268 THE BiG DROP
the junk bond market. It could be a lot of things, but my point
is, it doesn’t matter. It will be something.
What matters today is that the system is so unstable. The
blunders have already been made. The risk is already there,
embedded in the system. We’re just waiting for that catalyst
to trigger the collapse. It will happen sooner rather than later.
This is not necessarily something that’s going to happen to-
morrow — although it could — but it’s not a ten-year forecast
either, because we’re not going make it that far.
The dynamics — what are called the scaling metrics or the
size of the system — are an exponential function. What that
means is that when you triple the size of the system, you don’t
triple the risk. You increase risk by ten or a hundred times.
That’s what we’ve done today.
So, I would say two things. First, the crisis could happen
very suddenly and likely you won’t see it coming. Investors
always say to me, “Jim, call me up at 3:30 the day before it
happens and I’ll sell my stocks and buy some gold.”
But it doesn’t work that way for the reasons I just ex-
plained. And even if it did, you might not be able to get the
gold. That’s very important to understand.
When a buying panic breaks out and the price of gold
starts gapping up not by $10 or $20 per ounce per day but by
$100 and then $200 per ounce and then, all of sudden, it’s up
$1,000 per ounce, people say “I have to get some gold.” At that
point, you won’t be able to get it.
The big players will get it — the sovereign wealth funds,
the central banks, the billionaires and the multibillion-dollar
hedge funds — they’ll be able to get it. But everyday investors
won’t be able to get it.
You’ll find that the mint stops shipping it and your local
dealer has run out of supply. You’ll be able to watch the price
on television, but you won’t actually be able to get the gold.
It’ll be too late. That’s why the time for action is now.