Exclusive Interviews
Shawn Perger on Crisis Cycle Investing, the Promise of Silver and the Internet's New Narrative
By Anthony Wile - January 02, 2011

Introduction: Shawn Perger is the founding CEO of Foremost Research Group Inc. based in Vancouver, Canada. Mr. Perger, an author and speaker at investment conferences, has more than 20-years experience with Vancouver's vibrant venture capital marts, arguably the center of global venture capital finance. Shawn has taken it as a personal mission to introduce clients to practical, free- market solutions that can greatly enhance their ability to protect and grow wealth. He is a long-time reader and friend of the Daily Bell and recently wrote a book called Crisis Cycle Investing that espouses a Bell-like point of view when it comes to analyzing investment opportunities. The Bell sat down with him to discuss the state of the world today.

Daily Bell: Let's jump right in. What is the Foremost point of view?

Shawn Perger: As you know, Foremost has a top-down, free-market thinking approach that uses the perspective that the Bell itself has helped pioneer. We try to understand the various forces impacting the business cycle and then figure out the trends that will result. Once we figure out opportunities, we share them with research analysts, brokers, asset managers and wealthy individuals who value our analysis.

Daily Bell: You just mentioned the business cycle. Would you categorize your approach as one of free-market thinking?

Shawn Perger: Free-market thinking – as you use the term at the Bell – is most important. Understanding the Austrian investing techniques it's based on is critical to successful investing. We've done our reading and thinking on the subject. I'm aware in fact that the Bell's point of view is part of what I call a growing "chorus of conviction" about how the world works. The dirty secret about the modern money business is that free-market analysis is always the bottom line – even though "they" don't admit it. They Keynesian propaganda is just that – rhetoric for the masses – and for the politicians so that they can say they're in charge.

Daily Bell: Tell us about your book, Crisis Cycle Investing.

Shawn Perger: It uses a Bell-like approach. As someone who has worked in the financial industry for years, I always looked for insights into how to identify opportunities. The idea that there was a monetary elite – what I call a monetary mafia because that's the way it operates – has become increasingly obvious. There's a whole historical narrative available now on the Internet. And the contest between the information on the Internet and the money-mafia itself provides us with the ability to identify numerous entry points.

If we identify a business or an investment, we consider it within the context of this ongoing contest between elite money power and everybody else. We're not going to point out anything, for instance, that has to do with the environment, even though that's all over the news and the media. Electric cars, solar energy – all of this is in the atmosphere – and I'm not trying to make a pun, either. It reminds me of the 1970s. There's the same sort of struggle between the powers-that-be that want to move the world away from carbon-based energies and the rest of us. It didn't work then and I don't think it's going to work now. The Bell has written on some of these issues, especially electrical cars.

Daily Bell: Like the Volt?

Shawn Perger: Sure, where's the outcry? It's a manufactured phenomenon. Of course, there's an economic law that says demand can be stimulated by supply – Say's Law – that a new technology can come along that shows us a better way. But I have a hard time envisioning that a car that can only be driven in a 100-mile radius is going to set the world on fire. Now over time there may be new iterations that make the technology more attractive, and then you would reevaluate. But you have to buy what you see. And in the case of the GM Volt, you've got plenty of people even within the company who are basically admitting the thing is a loss leader to get people into the showrooms. If the federal government wasn't involved, you might not even have had the Volt project in my opinion. But that's the kind of FedGov intelligence you come to expect – totally dislocated from the realities of what a "real" market might generate.

Daily Bell: Of course it's not just the Volt.

Shawn Perger: No. Given that it is a mafia project in my view, you suddenly have electric cars popping up around the world. That's another suspicious sign. Where are the cars coming from? The big, elite families in Japan have hopped right on board. Toyota – all the other families. The ones that built the tanks and planes in World War II. Now they're building cars, and you can bet they're on board with the West's power elite and the West's plans. You have to ask yourself constantly whether business opportunities are the result of market forces or of the money mafia's constant urge to create a world that is basically under their broad thumb. Are these legitimate expressions of the market itself or not? Is the market looking for this solution – or has it been in a sense cleverly promoted …?

Daily Bell: Can you give us some signs, some of the things you look for?

Shawn Perger: Well, again, you have to look at it in historical context. There's a logic to it that is fairly simple to identify once you understand where to look. The electric car movement was supposed to come out of this hysteria regarding global warming. There's no other reason. One can look at what's going on and decide that electrical cars are being proposed because the world is running out of oil. But even if one believes in peak oil, electric cars are not necessarily the solution. There are plenty of technologies that could get more miles to the gallon. They've been around for decades but have been suppressed.

That's the sign of a promotion, when the problem is posed in a certain way to create a given solution. The problem is that cars use too much gas and create too many pollutants. But carbon dioxide is a fairly nonsensical pollutant. It's supposed to be responsible for global warming, but who really believes in global warming these days – especially after a winter like this. The other reasons for electric cars is because regular cars are gas-guzzlers. Well, if that's the case, why not tackle the issue of gallons per mile? As I understand it, there was plenty of technology even back in the 1920s that could considerably extend the range of oil-fueled cars. Why do you need to solve the problem with an entirely new solution, and one that is even less satisfactory than what we have today?

There are red flags here. Money power wants to control things and electric cars are far more controllable than gas powered ones. The idea seems to be that everything ought to be hooked into the grid. Of course no one is asking where the power is coming from and it turns out that many of the power plants are coal-based. And transmitting the power is inefficient as well. So you've got a poor solution to a non-existent problem. It's no better than what came before and doesn't even address the issues that are being raised. The media makes a big deal about these cars and doesn't even ask basic questions. Didn't some magazine name the Volt Car of the Year? How is that possible? It's really ridiculous. It's outrageous actually.

Daily Bell: We've written about it. It's curious to say the least.


Shawn Perger: Unfortunately, NOT curious. It's all about control, about consolidating a kind of global government, a new world order. One that uses various promotional efforts to get people moving in one direction. Internationalism is the goal and has been for a long time. You hear it all the time … We live on a small planet. The world is getting smaller. People are interconnected and even mega-corporations are too. This may be true but that doesn't make it a preferable state of affairs. The idea of a single world political system ought to be scary to anybody.

Daily Bell: We call them dominant social themes.

Shawn Perger: Yes, there are some basic themes and many of them have to do with scarcity or other issues that appear generally dangerous. We're running out of oil and need electric cars. We're running out of food and need genetically manufactured crops. But the Internet itself is interfering with the mafia's promotions. I agree with the Bell – people are catching on. It's happened before.

Daily Bell: How did you come to all this? Give us a sense of your process, if you don't mind.

Shawn Perger: I'm like anybody else in that I had more questions than answers. I have to admit that working in the money industry here in Vancouver makes one resistant to at least some outside information. You tend to believe what you hear and what you've learned at school. The matrix is kind of all-encompassing. So you have to think outside the box and that's what I have tried to do in my adult life. The Internet itself has helped turbo charge my passion for knowledge by providing me access to great free-thinking minds. In essence, I'm a walking example of what you write about. I've taken what I've learned and used it within a larger personal and investment outlook.

I'm a questioning person anyway, so being able to find answers on the ‘Net was great for me. Gradually there was a progression, a kind of personal growth. I eventually began to boil down monetary issues to the market itself and ask whether human beings could handle things better than competitive forces. And the answer was always no, the Invisible Hand is best. The Mises Institute and Rockwell.com are a major ongoing help in understanding the world around us. Along with the Bell, I could live quite well in this world if they were the only sites my computer was limited to accessing.

Daily Bell: Yet it seems like we don't have much of an Invisible Hand these days.

Shawn Perger: There is no doubt from my point of view that the powers-that-be have been much more aggressive about the way they are operating in the 21st century than the 20th. There is not a single problem these days that can't be managed by some government agency, the more international the better. More misguided central planning leading us all to a more totalitarian world. You can see this especially with the G20, which some observers have compared to a kind of international traveling world-government. But you can also see the dissension within the ranks. As much as the monetary mafia would like to get all the horses moving in one direction, it's not easy.

Daily Bell: Do you think they will get there?

Shawn Perger: I don't know at this point. You can argue that power has been greatly centralized, but as the Bell likes to point out, the Internet has acted as decentralizing force and the perhaps the decision-making is not so simple after all. As more and more people find out what's really going on and what's really happened, other power nexuses enter the picture. People want a say and that complicates things. The economic downturn has actually helped circulate the different perspectives. That may not be true in China, but it's certainly a reality in the West. And the fundamental question I have is whether or not the stupefied majority can ever come to value liberty more than the false flag security they have so wiling sold their freedoms for.

Daily Bell: You're Canadian, aren't you?

Shawn Perger: First and foremost I am an individual. And yes I was born in Canada. Unfortunately, we Canadians tend to be socialist – especially here in British Columbia. But I'm happy to point out that Canada has escaped the worst of this terrible downturn. Being a free-market guy, I have to add that the less money that Canada throws at the economy, the better.

Daily Bell: You're not a fan of quantitative easing?

Shawn Perger: There won't be a result, or at least not a good one, from all this stimulation. The West is a dead patient at this point, one that's died on the operating table you could say. The money is like a defibrillator but you can't bring a dead man back to life. All you can do, maybe, is set his clothes on fire. And inflation is the fire, price inflation. We're headed straight into a hyper-inflationary hurricane, as you point out in your book High Alert, and the way the powers-that-be deal with the situation is to keep printing endless amounts of wealth destructing fiat money.

Daily Bell: So you think the era of dollar hegemony is almost over?

Shawn Perger: Yes, definitely. As long as Saudi Arabia was able to tell the world that it would only take American dollars for its oil, America could print as much as it wanted to. Other countries would have to buy American dollars if they wanted to purchase oil. And there was a spillover. The dollar psychologically became seen as an international currency. Countries used it for international purchases well beyond oil. But all that is changing now. China, Russia, all the BRIC countries are trying to get away from the dollar. The US has abused the dollar. It's printed too many of them and, as I stated above, the patient is dead.

Daily Bell: Why is that?

Shawn Perger: Good question. I'm likely to go with your answer on the subject, which is that the dollar is being purposefully taken down. I can see that happening if a certain money mafia wanted to introduce a global currency. The dollar was successful. You have to get rid of it before you can put something else in there. A couple of wars, a big economic downturn, excess spending, and all of a sudden you got the G20 trying to "find" an alternative. Coincidence? You tell me. It's way too much. Monetary stimulation will not serve to kick start the economy this time around, though it well may result in the creation of yet another asset bubble. The PTB have to know this, no one said they were stupid… just arrogantly confident they can get away with enslaving the world's populace to serve their power hungry appetites.

Daily Bell: A stock market rise?

Shawn Perger: We've seen that already, haven't we? Eventually this all hits bonds, especially US government bonds. The only asset class worth watching in this scenario is gold and silver.

Daily Bell: Why would the elite want to push gold and silver higher?

Shawn Perger: As I said above, they are not stupid. You have to figure that the money mafia has plenty of gold, especially. What's in the cards is probably some sort of global currency that has a gold-standard element to it. That's what makes sense on surface anyway, although it will likely continue to be government prescribed legal tender so it won't be a "real" gold standard in the free-market sense. No matter what, so long as the scenario plays out this way, it's still good for gold and silver. I used silver to illustrate Crisis Cycle Investing. Silver is a good example, currently, of a crisis cycle investment that can yield healthy dividends.

Daily Bell: Was that a formal recommendation?

Shawn Perger: We don't really make recommendations so much as bring ideas to people's attention. The Foremost perspective is pretty simple, though. We look at lots of factors including dominant social themes. We see which promotions are apt to be successful and which are not. Additionally, some elite promotions may by chance end up supporting certain free-market industrial initiatives, which could be seen as a real-life positive. Basically, this analysis is built around the increasing free-flow of information provided by the Internet. Investing in the 21st century is not really about finding a better mousetrap but on betting whether a given good or service is something that money power wants to plug. Then you have to decide whether the Internet will allow it – or expose it. We modelled our approach off of the VESTS model you outlined in High Alert.

Ultimately, the system has been set up to be destabilized, in order to enhance globalism. In a private banking environment, people are free to take their silver and gold elsewhere if they lack confidence in the institution. But when a central bank is set up, people eventually lose that choice, as the government mandates that its bank is the only bank with the power to issue paper money. Once bankers have money power, they control economies and how they operate. It's called money power and allows a small handful of people to basically run things from behind the scenes. It's a Wizard of Oz metaphor.

Daily Bell: Right. Ellen Brown and those in the Sovereign Money movement use that metaphor a lot. Where do you stand on sovereign money?

Shawn Perger: The idea that the state or federal government should print money instead of a third-party central bank? I don't see it matters a great deal who is doing the money printing when either option is entirely linked to socialist-driven demands that excuse the need for an inflationary monetary policy. You still end up with ever-increasing amounts of enslaving fiat money, unbacked by gold or silver. Once you have a single issuing monetary body you have an invitation to corruption. Deals will be cut and "select" people will receive loans for impractical projects. In reality the money will not be paid back. Inflation will rise no matter what anyone intends. There is no way for human beings to run a better market than the free-market itself is capable of doing. There is simply no way for human beings to successfully control money over the long-term without the inevitable piper of reality being paid. Only the Invisible Hand can determine the amount of money in an economy.

Daily Bell: We're far from that.

Shawn Perger: Yes, we've embarked on a big experiment. Never before has the entire world been on a fiat-money standard where money is unbacked by a commodity. It's not going to end well, either. The formal demonetization of gold and silver came in the West when President Richard Nixon finally took the dollar off the gold standard formally in 1971. Since then, nothing but the full faith and credit of the United States has kept the dollar afloat.

Of course, if you go back in time, you can make an argument that these crises didn't just happen. If I have anything to contribute to the conversation that you guys are having, it's that you can make connections going back a hundred years and come up with a plausible argument that these monetary evolutions are not entirely coincidental.

Daily Bell: How do you mean?

Shawn Perger: The biggest breakthrough I had in my book – which I shared with the Bell – was stumbling across a Wikipedia document that's been removed now. It gave the dates for the demonetization of silver and it really was quite shocking. In the US, they make a big fuss about how the New York banking axis used Washington DC to outlaw money as silver. The Crime of 1873, it's called. It was a huge deal in America, which had bimetallism up to that point.

But what was so fascinating to me – and eye-opening was that silver was demonetized around the world at approximately the same time. What are the chances of that? We went from a gold and silver standard around the world, to a gold standard, and then after World War II a central bank-gold standard and then in 1971, even that standard was severed. All these changes were worldwide. In the history books, the American demonetization of silver is treated as a huge political issue. But how do we explain it in the context of the demonetization around the world? Suddenly it looks like a lot of fuss about nothing. It was supposed to be a specific American crisis, but it turns out that it wasn't and that America was just a small part of the deal.

Daily Bell: We agree with you about the silver issue. It's quite startling when you look at things in context.

Shawn Perger: I'm not a big fan of conspiratorial historian David Icke's theory that the elite is actually a bunch of reptilian lizards. But he's got a point when he suggests that his travels have made him suspicious of the way changes happen around the world. If you travel in South America and Europe – and even China as well – over and over you find a lot more homogenization these days than you might expect. A law in one country is suddenly enacted in another. You see it with these electric cars. Or with global warming for that matter. Suddenly everybody is concerned about this problem or that one. And the solutions tend to be similar as well. What the silver demonetization history showed me was that this homogenizing has been going on far longer than we might expect.

Daily Bell: We're going to print the excerpt at the end of this interview. Let people see for themselves.

Shawn Perger: It's a fairly startling timeline. And there's a quote you should use as well.

Daily Bell: Yes, from US Secretary of the Treasury Carlisle.

Shawn Perger: It brings home quite clearly questions not just about monetary manipulation but how far back all of this stuff goes. It's actually creepy to contemplate. From this point of view, the history we've been taught is like ripples on the lake. You never see beneath, to what is actually causing the disturbance.

Daily Bell: But maybe the Internet has allowed us to look beneath?

Shawn Perger: It's allowed us to put together a lot of items that we weren't able to see in context. That's what I'm trying to offer with my book and with Foremost generally. A way to put modern life and modern investing in a larger perspective. It's not something that has been done before, or not generally. You've helped pioneer this point of view, but I think it's one that is going to become only more popular over time. People have to realize that the real conversation in the 21st century is between an increasingly educated populace and an Anglo-American money mafia that has been manipulating world events maybe for centuries. It affects every part of our lives and how we generate and maintain wealth.

Daily Bell: Obviously we agree with that sentiment. Anything else you want to mention? Where can we find your book?

Shawn Perger: The book has just been printed in a limited edition and is available on Amazon. You can access it by clicking here now. If it is currently not available, you can drop us an email at consulting@foremostresearch.com and we'll try and help you get a copy.

There's one other thing I'd like to mention. A new venture for Foremost, one that I cannot talk about yet, but certainly the biggest single entrepreneurial effort that I've ever been involved with may be materializing. I think it's going to be a pretty incredible venture and I'm very excited to announce it, but we can't quite yet. We are just completing our due diligence now and, if this appears to be as real as it promises, I think we may have stumbled onto a life-changing opportunity here.

Daily Bell: Sounds interesting. Let us know when we can mention it.

Shawn Perger: I certainly will as I fuly intend on maximizing my own exposure, professionally and financially to this venture if my research gives me a green light. Thanks for having me.

Daily Bell: Our pleasure. Readers can see the silver-demonetization timeline below.

COINCIDENCE OR PLAN – YOU DECIDE! (Excerpted from Crisis Cycle Investing by Shawn Perger)

History of Monetary Systems by Alexander Del Mar, 1895 Dates of Demonetization of Silver

France and the Latin Union – A conference between "the four states whose monetary system rests on a numeration by francs,": viz., France, Belgium, Switzerland and Italy, resulted in the Latin Monetary union of December 23rd, 1865. Accordingly, when the international delegates met again (June 17th, 1867), it discussed the entire monetary question, and carried a resolution in favor of what is called gold monometallism. This resolution was soon afterwards engrafted upon the legislation of the States which agreed to the Latin Union, in the shape of a New Mint Code. In 1873, France and the Latin Union limited the coinage of silver.

Great Britain – By the Act of 1816, the mints were closed to the private coinage of silver, and all silver coins, whether light of heavy, were limited in tender. In 1870, a New Mint Code was enacted.

Germany – On December 4th, 1871, an Act stopped the further Private Coinage of full legal- tender silver and ordered a new coinage of gold pieces of full legal-tender. The German Act of 1873 suspended the Private Coinage of silver. All new silver coins were limited in tender.

Portugal and Brazil – Portugal in 1854 copied the British System of 1816, suspended the Private Coinage of silver, limited the legal-tender of silver.

Scandinavia – On September 20th, 1872, a monetary union was adopted by Sweden, Norway and Denmark, which was followed by a New Mint Code. Under this code the private coinage of silver was suspended, and the legal-tender of silver coins limited.

Japan – In 1872 this state adopted a New Mint Code, forbade the Private Coinage of silver, limited the legal-tender of silver and adopted what is known as "the gold standard." In 1878 after "the gold standard" had duly departed from the country, the full legal-tender of silver coins was restored and Private Coinage again permitted. In 1894 the Private Coinage of silver was again suspended.

Holland – The laws of May 21st, 1873, limited the legal-tender of silver coins.

Italy – Under a renewal of the Latin Monetary Union dated January 31st, 1874, and the law of July 17th, 1875, the Crown limited the legal-tender of silver coins.

Spain – The law of August 20th, 1876, suspended the Private Coinage of silver, except as to metal produced by the mines of Spain.

Russia – The law of November 13-15, 1876, adopted gold coins as sole full legal-tenders, and reduced the legal-tender of silver coins.

Austro-Hungary – The decree of March, 1879, suspended the Private Coinage of silver, but did not limit the legal-tender of silver coins.

Turkey – In 1882 full legal-tender was limited to gold coins.

British India – An order Council, dated 23rd June, 1893, suspended the Private Coinage of silver.

Argentine Republic – The law of September 29th, 1875, authorized the Private Coinage of gold, admitted certain foreign gold coins to full legal-tendership, limited the legal-tender of silver coins and forbade the Private Coinage of silver.

Chile – Law of November 26th, 1892, stopped the Private Coinage of silver, limited the legal-tender of silver.

United States of America – The New Mint Code of February 12th, 1873, destroyed the Private Coinage of silver by indirection, in omitting the word "dollar" from the empowering clause relating to silver coins. December 1st, 1873, the Code Commissioners made an unauthorized and unwarranted alteration of the law by limiting the legal-tender of "all" silver coins, including the outstanding silver dollars, which had been full legal-tenders since the foundation of the Republic. Both these Acts (of 1873) were passed during a suspension of coin payments, and without eliciting public attention. This surreptitious legislation was not discovered, nor did it attract public attention until 1875-6.

Mr. Carlisle, since Secretary of the Treasury, said in the House of Representatives, February 21st, 1878, "The conspiracy which seems to have been formed here and in Europe to destroy by legislation and otherwise from three-sevenths to one-half of the metallic money of the world, is the most gigantic crime of this or any other age. The consummation of such a scheme would ultimately entail more misery upon the human race than all the wars, pestilences and famines that ever occurred in the history of the world." Mr. John Jay Knox, one of the officials who in 1869-70 lent his assistance to the preparation of the American Mint Code, when the matter was brought home to him acknowledged his part in it, and boasted that he was "proud of his work."

After Thoughts

Shawn Perger did us a favor by reproducing this silver demonetization timeline. It clearly shows how a wave of demonetization swept round the world in the late 1800s. But more than that, it shows once again the insufficiency of education when it comes to Western history. We tend to think that Shawn Perger is right. Education in the West as it is offered today provides a clear view of the ripples in the water without showing us what is moving beneath.

It is no clearer, for instance (as we have mentioned before) as to why the world went to war in 1914 then any other explanation. We have some of the same questions regarding World War II. It is fairly clear that Hitler did not want to fight Britain – he even let the entire army escape from Dunkirk. What were the real reasons behind these wars and who was really responsible for their advent? We have our suspicions.

We've written any times before, by now, about our astonishment over the questionable nature of much of the "accepted" historical narrative of the 20th century. And if this silver demonetization timeline is to be believed, we would probably have similar questions about the 19th century as well. In fact, in many ways we do. We have never been entirely clear about the causes of the Civil War. Why was it necessary for the South to secede so violently – and why didn't its leaders fight a guerilla-style war rather than play into the North's hands with vast set-piece battles?

History is written by the victors, yes. But we would add to that by suggesting that history is written by those who foment the wars and even, perhaps, choose the victors in advance. We would argue a new paradigm is needed, one that recognizes that history is not created by "great men" or even the "proletariat." History is, very simply, a purposefully obscured narrative of elite activities and the impact that they have on the larger society. In other words, history is "us versus them" – the leaders of society versus everyone else.

So much can be explained once one decides to use this particular perspective. It illustrates everything, from wars, to culture, to architecture and even religion. It turns out that most of human history – and doubtless prehistory – is a narrative of elite attempts to control the fractious masses beneath by any means necessary. One can even look at investments from this perspective, and Shawn Perger does us a favor by explaining how it can be done. We thank him for his interview. Here at the Bell we also await the wider distribution of his book and a more specific announcement of the venture that he mentioned at the end of his interview. It sounds mysterious … but interesting, perhaps.

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