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The following podcast is sponsored by Financial Sense Wealth Management. To learn more about our
investment services, go to FinancialSenseWealth.com or give us a call at 888-486-3939.
This is the Financial Sense News Hour. Now, here's the Financial Sense News team.
Well, you've heard the pronouncements by 2030. We are going to be reducing carbon emissions in
by 2050 completely. Will this work? Well, that's the discussion of today's program. Joining me on
the program is Robert Bryce. He's an author and journalist and a public speaker. Also on the program
is Simon Michaux. He's an associate professor at Geological Survey of Finland. He also has a
PhD in mining.
Gentlemen, the last time we had the two of you together, we talked about almost the
near impossibility of getting to 2030 and 2050 with these pronouncements. And mainly, we were
talking about wind and solar, which are intermittent, replacing reliable sources of electricity like
coal, natural gas, and nuclear, hydroelectric. But there's a new element here that I want to
begin our discussion today because this makes it nearly impossible. And that's the advent of AI
in the cloud. I've read studies by 2028. AI alone will take up 25% of the electrical grid. The cloud
will take up 10% and maybe EV is 4%. So let's begin with that because this is a major element
because these AI centers operate 24 hours a day, seven days a week. They don't shut down.
Well, I've recently written about this, in fact, on my Substack, Robert Bryce.substack.com,
in which I pointed out that the headline was the EPA's new greenhouse gas rules will kill AI in the
crib. So at the same time, we're seeing this massive expected increase in power demand from data
centers and artificial intelligence. The EPA, in May, issued a new rule that will hamstring the
electric grid and force the closure of all of the coal plants in America. That's 16% of all the
generation in the country. By the way, the coal fire generation in the US is falling. But last
year, not in the ancient history, last year, coal fired power plants produced more electricity in the
United States than wind and solar combined. At the same time, this EPA rule, while shutting down coal, will effectively prevent the construction of new baseload gas plants. So yes, on the one hand,
we're seeing this expected increase from electrification, electrify everything, data centers,
EVs, blah, blah, blah, blah. And while the EPA is doing all it can to hamstring the power grid,
something has to give here. And there's a lot of litigation that's already been filed over this.
But I think it's important to keep the context here, Jim. It's not just about AI,
it's about the same, about policymakers hamstringing the grid at the very time we're
expecting this big increase in demand.
Simon, I want to go to you for a minute because there's a new book out there. It's called The War Below, Lithium Copper and the Global Battle to Power Our Lives by Ernest Schneider. And he basically talks about any time, at least in the United States, you want to get a permit to open up a new mine. The Biden administration has nullified about six or seven key permits around the country that you're going to, you know, the banana greens, you're going to have, you know, they're going to be looking at, oh, there's a plant that's endangered or rodent or something like that. But when we talk about electricity, we're talking about copper. And let's move into that because copper grades are falling in the world's largest copper producer, Chile. And they don't understand the vast amount of minerals that will be necessary to get the copper to do this.
So no, no, they don't understand. Incidentally, I'd be interested in new chaps answering a question.
This issue that we keep talking about this network of issues. Is it a mistake? Is it stupidity?
Or did they really mean it? Because I'm starting to suspect the latter.
Right. So the question for AI, going back to AI, is I keep hearing AI, how it's going to save us
and everything like that. But it doesn't magic up more resources. It's not creating anything
physical. It can actually work at how we can use those resources better, but it's not creating
anything new. And what we're facing is so massive that an efficiency step change won't change anything. So is this a smart move? Probably not.
So back to your question. Yes, grades are indeed decreasing. Before the electrical revolution, so to speak, was even proposed, I was collecting information 10 years ago, was showing that the mining industry was grading into a new business model. Grade was decreasing, but you also had a number of other problems. So great. Let's say you've got a ton of rock. How much of that rock is metal? And the grade is like, say 3% copper, which is now very high grade. Is it, you know, is it, or how many grams a ton of gold? Is it 0.5 a gram, 0.1 gram? When I started my career 25 years ago, the cutoff grade for copper was about two or three percent. And the cutoff grade for gold was around one, one gram a ton. Right now we're at 0.1 gram a ton for gold, grading in to say 0.05. And when I've been part of feasibility studies, it's looking at like 0.1% of copper as the floor going lower. And we've seen that
in 25 years. So what I found was I called it originally six capiates that will change our design culture. So grade is decreasing. Why is that we're mining up all the good stuff? And now we're left with all the difficult to work, high grade, low grade, difficult work deposits and challenging post codes. Also what we call the grind size is decreasing the minerals in the rock. We've got to take the rock and crush and grind it down to the point where the minerals that we actually want are what's called liberated. They're completely accessible now. And so when we use something like froth flotation, we can pluck those minerals out. It's no good if the mineral to partially embedded with with rock around it. The actual grain of mineral or metal that we're after has been decreasing. Now the problem with this is the more the finer you go, the exponentially more energy you need to get there. Now the closing size for a
commutation plant say 30 years ago was around 150 microns most of the time. That is you have to take
all the oil and grind it down to a most of it passing 150 microns, say like 80 90%.
How much energy did you take to do that? Now we're talking about closing sizes of 20 micron
and gold grains that are like five micron and three micron. So it's getting finer. So not
only do we have to shift more ore, more dirt, but we're now having to actually grind finer.
The rock is getting harder. In terms of impact breakage, we're now moving into lower grade rock
which happens to be very disseminated and much harder to actually crushing grind.
And when we actually have to go finer, we're using more potable water. So water consumption is going
up as well as energy. And these things compound on top of each other. So it's getting harder and
harder to mine. It's not easy.
Well, is it fair to say if I can jump in? So Simon, is it fair to because I published this piece recently on Vatslav Smil on the title is Smil calls bullshit on net zero and he brings up the issue of copper as you're talking about now. And that the average grade in Chile has now it's 0.65% copper per ton, right? Is the or I guess it doesn't matter per ton, but the copper grade is continuing to go down. The thing that I've been trying to figure out and you know, there are people say, Oh, well, you know, we have enough copper and it's not that big of a deal. And you know, me show is wrong and Harrington is wrong and Smil is wrong and they don't understand. And there's a new University of Michigan study that just came out in fact as well about this very same issue. But the question since this is financial sense and Jim, I know it's your podcast, but will the will the miners make more money at higher copper prices? This is the part that seems to me to be the question about the commodity copper prices are going up.
And they've had a big bounce just recently. But what does it mean for the copper miners themselves
that more intensity of all these things you're talking about? But are any of them going to make
more money if the price goes up? Or are they going to be just the same profitability as they've been
in the past?
Some of the mining companies, as you know, it takes anywhere from 10 to 15 years
to put a mine from discovery into production. And so you have the IEA, you have all these
government agencies saying that, you know, we're going to read to basically peak demand. So if you're
miner, and you're going to spend billions of dollars to put a mine in production, it's going
to take maybe 10, 15 years to get it in. And by the time you do it, they're telling you that
we will have reached peak demand. Why are you going to make that investment? So what we're saying, and you see it in the oil industry, Conoco Phillips just bought out Marathon, Exxon, bought
Pioneer Resources, Chevron bought Hess. You saw BHP, the world's largest miner, make a play for
Anglo-American. It's cheaper for them and more cost efficient to just go buy another miner, which
certainly doesn't add to the production to reach these goals. But it's a safer play because there's
so many uncertainties in terms of regulation, environmental impact. And that's what we're
saying with the miners. They can make money if they do it this way. It's uncertain whether they go
out and make a discovery and then try to bring that mine in production.
To add to that, the cost per ton of copper being produced, costs have gone through the roof. Yes, the sale price has gone up at so of the costs. The logistics to get that ton have also gone through the roof. More has to be done. So what we call CAPEX, or the capital expenditure to start a mine, is now much, much, much higher than what it was 30, 40 years ago. So to start a mine, you've got to spend something like four billion US. I don't know what it is, and that figures out now a couple of years old.
I don't know what it is now. But you have to have put a substantial amount of cash on the ground.
It takes a long time to build the mine. Then you've got to take a long time to actually
produce, to actually pay that CAPEX loan off back. Then you start getting profit.
So you go to an investor and you say, give me your money, and in 10, 12 years maybe you'll get some
of it back. Or they can go to the stock market, put it in the stock market and get the same answer
in six weeks.
We're seeing it in the industry. Like I said, it's interesting that the Barons just did an article and they broke up Standard Oil. I think it was 1911. And if you look what's happened since then, they're putting together Standard Oil back together again because the big companies keep getting bigger by buying the other companies, the former Standard Oil satellites. I want to read something from Vaughan Club's article, Robert, that you cited. And he talks about, it would take 600 million tons of metal at a 0.6 grade of copper, which would require the removal processing and disposition of nearly 100 billion tons of waste rock, which is about twice as much as the current annual total of global material extracted, including harvested biomass, all fossil fuels, ores, industrial minerals, and the bulk construction of materials. And we've got basically four countries that produce copper, chili, Peru, China, and Congo.
But here's something that's even more interesting. We know about OPEC, but China controls 60 percent of lithium, 65 percent of cobalt, 90 percent of rare earths. So their grip on key strategic
materials is two to three times that of OPEC. So how does this work when we're in an economic war?
Well, I think that's a key point. And it's one of that I keep asking, Jim, and I'm not a Republican,
I'm not a Democrat, I'm disgusted. But I've never seen a more ideological administration
than this Biden crowd. And I don't understand why they are so hell bent on making our auto industry
dependent on Chinese supply chains. And the International Energy Agency just released a
report just in May, and I wrote about it again on my substack, robertgrice.substack.com. Again,
repeating the key points, if we take copper away, we take lithium away and just focus on neodymium
iron boron magnets, China controls effectively the entire global market. And so, you know,
this fact that you start, we started Jim talking with these tariffs on EVs and other supply chains
for the auto sector. Why in the name of Jesus, Mary and Joseph? Are they so eager to make our
auto sector dependent on Chinese supply chains? I don't understand it. I'm not bashing China.
China's going to take care of China, but this makes no sense from a strategy standpoint,
from a geopolitical standpoint. But yet, this is what they're doing.
And Simon, let's talk about it. It's one of the key things that's coming out. I mean, we've been
focusing, everybody's talking about EVs, windmills, and solar panels. But now you add technology
coming into play. And one of the reasons I have such a concern, my own state of California,
the land of fruits and nuts, we just shut down one nuclear power plant and we're getting excess
power to my own city of San Diego. We're getting it from Arizona. But here's the key thing. Taiwan
Semiconductor is building three fab plants that are going online in the next couple of years.
Intel is building a fab plant there. Apple is building a factory. And I read in the battle
below that Taiwan Semiconductor sucks up 20% of all electricity on the island of Taiwan.
So what happens to California when Taiwan, Intel, and Apple go online? We're not going to have power.
A lot of these things are just not thought through. There is an element of everyone assumes
we're still operating like it's 1950. And certain basic things just have not been thought through.
Stove is hot. Don't touch it. So we touch the stove. That seems to be our plan.
Well, I'll jump in here for a minute, Jim. You're right. We're seeing, I was, I'm going to Oregon
next week and I was just looking at the Pacific Northwest utility committee and they're projecting
30% increase in power demand in the Pacific Northwest in the next 10 years. How are they
going to build it? You know, in this idea, oh, we'll build it with wind and solar. That's easy
to say, but very hard to do given the land use conflicts that are happening all across the country
and I've cataloged those in a renewable rejection database. But if you don't mind, I'd like to just
pursue Simon a little bit on this because the Goldman Sachs is expecting that there's a copper
deficit of 500,000 tons in 2024. Prices will go to $10,000 per ton this year and higher in 2025.
So again, there are bullish calls on demand, bullish calls on price, but is it investable?
And, you know, this is financial sense. Does it, I mean, would you buy a copper mining company now?
I'm asking this both out of just kind of, you know, my curiosity, but also as someone who's,
you know, hopes to retire someday. Will the copper mining companies make more money at higher
prices or is this, are they chasing their tail because of higher prices or higher cost rather?
The caveat is, could I have that copper mine without any associated debt?
No. Right? Yeah. Because when you have that copper mine, there's a long tail of obligations that
come with it. And that's the problem. So people in the financial world, for example, want a quick
return. They want to return in the next financial quarter, a year at the most. The idea you've got
to wait 30, 40 years before you get your big payday is not something the current, the current
industry is acceptable. You might, you also might remember that mining has gone through
several eras or about to grade into another era. So there was a time, for example, when you just,
it was a couple of guys down at the creek with panning and a few shovels and they could get
enough to earn a living. Then it got to the point where you had to actually put infrastructure on
the ground. You had to dig in the ground and you had to put posting in and you had to actually
start having infrastructure that costs money. Then you need to be backed by a million,
like someone with money, like a rich personal or a rich group of people would have to then finance
a mine. That was another era. Then mines got so big, we needed a corporation to do it.
Mining companies had to actually form up and they had to put industrial assets on the ground.
And now we're starting to talk millions, tens of millions, hundreds of millions.
But that era has passed. Now, in the 70s, there was a time when the mining companies owned and
controlled their mines. But because mines have gotten so large, they now have to actually sort of
get it financed by the banking sector. So when you start a mine, the mining operation goes out
and gets shareholders and they put up about 30% of the capex necessary to get going. The rest
comes from a hedge fund. The banking hedge fund of the end of town has taken control of mining.
Now, what that has meant, and there are other signatures of an era that we're in as well,
but what that has meant was the hard-nosed nature of the finance sector. They don't care how you
do it. You will increase the bottom line. We want our money back. How you do it is not our problem.
So what ends up happening is a very short-term viewpoint has come in. Back in the 70s and the
80s, the mining industry thought about, we've got a natural asset on the ground that we will
develop. So we will invest money now as do things that we will start to see the benefits of in 20,
30 years time. All of that stopped. Now, we've got a situation where every action we do has got to
change the bottom line for the better in the next financial quarter or the next six months,
or we don't do it. Right. And so that short-term thinking has permeated the entire mining industry
right through my career. It is now short-term thinking across the board. And that, I think,
has leaked into the investment sector. They want a turnaround time quick. It's not about resource
stewardship. It's not about legacy investment for your family. I'll invest now so my grandkids will
be rich. We don't think in those terms anymore. And so, but mining is now getting increasingly
harder and harder to do in a quick turnaround time, which is why mining is not sexy and it's very hard
to raise capital. The boys and girls at BHP one night, we were having a drink and they made
the mistake of telling me a few things. There is a ratio. The ratio is between NPV divided by
CAPEX. NPV net present value is the size of the prize, how much value they can get out of that.
Problem is the NPV window is only eight years long. Anything longer than eight years is not
included in that calculation. So if it takes longer than eight years to actually build the site
and then pay off CAPEX, all of a sudden NPV is not a very useful tool, but they still use it.
Divided by CAPEX, the capital expenditure needed to put the mine on the ground. The large of that
number is the risk. How much trouble do they have to go through to actually get the capital together?
So if the size of the prize is not big enough versus the amount of work that they've got to do
to get it going, if that ratio is not high enough, they don't touch it. And what's happening is most
mining operations have a ratio that's too low. So it's really hard to get going now.
So at the demand end, people are ringing their hands going, oh, where's my copper? Please give
me my copper. We'll pay you more money. But at the other end of the value chain, which is much more
difficult to be maneuverable, they can't respond as quickly. They just can't. And the fundamentals
aren't there. And all the people ringing their hands saying, oh, we want money, we want copper,
we want copper, they're not backing it up. We'll just put the price up and the market can fix it.
That's not translating into capital being raised.
Simon, how would you equate this? In the West, we look at profitability and you take the oil
sector. They stopped spending a lot of money. I think exploration budgets are down about 60%.
And they're doing their exploration on Wall Street, as you said, it's cheaper to buy somebody else.
But let's talk about China because they're not looking for the next quarterly profit.
They have more of a long term view. So they're dominating minerals. So let's talk about China
for a minute, because they are dominating minerals in a way we haven't seen. I mean,
almost two to three times more powerful than what OPEC is.
So when I first arrived in Europe, people didn't want to know about China at all. It was just
like they're afraid to say you mentioned it out loud. But coming from Australia, we don't have
smelters and refiners on Australia continent anymore. We sell that concentrate to either
China or Indonesia or Malaysia somewhere in Southeast Asia. And in Europe, they don't
understand because they don't do mining. They think mining is beneath them. But they buy
things from the market. And that products that are made on components, anything manufactured
in Europe is made from components that are produced in China. So I'm got let's call the
European critical raw materials list. So anything that Europe thinks it's worried about China's
controlling most of it. What about the metals tracked by the World Bank? This is the metals
that actually the World Bank tracks to check the health of the global industrial system.
So we've got silver and gold, zinc, lead, raw steel, aluminum. China is actually in there most
of the time. All right, what about industrial minerals and refined products? This is all the
stuff that industrial minerals like plastic acid, or sulfur, or titanium, or, or what have you,
China's dominating there, every single one except the two or three.
Okay, that's the demand side. Who's doing the manufacturing? So coal, gas, oil,
silver, gold, zinc, nickel, tin, lead, copper, steel, pig iron, iron ore, aluminum. China controls
about 80% of the manufacturing sector. And when we actually sort of did some, you know, numbers
on a napkin. So we got to do this on a napkin in a restaurant in front of your boss, certain forms
have to be obeyed. Right. But what we found was we could demonstrate that the Chinese,
in Chinese territory, they're controlling about 60 to 70% of the global industrial system.
Right. And then you when you come to, well, Chinese capital is flowing across the planet
and controlling industrial operations across the world. We don't know how effective that is.
But we believe it's substantially more. So the Chinese are in the driving seat,
they indeed have a long term plan. So the Chinese plan was as follows, I started tracking this,
because when I was doing the mineral intelligence stuff for GTK, when I first arrived, I asked some
very basic questions, and everyone looked at me like a poleaxed hobbit. Yeah, that they just
this glassy eye 1000 yards there. What? What? And so I just did it. So in Europe, we've got what's
called the circular economy. And that's our plan to get onto a new resource paradigm. So we love
talking about it. We haven't really done it yet. But at least we're talking about it,
even if it is in circles. The Chinese put together a plan that we first saw in the year 2002,
with their first resource strategy plan. I'm of the opinion that their macro scale plan,
that their 100 year marathon is commodities and resource based. They want to become an industrial
superpower, and they want to control the rest of the world industrially. So they start out with a
resource plan first and a military plan second. But they didn't publish the resource plan, I believe,
until the military plan was thought through. So the the fun and games that we're actually sort of
seeing at the moment, South China Sea and all that, this is all strategies that were game
theory and tested decades ago. So this is the sort of thing that we're dealing with. Right,
so there is a document called Made in China 2025. Now that is a think tank that actually sort of
in the West, I think it's British, that actually got hold of the China plan and they had a look at
it. And that plan, now I've been to Hong Kong, and I spoke to a few people, and this has been
verbally confirmed. What they want is by 2050, again, that bloody year, there's two of them,
2050, 2030, I don't know, what are you, no imagination. So by 2050, everything industrial
on the planet will be controlled by China. That is, if you as a consumer wanted to actually buy
anything, like the computer you're looking at, your phone, your car, building materials,
you've got to do business with the Chinese in some form. That is, everything industrial on the
planet will be owned or controlled by the Chinese, where they dictate what happens to the materials
produced. And the model that has been proposed, I don't know if they're taking the piss out of me
or not, but this is what they said, all materials and goods will either flow directly into China,
be turned into stuff, and then finished goods are coming out, which they will then be purchased on
their terms, where we are paying exorbitant amounts of money to them, to the point where
every other nation state needn't bother having its own industrial system. Right, or it'll be
extracted and processed in the country that's in with Chinese owned and operated
organizations, and the capital profit will flow to China. Right, and they described it
like the hunger games with the capital. But when the capital, they're not talking about the capital
in terms of the Chinese, they're talking about as the Han dynasty in China. The Han dynasty is in
China, and it controls China like the Saudi royal family controls Saudi Arabia. So this is actually
the plan that's been put on the ground a long time ago. They, the PRC government then put out
some recommendations what they wanted the private sector to spend their money on. The private sector
did it. They operate very differently to the West. Right, like say in within China, as I understand
there's three basic groups. One third of companies are doing quite well economically.
One third are right on the bread line about to go under, and one third are under, and actually in
the process of being eaten by everyone else because they're coming apart of the seams. And
internally, there's a very fierce competition about what third your company is in. And they're
trying to knife each other and trying to overturn each other in a very sort of competitive bare
knuckled, no whole bards kind of way. Within China, without China, suddenly they all unify and
they're a vertically integrated system doing exactly what the PRC government's telling them to do.
And so anyone that's trying to start up a, let's say you're trying to start up a mine,
and you're trying to start it up and say, you know, say Sweden, Scandinavia somewhere,
you say, I've got a mine, it's great. And every time you go out there, you come up against this
vertically integrated Chinese system with all its assets and smelters and refineries that are all
cooperating with each other. And you get the absolute crap kicked out of you. Because they've
got the money and the class behind them. And so every operation that the Western groups are
actually putting forward are happened to be small and tend to try to operate on their own in a
free market context. Whereas the Chinese juggernaut, also known as the Borg, every time they operate
a new operation, they're talking to other Chinese operations. And there's a long term strategy here
where they want to take over the world. So the American Empire is now approaching its sunset
and the Chinese people believe this is their chance. This is what they're going to do. And its
industry is the vector to do it, not military action. The West is playing chess, they're playing
Go. Chess is the objective is to take down the enemy king. Go is to quietly take over territory.
It's a very different mentality. It's interesting because Art Berman, one of the
oil analysts I really respect, he just wrote an article that gets back to the charts he was showing.
There's Simon, it says the US will lose the economic industrial war with China
on the renewable energy front. And he signs many of the kind of things that you're talking about.
And he refers to China had a plan 20 years ago to implement this. We're just now waking up 24
years later. Oh, my God, we're scrambling. We have to do something. But there's nothing logical,
or like I said, collective stupidity in the way we're approaching this. So I found it interesting
as you were displaying those graphs. And hopefully, I mean, if you could send us some of those graphs
that our listeners could see that because it is astounding. I mean, it's right in your face.
And this is what Art Berman is talking about. We're going to lose this war.
And let me give you an example from the war below. And that is when you take a look at
the cost of energy and what it cost to put these things into place. We had a rare earth mine called
Mali Corp. They started producing rare earths, especially when China embargoed Japan. So Japan
started buying rare earths from the US. China didn't like that. So then they cut the price,
got rid of the embargo. And then what they did is they flooded the market with rare earths,
basically put Mali Corp into bankruptcy. And here's what I love. In the bankruptcy court,
a hedge fund manager with a Chinese partner bought the rare earths. And I read a statistic,
they own more farmland in the US than Bill Gates does. So once again, a long-term strategy to
control the minerals and the resources to make this happen. It's all about metals, minerals,
and magnets. And this entire concept of this overhyped energy transition, it all depends
on the ability of different producers all around the world to produce those metals, metals,
minerals, and magnets. And again, to bolster what Simon has been talking about, the IEA's report
just from a few weeks ago makes these very same points. Now, they don't make them as pointed
in the way that Simon just did. But if you look at their graphics, it's very clear. Something like
97% of the world's photovoltaic wafers now come from China. 80% of the polysilicon comes from
China. And remember, it was just three years ago that the Biden administration announced sanctions
on the Chinese suppliers of polysilicon because of slave labor in Xinjiang. And this has not been
repealed. But if I can ask one other quick point here, because there was a piece in Bloomberg
just two days ago, it builds on your point here, Simon, about the control of these metals and the
refining of these metals. It's that China is now stockpiling copper and apparently by dramatic
increases in the amount of copper that they have been stockpiling just, and it's been just this year.
Why do you think that is? I mean, have you heard this? Have you seen this? And what's your read
on this? Are they expecting a big run up in price? Because this is the strategic
metal for all of this alternative energy stuff. They're playing the long game. And I think that
when you start seeing them do that, I think it's actually time for them to pull the trigger.
What do you mean by that? Pull the trigger regarding what?
So we have been mapping, let's call it all the trouble in the world. The last couple of years,
it's been one damn thing after another. There's been market problems. I actually sort of see all
of this as a macro scale system. And what's underlying it is I saw a blowout in the metal price
in the year 2005, the month of January, which was linked to a signature in the oil industry.
So the system's been trying to thermodynamically correct, and we're not allowing to do it
by printing money. Now, every nation state in the world knows this. So what's here is I've
took the World Bank data, all of those base metals and precious metals and oil, gas and coal.
And so this is what the World Bank checks the price to see the health of the global economy.
What I've done is I've overlaid those prices, real data, but I've indexed each curve to the
number 100, and the year 2001, the month of December. So what that does is it overlays all
prices on top of each other to show periods of relative volatility. So you see a period of
relative stability, apart from some monkey business around 1979, the around oil embargo.
January 2001, 2005, sorry, you have a blowout. The price of everything goes up. That puts the
entire system under such a lot of strain. We've got the global financial crisis, the largest
economic correction since the 1929 Great Depression. That wasn't enough to resolve
the underlying issues, whatever they were. And they're still there post that we've been fixed
by printing of money. And this peak at the end here is COVID, the gift that keeps on giving.
So what this shows is the systems thermodynamically trying to correct. All right, what happened in
2005? Oil plateaued around around January 2005 around there. Oil plateaued. Now the Saudi Arabians
at the time were the swing producers. They were told to increase production, or they tried to
increase production, they couldn't do it. So on the right hand side, you see the rig count.
The rig count went up really, really fast. They brought on more rigs as fast as they possibly
could. Yet their production went down. Right, so you had a 146% increase in rig count in exchange
for a 4% contraction in production. They were the swing producers. Right, so that's what happened.
All right, in that time, we had the oil price spike. And it peaked,
and there's the global financial crisis. It all crashed. And it went away when we started
quantitative easing. Right, so what I make the case of in 2005, oil plateaued, the price of
everything that is attached to oil, which is everything blows out, the systems put under
strain. It breaks in 2008, what we call global financial crisis. The system actually dies at
that point. And we've been keeping it together with the printing of money ever since. Oh, and this
is what happened in 1970, when we decoupled from the gold standard. So we have two big macro scale
patents. One's 1971. And one is 2005. Right, so to answer your question back to the original
question, what's happening? This has been known, I believe, by all the big players for some time now.
And it's related to our energy, oil in particular, everyone who's got oil knows and
understands that the status of their reserves. Now, in 2018, November, we saw peak crude oil.
That's gone down. Now, Art Berman's done some excellent work to show that what we call
total liquids, we're getting a lot of gasoline now from natural gas liquids and biofuels.
But oil, crude oil that does all your diesel and all your heavy stuff, that's declining and looks
like it's not coming back. So we've seen peak oil, it's an observation. It's in our past six years
ago now. So anyone who has oil knows and understand this, which means it's time. That is, it's time
to actually shift off one energy system onto another, whatever that is. And anything attached
to energy will now be restructured. And this is going to be one damn mess. Now, because oil's
their highest density energy system with the world is ever known, it's going to be easier
pre peak oil to do things versus post peak oil. So China, that thinks in its long term fashion,
has been stitching up assets all over the world to own and control them in context of it's easier
to do things before peak oil than after, including the stockpiling of metals. They also will go out
and buy mineral reserves in the ground and they'll often pay too much money for them to make sure they
get them. We've seen that a few times now. Now, let's call it the crash, we all know it's coming.
Every analyst knows it's coming, every nation state knows it's coming. But I actually see it
a little differently. Instead of a point of a crash, it's an era. So we've got an era from
about 2005 to whenever things get difficult. I call it the long emergency. It's one thing after
another, the death of 1000 cuts. You know, when they say, Well, how do we go out of business? First,
it's little by little and then suddenly all at once. Right. So for a long time, lots of medium
scale problems have been going wrong and what they've been papered over and patched together.
Then one day something big breaks that cannot be fixed easily, then we have our crash.
Is it economic? Is it something else? It doesn't matter. All these things are connected together.
I think we're approaching that point now, which is why I believe everyone wants a war,
because it's a wonderful distraction to cover this era of the big break. And it covers all the
domestic problems. They can now point to the war instead of saying, Oh, well,
it's really the nature of the system we've all been running for the last 50 years.
And so that I believe what's happening, China knows this, they're playing the game,
they're playing go, and they're better at it than us. And they don't care if they lose large
portions of their own population, where we're distracted on things that really don't matter
in the scheme of things. That's what I believe has happened. That's interesting because we are now
giving weapons that can strike into Russia. It's like we're provoking the bear
in trying to provoke a conflict here. Look, I'm in Finland at the moment,
and I've seen some flamboyantly stupidish. Right. Now, about two weeks ago,
but this, this came from Nate Hagans, but I've actually heard this from another source now,
where American technology and American systems were used in Ukraine
to strike at targets within Russia, as in military targets. And what they struck,
were not one, but two sites that were used as early warning systems to detect a nuclear strike.
Right. They actually took out two targets. At the same time, the Americans were running
an exercise using nuclear capable B-52s to make a run on St. Petersburg.
So the Russians at the time would have seen two of their assets get taken out while they're a
nuclear capable aircraft in the air heading towards one of their civilian centers. The scuttlebutt
that I've heard was they wanted the Russians to panic and launch a strike against us first.
Therefore, they could be blamed for starting a third world war.
Play silly games, win stupid prizes. Fortunately, the Russians and the Chinese
are playing a larger game that I think is multi-dimensional and fifth generation warfare,
and they are actually sort of seeing things very differently, and they didn't panic.
But the people who are in charge, I think, you know, they're playing with matches.
They need adult supervision. They're not terribly bright, or they are genuine sociopaths.
They don't seem to understand their own hubris. We are already in the background.
There is military exchanges on both sides now. There have been casualties,
which suggests we are at war now. But it's not just Russia,
because the broad brush plan is all bricks economies together.
Brazil, Russia, India, China, South Africa, and however many other countries like Iran have joined
them. We're seeing the fall of the American petrodollar empire and the rise of the bricks
based commodities backed currency set, which currency set is allowed to survive.
So the war in Ukraine has actually nothing to do with Ukraine. It just happens to be the
football pitch that we happen to agree to meet on. It's absolutely amazing when you see all
these things. And if you try to put some logic, when I read Berman's article about the tariffs
on 17 key strategic minerals, and we're trying to make our EV industry competitive,
you have to ask yourself, where's the logic, the lack of critical thinking here? I don't care
if it's on the global geopolitical front with what we're doing, as you just mentioned,
striking targets. Where does this go in your opinion, either of you?
As a reporter trying to figure out what's next, to me, they're these discrete parts of the story.
And Simon, you're in Europe and you have a different view and you're an Aussie in Europe
and have a different view. I'm just trying to figure out, okay, well, what does all this mean?
And what does it mean for the U.S. in a strategic sense? And I'm very concerned about the war in
Russia or the war in Ukraine and what's happening there. And there was a point that I don't know,
it wasn't Nate Hagin or someone else just pointing out that now Russia is fully on a war footing.
For them to end the war in Ukraine, it would be bad for their economy because this is what
they, now their whole economic system is hinging on their military production and so on.
So it's a very dangerous time, I think, in the world and one that's very concerning.
But I guess, you know, it's Jim's show, but, you know, it's called Financial Sense.
So Simon, do you think it makes sense? Again, this is my own curiosity because I've
heard bullish calls on natural gas lately here in the U.S. because of AI, because of LNG exports,
et cetera. But and, you know, Lee Gehring and Adam Rosianswager very much in natural resource
investing. So given what you've talked about to a commodities-based economy, would you put
money in commodities? Would you buy copper miners? What would you do? I mean, what, what makes sense
in a world that's gone nuts if I gave you, this is my $10,000 question, it's Jim's podcast,
the $10,000 question, if I name you my fiduciary and say, make the most money on this $10,000
and give it back to me in 10 years, where would you put it today? I put it in a smelter.
In a smelter for copper, zinc, what? Copper is the new gold, right? Copper is the new gold.
Right. Because no matter what we do, we need copper and copper is in trouble. By the way,
the shortage for projected for copper, that's been predicted for a long time. About a third
of the copper that's actually on the market comes from recycling. So mining is not able to deliver
on its own anymore, and it hasn't been for some time. So, but the information I'm looking at is
all metals, base metals, and needed and will be needed in an unprecedented way,
or about to reinvent ourselves in ways that we don't understand yet.
Copper will be needed, you can probably guess nickel will be needed,
tin will be needed, and so on, all the base metals, you know, all the zinc, magnesium. Now,
once people sort of get their ass in the gear and decide to do some work, they can start a mine.
Okay, it takes 20 years, but they can still do it. Think about how long it would take to
establish a single smelter. Because to establish a smelter, you've got to put a serious capital
investment for a start, you've got to have support structures like power around it,
then you actually need to guarantee supply from various mineral mines, and you need, I forget
how many it is, but you need many, many mines to supply one smelter. So the smelter is the bottleneck
part of a massive system. And you can't just knock one up overnight, you put it over there,
paint it blue. Right, but once we actually get to the hard part, the flash point, if you will,
pun intended, is how do we turn raw materials from all over the place into something useful,
like sheets of metal, bars of metal, stuff to do industrial things with the manufacturing sector,
will be dependent on what those smelters deliver. Now, when we say we're going to reinvent ourselves
and do different things, all right, you can refit a smelter, but you'll still need all the basics
of copper, nickel, tin, steel, all of those things will be needed. The problem you have
is the market we're going into won't be a free market. If you can look at some of Whitney
Webb's work, that's actually describing how the finance market is changing. I don't understand
everything that she talks about, but we are seeing some radical changes. We've been pushed into the
digital space of that digital space is now being controlled in ways that we've not seen before.
The problem we have is, is the market going to be free? What happens if your industrial
glass of whether it's a smelter or a mine gets nationalized? What happens, for example,
if you put what we call wealth, you know, if we have like a currency reset, and all of a sudden,
you know, the World Economics Forum of, you know, the great reset, which is also called the great
taking is not only going to really do over the average person, but it's going to do over many,
many industrial operations as well. There's going to be an adjustment of who owns what,
and the law itself is going to change. So, so what I was just saying is we, we see the world
through a lens at the moment, where we believe we know how things work. We've got the law,
we've got free markets, everyone's nice to each other. Everyone plays fair most of the time.
What happens if we move into a wild, wild westward, I don't know rules and people don't
like us anymore. Right, so I don't know how to navigate that correctly. I don't give financial
advice. This is not financial advice. But I would say if you could put your assets
in around actually some somewhere associated with smelting and refining on one of these vital
minerals, metals, this is the don't go gold mining in California, you sell gold picks to gold
miners. I'm just trying to think where we go from here, because I mean, there are so many things
that are moving, and I would say accelerating, as you pointed out, Simon, I mean, just, just the
fact that we're pushing AI and it's going to consume 25% of all electricity. This is an element
that people haven't really thought through. Well, where's that electricity going to come from?
So I call, I call AI households incorporated. Because I don't think it's going to be a tool
that's going to be very good. Like it's not going to be, it's going to be great for some people,
but it's going to end very poorly for others. May I suggest I've put together two geopolitical
maps that have described these discussions that helped me understand what I'm doing.
1962, that is the peak of discovery of oil itself. 1972 decouples from the gold standard.
73 is the petrodollar agreement. 2005 is the metal price blowout that I showed you earlier,
which is related to Saudi Arabia. Three years later, the system under strain blows out.
We have the global global financial crisis. At this point, I believe the petrodollar system
failed. Within this, they had the petrodollar alliance, which is, you know, the petrodollar
alliance as managed from London through the CD finance sector. What was to replace the petrodollar
system was the Transpacific Partnership, the TTIP and the TISA, which are all part of one
global organization. Excuse me, I believe that was the replacement of the petrodollar and it failed.
It failed because Julian Assange and WikiLeaks leaked it to the European Parliament,
and the politicians on the ground realized they were being cut out of this. They said,
we're not doing this. Right. So then 2018, we've got peak oil production,
peak gas reserves, as in when what's been actually added to gas reserves, I think was around the
same time. I'm not sure about that one. I'd have to actually look at the data, but everyone who's
got oil and gas, Russia, China, China, US, Iran, they dominate reserves and consumption of gas.
They would know the status of those reserves. So we're in what I call Thucydides trap between
the fall of the petrodollar alliance and the rise of the commodities alliance, the BRICS nations.
Thucydides trap is a concept put forward by a Greek historian that studied the Peloponnesian war
between Sparta and Athens. And he found that historically he had 18 references where 12 out
of 18 times you had an incumbent empire will go to war about someone challenging their throne
to be an empire like a new power would rise and 12 out of 18 times it resulted in war.
Do we go to war or not? Thucydides trap, Ukraine war, Nord 2 gas pipeline, rejection of Russia
from swift economic sanctions, breakdown of contract law, the Syrian war, South China Sea,
cats and dogs living together, all trouble in the world. What we're looking at here is an attempt
to get a kinetic war going, because that's the petrodollar alliance method of doing business,
aka the last thing I showed you, the commodities alliance who are also bastards, there are no
good guys here. They use economic war and fifth generational war. And it's a kind of warfare.
I don't think the incumbent petro alliance is very comfortable with or they're not as good.
So we're seeing debt saturation and quantitative easing and all these sorts of things.
COVID-19, the gift that keeps on giving happened to actually be at the perfect time to camouflage
what peak oil would have meant when the actual price cone was closing. And now we actually
have an entirely different crisis to deal with. 2022 is the genesis of a gold back currency,
the ruble and the yuan. The ruble was partially restructured, but I think I was expecting to see
now by now a commodities back to you on 2023. The basal three banking accord went live that
actually recognized formally recognized the golden commodities were valid as bank reserves.
Right. So we're seeing all the currencies are now under pressure to survive and possibly may crash.
And the commodities alliance is now starting to rise.
By 2025, China's Belt and Road Initiative will be in everyone's face. This is the
made in China 2049 plan that I sent you stuff earlier. And for the West in the World Economic
Forum, they keep talking about Agenda 21 and Agenda 2030, which is their plan to restructure society.
So what we've got is multiple factions behind the scene, putting their respective plans on the
ground. All factions are not very nice. All factions plans we would never agree to
if we had the choice. Right. And so this is the actual sort of map of what I see everyone sort of
jockeying for position. I actually am of the opinion all of these plans will fail. Now to
answer your question, like I asked before, all the stuff we're seeing, is it stupidity or did they
really mean it? Now the entire green transition, it's been a rubbish plan for some time. And
everyone I've spoken to an official capacity, no one's actually done any work. Like there's a lot
of talk, but you know, they have put up like some heroic efforts to put up wind and solar farms.
But what they've put on the ground is nowhere near enough. Right. And we haven't seen the massive
increase in electric vehicles to the level of, you know, we haven't, you know, when you can say
we've passed 10% of the global transport fleet, you can say, all right, now we're serious. But
we've struggled to get past 1% for years. I just wonder, you know, what happens, Simon, when,
you know, we have brownouts in California, we just get used to them. In fact, I'm getting ready to
add batteries to my solar panels because I see what's coming. When do people kind of say, hey,
this isn't working and had enough? The stuff you tell me isn't true. It's not playing out. When
your refrigerator is shut down for a half a day, your food spoils, you don't have enough gasoline
or you don't have enough electricity. I mean, in 2022, we were told for a whole day not to
charge our EVs from nine in the morning to nine at night. I mean, and we're nowhere near
completing anything that's going to be necessary to make this work.
Yeah. Yeah. Well, if I could jump in, one of the things that the key vulnerabilities I see now
in the near term for the US and Jim, you're adding batteries, I'm just got a note from
contractor, I'm having a Generac installed at my house, right, a standby generation unit,
22 kilowatts. Why? Because I've had three long blackouts in my house in central Austin since
last August. And remember, we got blacked out for two days during winter storm Uri in 2021. So,
you know, Simon, I don't know if I agree with all the things you're bringing up because I,
you know, you've studied it and it's a different view on the world than I've even thought about.
But what do I see in the near term here in the United States is rising electricity rates,
dramatic increases in electricity rates. What is it? Very clearly a regressive scheme in all
this decarbonization effort. And California is the classic example. And particularly in San Diego,
Jim, you know this, electric price prices in California are going through toward the moon
because of this insane rush toward decarbonization that has no connection to the physical world.
And so we're spinning just staggering amounts of money on wind, solar, electric vehicles,
all this stuff, all of it screws the poor in the middle class. And meanwhile, there seems to be
no sensibility in Washington about the debt crisis, about what the future of the US dollar,
the future of the US economy, our dependence on foreign supply chains. It's very disconcerting.
It's a very difficult time to try and get your mind around what is really happening.
And that's why I asked the question, the $10,000 question, because when people answer it, it gives
a view of their world view. And I've heard everything from buy Bitcoin to the S&P 500 to
Berkshire Hathaway, and now buy a smelter. But it's all very confusing time. But I'm tending to
think that these ideas around the control of commodities is going to be the critical issue,
not who has the reserve currency, because that could fall apart if that happens. And that's
big trouble for the US. Well, we're 30% invested in commodities for our clients,
all the kind of things that we've been talking about. As I've been looking at this,
I looked at this in the 00 decade when we saw copper, when we saw oil, and the industrialization
of China. And now this is on a scale so large. And as Simon talked about, peak oil,
you know, what do you do when you can't produce more to get that economic growth? And we've been
talking about minerals, the mining, copper, lithium, cobalt, nickel, all of that. Mining
uses fossil fuels. You can't do mining without these big trucks, loaders,
crushers that all require fossil fuels. And when you talk about this
debt bomb that's going to go off, and you talk about what the emerging markets are doing economically,
the thing that worked for the US is if you traded with the US, you had excess dollars.
But we had a large market that you could invest those excess dollars into treasuries,
into stocks. China doesn't have an open market, but what they are doing is developing a gold
market. So if I trade with China, and I'm Brazil, I have excess one. Well, what I do with those excess
one, I can't go in and buy Chinese bonds, but you know what I can do? I can go out and exchange that
one for gold, and I can use that gold to buy other stuff trading within that block of, what is it,
Simon, what is it about? 20 countries right now. We talk about the G20. We may be talking about the
EM20 or more. So last I count was, I think it was 29. I actually haven't looked into it properly,
but we are seeing a tectonic shift. A tectonic shift. Sorry about what, Simon, you lost me there.
So there's a tectonic shift in the markets in terms of where every nation state was flowing
money through the Anglo sphere, right, the US dollar in particular, where the whole BRICS
nation, I believe BRICS was formed to the purpose of getting these countries out from under the
Petrodollar system. Now, so the BRICS commodities economies are put forward and they're now starting
to put systems on the ground, you know, like, you know, a parallel to SWIFT, for example,
where other nations can now do business outside the Petrodollar alliance.
I see. Well, does that partly explain why all these central banks are buying up gold then,
because the belief in the dollar has gone away, because, you know, again, this is one of the
parts that's confusing to me. And now I never believe the gold story, but I'm starting to believe
it. And, you know, you said just a few minutes ago, copper is the new gold, Simon, which would help
explain why the Chinese are now hoarding copper. And I mentioned Bloomberg, other analysts have
seen the same, very same thing that China is hoarding copper in a way that would suggest they
see it as an absolute, as a critical metal akin to gold, as you said before.
Yeah, so central banks have been buying gold in a frenzy since 2008. They tend to go through
bits and starts of it. But China and Russia in particular have been buying gold, but also dumping
not just US treasuries, but all other western nations treasuries. The idea was everyone had
some of everyone else's treasuries in a diversity thing. And so it was in everyone's best interest
to keep the system going for as long as possible. And they've been dumping stuff.
I think you've got multiple things happening here. On one hand, we all understand that the
industrial system is about to change, and we need raw materials, copper being one of them.
On the other hand, there's the currency systems that we used to determine
who owns what and who owns what and who does what. That's what money is a decision making for.
I think we're going to go to a commodities back currency, but I don't think there's enough gold
to back a currency system as large as the one we've got now. And we need electronic funds
transfers because they have to be fast. We can't go back to physical gold bullion because it's
simply not fast enough to run a global system the way it is at the moment. And so we're going
into a system that I don't quite understand. To me, there's no precedent for it,
right? But on one hand, it's going to be an electronic currency. Is it going to be like
some sort of crypto structure? I don't know. Is it even possible? I don't know. On the other hand,
we need to have it backed by something physical and tangible. We all like gold and silver,
but is that enough? The answer is probably not. So what do we do? It could be Simon,
a basket of commodities of which gold and silver are part of, whether you put commodities,
whether you put oil in that basket or copper or something like that. But it's going to have to
be tangible because what they're doing with the debt, I think we're going to cross $35 trillion
this month. And I think we'll be at $36 trillion, $37 trillion. The CBO estimates $50 trillion
by the end of this decade. I think that's understating at the rate because it starts to accelerate
as your debt. And we're spending more on interest on the debt than we are
on our U.S. military. An interesting thing that you were talking about, the conflict,
the Wall Street Journal just did an article. We've got $10 million Abram tanks that are being
destroyed by two and $400 drones. So you can't shoot a million dollar missile at a four or $500
drone. And so all of this stuff is coming to a head and it's going to take some real deep
thinking because I don't think we've ever been here before. That's correct. You nailed it right
there. We've never been here before. So all these people sort of laying down, this is the way it's
going to happen. We don't know. And in fact, yeah. I'd like to take this in a different dimension
now. We've been talking about all this. I'd like to get everybody's best recommendation.
The people listening to this show, what would you tell them to do? Robert,
you talked about you're getting a Gen Rack generator because you've gone through four
brownouts and for an extended period of time. They're coming to California. We've been dealing
with these going back to the 90s. I'm a big favor of owning something tangible when money is being
debased as it is. So your best guess, what would you tell listeners to this show today? If you were
to give many advice and more importantly, what are you two doing given what you see to protect
yourself? Well, my answer would be, don't listen to me. Because what do I know about anything?
Here's a guy I follow on Substack. I'll read this because it's so funny. His
Substack is Quoth the Raven and he writes about finance and about investing and he says,
this post represents my opinions only. In addition, please understand I am an idiot and I often get
things wrong and lose money. So I am an idiot. Where is the majority of my money invested, Jim?
It's in Schwab Dividend, which is underperformed, but it's blue chip stocks that pay a dividend
and they're based in the US. So that's my bias toward exchange traded funds that are indexed
and S&P 500 as well. All of that said, I do own some energy stocks, but I'm also starting to
believe the golden copper story. And so I have in the last few weeks, not that anybody's going to
don't take this obviously as investment advice, but this debt balloon that you're talking about,
Jim, is deeply concerning to me. And the US, I mean, the counter narrative, of course, is the US
is still the best house in a bad neighborhood. Do you really want to put your money into the
yen, the yuan, whatever? But ultimately, I think some of these things that Simon is talking about
and some of these trends that where we have no fiscal conservatism left in America, no one
paying attention to this, where we're paying more on our debt interest than we are for the defense,
this is incredibly worrisome. So I am beginning to get very bullish on the prospects that we've
been talking about now about commodities and that you need to own physical hard assets and
that it's not enough. And despite this enormous run up in NVIDIA and these other companies,
because I think ultimately we're going to have to need the stuff to make things happen.
Simon. So for me, I don't have a lot of money because the work that I do is a wage of about
half of what it would be if it was in the private sector. And I've been changing child sport now
for the last 16 years, which means my ability to actually save money has been seriously knocked
around. So what I would say is what I have done is made sure I don't have any debt. I am debt-free.
So apart from the usual, get out of debt-free, make sure your household is resilient. Imagine,
for example, if a hurricane hit or the power goes out or whatever, be in a position to sort of manage
unplanned difficulties, whatever they might be. I also have found that most of the people around
me disagree with my ideas. Right. So the idea of actually trying to tell people around me what
they should or shouldn't do. Nah, that doesn't work. They'll work it out. So what I would say
that might be of use is take the time to look at what's happening and try and understand it.
Try and understand all the moving parts because a lot of what's happening and what's coming in
has the capacity to create an extraordinary amount of anxiety.
Right. And that anxiety is incapacitated. People will panic. Be in a position where you don't have
to panic because you're understanding what you're looking at. You may not like it, but you understand
it, which means if you're not panicking, don't be in the middle of a herd that's on top of a cliff
when someone yells out, yo shit's on fire. Right. If you see something like, oh dear, this is going
to end and then you panic, you don't understand what you're looking at. It all checks out. So this
whole thing where we're constantly looking at the news, even if the information you're looking at
turns out to be incorrect and you get the wrong end of the stick, at least if you start the process
of trying to understand what you're looking at, it means that the moment we do hit those difficulties,
your mind will be primed to problem solve. Now in that environment, if you can be as flexible as
possible, don't actually sort of attach yourself to the stories we used to have. I must have that car.
I must, you know, the old Bill Hicks, the comedian quote, look at the forers of worry on
my ford, look at the numbers of my bank account. See if we can step away from that.
Where, okay, if we, I remember reading the memoirs of someone who was in World War II,
who was a rich man, but because of the way the war happened, he lost everything.
All his wealth, what he did keep was his family. But he remembered reflecting later,
after World War II, that the moment he actually let go of the material possessions that he had
spent a lifetime trying to recruit, and he said, it's important to keep my family together and alive.
Right, that became his reason to be, and he was relatively functional. But until that point,
you know, oh no, I've lost all my money. My factory's been destroyed.
The bank has been overtaken, and I've lost all my money, blah, blah, blah, what am I going to do?
He was in hell. Right, and he couldn't do anything. So if I was to recommend that,
anyone, I'd recommend that understand so you don't have to panic.
Yeah, there's so many books I would add that you can read and gain an understanding of the
very things that we've been talking about here, so that when you see them, because once again,
if you turn to the media, it's collective stupidity. They put out this stuff,
and nobody's ever held accountable. Well, you said this, but that didn't come true.
Now you're saying this, that didn't come true. So you have to basically do some in-depth reading
and thinking to understand the very things you're talking about.
I understand the trends. So instead of saying we will crash next Tuesday about dinner time,
and so the markets and the systems we look at have these,
prob these underlying issues it has to struggle with.
Right, so instead of actually sort of saying we will face this particular scenario, just
understand, well, this particular direction may not be as stable as we think.
I'll add one just quick point, which is, and I agree with Simon about being out of debt,
I'm happy to say I am out of debt, but in Domburg, who's on sub-stack, he has very popular sub-stack,
he's talked about this a lot, be prepared. It's the Boy Scout motto. We have several gallons
of water in our garage. We have canned food. I keep propane. I have standby generator,
these things, and I think this is just good practice for everyone.
You don't make your, to the extent that you can, make yourself resilient, and that includes
canned food. That includes having a way to heat your home or firewood. Unfortunately,
we have a fireplace, so be prepared. Don't, to the extent that you can, make yourself resilient,
and I think that applies to your investment strategies as well, whether it's keeping cash
in the house, which is something I do. I like cash. Sometimes those credit cards might not work.
This has been very instructive for me, to talk about these longer-term issues and structural
changes in the global economy, because I see of many signals now that there is plenty of reason
to be very concerned, given the fecklessness of American political leadership and what's
happened with our, this massive amount of debt that's been imposed, and what that means, and
the run-up in particularly housing prices, and what that means for the younger generation.
All this is incredibly worrisome, but all that said, I'm optimistic for the future,
and I'm going to remain stupidly optimistic, because I just, I have to be that way.
I'm also optimistic, because I've got a plan, but that plans for a small number of people.
Well, I'm the same, you know, I have six months worth of supply, and to the point,
I actually bought a month's supply of food for every one of my employees, for the very same
reason, because like I said, we have all kinds of problems here in California.
Simon, you have been showing a lot of key graphs and things of your study, and we're going to make,
I just want our listeners to know, we're going to make this available. Those last
graphs on the emerging markets, the aggressors, and things like that, I think are just
must viewing and reading, if you want to maybe put some of this in perspective and learn and
understand what's going on here. I'd love to do this again, guys. As we close, each one of you,
why don't you give out how they can follow a lot of the work you do? We'll begin with you, Simon.
Okay, now I'm not as organized as I should be. I've got a website, SimonMachaud.com,
where I'm trying to put all my work on it, but now that I think about it, the last 12-15 things
that I've done in the last few months have not been put on that website. Are you talking about
the stuff you showed us today? That's on there now. Okay. All of that's on there now. This is
new stuff. What I call the purple transition, the green transition won't work, but the purple
transition might. I've actually put a plan out there. It's gone through several conferences now,
and it's still alive. I'm also developing some ideas with the Venus Project, VenusProject.com,
as in my solution. What will that be? SimonMachaud.com and theVenusProject.com
places you can track my movements. Let me spell your name on your website.
It's SimonMachaud.com. Okay, and Robert? Well, I'm easy to find on the Google. I'm on TikTok.
I'm on Instagram, YouTube, LinkedIn, blah, blah, blah, blah. I'm pushing people toward
my sub-stack, robertbrice.substack.com. That's where I'm doing essentially all my writing lately.
My website is robertbrice.com, but then also my new docu-series, new five-part docu-series,
I'm very proud of. My colleague Tyson Culver directed, did a great job. You can find that
at juicetheseries.com. That's our new five-part docu-series, Juice Power Politics and the Grid.
I'm very proud of it. We've had three million views on YouTube, so it's gotten good traction.
Kudos to my colleague Tyson Culver for the way how he directed, brought together a whole
bunch of different people. We did over the four dozen interviews. So, yes, robertbrice.substack.com,
juicetheseries.com. Did I mention juicetheseries.com? I hope I mentioned juicetheseries.com.
Yes, you did. And then a lot of these articles and graphs and things we're going to have on
our own website, which is financialsense.com. Gentlemen, I'd like to thank you for being
so generous of your time. We went longer, but there was just too much good stuff
here today that we had to get through and talk. So, I want to thank you both.
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