivatives industry, teaching clients basic trading techniques with technical analysis.

Joining Fat Tail Investment Research eight years ago, Shae has worked across a number of publications, such as Australian Small-Cap Investigator, Gold Stock Trader and Microcap Trader. She’s spent the past two years however, honing her macro analysis skills alongside Jim Rickards, showing Australians how to invest and profit form global macro trends.

Drawing on her extensive experience, Shae is a contributor to Money Morning, and lead editor of sister-publication Markets & Money, where she looks at broad macro trends developing around the world, combining them with her distaste for central banks and irrational love of all things bullion.

Money Morning Australia