This is about how inflation works in the real world. Inflation doesn't affect every asset class equally or simultaneously, it affects different asset types in phases at different times.

Most people think of inflation as a general rise in prices across the economy. Everything goes up together, roughly at the same time. That's not how it works. And a French economic crisis from 1720 explains exactly why.

The 300-Year-Old Idea That Explains Everything

Richard Cantillon was an Irish-French economist writing in the early 1700s. He developed what we now call the Cantillon Effect, and he didn't arrive at this theory in a classroom. He arrived at it by watching a financial disaster unfold up close.

Cantillon worked as a banker and agent for John Law, the man behind one of history's most spectacular monetary collapses. Law convinced the French government to let his state-backed bank issue vast amounts of unbacked paper currency. That currency was used to fuel speculation in the Mississippi Company, with cheap loans handed out so people could buy shares on credit. Share prices ran from 500 to over 10,000 units of French currency. Then the whole thing collapsed. By 1720, the shares were worthless, the company was bankrupt, and John Law fled France. Inflation had hit a monthly rate of 23% in January of that year. Read that again slowly. 23% in a single month.

What Cantillon took from this experience became his central thesis: money is not neutral. When you expand the money supply, prices don't rise uniformly across every asset at exactly the same time. The new money flows somewhere first, inflating those assets, before eventually moving on. It alters relative prices. It shifts wealth. And it creates an enormous opportunity for those who can see the rotation coming.

What Most Economists Get Wrong About Inflation

I studied finance and economics at Melbourne University. In third-year economics, they tried to teach me Modern Monetary Theory. This was nearly a decade ago, and the argument went something like this: we've had QE1, QE2, QE3, QE4 since the GFC. We've printed extraordinary amounts of currency since 2008. And yet government inflation data stayed around 2%. Therefore, printing currency does not cause inflation.

That's what they taught me. And it was wrong.

Here's why. There was inflation after 2008. Significant inflation. But it didn't show up in consumer prices or commodities, because that's not where the newly printed money went. The money flowed into financial assets. It flowed into real estate. It flowed into shares. It went to the places where wealthy people park capital. So asset prices inflated enormously, while the CPI stayed relatively calm, and the mainstream economics profession declared victory.

The inflation was always there. It just wasn't where most people were looking.

The Asset Rotation into Precious Metals is Happening Right Now

If you step back and look at history in phases, the pattern becomes obvious.

From 1990 to 2000, it was the decade of stocks. The tech bubble peaked in 2000 and it was a terrible time to be buying equities, but a great time to be selling ones you'd held for a decade. Then came the 2000s, where nobody wanted shares after the dot-com crash and everyone piled into property instead. That worked until 2008, when the GFC hit and property crashed hard in the US. So money rotated back into shares, and particularly into tech. That rotation lasted nearly 20 years.

Fast forward to 2026. Tech has had an almost two-decade run. And I'm seeing the same bubbly behaviour at the top that history keeps showing us. In South Korea right now, people are taking out bank loans to get leveraged exposure to semiconductor stocks. That is not behaviour you see at market bottoms. That is behaviour you see at the top.

Meanwhile, commodities are doing something remarkable. Silver just broke out of a 45-year cup and handle pattern at the key $50 US resistance level. Gold broke through $2,000, a level it was capped at for years, and is now approaching $5,000. Platinum is out of a 13-year downtrend. Oil, uranium, soft commodities - all starting to move.

This is the Cantillon cycle in real time. Financial assets are overvalued. Commodities are still relatively cheap. And the money is rotating, right now, as you read this.

How I'm Positioning My Own Money

I started Liberty Bullion because I could see this rotation coming. And what I'm doing with my own money is buying gold, silver, and platinum.

The way I see it, when this plays out fully, there are going to be three groups of people. The wealthy, who positioned early and get wealthier. Everyone else, who gets crushed by the inflation they didn't see coming. And a third group - those who recognised the pattern, acted accordingly, and protected their wealth and their family's future from a system that was never designed with them in mind.

That third group is where I'm trying to be. And it's what I built Liberty Bullion to help other Australians do for themselves.

This is not financial advice. This is what I'm doing with my own money, and why.

What a time to be alive. Sam from Liberty Bullion