Structuring financial institutions for catabollic collapse

In this environment debt will need to be used much more strategically than it is today, that is for productive purposes, and with far less leverage. This will require business and individuals to save significantly more than present to qualify for loans and it is highly unlikely that consumer and business credit will be as widely available as presently for day to day spending/operations.

The final consideration to be discussed here is the nature of our money. The great credit expansion of the last century saw virtually all nations abandon currencies backed by something tangible to be replaced by fiat currencies, money issued by the decree of governments. If our money is to end up being worth more than that contained in a game of Monopoly, we need to back our money by something tangible, whether that is gold, other precious metals, energy reserves, agricultural commodities or a combination of the above.

This will provide a firm basis for our monetary system and reduce the ability of governments to resort to ultimately counter productive policies such as printing money rather than acting in a financially responsible manner.

Of course there is virtually no chance that any of the suggestions I have made will be implemented in the immediate future. That is not the point however.

Sooner or later, one or more of the crises mentioned will trigger the first step on the downwards staircase of catabolic collapse at the global level. At some point a critical mass of people will come to realise that the conventional wisdom as portrayed by the media and our politicians is wildly off the mark. Unfortunately when we get to that point, it is likely to be under extreme duress.

That it is why it is important to be thinking about how we manage catabolic collapse now. There are other options to the manner in which our society and financial system currently function. Well thought out alternatives ready for implementation when crisis makes the seemingly impossible possible could very well make the process of catabolic collapse far less difficult than might otherwise be the case.