With stocks at all time highs, what are the chances of another significant market crash? originally appeared on Quora - the place to gain and share knowledge, empowering people to learn from others and better understand the world.
Wildfire itself is the most effective treatment for reducing larger wildfires.
- Jan Van Wagtendonk, biologist, Yellowstone Field Station.
The sequoiadendron giganteum is the largest tree in the world.
Better known as a 'giant sequoia' these redwood trees can grow over 300 feet tall and can live for thousands of years. In fact, the oldest living sequoia sprouted in about 1,500 B.C.
One of the most amazing things about sequoias is how they start their life.
Just like any other tree, a seed must take hold in the earth. However, for the sequoia, seeds are released from a cone usually during exposures to fire.
Yes, you read that correctly. Fire helps these trees grow.
If you think about it, this actually makes sense. A wildfire will burn away all of the competition, which will then give the sequoia seed a better chance at success when it starts to grow. Additionally, the fire will clear out dead debris and provide new nutrients for the soil.
Now, that's what's supposed to happen in a natural setting...
Wildfires naturally occur from lightning strikes and they'll usually burn as a 'ground fire' or 'surface fire.' That means that they burn relatively slowly with small flame lengths.
These types of fires are fueled by dead branches, pine needles, and other natural materials that cover the floor of a forest.
For giant sequoia trees, these fires are slow moving and don't harm them at all.
But... there's a problem...
We humans think we're smarter than nature and for the last one hundred years we've actually been preventing these smaller fires.
This has been particularly true in the US, where wildfires have been quickly extinguished to protect homes due to urban sprawl and to 'preserve' natural habitats.
This results in a large buildup of natural material on the forest floor, which creates a disproportionate amount of fuel waiting to be consumed.
You see, when you have a large amount of fuel on the ground, those 'ground fires' begin to produce huge flame lengths. Eventually, these flames reach the tops of trees.
This is called 'crowning' and that leads to an 'aerial fire' or 'canopy fire.'
Essentially, instead of just the ground burning, you now have the entire forest burning top to bottom.
Once the entire forest begins to burn top to bottom, the heat being produced overwhelms everything. Even those sequoia trees that don't mind the ground fire can't stand up to a full on wall of destruction.
At this point, the situation is completely out of control.
The resulting damage from these types of fires are devastating. Not only are thousand year old trees burned, but an entire ecosystem can be flipped upside down.
And that's not including the millions of tax-payer dollars used to fight these fires, the destruction of peoples' homes, and the loss of life from those who can't get out of the way.
This scenario is EXACTLY what is happening in our financial system.
Governments have imposed all kinds of policies to stimulate our economies.
For the short term, we may see times of prosperity and success, but we are just kicking the can down the road towards an enormous day of reckoning.
We are in the second longest bull market in modern financial history. Artificially suppressed interest rates, wealth creation through quantitative easing (QE), and a whole list of other 'unnatural' economic policies are just like preventing those small wildfires... eventually everything will backfire and get BURNED.
That's why I think it is so important to take a hold of your wealth and finances for yourself. Do not trust that everything will be just dandy. Start to find out what is actually going on.
Although we are approaching a scary time in our financial system, we are also living in an incredible time period with more opportunity than you can shake a stick at.
If you can properly identify where to be with your money (and just as importantly, where NOT to be), then you will be very successful over the long term.
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