The Coming Currency Collapse

Issue #60, Volume #3

This Is Not An Opinion – This Is The Historical Record

Inside today’s Daily Journal…

• Essay: The Coming Currency Collapse

• A rare upward adjustment to EPS earnings

• Global debt explodes

• Trump authorizes support for LNG and electricity

• Chart Of The Day… MSCI

• Today’s Mailbag

Editor’s note: On Friday, Porter shared part 1 of a three-part Journal about William Strauss and Neil Howe’s generational theory, which proposes that history runs in 80-plus-year cycles, divided into four distinct phases or Turnings.

To be clear, Porter wrote, this is not a prophecy. This is pattern recognition. And the fourth period – the “Crisis” period – began in 2008. And since each turning lasts around 21 years, that means 2029 will see the final, climatic end of this generational crisis.

Porter begins part 2 today…

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The “Crisis” period began in September 2008…

Our money supply (M2) has grown from roughly $8 trillion in 2008 to $22.44 trillion – a 180% increase in the currency supply in 17 years

Federal debt has erupted to almost $40 trillion. Debt-to-GDP has crossed 120%, shattering the 1946 record that had stood for 80 years. Net interest on the national debt has passed $1 trillion annually – larger than the entire defense budget, and nearly triple what it was just five years ago.

This is not a cyclical downturn. This is the final storm. The only path forward is a complete financial reset.

If the financial signatures of the ordinary turnings are clear, the signature of the Fourth Turning – the Crisis – is emphatic to the point of brutality.

What always happens at the end of the Fourth Turning is the complete collapse of the sovereign’s existing debt and currency regime. And these changes go way back in Western Civilization – long before democrats and republicans and Democrats and Republicans.

The best, most illustrative example was the destruction of the Knights Templar.

In the 13th century, King Philip IV of France was the most powerful monarch of his age. But endless wars with Flanders and England gutted his treasury. He tried every expedient the medieval state allowed. See if this sounds familiar…

First, he debased the currency.

Between the 1290s and 1306 Philip IV systematically reduced the silver content of the French livre. When the economy began to seize up from the resulting inflation, the value of French sterling collapsed by more than 60%, forcing Philip to order the mass confiscation of private silver plate for re-minting.

Americans did the same when silver soared to $50 in 1980 and when it soared again to $100 this year.

Second, he expropriated his creditors one class at a time.

In 1291 King Philip arrested the Lombard merchant-bankers who had extended him vast loans against future taxes, seized their assets, and extracted 250,000 livres tournois by forcing them to purchase French nationality.

What do you think U.S. President Donald Trump is doing by starting a trade war with China? And have you seen Trump’s Gold Cards? You can buy U.S. citizenship for $5 million.

Third, on July 22, 1306 – the fast of Tisha B’Av – he arrested every Jew in France in a single coordinated dawn raid of roughly 100,000 people.

Philip IV expelled the Jews with only the clothes on their backs and 12 sous each, auctioned off their homes and belongings, and, crucially, transferred every debt owed to them onto the Crown’s books.

I know, you think that can’t happen in America. What do you think all of the demands for reparations are really about?

After running out of every other option, on September 14, 1307, Philip IV sent sealed orders to every bailiff in France, to be opened simultaneously a month later.

At dawn on Friday, October 13, 1307, roughly 15,000 Templar Knights across France, including Grand Master Jacques de Molay, were arrested in a single coordinated strike. Why? Gold of course. The king seized the knights’ treasury. And all the king’s debts to the Knights Templar vanished. On March 18, 1314, Jacques de Molay was burned alive on an island in the Seine in view of Notre-Dame, the pyre deliberately constructed of slow-burning green wood. This is why, even today, Friday the 13^th is a feared day.

Read the sequence again with modern eyes and the financial architecture of a Fourth Turning is unmistakable:

unsustainable sovereign debt → currency debasement → expropriation of foreign creditors → expropriation of domestic creditors → dynastic and geopolitical collapse.

Philip IV ran the complete Fourth Turning financial playbook in less than 25 years, in the 13th century, and every element of it – every single one – has been repeated in every sovereign debt crisis since.

This is not medieval. It isn’t a renaissance pattern. It’s not a modern pattern. This is a human pattern and human nature does not change.

The saeculum that Strauss and Howe mapped is simply the local expression, in one civilization, of an arithmetic that governs every state powerful enough to borrow and too proud to pay.

When the debts become impossible to repay, the sovereign always – always – turns on his creditors.

The only questions are who the creditors are, what name is given to the confiscation, and what comes next.

• The Revolutionary Fourth Turning (1773–1794) The Continental Congress, lacking the power to tax, paid for the Revolution by printing $241 million in Continental currency. By 1780 the bills were worth one-40th of their face value. By May 1781 they “ceased to circulate as money” altogether. The Crisis was resolved only by the constitutional convention of 1787 and Alexander Hamilton’s sound-money restoration. A new monetary order had to be built from ash.

• The Civil War Fourth Turning (1860–1865) In December 1861 President Abraham Lincoln suspended specie convertibility. In February 1862 Congress passed the Legal Tender Act, authorizing $150 million in “greenbacks.” Union inflation hit 25% in 1863 and 1864. In the Confederacy, the money supply rose 20-fold and an item that cost $1 in 1861 cost $92 in 1865. Federal debt grew from $65 million to $2 billion in five years. The Crisis was resolved only by a new monetary order – the National Banking Acts – that rebuilt the dollar around federal supremacy.

• The Great Depression Fourth Turning (1929–1946) From 1929 to 1933, debt-to-GNP exploded from 16.4% to 42.3%. On April 5, 1933, President Franklin Roosevelt signed Executive Order 6102, making private ownership of monetary gold a crime. On June 5, 1933, Congress abrogated the gold clause in every private and public contract in America. In 1934 the price of gold was revalued from $20.67 to $35 an ounce — an overnight 69% devaluation of the dollar by government fiat. A new monetary order was imposed on the world.

The pattern is unmistakable: every Fourth Turning climax in Anglo-American history has been a mass confiscation of purchasing power, engineered by the state, to liquidate debts that could not otherwise be paid.

This is not an opinion… This is the historical record.

The names change – Continentals, greenbacks, gold clauses – but the mechanism is identical: when the arithmetic of the old regime becomes impossible, the currency is sacrificed to save the state.

Which brings us to 2029.

Tell me what you think: porterstansberrydirect@gmail.com

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On Thursday, in part 3 of the Journal, Porter will complete his discussion of the Fourth Turning, when he explains why the current trajectory of American fiscal policy cannot go on forever. As a result, he says, it will stop.

Good investing,

Porter Stansberry
Stevenson, Maryland

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3 Things To Know Before We Go…

1. Analysts shrug off war concerns and raise earnings estimates. Historically, Wall Street analysts revise earnings estimates down going into each reporting period, providing a low bar for corporate America to step over. This year, however, analysts have bucked this trend and raised 2026 earnings estimates 5% over the preceding 12 months. The rising estimates are mostly concentrated among chipmakers, which benefit from the AI infrastructure buildout. At least so far, the global energy crunch caused by the war in Iran has not impacted this year’s strong outlook for S&P 500 earnings.

2. The last time the world carried this much debt, it had just finished fighting Hitler. Global government debt is projected to hit 102% of GDP by 2031, a level the world hasn’t seen since World War II. U.S. federal debt is tracking to 142% of GDP by 2031, and China’s debt is climbing toward 127%. All this means that global interest payments are projected to rise from 3% of GDP today to 5% by 2031… this is money that cannot build infrastructure, cannot fund innovation, cannot drive growth. The global economy is no longer being grown – it’s being borrowed. Own real assets: gold, energy, productive land, businesses that can raise prices. Do not own long-dated sovereign debt.

3. Trump invokes the Defense Production Act to fund coal, LNG, and the electric grid. On Monday, the president authorized the U.S. Energy Department to channel funds toward coal-fired power plants, liquefied natural gas (“LNG”) infrastructure, refineries, and grid equipment such as transformers and turbines. The framing is national defense, but the motivation is obvious. Voter angst over the rising cost of gasoline and electricity – inflamed by the Iran war and AI power demand – threatens Republican control of Congress in November’s mid-term elections.

Chart Of The Day… Index Leader MSCI

Index and analytics giant MSCI (MSCI) reported Q1 2026 this morning: revenue and EPS both rose around 14%, with a 59.3% adjusted EBITDA margin – the kind of printing-money profitability that defines a true compounder – and recurring subscription retention at 95.4%. This is exactly why MSCI is a Complete Investor recommendation: the toll booth is always open, and every time money moves in global markets, MSCI clips a coupon.

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Mailbag

On Friday last week, Porter shared the first Daily Journal on “The Fourth Turning.” Readers share their thoughts…

“The Fourth Turning”

Joe P. writes:

Porter: I have been reading the book. It is indeed a very scary future. Most people are sleepwalking right into the chaos. Unfortunately, the signs are everywhere. The government and media are huge propaganda machines. It will end badly. I have read several of your books, which point out the same thing. Thanks for giving us guidance in these trying times.

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“Feedback On The Fourth Turning”

Michael Y. writes:

Your assessment is completely correct. I have been working for 30 years, gradually putting together roughly the same assessment of the Fourth Turning. Mine is based on being a scientist with curiosity about history, politics, economics, and generational dynamics.

I look forward to reading your next article.

I believe so strongly in my own findings and related authors (Howe) that I have spent a lifetime preparing for and investing my savings in ways to prepare for the coming social, political, and economic storm.

Now, with it fast approaching, friends and family are only now coming to understand what I have been saying for years. Being vindicated is bittersweet. However, the storm approaching is so vast, I honestly wish I had been wrong.

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In last week’s Daily Journal, Porter emphasized the financial and crime-ridden disaster that is New York, explaining that he plans to move to Winter Park, Florida.

“It Wasn’t Exceptionalism, It Was Capitalism – And It’s Over”

Rob C. writes:

Great post. A friend of mine shared it with me and I’ve since shared it with many other people.

I’m a 66-year-old recently retired father of three and the son of a career naval officer. Lived mostly on the East Coast, including Virginia Beach, Newport, Rhode Island, and then Jacksonville. I ended up as a University of Florida graduate and have resided in Florida for most of my adult life.

I have three early-20s college graduates and luckily, I’ve convinced all of them to stay away from New York City. They’re all gamefully employed in the southeast.

My note is mostly to share my thoughts on relocating to Florida. I’m familiar with most of the state and have lived in three of the four major cities, including in Winter Park. Like most states today it boils down to being in the right zip code no matter where you are.

When it comes to Florida, there are basically about eight to 10 towns that I think are the best. For what it’s worth here they are. Basically these are organized in zone:

• Jupiter, Tequesta, Hobe Sound

• Ponte Vedra or Atlantic Beach

• Winter Park or Windermere

• South Tampa

• Naples

For what it’s worth, I actually lived in Winter Park right out of college and have been there throughout my younger years as my grandparents lived a block off of Park Avenue behind St. Margaret Mary Catholic Church. It’s a beautiful spot, especially the Park Avenue and Rollins College area.

There are other nice small towns throughout the state but the key for me is an airport nearby.

Thanks again for your writings, and best of luck to you and your relocation.

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