The Flying Frisby - money, markets and more

Explore the epic tale of Jason's quest for the Golden Fleece, filled with betrayal, vengeance, and divine intervention. Discover how Jason, aided by his crew and supported by Hera, faces challenges to claim his rightful throne and confronts the consequences of human flaws in a tragic ending.

In my late teens and early 20s I was obsessed with beaches. I had always liked them, we all do, but I think it was a trip to Thailand in 1989 that triggered the obsession. Being on Koh Phangan back then when there was barely any power on the island - you had to go to back to Koh Samui for the full moon parties - smoking joints, lounging about in hammocks, philosophising with my mates, talking about our futures, watching the world go by, swimming, snorkelling, playing endless games of frisbee and volleyball on the white sands as sunny days drifted into beautiful sunsets, is a time I will always cherish. After that trip, I used to endlessly contemplate beaches - didn’t matter if they were tropical or Cornish, Mediterranean or in Bournemouth - they all have something to appreciate and enjoy. As a young writer trying to get stuff published, I wrote and wrote about them. Then, in 1996, The Beach was published. Alex Garland’s debut novel caught a zeitgeist and took the world by storm, eventually becoming a film with Leonardo di Caprio. Anything beach related would now be copycat. Garland  owned the subject and I had to move on.I always wanted to end up on a tropical beach somewhere. I’ve left it a bit late, but the dream still lingers, though, like many a dream of my youth, it’s somewhat faded.Today, generally speaking, the thought of a really crowded beach, packed with sardine holidaymakers, fills me with a certain amount of horror. It probably does you. I’d pick the Maldives over St Tropez pretty much any day of the week (even though I’ve never actually been to the Maldives). As for Bournemouth beach in a heatwave, I’ll almost certainly pass.Subscribe to this eminent publication.A Free Market Success StoryThis week my two sons and I have come to Ksamil in the south of Albania for a boys’ holiday. I put a post on Twitter - should we go to Bulgaria and the Black Sea or Kotor in Montenegro? Something Tom Winnifrith said persuaded me to come to Albania instead. I liked the idea of flying to Corfu and then getting the ferry across. And I heard the beaches were nice. We arrived after a journey that was a lot more drawn out than I would have liked, went for an early evening stroll and oh, how my heart sank. The beaches were probably the most crowded I have ever seen. Crap music blared out. You seem to have to hire sunbeds, which cost €25 - there are three of us, have I got to pay €75 a day just to get on the beach? Negativity prevailed.The following morning I spoke to Ilir, the extremely helpful proprietor of the 6 Milje hotel, where we are staying. “What do people normally do with their phones when they go swimming?” I asked him.“You have to understand, the beaches here are not like the beaches in Italy or Spain, public beaches, and maybe your stuff isn’t safe,” he said. “Here in Albania nothing gets stolen”. I raised a doubtful eyebrow.“The beaches are privately owned,” he explained.He had said the magic words and my ears pricked up. “It means you have to pay, ha ha ha,” he laughed. “They want the money. But everything is taken care of.”I couldn’t help myself. “Are you familiar with the Tragedy of the Commons?” I asked. “When everybody uses the resource but nobody looks after it, because nobody owns it. You see it in the oceans, in the common parts of social housing -”“Yes, yes,” he said dismissively.I don’t know how these Albania beaches were procured in the first place. The way assets were seized after the fall of communism in Russia was not exactly salubrious. I expect something similar happened in Albania as communism went down here. Ilir agreed.“Probably,” he said. “But somebody has to pay,” he went on. “They made a big investment. Before Ksamil was just rocky. They brought in all the sand.”Beach replenishment is very expensive, my two sons then  told me with great authority. They had both studied it in geography. They went on to discuss whether it is beach replenishment or beach nourishment. I now approached my first day on an Albanian beach looking at things through a more optimistic (and biased) lens.Each stretch of beach does seem to be owned by a different business, often linked to a restaurant or bar nearby. The businesses are competing every day to fill their sun loungers, so each is trying to make its bit of beach as attractive as possible. The result is clean, well kept beaches with an enormous range of sun loungers - from premium sun loungers a yard from the sea with curtains around them for privacy and champagne service to bargain basement folding metal things at the back (not that bargain basement).  Whichever stretch of beach you go to, you are politely greeted by that section’s “head of loungers”. He sorts out your umbrella, he asks you if there is anything else you need, he will keep an eye on your stuff. It turns out €20 for a pair of loungers plus an umbrella is about the going rate for the mid-range stuff. I’ll pay that just to know my cash and phone are safe. (This remains, by the way, very much a cash economy - all hail Albania - both lek and euros are accepted).There are a gazillion bars, restaurants, stalls, as well as the occasional travelling fruit or recently-barbecued-corn-on-the-cob vendor. Some of the bars/restaurants/stalls are for the loaded (of which there are quite a few - I think this place might be Albania’s answer to St Tropez: there are a lot of glamorous, beautiful people) others are for the skint or the stingy. Some play loud music, others are quite mellow and quiet. The stretch of water in front of each beach is filled with enticing things to do. There are diving boards, paddle boards, luxurious floating rafts with sun loungers, one stretch of beach has lanes laid out like an Olympic swimming pool so people can train, there are masks and snorkels for hire, pedalos, pedalo taxis that will take you out to the nearby islands and rafts if you don’t want to get wet. The swimming areas are clearly marked by buoys, so that boats and jet skis pose no risk to swimmers. There is even an entire floating, inflatable water slide assault course thing. Sounds horrendous, but I defy you, if you are an eleven-year-old boy, not to absolutely love it. Couples are catered for. The old are catered for. Young families are catered for. The water is lovely.This might not be the remote Maldives eco experience. I don’t think I have ever in my life seen such crowded beaches, except perhaps at midnight on New Year’s Eve in Rio de Janeiro on the Copacabana. The circumstances there were slightly different. Environmentalists will probably hate it. It is highly developed. It is not the wild and desolate beach many might hope for. But it is providing a lot of pleasure to a lot of people, using a minimum amount of space, while providing opportunities to a lot of other people, making them prosperous and lifting living standards. The locals here work extremely hard - they are very ambitious. In my hotel, the staff are still working when I go to bed at 11 and when I am up the next morning at 7 the same staff are already laying out breakfast. There are tourists here from Albania itself. There are lots of Italians, very few from Greece, quite a few from the UK, France, Scandinavia and Germany.  I’ve heard a lot of Eastern European accents that I cannot place. It’s a real hotspot and it is booming.In short, it’s an example of a free market at work, private property rights, the benefits of competition, and all those things that libertarians such as myself advocate for.It’s cheaper than the UK, but not as cheap as you might expect Albania to be. This holiday is going to cost me a lot more than I anticipated. When I complained about the cost of aftersun, the woman in the shop snapped back at me quite articulately telling me that the people here only have two months a year to make money. I have all that other time. My sons, meanwhile, whose finger is on the pulse in a way that mine is not, told me that my ideas of prices are way out of date. I guess that’s inflation for you.“How corrupt is it?” I asked Ilir. “Sometimes people come to the hotel asking for protection money, but we always make sure they don’t come on the property. In your country maybe you have a straight line between what you can and cannot do. In Albania the line is very squiggly.”I am sure there are villainous types, who don’t deserve it, who are making fortunes out of this incredibly vibrant economy. Villainous they may or may not be, but they were also entrepreneurial. I am sure there are many things that people who know more about the history of Southern Albania than me could find fault with. It is not perfect. Nothing is. But it is also testament to what free markets can do and how quickly, if left alone.My show on gold at the Edinburgh Fringe this August will take place at Panmure House, the room in which  Adam Smith wrote Wealth of Nations. You can get tickets here.Interested in buying gold to protect yourself in these uncertain times? My recommended bullion dealer is The Pure Gold Company, whether you are taking delivery or storing online. Premiums are low, quality of service is high. They deliver to the UK, US, Canada and Europe, or you can store your gold with them. More here. This is a public episode. If you'd like to discuss this with other subscribers or get access to bonus episodes, visit www.theflyingfrisby.com/subscribe

I’m doing a show about gold at the Edinburgh Fringe. If you are in Scotland between August 4th and August 20th, plesase come. It’s at Panmure House in the room in which Adam Smith wrote Wealth of Nations. You can get tickets here.Thousands of years before the dawn of civilisation, as prehistoric man hunted and gathered his way through the Stone Age, he might have come across six native metals - metals which occur in nature in a relatively pure state: silver, tin, lead, iron, copper and goldHe found gold in river beds - nuggets, mixed in with sediment, relatively easy to find, collect and shape. Gold doesn’t naturally combine with other metals in nature, so it is easy to identify. It shone, it glistened and so man adorned himself with it - as well as with bones, teeth, precious stones and shells. Archaeological evidence from Spanish caves shows that gold was used by human societies as early as 40,000 years ago. This predates agriculture and the development of settled communities. It is the earliest example of human use of any kind of metal, and its purpose was as jewellery. The first records of man using copper came tens of thousands of years later. Lead, tin and iron’s first use, when advances in metallurgy took us into the Bronze Age, came even later. The use of gold for personal adornment was an established practice, even in prehistory. (Even copper’s first use was as jewellery). It is easy to make anthropological interpretations. Gold, a symbol of beauty, power and status, also indicates reproductive fitness: Look at me, I have access to this rare, shiny substance.Stone Age man had the same basic instincts as we do today - the same urges, desires and compulsions: fear, desire, love, hate, greed. Nothing inspires greed like gold. Survival is the most basic compulsion: to find water, food and shelter, for yourself and for those close to you. Then there is the survival of your species: the need to reproduce. If you are to survive, thrive and reproduce, so does the species as a whole grow stronger. Thus can an individual’s self-interest be good for the species as a whole. What often goes unmentioned, though, is our instinct for beauty.  What we find beautiful is also often good for us in some way. We are instinctively repulsed or alarmed by things that are dangerous – snakes, spiders, a cliff edge, loud noises - but things that aid our survival we find beautiful - the sound of running water, a fit and healthy potential mate, an open landscape with water, varied animal and plant life, good visibility and shelter. And we find gold beautiful. The experience of beauty, whether derived from nature, art, music or even mathematics, correlates with activity in the emotional brain - in the medial orbito-frontal cortex. Beauty has long been associated by philosophers with truth and purity – also qualities commonly associated with gold. Our instinct for gold and the emotions it inspires from beauty to desire are basic. There has not been a culture in all history that did not appreciate the value of gold. It is a primal instinct. “The desire for gold,” said Wall Street trader Gerald Loeb, “is the most universal and deeply rooted commercial instinct of the human race.”The artefacts found in those Spanish caves suggest that the people who lived in them had some basic skills. (Gold, which is relatively soft, is fairly easy to shape even using simple tools). Like shells, bones, stones, even hand axes, gold would have been used as reward as well as for decoration: as an expression of gratitude, as a prize for completing a task, for heroic deeds, as a tool in barter and exchange - as early money, in other words,. Even in prehistory gold was performing the role it has always performed - and always will: to store, display and exchange value. Subscribe to this brilliant newsletter.Transcendent Treasure: Gold's Link to the DivineGiven its unique characteristics - beautiful, eternal, immutable - it is no surprise that  gold found special status at the dawn of civilization. Our prehistoric ancestors cherished gold even before they were able to speak. Nor did that captivation fade after pre-history. Whether Asian, African, American, Mediterranean, Germanic or Celtic, gold occupies a place in the history and mythology of almost every ancient culture, the most valuable of all metals. As money, it was at the core of all their economies, however primitive.Today we know of 90 metals or more. Many you’ve probably never heard of, let alone touched or seen.  The likes of Cesium, Nihonium, Flerovium, Moscovium, Livermorium, Yttrium or Zirconium. Until the 13th century we knew of just seven: gold, silver, copper, tin, lead, iron, and mercury. There were also only seven known celestial bodies: the sun, the moon, Mars, Mercury, Jupiter, Venus and Saturn. Each metal came to be associated with a celestial body - silver with the moon, iron, rusty and red, with Mars, Mercury with its namesake, Jupiter with tin. With its glimmering yellow colour, gold was associated with the sun. To the ancient Greeks, and other cultures besides, the sun was a golden chariot driven by the sun god, Apollo, across the sky each day. The Egyptian sun god Ra was depicted as a yellow blaze of gold. The Incas of South America believed gold to be the sweat or tears of the sun. The Latin word for gold, aurum, derives from Aurora, the goddess of dawn, who rose each morning to announce the sun’s arrival. The root of the word by which the Celts and Greeks referred to gold was the Sanskrit “Harat” which means colour of the sun. Plato and Aristotle both thought gold was actually obtained by combining intense sunlight with water.The symbol for the Sun (a circle with a dot in it - ☉) was once the alchemical symbol for gold. There are seven days of the week, too, and in many cultures so did each metal come to be associated with a day. Gold’s day, of course, was Sunday.Tell someone about this really interesting article.While silver was perceived as feminine, gold was a masculine metal, connected not just with the sun but with the lion, a symbol of strength. This association lives on today, from the lion rampant (standing on its hind legs) found on so many family crests to the three gold lions on the English coat of arms. Gold represented wealth, prosperity, authority and charisma. It was a symbol of knowledge and enlightenment, its radiant qualities mirroring the illumination provided by the sun. And so scholars and sages adorned themselves with it to reflect their intellectual and spiritual pursuits.The sun's energy was thought to have infused gold with special healing properties. Ancient healers and priests often used gold in their remedies and elixirs, attributing its regenerative powers to the sun's life-giving energy. Wearing gold could help physical well-being and aid in recovery from ailments. The ancient Greek sun god Apollo was the god of healing and diseases, while his son, Asclepius, was the god of medicine. Apollo delivered people from epidemics, but could bring ill-health and deadly plague. Modern science confirms these instincts, with Vitamin D, which we get from sunlight, now being seen as so important for our general well-being. As the sun was a guardian against darkness and evil, so could gold ward off negative energies and offer spiritual protection, thus talismans and amulets were often made of gold. Kings and queens decorated their bodies with gold to demonstrate their power, to impress, to dazzle, to command and to authenticate their god-like status. Because of gold’s imperishable characteristics many imbued it with divine qualities, and it is forever associated with the eternal, the permanent and the incorruptible. From Hercules’ quest for the Golden Apples of Hesperides (which bestowed immortality) to King Arthur’s knights’ search for the Holy Grail to Frodo’s attempt to destroy the precious ring of power in The Lord of the Rings, gold has become a symbol of incorruptible quest, purity, ambition and purpose. The golden thread left for Theseus by his lover Ariadne to help him escape the minotaur and the labyrinth symbolises an enlightened or clear path. Even today the young student gets a gold star, the athlete a gold medal. It is a symbol of achievement.In Scotland between Aug 4th and Aug 20? I’m doing a show about gold at the Edinburgh Fringe. It’s at Panmure House in the room in which  Adam Smith wrote Wealth of Nations. You can get tickets here.Buying gold?Interested in buying gold to protect yourself in these uncertain times? My recommended bullion dealer is The Pure Gold Company, whether you are taking delivery or storing online. Premiums are low, quality of service is high. They deliver to the UK, US, Canada and Europe, or you can store your gold with them. More here.This article first appeared at Moneyweek. This is a public episode. If you'd like to discuss this with other subscribers or get access to bonus episodes, visit www.theflyingfrisby.com/subscribe

NB My next Best In Class, in which I identify the go-to stocks in the natural resources sector, is out tomorrow. Keep an eye out for that. (Only for paid subscribers).Today, though, gold …I am going to the Edinburgh Fringe this August to do one of my lectures with funny bits. This one is about gold - its history, its fascination, its future. It really is the most amazing metal, not least because it is, as Spandau Ballet famously sung, indestructible. Life may be temporary, but gold is permanent. No other substance is as durable, not diamonds, not tungsten carbide, not boron nitride. You can shape this enormously ductile metal into pretty much anything. An ounce of gold can be stretched into a wire fifty miles long. You can beat it into a leaf just one atom thick. Yet there is one thing you cannot do and that is destroy it. You can change its form by dissolving it in certain chemical solutions or alloying it with other metals. You can even vaporise it. But the gold will always be there. It is theoretically possible to destroy gold through extreme methods such as nuclear reactions, but in practical terms, gold is indestructible. That makes it unique among natural substances: the closest thing we have on Earth to immortality. Perhaps that is why practically every ancient culture we know of associated gold with the gods, why the Egyptians believed it had magical powers that gave you safe passage into the afterlife. In a museum in Cairo you will find a golden tooth bridge made for a well-to-do Egyptian 4,500 years ago. It is good enough to go in someone’s mouth today, (though I would give it a good scrub first). In 2021 a metal detectorist by the name of Ole Ginnerup Schytz unearthed a Viking gold hoard in a field near Jelling in Denmark. The gold was just as it was when it was buried 1500 years earlier, if a little dirtier. Gold does not corrode, it does not tarnish, it does not break down over time. All the gold that has ever been mined, save the tiny amounts dissolved in aqua regia (nitrohydrochloric acid), still exists in the world in one form or another. Some may have been lost, but none of it has been destroyed. What’s more, it will always exist. Even tiny specks of gold dust are permanent.Park that thought for a moment, as we consider how gold came into existence. No one really knows the answer to that.Divine creation is one widely held theory. Another is that gold’s origins lie in supernovae and the collision of neutron stars. Scientists think they actually witnessed gold being created in August 2017. Some 130 million light-years away, two neutron stars, each as small as a city but heavier than the sun, collided. The collision caused a colossal convulsion known as a kilonova. An enormous amount of energy was then released in the form of gravitational waves and electromagnetic radiation, including visible light, which was observed by telescopes around the world as it rippled through space and time to Earth. Astronomers were able to measure the amount of heavy elements produced by the collision, because of the multiple wavelengths and bright optical and infrared glow. Something like 16,000 earth masses of material was hurtled into space, says Harvard astronomer Edo Berger, creating “10 times the Earth's mass in gold and platinum alone".  (Gold, by the way, makes up about one millionth of the Earth's mass, and most of that is still in the planet's core.) "It makes it quite clear that a significant fraction, maybe half, maybe more, of the heavy elements in the Universe are actually produced by this kind of collision," said physicist Patrick Sutton of the Laser Interferometer Gravitational-Wave Observatory in the US. High temperature and high pressure in the cores of neutron stars, argue scientists, cause atomic nuclei to capture free neutrons in a process known as "neutron capture." The resulting nuclear reactions then lead to the formation of gold. When these neutron stars eventually die, they explode as supernovae, and disperse the gold and other elements that were created into space. Perhaps the Incas and Aztecs were not so wrong to see gold as the tears of the sun. Our solar system (the sun and everything that orbits it) was formed from the cloud of gas and dust – a so-called solar nebula - that resulted from one such stellar collision. Small, solid objects - planetesimals - then formed by accretion: the process of gravitational attraction by which small particles in space stick together. These planetesimals grew and grew, through continued accretion and collision, to eventually form the planets. In short, gold was present in the dust that formed the solar system four and a half billion years ago. Being permanent, it is exactly the same today as it was then. Isn’t that an amazing thought? That little bit of gold you may be wearing on your person is older than the Earth itself. In fact, it is older than the solar system, as old as stardust. To touch gold is as close as you might ever come to touching eternity. Yet this eternal substance is as good as useless. Unlike other metals, which we use to build things, cut things or conduct things, gold’s industrial use is so limited as to be non-existent. It is a good conductor of electricity, but copper and silver are better and cheaper. It has some use in dentistry and in medical applications, such as radiation therapy and the treatment of arthritis, but such uses are minimal in the greater context.Gold’s purpose is as a store or display of wealth. It has no other significant use. It is dense, tangible value: pure money.Over the years we have used all sorts of different things as money: shells, whales’ teeth, pieces of specially printed paper, computer bits, promises. Today, packets of mackerel serve as currency in US penitentiaries - “macks,” they are known as. But one has outlasted them all, and that is gold.My show on gold at the Edinburgh Fringe this August will take place at Panmure House, the room in which  Adam Smith wrote Wealth of Nations. You can get tickets here.Interested in buying gold to protect yourself in these uncertain times? My recommended bullion dealer is The Pure Gold Company, whether you are taking delivery or storing online. Premiums are low, quality of service is high. They deliver to the UK, US, Canada and Europe, or you can store your gold with them. More here.Why not subscribe to this most excellent publication?This article first appeared at Moneyweek. This is a public episode. If you'd like to discuss this with other subscribers or get access to bonus episodes, visit www.theflyingfrisby.com/subscribe

Despite being built of bricks, a house is, in many ways, a financial asset. This is because, for the most part, we use finance - debt - to buy real estate. Mortgages, aka “death grips”, have been around for hundreds of years. Debt has been around since before human beings settled on the fertile plains between the Tigris and the Euphrates. But mortgages in the UK only hit the mainstream in the 20th century. First, after WWI, following Prime Minister David Lloyd George’s 1918 promise to build “homes fit for heroes”, and then, probably more so, in the 1950s and 1960s as the Tory government reduced Stamp Duty and lent money to building societies as part of its pledge to create a “property-owning democracy”. In the 1950s and 60s home ownership went from below 30% to above 60%.On the one hand, the mortgage enabled many people to get on the housing ladder in the first place. The financing also enabled more properties to be built. But on the other hand, introduce debt into a market, you introduce more money into that market with the consequence of higher prices. See student loans for more details. If house prices were determined only by the amount of available cash, they would be lower and more in line with earnings. But they are not.House prices are determined by the amount of debt that is available, which in turn is determined by the cost of money (interest rates), general risk appetite and so on. That is why prices are now so out of kilter with earnings. Once upon a time, and not so long ago, house prices were 3 times earnings. Now in London they are north of 10 times.Why houses cost so muchThe widely accepted view is that houses are unaffordable because we do not build enough and this has lead to a shortage of supply. The stats I would always call on to counter this argument are that between 1997 and 2007 the housing stock grew by 10%, but the population only grew by 5%. If house prices were a function of supply and demand, they should have fallen slightly over this period. They didn’t. They rose by more than 300%. The cause of house price rises is the unrestrained supply of something else: money. Mortgage lending over the same period went up by 370%.I was just doing some research this morning as those numbers are so out of date, but the latest numbers do not tell such a different story. In the ten years to 2021 the housing stock in England and Wales grew by just above 6%. The population grew by a similar amount - 6.5% in England and quite a bit less - 1.4% - in Wales. But average UK house prices over the same period went from £167,000 to to £270,000 (more in England). Mortgage lending, meanwhile, more than doubled (from £153bn to £316bn) over the same period.The relationship between money supply, aka credit, and house prices is obvious.Research by thinktank Positive Money shows that over 50% of the money created by banks when they lend now goes into mortgages. All that newly created money going to into a market where supply is constrained by planning laws will inevitably push up pricesThese two charts from Positive Money illustrate the relationship between credit creation and house prices.Here is London.I’m not saying population growth doesn’t affect house prices. It does. So do dumb planning laws and the restrictions they place on new build. But neither to the same extent as money or credit supply.Even the Telegraph admitted this yesterday, albeit accidentally, saying: “The jump in house price cuts corresponds directly with a doubling of mortgage rates”.The Bank of England does not factor money supply or house prices into its measures of inflation, it only includes a basket of consumer goods and services. These goods and the services are prone to the deflationary forces of globalisation and increased productivity: that is to say the shirt on your back has got a lot cheaper because it is now made in Bangladesh where labour is a lot cheaper than it was in Manchester, or wherever it was made a few decades ago.Thus the Bank has been able to say inflation is low for decades, it has kept interest rates too low for decades, money has been too cheap for decades, people have borrowed for decades and house prices have risen for decades.Quick - tell someone about this amazing article.Peak cheap labourOf late, we have hit something of a deflationary limit, albeit a temporary one. First, Covid-19 hit supply chains and that has pushed up prices. Second, the trend is towards more not less government intervention, regulation and taxation, which also puts upwards pressure on prices. Third, where does the world now go to find cheaper labour than in Bangladesh or China? Africa, maybe, or machines. But, for the time being, we have hit peak cheap labour.Thus has inflation spread, even by the Bank’s measures, and it is forced to raise interest rates. Rising rates push up the cost of borrowing. Many that have borrowed can no longer service their debts, and so look to reduce their debts or offload the assets they have borrowed against. This puts selling pressure on the market.Rising rates reduce people’s appetite to borrow, the amount they can afford to borrow and banks’ willingness to lend. This takes buying pressure out of the market.The result is the panic we now have in the housing market. Falling prices, bearish sentiment and more. A third of all listed homes are now discounted. But, at 5%, the Bank of England base rate is still too low. Its own measures say inflation is 8.7%. Truflation has it at 11%. If you can borrow at 6%, and real inflation is 11%, in a way you’re making 5%, though few will see it like that.What happens if rates go to 8.7 or 11%? It’s not like this hasn’t happened before.I’m now 53. I’ve watched and been dumbfounded by the UK property market for too long. It is awful what it has done to this country, in my view, pricing out an entire generation, reducing family size and all the rest of it. For years every other government policy, it seems, is aimed at propping up the market, rather than letting it correct. That makes me reluctant to go all-out-bear in the way that many have done, and call for 35% corrections in the housing market. There are two ticking time bombs, however. First, the Bank really does lose control of inflation and we get some kind of currency crisis. This would tie in with my cycle, Frisby’s Flux, which suggests we could see lows in sterling next year. Second, the sheer number of fixed deals that are coming up for renewal in the next couple of years. This will see something in the region of two million households faced with mortgage repayments of at least double the level they were when the original deal was taken out (see below chart). Many are not going to be able to meet those repayments. The Office for National Statistics (ONS) says 57% of UK fixed rate mortgages were fixed below 2%. Forced sellers will quickly drive down prices. The government will no doubt find ways to prop up the market. It knows this is coming. But housing markets move slowly. Housing crashes are only called crashes in retrospect. I think houses almost certainly get cheaper before they get more expensive again. If you are looking to buy a home, unless it’s really urgent, I would find an excuse to wait, perhaps until 2025, as this 18-year cycle suggests.This August Dominic will be performing one of “his lectures with funny bits” at the Edinburgh Fringe, at Panmure House, the room in which  Adam Smith wrote Wealth of Nations. This one is about gold. You can get tickets here.Interested in buying gold to protect yourself in these uncertain times? My recommended bullion dealer is The Pure Gold Company, whether you are taking delivery or storing online. Premiums are low, quality of service is high. They deliver to the UK, US, Canada and Europe, or you can store your gold with them. More here. This is a public episode. If you'd like to discuss this with other subscribers or get access to bonus episodes, visit www.theflyingfrisby.com/subscribe

Before we begin today’s piece, a quick reminder for those who might find themselves in the Scottish neck of the woods this August, I am doing a show at the Edinburgh Fringe all about gold.It’s from August 4th to 20th at 2pm. Please come if you are in town- you can get tickets here.Plus an added bit of history: it takes place in the room in which Adam Smith wrote Wealth of Nations. Hopefully, I will see you there.And, if you would like me to speak at your event or to advertise on these pages, please drop me a line.Copper, they say, is the metal with a PHD in economics. Gold, eternal and indestructible, will protect your wealth. It might even give you safe passage into the afterlife, at least that’s what the Ancient Egyptians thought. Zinc, on the other hand, stinks.That is the cruel verdict the poets of the investment world have bestowed on zinc, and there is plenty of truth to the maxim. In the spring of 2022, zinc was flirting with $4,500 a tonne. Here we are 14 months on and the price is down $2,000 - $2,400/t at time of writing. Not only does zinc stink, it sinks.It’s a story common among metals, but zinc really has been bad. Amongst LME-traded metals only nickel has been worse.China’s post-Covid bounceback was supposed to herald good times for metals investors. No such luck. Global demand for zinc fell by 4% last year, led by a decline of 6% in Chinese demand. The International Lead and Zinc Study Group (ILZSG) forecast supply shortfalls of 150,000 tonnes last October. For the first four months of 2023, it has just reported that the global market for refined zinc was in surplus by 138,000 tonnes. That’s probably why the price of zinc keeps sinking.Zinc stockpiles at the London Metals Exchange (LME) were low at the start of the year, equivalent to less than two days' worth of global consumption.  While stockpiles are low, there is always a chance of supply shortages and then price spikes, but they have since quadrupled and spreads suggest further inventory is expected. It is hard to be bullish when there is no shortage of supply and no unusually large demand.Here, for your information, is a chart showing 50 years of zinc prices. That said there is a clear long-term trend since 2000 of higher lows.Just over $4,500/t was the all-time high in 2008, during a decade in which all raw materials boomed. You can see the barren commodities depression of the 1990s, by the end of which zinc had slid to $750/t; the incredible boom of the 2000s; more depression between 2011 and 2015.2016 and 2017 were good years for zinc - by then there was a considerable shortage in supply. Exploration and development budgets had been slashed almost to zero, and there were genuine shortages of the metal.Things turned down again in 2018, leading to an eventual low in 2020 at the height of the Covid panic below $2,000/t. It fell pretty much in tandem with emerging markets, as is often the way with commodities. Much of zinc’s poor performance can be explained by its ties with steel. Zinc was caught in the crossfire of trade wars and, in particular, the tariffs on steel products. Coming out of 2020, however, it had a bonanza run, eventually peaking in early 2022 with quite some spike, caused by Vladimir Putin’s invasion of Ukraine. We were back near $4,500/t. Since then we have been in near free fall. It would appear the 2020 Covid-19 lows at 2,000/t are beckoning again.Around $2,400/t, however, most mines do not make money. Many actually lose.  A prolonged period around these levels will trigger output cuts. It’s already starting to happen. For example, Sweden's Boliden (BOL.ST), recently put its cash-flow-negative Tara mine in Ireland under maintenance. 650 workers laid off. Closing a mine is not only damaging to communities, it is expensive. Such decisions are not taken lightly. But stinking zinc has its first victim. Tara is Europe's largest zinc mine, the eighth-largest in the world. Other mines will probably have to close too. There are thought to be 22 significant zinc mines outside China (including Tara) with all-in-sustaining costs higher than $2,400/t. This will lead to a shortage of supply and, eventually, price rises. Thus does the mining cycle of life - and death - continue to turn.Why do we need zinc?First isolated in India around the year 1300 (much earlier than in Europe), zinc now is the fourth most used metal in the world, after iron, copper and aluminium. Its main use is in the construction industry: the frames of buildings, bridges, roofs, staircases, beams and piping all contain zinc. A coating of zinc over iron or steel protects the metal beneath from rusting. It is also used in alloys (brass and bronze), in compounds with a range of applications, particularly in batteries – from everyday AAs and AAAs to silver-zinc batteries in aerospace – and, increasingly, in fertiliser.Around 60% of zinc usage is in the form of galvanised steel, which is widely used in the construction and automotive sectors. That is where demand has been weak. There is also a narrative emerging around zinc battery storage. Zinc batteries offer a wider operating temperature range, longer life, and a lower cost per kilowatt hour than today’s leading batteries, including lithium.  The market for zinc is worth around $35bn a year. Numbers like that can be difficult to fathom, so to put $35bn in some kind of perspective, that’s around double the size of the lead and silver markets, but about a fifth of the size of the copper market. You guessed it. China is, by some margin, the world’s largest producer (33% of global production), the world’s largest refiner and the world’s largest consumer.After China, the next biggest producers are Peru, Australia, India, the US and Mexico. Australia, however, has by some margin the largest reserves.Just below 40% of zinc production derives from recycled or secondary zinc, especially from galvanised steel and batteries. (Galvanised steel tends to have a long shelf life). This is a tight market so it does not take a lot to knock it off balance. But both supply and demand have been pretty much in tandem this last decade, apart from a wobble in 2016-17.Zinc’s time will come. But I’m not of the view that now is that time. That said, fortune favours the prepared. Bear markets are the time to get ready, to do your research, to work out the best ways to play the zinc game, so that you are ready to pull the trigger when we reach that inevitable point when demand increases and there is not the supply to meet it.How to invest in zincThere are a range of ways to play zinc. WisdomTree offers a London-listed ETF, (LSE:ZINC) , or you can spreadbet the price (which has its own considerable risks attached, and I’d avoid doing so unless you know what you are doing). The large miners are another option, but none are pure plays. Glencore (LSE:GLEN) is by some margin the world’s largest producer, followed by Hindustan Zinc (Mumbai:HINDZINC), Teck Resources (TSX:TECK) and Zijin Mining (SHAGHAI:601899). BHP Billiton (LSE: BLT), Vedanta (LSE: VED) and Sweden's Boliden (BOL.ST) are other options.The largest mine in the world is in Algeria, the Ghazaouet Mine. Teck owns the next largest, the Red Dog Mine in Alaska. Vedanta own two of the “top ten”: the Rampura Agucha Mine in Rajasthan, India and the Gamsberg Project in Northern Cape, South Africa. Glencore also has two of the top ten - the Mount Isa Zinc Mine Queensland, Australia and the McArthur River Mine in Northern Territory, Australia. As zinc often occurs with lead and silver, the largest silver producers often have significant zinc bi-product. And vice versa.In the world of junior mining, there is no shortage of zinc plays. I have some legacy shares in dual-listed Solitario Zinc (NYSE: XPL; TSX: SLR), but the stock has gone to sleep. It has good high-grade projects in Peru and Alaska, both in partnership with majors, and as a result neither are being developed. To be fair, management has kept the share structure tight. At 9% ownership, has plenty of skin in the game and there is a reasonable cash position. It is now working on developing a gold project that is promising, but you get the impression the project might have brought in to justify the existence of management, while its zinc properties are on hold. I recently attended a gold show in Germany, the Deutsche Goldmesse, and saw one of the best presentations by a zinc company that I have seen by any company for some time. I’ll be covering that in my next Best In Class.Please consider subscribing to this mighty publication.Interested in buying gold to protect yourself in these uncertain times? My current recommended bullion dealer in the UK is The Pure Gold Company, whether you are taking delivery or storing online. Premiums are low, quality of service is high. They deliver to the UK, US, Canada and Europe, or you can store your gold with them. This is a public episode. If you'd like to discuss this with other subscribers or get access to bonus episodes, visit www.theflyingfrisby.com/subscribe

Before we begin today’s piece, a quick reminder for those who might find themselves in the Scottish neck of the woods this August, I am doing a show at the Edinburgh Fringe all about gold. It’s from August 4th to 20th at 2pm. Please come if you are in town- you can get tickets here.Plus an added bit of history: it takes place in the room in which Adam Smith wrote Wealth of Nations. Hopefully, I will see you there. So, the pound …An alert just went off in my calendar: “start looking to short the pound”, it says. Why would one short strength?Look at the pound these last few months, it has been very strong, very strong indeed. You wouldn’t know it to listen to many financial commentators, who so often seem consumed with national self-loathing, but against a basket of foreign currencies, the pound actually flirting with six-year highs (it’s got a bit further to go against the euro and the US dollar, though, largely, we tend to think of pound-dollar, aka cable, as the defining measure). Charlie Morris of Bytetree argues that the pound has become the carry trade. (When you borrow at a low-interest rate in one currency and invest in another currency at a higher rate of return).We are in an equities bull market of sorts, and the pound, as the currency of a nation geared to finance, tends to be strong when financial assets are strong. During times of financial crisis, it is much weaker.Whatever the explanation for recent pound strength, I set the alert some three or four years ago - before the strength kicked in. What was I thinking?It’s based on a cycle I’ve identified. As far as I know, I’m the first to observe this cycle, so, with Brand Frisby in mind, I’ve named it after myself: Frisby’s Flux - the eight year cycle in the pound. Before I explain the cycle, let me issue a disclaimer. As outlined last week, it’s easy to look back at history, find some arbitrary pattern and declare it a cycle. Real life in real time is often a very different matter. Nevertheless, cycles can help frame where we are in the grand scheme of things. My observation is that every eight years, the pound seems to crash. We start in 1976, the year of the IMF (International Monetary Fund) crisis. At one point, inflation reached 24%. The Labour government borrowed $3.9bn, at the time the largest loan ever requested. From high to low, sterling lost around 40%, reaching $1.60.But it recovered. By the early 1980s sterling was back above $2.40.Then came the next bear phase, in which the pound would drop by more than 55% and reach an all-time low against the dollar – $1.04. This was the era of the Falklands War and then the miners' strike. The low came shortly after 1984, in early 1985.On the other side of the trade, the US dollar was showing extraordinary strength – so much so that France, Germany, Japan, the US and the UK eventually colluded to depreciate it. This was the Plaza Accord of 1985. Again sterling would recover – this time to $2.Eight years on, in 1992, sterling hit another significant low. This was Black Wednesday, when the Bank of England took the UK out of the European Exchange Rate Mechanism (ERM). It fell from $2 to $1.40 – a 30% loss. The killing that George Soros made selling the pound sealed his reputation.Eight years later, around 2000, as the dotcom bubble collapsed, so the pound lost 20% of its value. (What did I say about the pound being geared to finance?).  But again it recovered. By 2007 it was above $2.10. Can you imagine? The pound above two bucks only 16 years ago.Then we got the financial crisis of 2008 and, yup, the pound lost 35%, hitting a low of $1.36.The next low came in 2016 with Brexit then the infamous Flash Crash of 2016, shortly after Theresa May's speech at the Conservative Party Conference. Having been above $1.70 at one point earlier in this cycle, it hit a low of $1.14, according to some measures. The overall drop from high to low was almost 35%.The subsequent bull market was probably the limpest in living memory. The 2016 low was retested in the Corona panic of 2020, but then we get a good rally to $1.42 by summer 2021.After that, with so much political upheaval, the pound turned down. When the Bank of England broadcast that it would be selling the UK gilts it had printed the money to buy during Quantitative Easing, and Chancellor Kwasi Kwarteng then gave us his low-tax budget, panic hit the markets and the pound hit an intraday low of a $1.04 (the same low it hit in 1985). Since then we have had quite some rally.Here’s the illustration of everything I’ve just described. Don’t you love charts? They get to the point much quicker.Did the 8-year cycle low come early? Was that it in 2022? Or can we expect it some time in 2024?When I first wrote about Frisby’s Flux, as long ago as 2017 it may have been, I suggested that we should be looking for a high some time in 2022-2023, as an opportunity to go short. Hence why I put that notification in my calendar. This current rally might be providing us with just one such opportunity. Question is: how long does the rally go on?On a long-term basis, the pound at $1.28 is not exactly hugely overvalued. On a Big Mac Index basis (which measures relative currency value around the world based on the cost of a Big Mac) we are not far off fair value. As I say, cycles are easy to identify in the rear view mirror. They are much harder to trade in real time. Perhaps the trigger will be yet more dysfunctional politics. Perhaps the Bank of England will fall even further behind the inflation curve and rates will spike, triggering some kind of crisis, such as we saw in the lead up to 1992. Perhaps equities more generally turn bearish. We can only guess what the trigger might be. But Frisby’s Flux, whatever it is worth, and that might be very little, is suggesting there might soon be an opportunity to go short the pound  looking for an eventual low in 2024.Interested in buying gold to protect yourself in these uncertain times? My current recommended bullion dealer in the UK is The Pure Gold Company, whether you are taking delivery or storing online. Premiums are low, quality of service is high. They deliver to the UK, US, Canada and Europe, or you can store your gold with them.The Flying Frisby is a reader-supported publication. To receive new posts and support my work, consider becoming a free or paid subscriber. This is a public episode. If you'd like to discuss this with other subscribers or get access to bonus episodes, visit www.theflyingfrisby.com/subscribe

A must-watch/listen interview with Miami-based, Michael Saylor, Chairman and co-founder of Nasdaq-listed MicroStrategy Inc (NDX:MSTR).Michael is one of the most articulate proponents of bitcoin, having shot to fame in 2020 speaking so passionately about it in numerous interviews. With his company buying over 140,000btc, Microstrategy, effectively, keeps its treasury in bitcoin.In this interview we discuss:* the state of bitcoin* the future of bitcoin* how changes in accounting will enable corporates to purchase more bitcoin* how 7% inflation destroys companies* why Turkey should buy bitcoin* gold vs bitcoin* Lightning, micro-transactions and their likely effect on the bitcoin priceWatch the video version of this interview here.Don’t forget my Edinburgh Show this August, if you are in Scotland.Subscribe to The Flying Frisby for more amazing content.Useful links:Michael on TwitterThe Saylor Academy.Hope.com - bitcoin education site This is a public episode. If you'd like to discuss this with other subscribers or get access to bonus episodes, visit www.theflyingfrisby.com/subscribe

Hugh is an author with experience in business, market research, psychotherapy, academia and performance. He has collaborated with Paul McKenna on many best-selling self-help books in UK and USA, and leads workshops in negotiation, qualitative research, hypnosis, performance and presentation skills, practical philosophy and authentic storytelling.​His latest book, which we discuss today, is The Bug in our Thinking. In a world awash with illusion and misinformation this is a guide towards clarity. It has philosophy for non-philosophers, hypnosis for non-hypnotists and stories for hungry hearts. Get the paperback here, or the kindle version here.Here is the video version of this interview. Please subscribe to The Flying Frisby. This is a public episode. If you'd like to discuss this with other subscribers or get access to bonus episodes, visit www.theflyingfrisby.com/subscribe

Before we begin today’s piece, if you should happen to be in the Scottish neck of the woods this August, I am doing one of my lectures with funny bits at the Edinburgh Fringe this year.This one is about gold. It has got Greek gods, interstellar collisions, heists and Nazis. What more you could want in a show? It’s from August 4th to 20th at 2pm. Please come if you are in town- you can get tickets here.Plus an added bit of history: it takes place in the room in which Adam Smith wrote Wealth of Nations.Hopefully, I will see you there. So cycles …‘The wheel is come full circle,’ commented Shakespeare’s Edgar on the carnage that surrounded him at the end of King Lear. The notion of a wheel of fortune is one that has pervaded since antiquity. There are good times and bad times. There are bull markets and bear markets. There is boom and bust, something Chancellor Gordon Brown said he was going to eliminate.Whether it’s the seasons of the year, the moons, or the inevitable ageing process and the cycle of life - what Shakespeare called “the Seven Ages of Man” - it’s clear that there are recurring patterns to the world around us. There are even recurring patterns in the length of women’s hemlines. Anyone who has been involved in business for any significant amount of time will know that markets never go up for ever, but are subject to the same cyclical movements. Commodities are very prone to cycles, so called secular bull markets or super-cycles. In 1947, Edward R. Dewey and Edwin F. Dakin published a book called Cycles - The Science of Predictions. It’s now out of print, but Dewey and Dakin noticed a 54-year index cycle in wholesale prices – in other words commodity prices  - going back to 1790. Based on this they made projections for the future. They called it the 54-year "Rhythm".Their forecasts were pretty accurate. The 1980s and 90s were a clear secular commodities bear market. The 2000s a clear secular bull. The 2010s another secular bear. The 2020s? A bit of everything.Thinking in basic terms can be an effective way of investing: are we in a bull market or a bear market? How long does this bull/bear market have to run? Find a bull market and go long. That’s all you need to do really as an investor. There’s no point picking brilliant stocks, if the sector they are in is in a bear market.   Mining companies themselves, go through clear cycles – perhaps phases is a better word – from exploration and discovery, through development and mine building, to actual production. New technology goes through a clear cycle as it evolves, which research firm Gartner dubbed the hype cycle. Look at what happened with Dotcom and the internet: from invention to excitement and bubble to collapse to mainstream adoption. Felix Dennis in his book How To Be Rich talked about “riding the wave”: getting into a new growth area early and then surfing to riches. Thinking in terms of cycles can help you to frame the bigger picture. It can give you an idea of where you are in the grand scheme of things. We like reading about cycles because they bring a veneer of certainty, clarity, security and comfort, where there is, in fact, often none. But most of us have a slightly superstitious streak, which means we can be vulnerable to cycles narratives, too easily persuaded by them and too easily wedded to them.I remember around the time of the Global Financial Crisis in 2008, many became obsessed with the idea of Kondratiev winter. In his 1925 book The Major Economic Cycles, Russian economist Nikolai Kondratiev had identified a long-term cycle lasting approximately 50 years. As I say, cycles can make for good copy and Kondratiev made his name pedalling them. We had had spring, summer and autumn. Now we were headed into winter. The notion was confirmed by the collapse in financial markets happening in real time around us. The narrative took hold, and many buckled down with gold, tins and guns, ready for a great depression, only to miss out on one of the most epic bull markets in history.Back in 2005 economist Fred Harrison wrote about an 18-year cycle in UK property in his cult classic Boom Bust: House Prices, Banking and the Depression of 2010. In 2005 many had already turned bearish on property with good fundamental reasoning. But Harrison said the bull market had longer to run and the top was coming in 2008. He was right. There were still two more years of bull market. The peak actually came in the third quarter of 2007. The problem is the trough was so short lived. A couple of years maybe. We got the Global Financial Crisis but I don’t remember the “Depression of 2010”.  There was a buying window during that 2009 to 2011 period, but prices, especially in London, did not fall by anything as much as many were hoping. Interest rates were slashed and there were few forced sellers. Without the rate cuts, house prices would have come down by a lot more. By the turn of the decade it was off to the races again. If you sold in 2007, but were too wedded to the cycle theory, you would have been waiting for lower prices and never got back in again. Harrison, by the way, is forecasting the next peak in UK real estate in 2025. He may prove right, but recent data coupled with rising rates suggest the market has already peaked. Is this another false top, such as we saw in 2005? We shall see.Another popular cycle is the four-year “presidential cycle” in US stocks. A few years ago GMO’s Jeremy Grantham, one of its main proponents, declared that it doesn’t work any more because the US Federal Reserve has broken it. But here we are in 2023, in the third year of a presidential cycle, and the S&P500 is acting it out to the letter, rising to new highs when few expected it.The idea is that economic sacrifices are made during the first two years of a president's term (while it’s still OK to be unpopular). This results in the “four-year cycle low” in the stockmarket. Then, in the final two years of the term, the focus shifts towards stimulus, to boost the economy ahead of the next election. That 3rd year boom is just what we are seeing now.Cycles are all very well in theory. They make a great topic for discussion, but trading them in real time is a different prospect altogether. It’s too easy for an academic to look back at history, find a pattern and declare it a cycle. When real life doesn’t fit the model, you’ll hear something like: “Well, the war upset the cycle”, or “they printed loads of money, so the cycle didn’t work out”. Markets are not fixed and predictable in the same way as the days and weeks of the year.I like writing about cycles. I like reading about them. I think they help guide you through life. But when the word “cycles” comes up in investing, I breathe out and try and erect a defensive mental wall. Heaven forbid I should get too wedded to them. Real life and academia are not the same.Thanks for reading. Please subscribe if you haven’t already, and check out my paid letter. Lots more great content on its way.Interested in buying gold to protect yourself in these uncertain times? My current recommended bullion dealer in the UK is The Pure Gold Company, whether you are taking delivery or storing online. Premiums are low, quality of service is high. They deliver to the UK, US, Canada and Europe, or you can store your gold with them. This is a public episode. If you'd like to discuss this with other subscribers or get access to bonus episodes, visit www.theflyingfrisby.com/subscribe