One of the most important concepts that fundamentally shaped my worldview regarding investing, monetary systems, and ultimately precious metals is something known as the Cantillon Effect.
Ironically, despite holding both undergraduate and graduate degrees in economics, I was never taught about Richard Cantillon or the Cantillon Effect during my formal education. Most of the curriculum centered around Keynesian economics, monetary intervention, and macroeconomic stabilization theory.
I did not encounter the Cantillon Effect until after the Great Financial Crisis of 2008, when central banks around the world began aggressively expanding the money supply through unprecedented monetary stimulus programs.
That period ultimately pushed me toward studying Austrian economics independently, where I first encountered the writings of Richard Cantillon, Ludwig von Mises, Friedrich Hayek, and others.
The deeper I studied these ideas, the more I began to understand inflation not merely as “higher prices,” but as a structural transfer of wealth.
The Cantillon Effect describes the reality that newly created money does not enter the economy evenly.
When central banks create new money, not everyone receives it simultaneously.
Instead, the money enters through specific channels first:
Those closest to the source of monetary creation receive and deploy the money before prices throughout the broader economy fully adjust.
This creates winners and losers.
The early recipients of new money are able to purchase:
at what are effectively yesterday’s prices.
By the time the broader public experiences the effects of monetary expansion, prices across many asset classes have already risen substantially.
Wages and salaries typically adjust last.
One of the reasons I became increasingly interested in precious metals is because I gradually came to view inflation as a form of hidden wealth transfer.
A large portion of modern financial commentary treats inflation as though it were simply an unfortunate but natural phenomenon.
But when viewed through the lens of the Cantillon Effect, inflation becomes something far more structural.
Those closest to newly created money benefit disproportionately:
Meanwhile:
bear the cost later through rising prices and declining purchasing power.
This realization fundamentally changed how I thought about money, investing, and long-term wealth preservation.
Over time, I also began to believe that the asymmetry extends beyond money itself.
In my view, those closest to capital and institutional flows often gain access to information first as well.
That belief heavily shaped how I approach market analysis.
I do believe markets can be manipulated in shorter timeframes:
can all create enormous noise.
Because of this, I became increasingly focused on longer-duration technical structures.
I place far greater importance on:
than on short-term market fluctuations.
The larger timeframes tend to filter out much of the noise and reveal the broader structural movements taking place underneath the surface.
My broader thesis surrounding gold and silver is rooted in the belief that we remain within the later stages of a long-term secular bull market that began around the turn of the millennium.
In many respects, I view the period around 1999–2001 as a historic inflection point for precious metals.
That era included:
From a long-term perspective, I believe that marked the beginning of a structural shift.
Historically, secular bull markets often experience their most dramatic price appreciation during their later stages, when broader public participation finally begins accelerating.
The final phase is frequently characterized by:
In my view, precious metals have not yet experienced the kind of widespread public participation associated with true secular blow-off peaks.
While my initial interest began with macroeconomics and monetary systems, over time I became increasingly drawn toward Mexican Libertads specifically.
The Libertad series represented something unique:
As I researched the series further, I realized much of the available information surrounding:
was fragmented or poorly documented.
That realization ultimately led to the creation of this archive.
The Cantillon Effect was one of the foundational ideas that changed how I viewed:
It fundamentally altered my understanding of how monetary systems distribute benefits and costs across society.
Whether one agrees with Austrian economics or not, the asymmetry surrounding monetary creation is difficult to ignore once observed closely over long periods of time.
For me personally, that realization became one of the driving forces behind investing in:
This article serves as the beginning of a broader series exploring: