The Flying Frisby - money, markets and more

I’ve seen it happen with so many niche commodities - potash, graphite, antimony, rare earth metals, cobalt, vanadium - and I am pretty sure it is happening again.There is some substance you’ve barely heard of. Suddenly, it’s essential to some new technology which is going to save the earth in some way, but nobody’s producing it. Why is nobody producing it, if it’s so essential? Because prices are so low.Prices then start going up, because everybody wants it and nobody’s producing it. Suddenly, a load of natural resource companies which aren’t going anywhere, especially in Canada and Australia, “change their focus” and “pivot” They start exploring for said commodity. Some of them acquire half-explored development projects and re-drill them.Investment capital piles in. Some of the above companies actually make discoveries that start producing. Existing producers up their output.Within a few years, there is a surplus of said commodity, where once there was a shortfall, and the price comes back down again. The bigger the previous rocket launch, the bigger the subsequent crash. Those companies that aren’t profitably producing hit the skids. Those that are have to tighten their belts. The bull market has morphed to bear.Nothing fixes high commodity prices like high commodity prices runs the adage. If you can time these cycles well, you can make a great deal of money. But you can also lose a lot of money.The bull market in an essential commodity bursts I think we are seeing one such turn right now in lithium. Perhaps even in the broader battery metal space. Fossil fuels are destroying the planet. Electric vehicles are the answer. But they need lots of lithium? Yes. Who makes lithium? I don’t know. But the price is going up. Quick, let’s invest in lithium. Let’s start a lithium company. Lithium is going to save us. Tesla can’t get enough lithium. Tesla’s going to buy a lithium company. Lithium, Tesla, EVs, Net Zero, Climate Change, BUBBLE!!!Much as I love niche commodities for these repeating cycles they display, I’m afraid I missed the lithium bubble. I didn’t catch the early phases of the bull market when it had a good run in 2016 and 2017.In 2018 and 2019 the lithium companies had a miserable time, and I felt somewhat vindicated. But after the Covid lows of 2020, they exploded - I missed that one too, as I was away with other commodities. I felt I was too late to join the party. I clicked my tongue as the price went up without me. I clicked my tongue even more as the bull market went on for longer than I thought it would . I then watched with a certain amount of confusion as the companies pulled back while the price of lithium carbonate kept on rising. That’s not normally a good sign.In any case, now the price of lithium carbonate has stopped rising. In just a couple of months, it’s lost over 30% - having risen tenfold. Here’s the price action since 2017.And here is the Global X Lithium ETF (NYSE:LIT) - the lithium companies - over the last ten years.Supply up, demand down Lithium is not actually that hard to produce. Many of the problems are regulatory.  But there was a frenzied rush by electric vehicle makers to secure supply over the past two years, which sent lithium prices to the moon. Whoever could get producing first would win the race to secure contracts. The slower movers would suffer. Then late last year China announced it would halt subsidies for the $87 billion industry. Demand for electric vehicles dropped, just as lithium supply started coming on-stream. There is now a lot more supply on its way from China, Chile, Australia and North America and that is only going to send prices one way. Australian supply alone is set to rise by 32% this year.Lithium giant Albemarle (ALB.N) has said the lower car sales are a “temporary weakness”, given the early Lunar New Year in China. I’m not buying it. As my buddy, asset manager Simon Catt of Arlington Capital, alerted me in an email yesterday, the AUD$12.5bn market cap, Aussie producer, Pilbara Lithium (ASX.PLS) announced last week that their latest shipment of 15,000 tonnes of 6% spodumene concentrate was unpriced. “UNPRICED! Hold the phone,” he cried.Chinese battery giant CATL, the largest Chinese battery manufacturer, is selling its batteries at little more than cost to automakers. The discount includes an assumption that prices of lithium carbonate would fall by over 50%.“Lithium - First Leg Lower”Goldman Sachs just put out a report titled, “Lithium - First Leg Lower”, noting much of what I have just said and more. Chinese lithium demand is down 52% versus the three-month moving average, while production is unchanged. Prices “have more room to fall before spot demand recovers, in our view.” Goldman notes the end of subsidies, falling EV sales, falling spot prices, falling demand from EV battery production, and rising EV inventory putting a further dampener on demand and rising supply from China and Chile. It would seem the battery wheel is come full circle, if I may misquote the great man.This is not the end of lithium demand, nor the end of the electric vehicle. Both will play an enormous part in our futures. But my hunch is that this is the end of a two-year bull market that saw lithium carbonate and spodumene up many times over. Supply can now meet demand. The market has solved the problem in the market. Now the market has another problem: falling prices. It will solve that too. And so the commodity cycle turns. West Eng gig alert! This May, wearing my comedy hat, I’ll be coming back to Crazy Coqs in Brasserie Zedel for another night of “curious comedy songs”. That’s this May 7th. Please come if you’re in town. They are super nights.Interested in protecting your wealth in these extraordinary times? Then be sure to own some gold bullion. My current recommended bullion dealer is The Pure Gold Company, whether you are taking delivery or storing online. Premiums are low, quality of service is high. You can deal with a human being. I have an affiliation deals with them.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

Today I wanted to expand on a theme I have been writing about for a while: that the green energy revolution is anything but green. In fact, the amount of metal required and the amount of fossil fuel needed to be burnt to make it happen means it will be extraordinarily damaging to the environment, while unprecedented amounts of CO2 will be released into the atmosphere.Moreover, unlike the inflation that resulted from Covid and the Ukraine war, which might yet prove temporary, Net Zero will produce inflation that will be prolonged and entrenched. In other words, Net Zero is not only deluded, but it will also be extremely damaging, both to the planet and to people’s lives.Here we explain why - and what to do to protect your wealth.How much more metal do we need to achieve Net Zero?I stumbled across a super talk this week by Mark Mills, author and senior fellow at the Manhattan Institute, called "The Energy Transition Delusion: Inescapable Mineral Realities". He argues that the current energy transition to renewable is based on a flawed understanding of the resources required to make it happen. Most of the evidence cited here is cited from that talk.Today the world gets a little under 4% of its total energy supply from wind and solar. That’s one-third as much energy as it gets from burning wood. I couldn’t believe that stat when I read it - are we still burning that much wood? - but that’s what the International Energy Agency (IEA) says. Wood still provides 350% more energy to the world than all the world's wind turbines and solar power combined.To get to this 4% level the world has directly spent something like $5 trillion (more than double UK GDP) in the last 15 years, and probably the same amount again in indirect spending, says Mills. An electric vehicle requires 400% more metal than a conventional car. To build a machine to replace a gas turbine, you need 1,000% to 2,000% more mineral to deliver the same unit of power. To deliver the same mile of driving, the same hour of heat, the same hour of lighting or the same hour of computer time the extra minerals required amount to anything from 2,000% to 7,000%Overall this amounts to an increase in mineral demand in the order of 700% to 4,000%. “Not to put too fine a hyperbolic a point on this,” says Mills, “this would be the largest single increase in demand or supply of metals in all of human history. It's never happened.”Where is all this metal going to come from?Mining cannot increase output whether by 700% or 4,000%, not in the next decade, nor in time for the Net Zero deadlines.We are thinking in terms of kilowatt hours instead of in terms of tonnage - and tonnage is what’s required to get those kilowatt hours. Mills says, “It requires both the extraction and movement of a quantity of materials equal to or greater than the quantities of materials that humanity extracts and moves and grows for all other purposes combined. The world's not capable of doing that with the technologies that exist.”Where is all this new metal going to come from? To take a mine from exploration and discovery to production takes 16 years. Even if you relax regulation (unlikely) and accelerate investment (not so easy) you are only at best going to shave a few years off that. To go out and explore for mines and develop them requires investment, which the industry has been starved of since 2011. What’s more, there’s no guarantee you will ever get a payback: exploration has a success rate of about one in a thousand. Let’s say you do discover something and start building a mine, what if commodity prices come down? You lose a lot more than your shirt.Then there’s the political risk, whether from activists campaigning to get your mine closed (many mine plans in Chile, for example, which is supposed to be a mining hub, have lately been ditched because of such objection) or from governments seizing the produce. Burkina Faso's energy & mines ministry issued a statement on Tuesday saying it had "commandeered" 200kg of gold from Endeavour Mining’s operations for "public necessity". The company will be compensated for its value, the statement added without providing further detail. Mining is starved of finance yet “the mining industry needs to deliver new projects at a frequency and consistent level of financing never previously accomplished,” says energy research company Wood McKenzie. Currently, the world is not even investing 10% of what’s required. Then there is the issue of refining. This is a major geopolitical and strategic issue. China dominates refining. 40% of the global copper supply is refined there, 35% nickel, 65% cobalt, 87% rare earth, 58% lithium. Never mind the strategic questions of handing China that much power, how environmentally friendly do you think Chinese refining is going to be? Chinese coal production for power generation hit a record last year. What will happen to energy and metal prices in all of this? Currently metals prices are a whisper in the broader inflation clamour. A sustained increase in the price of metals and energy of 300% or 400% will push up overall inflation. There is only so much you can hide with subsidies. Now let’s look at another cost, the environmental cost.As humans have extracted natural resources from the earth, they have become increasingly difficult to find and extract. A hundred years ago average copper grades were 4%. That is to say for every hundred tonnes of ore you process you might get four tonnes of copper. Today average grades have fallen to 1%. Other rarer metals require much more ore to be processed.“A half tonne battery,” says Mills, “requires 250 tonnes of ore to be processed somewhere”.  How the energy transition leads to pollution and climate changeTo produce the materials needed to realise Net Zero “will see the world consume fuels and emit carbon dioxide at levels that are unprecedented in mining history”, says Mills. Just nuts.Every time someone buys an electric vehicle (EV), they are essentially purchasing the previous consumption of 25 barrels of oil equivalent - half oil, half coal and natural gas. These hydrocarbons will have been burnt before even the first electron moves into its batteries on the road. By the time the electric vehicle first makes it to the parking space outside your home, it has already emitted 14 tons of CO2, compared to the 5 tonnes for the conventional vehicle. It’s not until the vehicle passes 60,000 miles that you end up with a net reduction. Humans require more and more energy as we grow more sophisticated. The Industrial Revolution increased energy demand. The automobile increased energy demand. The aeroplane increased energy demand. Computing increased energy demand. Drones and robots and AI are all going to increase energy demand. Surely, the answer is not to turn our backs on fossil fuels. The focus should be on developing cleaner and more efficient fossil fuel technologies, as well as improving renewable technologies.Unfortunately, the focus on renewable energy technologies has diverted attention and investment from the development of the cleaner and more efficient fossil fuel technologies we need.How to invest in the Net Zero transition So how to play all this? Do you think Net Zero diktats are going to change? I don’t. Governments are too scared of the environmental lobby to change tack. The way to protect yourself, I’d say, is to be long energy and long commodities. The likes of BHP or Glencore at the safer end of the market to juniors at the riskier end.However, what I have described above is not currently being displayed in energy and metals prices. Either the market has already digested and discounted the story, or it feels it is too far away to matter, or it thinks that governments will pivot, or it is not yet priced in. What do you think?The case for a secular bull market in commodities remains strong.If you are interested in natural resource companies, I cover them extensively. Please consider becoming a paid subscriber.Interested in protecting your wealth in these extraordinary times? Then be sure to own some gold bullion. My current recommended bullion dealer is The Pure Gold Company, whether you are taking delivery or storing online. Premiums are low, quality of service is high. You can deal with a human being. I have an affiliation deals with them.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

The bitcoin price has been quietly moving up and, almost inevitably, I am getting messages from people asking how to buy it.Bitcoin should make up a core part of your investment portfolio. Never mind the noise, the doubts, the FUD (fear, uncertainty and doubt), the “but I don’t understand how it works”, bitcoin is an incredible computational breakthrough with enormous implications for the world. It’s the most technologically brilliant form of money ever invented. My advice is to own a share of the pie - it is in limited supply.So here, by popular demand, we outline the best ways to buy bitcoin in the UK and elsewhere.This is a reversion of an article I put together for paid subscribers last year, but I am making it available to one and all.I wrote the first (and many say the best - who am I to disagree?) book on bitcoin from a recognised publisher back in 2014. So I know a thing or two about it.“A great account. Read it and glimpse into the future,” said Richard Branson. Though it’s not clear he actually read it.When he was Chancellor, Rishi Sunak, like George Osborne before him, gave it the big one about turning the UK into a hub for cryptocurrencies and the industries of the future, but these are just words. In practice, the UK regulator, the Financial Conduct Authority (FCA), has made life very difficult for the UK investor who is interested in cryptocurrencies. It has banned the sale of crypto derivatives and exchange traded notes to retail investors, which means traditional brokers are out, and it it has made sending money from a bank to a crypto exchange very problematic.Fear not. The guide will explain all.My first dollop of advice is this: before putting any significant sums to work, research as much as you can. Read about bitcoin, listen to podcasts and, above all, try out the tech. Buy small amounts, get a friend to do the same, and practice sending small amounts of money to each other. When you have got the hang of things, then you can invest more significant sums.Bitcoin’s repeating cycleBitcoin seems to go through four phases with every cycle - and these cycles repeat.* There’s the Quiet Accumulation. Few outside of the bubble of ardent bitcoiners take notice, as it discreetly creeps up. * The Frenzy and Blow-Off Top. The price rises accelerate. There is a rush to buy. The media is all over it. Everyone on social media is crowing. There’s a huge row about whether bitcoin is in a bubble or not. I get invited onto the BBC to talk about it. You get a phonecall from your mate’s nan asking how to buy it. Dean from up the flats starts holding court in the cafe about irresponsible monetary policy at the Federal Reserve. Bitcoin has one of its blow-off tops. See 2013, 2016 and 2021 for more details.* The Monster Correction. Bitcoin loses over 50% of its value. Economists who missed the boat go on telly and declare they were right, ignoring the fact that the price to which bitcoin corrected to is several hundred percent above where the quiet accumulation phase began. Earlier in bitcoin’s evolution these corrections could be 90% or more. Now they have “scaled back” to more like 80%.* The Frustrating Consolidation. Bitcoin goes into a period of range trading, consolidating the gains of the previous bull market. This is a period of relative quiet, at least by bitcoin standards. There are rallies that get many excited, we might even be seeing one of those now, but they prove to be false dawns. Investors get frustrated by the grinding action. The media loses interest. Many forget about it, and so we gradually drift into another Quiet Accumulation phase.We have just had a classic-of-the-genre Monster Correction, during which bitcoin lost 80% of its value, going from around $68,000 back to just under $16,000.Since December it has been quietly rallying and today we sit around $23,000. It might go back and re-test $16,000. It could fall another 80%. Then again it could go up and up and up from here. The best time to accumulate is during the Frustrating Consolidation or the Quiet Accumulation phase, and I suggest that is where we are now. Somewhere in stage 3 or 4 of the cycle.There are many who dismissed it late last year as it fell to $16,000. I take the other side. Given the spate of bankruptcies, the Sam Bankman-Fried saga and more, I think it’s pretty amazing that it didn’t go lower.The best ways to buy bitcoinThere are three ways to get hold of bitcoin: you can earn it, you can buy it or you can mine it. I suppose you can steal it as well. But that’s not something we cover here. Or anywhere.Forget mining for now. Bitcoin mining is beyond the scope of this article.Earning bitcoin is simple. All you need is a wallet. As long as the buyer of whatever product or service you are selling is happy to pay you in bitcoin, you just send them your wallet address, instead of your bank details, and they can pay you in bitcoin, just as they would any other form of money.There are countless wallet providers. I like Exodus, because it works on both your phone and your desktop, and Muun, because the interchange between bitcoin and the lightning network is very user-friendly.Follow the instructions they give you to get started. They have videos to help you. Keep a note of your seed phrase and store it somewhere safe. Put aside an hour to have a play, and familiarise yourself with how it works.So that’s how to earn bitcoin. What about buying it?To buy bitcoin, you need to go through an exchange - the equivalent of a broker or bureau de change.The best exchanges to buy bitcoinThere are so many exchanges now, and they all have their pros, cons and idiosyncrasies. The best for UK investors are probably any of Coincorner, Gemini, Kraken, Binance, Bitfinex, CEX.Io, Bitstamp, Poloniex, Bittrex and eToro. The one I use the most is Coin Corner. I have an affiliate deal with them.Opening an account with an exchange is a bit tiresome with all the ID checks, but it has to be done – broadly speaking, the more you want to buy, the more paperwork you have to fill in. And do make sure you set up 2 or 3FA. Most exchanges insist on it.Kraken, Bitfinex and Binance seem to have the cheapest commissions, but they are badly lacking in customer service and, if something goes wrong, you won’t get much help. Also - don’t buy off the front page. You will end up paying higher commission. Buy through the trading apps using a limit order. Commission rates are lower there for some reason. I guess it’s a way of snaring newbies.As I say, the one I use the most is Coin Corner. You can’t buy sh*tcoins with them. It’s good to have this temptation removed.Easier options for small amounts include Bittylicious or even bitcoin ATMs (but both their commissions and spreads are vast).Revolut makes it easy to buy bitcoin (and easy to open an account), but you can’t then move your bitcoins elsewhere. You can only sell back to Revolut, which is somewhat besides the point. But it also means Revolut solves the storage problem for you, though I wonder, for reasons explained here, how much protection you’ll have if they get hacked.Advanced users and purists will prefer the decentralised exchanges, but we will leave those for another day.Sending money to an exchangeOnce you have your account set up, you’ll experience the delights of sending money to your exchange via a bank. You might end up having to make a phone call to the bank at this point (and you’ll wait a while; banks’ response times have become very slow). The FCA-registered exchanges, such as Gemini, tend to be the easiest in this regard. (You can use a debit cards with CoinCorner and most of the others). I got so frustrated with HSBC blocking my transfers to crypto exchanges, that I switched bank to “challenger bank” Starling. Starling were fine at first, but now they have changed their rules. Conducting some research on Twitter, Barclays and Natwest are hopeless. HSBC, Halifax, Nationwide, Santander and Lloyds might let you after a few phonecalls. Revolut and Monzo are ok.In order to use crypto exchanges and send “significant” sums of money, my advice is to open an account with Monzo or Revolut. Send your money from your normal bank to them, then from them to the crypto exchange. (But a word of warning: don’t leave large amounts of money for long periods with Revolut. I have heard some nightmare fraud stories).To open an account, have your passport to hand and it can be done on your phone, simply, in just a few minutes. This seems a long-winded way of doing things, but it works.Send however much you want to spend on bitcoin to your Monzo account, and then from Monzo send it to an exchange.Share this post with anyone you know who might want to buy bitcoin.Other ways to get exposure to the bitcoin priceIf you’d still prefer some sort of listed option, there are various options, even to UK investors. Not as good as the real thing in my view, and during this bear market they have been very weak, much weaker than bitcoin.There is Microstrategy (Nasdaq: MSTR) which has become something of a proxy for bitcoin as it owns so much. Coinbase (Nasdaq:COIN) is another option. London has a listed bitcoin miner, Argo Blockchain (LSE: ARB), and both Vaneck and Han have crypto-related ETFs.And if, after all that, you prefer gold, my guide to buying gold is here.Please subscribe to this esteemed publication.Disclaimer: I am not regulated by the FCA or any other body as a financial advisor, so anything you read above does not constitute regulated financial advice. It is an expression of opinion only. Crypto is a famously risky sector so please do your own due diligence and if in any doubt consult with a financial advisor. Markets go down as well as up. Especially crypto. I do not know your personal financial circumstances, only you do, but never speculate with money you can’t afford to lose. 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 few weeks ago, an Irish friend of mine was contacted by the Irish Postal service. A package had arrived for her from abroad, but there were a couple of euros and change of duties to be paid. This had happened to her before - she buys a lot of stuff on the internet, clothes especially - and she duly got out her debit card and paid up.A week or so later, she was sitting in a meeting, when she started getting updates from Revolut notifying her that money was being sent from her account to Binance, the crypto exchange. She doesn’t have an account with Binance.She contacted Revolut and then found money had also been sent to the crypto exchanges Kraken and Coinbase, and then, of all places, to Deliveroo. The perpetrator was ordering dinner.She thought she had frozen her account, but it seems Revolut had already done this ten minutes earlier - their fraud detection system had been triggered and the customer alerted. The Revolut rep advised her that the transfers had not been completed yet, that they would be halted and that in a few days the money would be returned. My friend calmed down.The following day, however, she saw that the transfers had gone through. She got in touch with Revolut again. Only this time the rep told her that yesterday’s rep had given her the wrong advice. Those payments could not have been halted and the money would not be returned.After several days’ back and forth, Revolut then confirmed that the money was gone and that they would not be refunding it to her. If she had any complaints she should take it up with the police. In total, she had around 7,000 euros stolen from her account. Someone had stolen her debit card details, most likely that person supposedly from the Irish postal service, and that is how the fraud was perpetrated.She reported it to the Gardai (the Irish police), spending several fruitless hours on several different occasions at the station, where notes were taken on bits of paper (not digitally) and she was given titbits of advice such as, “ah, well, you don’t know what’s going on with them foreign banks.” There was one detective, apparently, who was helpful, but, apart from that, fruitless. They then told her to speak to the financial ombudsman, which she did, to be told that it was too close to Christmas and she should try again in the new year. She would eventually be given the run around by the ombudsman as well.She asked another of her banks what they did in this situation, and they suggested she try and find a solicitor. But this, it seems, was hard too. Most specialise in defending organisations against fraud, but few act for individuals, she says, and certainly not in her price bracket.She then started getting repeated calls from another company - a Florida number, but based in Israel - asking her for €1,000 upfront to recover the money, which they say there is a “good chance” of doing.Eventually, she got in touch with me to see if I could help. The whole story seemed extraordinary. I read the conversations she had had with the Revolut representative telling her not to worry. I couldn’t believe Revolut then saying she had no protection, when she was clearly the victim of a debit card fraud. Surely, even with Revolut’s non-banking status, it has to abide with EU customer protection laws, doesn’t it?I’ve had money stolen from my account, when I lost my debit card. Whoever found it went on a shopping spree round the supermarkets of South London. I had to fight to get the money back, and go through endless phone calls and form filling - and even then HSBC “forgot” to re-instate the stolen funds - but I did eventually get the money. I’ve never had such problems with credit cards, which is why I prefer them to debit cards. But even with HSBC’s delaying tactics, I never got a flat refusal in the way that my friend was given by Revolut.The ability to hold numerous different currencies in Revolut, the ease with which you can send and receive money internationally and indeed send to crypto exchanges, where many traditional banks will block transfers, make it a tempting option. But the convenience it offers seems to come at a cost and that cost is the safety of your money.I got in touch with Revolut here in the UK saying I was writing a story about this and I wanted to hear Revolut’s side. Revolut replied straight away. I spoke to their representative, who was extremely helpful (he doesn’t want his name mentioned here).He recognised that I was working to a deadline, looked straight into the case and then came back to me a couple of days later with a resolution. “The experience of [unnamed] fell well below our high customer support standards and we’re sorry for the distress this caused her,” he said. “We have reimbursed her stolen funds in full as a gesture of goodwill.”I’m not sure my friend’s experience would have been the same had she not had a friend who is a financial journalist, but I have to commend Revolut and this employee in particular for the way he acted as soon as I came banging on the door. He also had this to say: “Criminals use increasingly sophisticated techniques to steal your details and your money. If you receive an SMS message from any person or business, be on guard, particularly if the message asks for your details or includes a link or number. Do not share authorisation codes or passwords with anyone, ever, even if they claim to be from Revolut.”And, there, I suppose is the moral of this tale. Debit and credit card fraud is rampant, and its perpetrators are a lot more wised up than most ordinary consumers - than you or me, in other words. I’m not a writer who specialises in this kind of consumer finance, but I would also add that my experience is that you seem to get more protection from credit cards than debit cards, so use them. Use 2 factor authentication wherever possible. Have your payment notifications switched on, so that every time there is a transaction you get notified. That way less will slip by you. Cyber crime is everywhere.Revolut also added: “If you think your card details may have been compromised, freeze your Revolut cards immediately in the app by tapping “freeze” on each of your cards and report the fraud to Revolut immediately by contacting a customer support agent via the in-app chat.” That’s exactly what my Irish friend did though!My eldest daughter is about to go on a backpacking trip. She has a Revolut account - she likes Revolut - and she’ll be taking a Revolut debit card with her. But she will keep her core funds in another account, for which she won’t have a debit card with her, thereby leaving it less vulnerable. She’ll only transfer money to Revolut when she needs it. It may seem long-winded, but it adds a layer of protection. Thank you for reading this. Be sure to check out my recent piece on the Great Decline, if you have’t already. It as caught a real nerve. And be sure to check out Dr John’s latest: My Top 5 Investment Trusts to Own for the Next 20 Years. You do not want to miss that.If you’re buying gold, 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. You can deal with a human being. I have an affiliation deal with them.If you’re buying bitcoin, be sure to read my special report.And make your Number One resolution for 2023 to listen to Kisses on a Postcard.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

Something is very wrong with my country. Something big and something bad. We can all feel it, though we might not agree on what is actually wrong. The great institutions of state are falling apart. Mighty institutions that I grew up trusting for their integrity, respected around the world, seem to be crumbling amidst incompetence, incoherence, corruption and more.The government, essentially unelected, is unpopular and ineffectual. Not that a properly elected government would make much difference. Sir Humphrey and the Blob still seem to run everything. The system seems set up to look after the system, rather than its people. The opportunities for change and reform that were first, Brexit, then Boris Johnson’s sweeping 2019 election win, have been squandered. The government is unable to carry out even its most basic function, which is to defend the borders. The Bank of England has for many years been destroying the value of money. Inflation, which apparently was unforeseeable, is now at 9%. And that’s just official inflation – we all know actual inflation is higher. The Bank’s monetary policies, together with planning laws, have given us an intergenerational wealth divide which means anyone born after about 1985 can’t afford anywhere to live. They delay starting families as a result, and they have smaller families, with the long-term consequence that the local population is eroded away. This then gives rise to the argument that, as locals aren’t reproducing, we “need” immigration. I can’t remember trust in the police, who seem more concerned with online wrong-think than violent crime, ever having been so low. I wrote that sentence before the David Carrick scandal. The courts are overwhelmed and the court system is both expensive and antiquated. The legal system is manipulated and exploited, only affordable to the very rich or very poor. The penal system is inadequate. Google “NHS and news”, if you want to see what state healthcare is in. Radical progressive ideology has enveloped education. Even the armed forces have been afflicted by it. Universities are overpriced and increasingly irrelevant to the modern work environment. The BBC, the national broadcaster, is loathed for its bias, and its output is, for the most part, crap. Luxury green ideology has left us with sky-high energy prices. Royal Mail only occasionally delivers - I’m still getting Christmas cards now. The trains are useless and expensive. Who knows how well the civil service is doing? It’s opaque. The electoral process has become meaningless. You get the same blob whoever you vote for. Representative democracy is neither representative nor democratic.I could go on. You get the point. Everywhere that is not functioning involves (or has involved in its recent history) the heavy hand of the state. You could look at, say, shops, tech, restaurants or media – areas where the state is less involved – and user dissatisfaction levels are not comparable. Airports actually ran better when the border force went on strike. It’s as though the state is inherently incompetent. Why there aren’t more libertarians, I’ll never understand. Meanwhile, all of these institutions are costing a fortune. Spending on most is at all-time highs. By the time you factor in inflation (which is a stealth tax - even the Chancellor recently admitted as much), taxation levels are comfortably in excess of 50%. That is to say: more than half of everything you earn is taken from you by the state to pay for stuff that doesn’t work. That’s before we get to the tax on the future which is debt and deficit spending.And then there’s the waste. Here is just one example:Imagine how much better off we’d all be, if citizens, rather than the government, could choose where to allocate the money they earn. You spend your money better than they do.Culture wars and mass migrationIt’s not just crumbling institutions and state overreach. They call it the Culture Wars, but we are in the midst of a religious war, an ideological struggle. What Elon Musk calls “the woke mind virus” – an aggressive, radically progressive ideology born out of an obsession with identity politics – has taken over, especially within institutions and education, and is wreaking havoc. From male rapists being put into women’s prisons to expensive green initiatives that actually damage the environment to a pandemic of cancel culture. Again, I could go on. I don’t need to spell it out here. You know what I’m talking about. Small government and libertarianism solves this too, by the way. The virus would not be able to survive and spread without the oxygen of public money.Meanwhile, the demography of the country has changed, and as a result, so has its identity (though few have yet realised that). Last year, 1.1 million people migrated to this country –  that’s just the ones who were granted visas. There are plenty more that weren’t. In effect, roughly one in every 65 people you meet in this country only came here last year.  The London of the 1970s that I grew up in has vanished. The archetypical Londoner used to be the Cockney – the white working-class man or woman born within the sound of Bow Bells. Today the Cockney, once such an instantly recognisable English type and one that has had an incredible influence on Britain, barely exists. They’ve all gone. Almost every other UK city is on a similar journey to indigenous British white minority.As the song goes, “you don’t know what you’ve got till it’s gone”. Whatever we had has gone and we will never get it back. It’s not just the UK. It’s the whole of Western Europe, and probably much of North America too. My German friend jokes that Buenos Aires will be the last European city. On which note, it was incredible to watch the World Cup Final between Argentina and France. By the time the game ended and the substitutions had been made, it was, essentially, a match between Africans from Europe and Europeans from South America. I am not “anti-migration”, by the way. If anything, I am pro it. In my National Anthem of Libertaria I argue for free movement. The mass movement of people is an inevitable tide in the affairs of men. People have always moved, and always will. But I also view conserving our culture, identity and communities as paramount, and the state is failing to do that.  If such things were not state responsibility, but locals’, and people were empowered by lower taxes and the greater responsibility that comes with a smaller state, the outcome would be different. Mass migration is inevitable. People think it’s going to decrease. It’s not. It’s going to increase. There are more people in the world than ever before and – whether it’s those displaced by war, by lack of water, by poverty, hunger or (probably the primary factor) lack of opportunity – more and more of them are on the move. Because of modern communications, more of them are aware of better lives to be had elsewhere. Because of modern travel, more of them are able to travel further and faster than ever before. As a result, we are in a migration of people of historically unprecedented proportions. It’s only going to increase.Terrified of being labelled racist, Western governments have no coherent philosophy, let alone an actionable strategy, to deal with it all. Especially as both the public and the media have lost sight of the difference between what is legal immigration, what is illegal and what is asylum. Moreover, it has become impossible for all the shouting “racist” to have a grown up conversation about how much immigration we actually want - 100,000 a year? 500,000? Net zero? How pertinent is the Douglas Murray title: The Strange Death of Europe.The world is changing fast. For good or for bad, the Britain we once knew has left Middle Earth. I don’t think anyone voted for it. I don’t see many leaders trying to stop it. Locals who have paid taxes all their life and now receive inadequate services, or see that tax money being spent on these new Britons, while they go overlooked, not unreasonably feel betrayed, angry, frightened and more. Accountable local government with local borders might be better able to act on the wishes of its people, and defend against this sudden influx that is disrupting so many communities – if so desired. But that is not possible with Britain’s remote, centralised, unaccountable state. Given its record elsewhere, when the state is in charge of borders, why should it be any surprise they don’t function properly?A genuinely free market-driven economy might be happy with open borders and quickly able to adapt – more people to sell products to, a greater choice of people to employ – what’s not to like? But the state systems – schools, hospitals, transport infrastructure – cannot cope. As Milton Friedman observed, you cannot have open borders and an expansive and benevolent welfare state. You can have one or the other, but not both. Yet currently, both is what we have (or are attempting to have). That’s why everything is falling apart. In effect, we are paying for ourselves to be colonised.Maybe it’s multi-culturalism and expansive state welfare that are incompatible: the latter may only properly function in more mono-cultural societies, such as Japan. (Similar arguments can be made about crime levels. They tend to be lower in mostly mono-cultural cities, especially in Asia, to those in the the more multi-cultural west).Whether it’s Hull, Skegness, Mansfield or any other provincial town, when boatloads of young men from different cultures, with no instinctive loyalty to the UK or its ways (and sometimes a contempt for it), are dumped in a community and the community is given no say in the matter, and locals have no power to resist, any anger felt is pretty understandable. There are incidents when the young men are put up in four or five-star hotels, while there are locals, homeless, in tents outside. It is not what people want, nor what they voted for. As I say, representative democracy is neither representative, nor democratic. The model is broken.Brave New World, digital nomad-ery, robot takeover — or something worse?Finally, there are incredible developments in technology: the new worlds being designed for us by nameless, and, in many cases, slightly autistic coders in far away places, the extraordinary expansion of surveillance and the erosion of privacy. Those who have monitored ChatGPT will know that before long as much as half of the content on the internet will be generated by bots. But they are not neutral - they are politically biased. What are the implications of that and the extraordinary influence these nameless coders will have to shape the global narrative?Never mind whose fault this all is, or the rights and wrongs of it all. We all have our ideas. Plenty of them.  What I want to know is: where is this all going? I’ve been thinking about it a lot.Many draw parallels with the Fall of Rome and the invading barbarians at the gates. Others say we are headed into totalitarianism akin to George Orwell’s 1984. Many of my Eastern European friends think we are making the same mistakes they once made and headed into some kind of 21st century Marxism. My Venezuelan friends think the same. Some see a new rise of fascism akin to the 1930s.Some look to Isaac Asimov and the rise of intelligent machines (see my piece on ChatGPT, if you want to know just how advanced machine learning is now). My genius bitcoin billionaire mate, who has long since disappeared somewhere remote in New Zealand, thinks we are going into a world where everybody is housed in Butlins/CentreParks/Club Med (depending on your socio-economic status)-type holiday resorts, with virtual reality headsets on all day, while robots do all the work. That vision tallies somewhat with Aldous Huxley’s Brave New World.Another compelling scenario comes in James Dale Davidson and Lord William Rees-Mogg’s, in which they describe a two-tiered society. On one tier, thanks to advances in technology and communication, there will be a class of largely untaxed digital nomads, travelling from place to place, operating independently of nation states and government structures. Meanwhile, there will be a much larger class of people trapped in their nations, working in the physical economy (rather than the stateless digital one), heavily taxed and indebted. Hard-money advocates argue that some kind of hyperinflation and the destruction of fiat money is inevitable, or that, with the emergence of the Shanghai Cooperation Organisation, the US dollar is soon to lose its reserve currency status, with major implications for the international balance of power. In that case Western Europe is probably going the way of once-wealthy Argentina. “Great Reset” theory, in the wake of Covid and the vaccine furore - that powerful, yet secret actors and organisations, especially the WEF, are planning all of this - looks rather more credible than it once did.There is also a persuasive argument that the expansion of NATO, Vladimir Putin’s ambitions and the conflict in Ukraine is going to take us eventually to nuclear war. There is a lot to worry about. These really are incredible times.So back to the underlying question: where is this all going? The South Africanisation of everythingI was in the pub with my friend, the director Alex McCarron, the other night, when this subject came up. He had a simple but compelling answer: South Africa. The South Africanisation of Everything.There are many parallels: crumbling institutions, widespread corruption, mass migration; failing rule of law, rising crime rates – especially violent crime; inadequate policing and reliance on private security; identity politics, siloed, ghetto-ised communities within a so-called multi-cultural country; race-based crime, justified because of history; many cultures, each with their grievances, thrust together and by no means living harmoniously. It’s a credible scenario and one I can envisage. One small example: private security vehicles are ubiquitous in Johannesburg. You never used to see them in the UK. My friend sent me this image, spotted this in Notting Hill the other evening. I think such sights are going to get more and more become commonplace. It’s another symptom of a failing state.My view is that we are going to see all of those above scenarios. Nevertheless … things are better than we realiseIn all of this negativity, in many ways, things are much better than we may think and the world is in a better state than it has ever been. We are living longer than ever. There are fewer people living below the poverty line than ever. The number of people dying from natural disasters is lower than it has ever been. Information technology means we have greater access to information than ever. 6.8 billion people now have a smart phone - think of all the possibilities that open up as a result. More than 80% of the global population now has access to electricity. With modern transport we are able to go further than ever, quicker than ever. The world is, as a result, more accessible than ever. We might not enjoy her status, but most of us live with luxuries Marie Antoinette could never have dreamed of. Life is so much easier for us than it was for our ancestors and we should be grateful to them for the benefits we enjoy, as a result of what they went through. Wonderful things are possible. There is much to be positive and excited about. There has never been a better time to be alive.But something is missing. Something is wrong. We can all feel it.Our belief systems are awry. I am sure it’s to do with the absence of religion. Naive worship of incompetent state institutions has replaced it.Am I right about this? Please post your thoughts in the comments below. And how do you navigate it all, as an investor, and protect/grow your wealth? Gold and bitcoin are the obvious “anti-state” choices.Please share this article on Twitter, Facebook etc (if you liked it).Meanwhile, if you want to listen to Alex and I discuss the South Africanisation of everything – that podcast is here.Interested in protecting your wealth in these extraordinary times? Then be sure to own some gold bullion. My current recommended bullion dealer is The Pure Gold Company, whether you are taking delivery or storing online. Premiums are low, quality of service is high. You can deal with a human being. I have an affiliation deals with them.My guide to buying bitcoin is here.Make your Number One resolution for 2023 to listen to Kisses on a Postcard.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

There has been a discernible change in the narrative over the past few weeks regarding Covid-19 vaccines. From the Andrew Bridgen affair and questions in the House of Commons regarding the unusually high seasonal death rates to the publicity that came with “Novacc” Djokovic winning the Australian Open, to the sudden collapse of Thailand’s Princess Bajrakitiyabha, daughter of the King, and the resulting (likely fabricated) story that Thailand is nullifying its Pfizer contracts, the powers-that-be - and I’m still not sure who they actually are - seem to have lost control of the narrative.The take-up of boosters was low and there is now widespread doubt amongst those who had the vaccine that they did the right thing, while there is both pride and vindication amongst those who didn’t.In a world awash with both censorship and misinformation (which is worse? - there is another thing I’m not sure about), it is difficult to know who or what to believe.We do, however, have price. There is a truth to price. Price, like the truth, can change every day, many times per day, but the price of something, or should I say the price of a publicly traded asset, reflects all the available information about that asset at any given moment. In that respect, there is a truth to price.The price of Brent Crude Oil, currently $84, reflects all the available information there is about current and future oil supply, current and future demand, current and future government policy, net zero, global risk appetite and more. All the information, opinion, and research, the truths, the half-truths and the lies, the ideals and the realities - everything is distilled into those two digits: 84 dollars.And so today, with all this in mind, I thought it would be informative to ask - how are the vaccine stocks doing? How’re they are doing might tell us about the vaccine narrative itself.Covid-19 vaccine stocks The main vaccine stocks are as follows: * Pfizer (NYSE: PFE) - although not a “pure” play (its share price is determined by the success or failure of many of its products and patents), it did bring the world’s most famous and controversial vaccine to market. * Biotechnology company BioNTech (NASDAQ: BNTX), which teamed with Pfizer to produce its vaccine, can be seen as much more of a “vaccine bellwether” stock. Its messenger RNA (mRNA) technology was critical to the Pfizer vaccine.* Moderna (NASDAQ: MRNA). The ticker’s on brand! Moderna was quick in the wake of Pfizer and BioNTech to win a US EUA for its vaccine. Unlike Pfizer and BioNTech, it doesn’t have to split profits. It’s also a ‘pure play”, so a good bellwether.* Johnson & Johnson's (NYSE: JNJ) sold its vaccine at cost during the pandemic and it is so diversified with numerous other products that we can probably discount it as a vaccine bellwether. Still, we can include it on the list as it is a key player.* Likewise AstraZeneca (LON: AZN) -was an early winner in the vaccine race, but then it got embroiled in disputes with the European Union. Like Johnson and Johnson, it is also heavily diversified with other products and it also initially delivered the vaccines at cost. So, again, it is not a “pure play.”* There is the lesser-known Novavax (NASDAQ: NVAX), whose product is not as widespread as the others.* Ocugen (NASDAQ: OCGN), also not very well known, is partnered with Indian drugco, Bharat Biotech, and has a vaccine authorised in India. * Finally, Vaxart (NASDAQ: VXRT), is developing an oral vaccination tablet. At this stage of writing this article, I haven’t yet looked at a single chart of a “vaxco”, so I don’t know what I’m about to discover. I’m going to post 4-year charts - ie going back a year before Covid - along with a 200-day moving average (200DMA) in green to help identify primary trends.Let’s start with Pfizer (NYSE: PFE)You can see the run it had since 2020. But, shorter term, since early December, it’s been falling like a boulder off a cliff. It’s not seen any of the rally that accompanied the broader stock market since Christmas. It’s below its 200DMA and trending down. On the other hand, it’s still at $43, above its October low, and well above its pre-Covid price in the low- to mid-$30s, so all is not lost. I do not like the look of that chart at all. I’m pretty sure its handle will no longer be a four but a three before long.Next is BioNTech (NASDAQ: BNTX). This is a classic pop-and-drop and could just as easily be the chart of some crypto currency or junior miner.At $140, it’s 70% down from its $460 high, and it too is in a downtrend. There is support at $120 and it’s still three or four times higher than it was before Covid. I wish I’d known about BioNTech in 2020!Moderna (NASDAQ: MRNA) is next and like BioNTech, the other “pure vax play,” this is another pop-and-drop. Cynics would say pump and dump.Gosh, this was a $25 stock in 2020. It went to $500. How fortunes can change.Now it’s at $175, 65% of its highs, but above its 200DMA. The shorter-term trend is down, however.Gosh, these vaxco stocks are volatile. As volatile as crypto. (I don’t see the FCA warning against them, or indeed banning them though).Johnson & Johnson's (NYSE: JNJ) is next. Like Pfizer, it’s not a pure play, but I do not like the look of this chart at all. Double tops and stuff.It’s come down hard in 2023. What does the market know that I don’t?It’s below its 200DMA and trending lower. You want to see that October 2022 low, just around $158, holding, or failing that $152.To be fair to Johnson and Johnson, and not wanting to get too sensationalist, it has previous when it comes to spiky, up-and-down action. See early 2022 for more details.And so to AstraZeneca (LON: AZN) and this too could be displaying the worrying, early 2023 chart sickness of the vaccine major. Not as bad as the other two though.I’m going to give this one the benefit of the doubt and say it's a standard pullback to the 200DMA, which is rising, amidst an ongoing secular bull market.Pre-Covid it was around 7,000p, so it’s about 45% up on the back of the pandemic.If they’ve banned cryptocurrencies, why the FCA hasn’t banned speculating in the likes of Novavax (NASDAQ: NVAX), I cannot understand. Where’s the consistency? Surely that is what we want from our regulators. In any case, this is one brutal chart, and it’s back where it was before Covid.This was a $3 stock at the beginning of 2020. It went to $330. Somebody made a lot of money. Nancy Pelosi is my guess. Or maybe that Fauci bloke. (For the avoidance of legal doubt, I’m joking).Now it’s a $10 stock. I make that a 97% drop. Somebody lost a lot of money.By the way, here’s a chart of Novavax since its IPO in 1995. I don’t think I’ve ever seen anything like it. Talk about hype cycles. Fortunes have been made and lost in this company over and over. Remind me to buy it in about a year’s time at $5. It’ll be $150 or $300 a couple of years after that. (Then remind me to sell it).Next, we have Ocugen (NASDAQ: OCGN). Cripes, it’s another one. From a buck to 18 bucks back to a buck. I need to get more into biotech. It’s extraordinary.And last up, Vaxart (NASDAQ: VXRT) is developing an oral vaccination tablet. I almost don’t need to post this one. You know what’s coming.From below a dollar to $25 back to a dollar - and trending lower.So what can we learn from all this?One: vaccines are dead in the water.Two: there might be something nasty lurking in the pipeline for Pfizer, and perhaps Johnson and Johnson. My guess is something legal.If you’re buying gold, 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. You can deal with a human being. I have an affiliation deals with them.If you’re buying bitcoin, be sure to read my special report.And make your Number One resolution for 2023 to listen to Kisses on a Postcard.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

There are just three ways, I once heard someone say, to create real wealth:* You make stuff* You mine stuff* You grow stuffEverything else is just redistribution - pushing what is already there around. We can argue about whether offering a service is “making stuff”. I would say, generally, it is. I’ve always loved that as a maxim by which to view things. Pretty much all wealth creation comes under one of those three categories. You are bringing something new into the world that did not previously exist. It’s why I have issues with forex. The foreign exchange markets are the largest and most liquid financial markets in the world. They are more than 25 times larger in daily turnover than all of the world's stock markets combined. Forex has made many people supremely rich. But is forex trading actually creating new wealth or is it another illusory consequence of fiat, and just pushing existing wealth around? It’s a question for another time because it’s item two on that list - mining - that I want to talk about today, that loathed and despised industry, responsible for so much pollution, waste, injury, fraud and death. Why mining is so importantWe need mines. We cannot do without them. They are essential to human progress. Mines provide the raw materials that are the foundations for modern living. We would not have the world we have around us today were it not for mining: the primary means by which natural resources - metals, minerals and fossil fuels - are extracted from the earth. Human beings have been mining since before the Bronze Age and we won’t ever stop. These natural resources can be used to make wonderful things: buildings, bridges, planes, trains and cars, electronics, and, of course, energy. Mining, and all the risks you have to take to do it, is to bring new and real wealth into the world that did not previously exist. In the West we sit at our desks all day, in our clean, sanitised environments, and we forget that, for example, for the internet to exist, we need untold amounts of metal , be it steel, copper, silver or some rare earth metal neither you nor I know the name of. With our cosseted western existence, we have in many ways lost touch with the world around us: the land, the environment, the animals and plants we eat. We have forgotten just how the things around us came to be. There was a time when you would build up a relationship with an animal before you ate it. I’m looking around me at my office and every single item - from my desk to my computer to my books to the house I’m in - would not exist without mining.If Net Zero is to be realised (spoiler alert: it won’t be), and we are going to transition from fossil fuel to electricity, we are going to need to mine unprecedented amounts of copper and lithium (which in itself is going to entail extraordinary amounts of fossil fuel consumption). But mining has a huge environmental impact. Though it’s hard to find a human activity that doesn’t have an environmental impact, mining is exceptional. Together with certain types of fishing, it’s probably the most environmentally damaging of all industries. That’s why there are so many rules and regulations in place. They’re there to attempt to minimise damage. Mining will never have zero impact. There is a trade-off between the impact of the mine, the wealth it creates and the benefits it brings. But it is because of the potential mining has to cause harm, to the environment, to local communities, to workers, that so many of us feel ambivalent about it, if not downright opposed. The fellowship of miningThere are common characteristics to miners, visible throughout history and in all the myth and legend that surrounds them: brave, strong, hard working, fiercely proud, stoic, with incredible camaraderie amongst them - probably because of the incredible risks and effort involved in doing their job.From Snow White to Middle Earth, you see it in the depiction of dwarves, the miners of mythology. Visit any of the old mining pubs in Cornwall, Wales or the North East, where the mines are no more, but look at the pictures on the wall, let your senses go and you can feel it there too. The old boys who used to work in the now closed mines still talk about the camaraderie.Mining is hard. It always was and it always will be, even with modern machines. Never mind the financial and political risk, it’s dangerous. It’s a difficult business. You have to go to some of the most unsavoury parts of the planet. Yet for decades we have been attacking mining. We attack this key industry, which instead we should support.Protestors become heroes when they stand against this terrible industry. Lawmakers do not stand up to protestors, they bow to them.The cost of regulation in the UK is so high, the mining industry barely here exists now. We have lots of coal, we have tin, we have copper, we even have tungsten and lithium, but producing mines are few and far between. We were once a nation once internationally famous for its mines and its miners. It’s why so many metals exchanges are here. It’s why so many international mining companies are based here.We are using more metal than ever here in the UK, yet we are barely producing any of it. We are getting that metal from Asia, Africa, Australia and the Americas. Just because that mining is out of sight, it isn’t any less damaging to the environment. Heaven forbid the war in Ukraine, or tensions between China and the West, or Islam and Christianity, could grew into some kind of global conflict. If it does, we have big strategic problems - because we barely produce any metal."The Battle of Production is the Battle of Life and Death,” said Winston Churchill to the House of Commons in September, 1940. “It is being fought out every day in every mine, factory, and farm in the country. It is the Battle of the Coal Mines. It is the Battle of the Steel Mills. It is the Battle of the Harvest Field. It is the Battle of the Factories and Workshops. It is the Battle of the Shipping Lanes. It is the Battle of the Aircraft Factories. It is the Battle of the Munitions Works. And on the outcome of this Battle depends the life and death of the nation."So it was with great concern that I read this article from Chris Hinde about mining graduates.The state of mining in the UKCornwall’s Camborne School of Mines, founded in 1888, once used to be the most important mining college in the world. Through the 20th century, its graduates operated many of the world’s most significant mines - in Southern and Western Africa, Malaysia, Australia, South America, Mexico, the United States and Canada. It is now merged with Exeter University.Do you know how many British people over the past two years have enrolled in mining engineering or mineral processing undergraduate courses there or indeed anywhere in the UK? Take a guess.The answer is not one. Not a single person. As recently as 1990, there were over 300 mining graduates every year from five UK mining schools. Now there are none.The UK’s Engineering Council has 1,237 registered mining and mineral processing engineers. 80% of them are over the age of 50. Half of that 80% are over the age of 66 - retired or about to be, in other words.We used to export mining talent all over the world, but just to operate the few mines we have left here in the UK, never mind build new ones, the UK Mining Education Forum calculates the country needs over 60 new mining engineering and minerals processing graduates every year. We have none.Everybody wants to work in finance or tech. With years of greenwashing, we have forgotten the essential contribution which mining makes to society. We have lost touch. The green narrative has done so much structural damage to our history, our identity and our industry.Who is going to run Cornwall’s tin and tungsten mines, or extract its lithium? Who will operate Cumbria’s new coal mines (should they ever get planning approval)? If we don’t act fast, we will lose the self-knowledge of our own landscapes to be able to utilise their many and varied natural resources. This is not just a UK problem, by the way, it is the case across Western Europe.One lesson of the soaring cost of energy is that the mineral resource industries need investment and support, not attacking. Why would you invest in future production, if you know the government is just going to impose windfall taxes? The War in Ukraine, and especially the bind in which Germany finds itself, has demonstrated the strategic stupidity of being dependent on dodgy regimes for essential resources, when there is abundant domestic natural supply. The ridiculous irony is that to import resources from unscrupulous corners of the earth is considerably less green than producing them ourselves.A rather big country somewhere to the far east of us gets the concept of making stuff, mining stuff and growing stuff in a way that we no longer seem to. What are the implications?Please tell your friends about this article.And please consider becoming a subscriber to The Flying Frisby.If you’re buying gold, 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. You can deal with a human being. I have an affiliation deals with them.If you’re buying bitcoin, be sure to read my special report.And make your Number One resolution for 2023 to listen to Kisses on a Postcard. 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

Gold had an epic bull market in the noughties - I still remember the key numbers like it was yesterday.There was the low in 1999 at $250/oz, marked for all eternity by Chancellor of the Exchequer, Gordon Brown, as he sold off two-thirds of British gold at the bottom of the market, when there were no compelling need to sell.That low was re-tested in 2001 and we got a classic double bottom, followed by eight years of bull market, which ended, after a big wobble in 2006, in 2008 at $1,030/oz. Then the Global Financial Crisis came along. Gold plummeted along with everything else. An unstoppable rebound lasting three more years followed. First, the gold price broke out to new highs, and on it marched until it eventually peaked in 2011, with the Greek debt crisis, at $1,920/oz.Then came the bear market. Five brutal years of pain. It went all the way back to $1,040/oz.The period between 2018 and 2020 saw gold rally again, heading north of $2,000/oz, albeit briefly.But here we are in early 2023. And guess what? As I write, gold sits at $1,920/oz - the same price as it was back in 2011. Markets remember prices.What’s next for the gold price? Will it pull back from here? Maybe. Probably.It has rallied $300/oz in barely two months. It’s overbought. Neither silver nor the miners are leading. That’s usually not a good sign. Charlie Morris says gold is trading above fair value. Charlie Morris is usually right.You can get cute and try and trade it, but no one knows what is going to happen. It’s a precious metal and it’s a market. If they can throw you, they will.  But then again, gold usually does well when trust in financial markets is low. I’d say that’s the case now. Do you risk your position in the hope that you can get back in lower? What if it goes up instead?Or you can take the longer-term view. Like the famed trader, Old Partridge, in Edwin Lefevre’s Reminiscences of a Stock Operator, who never wanted to lose his position in a bull market, a view since echoed by a memed typo, you can just hodl on.We must each make our own choices, learn from them and live with them.What happens to the gold price if everyone starts buying? Here’s a nice little thought experiment. I’ve heard it before - but I’d forgotten it, and it was brought to my attention again by Winston Miles of Canadian investment house Eight Capital.There was a presentation by strategist Grant Williams in 2016 called “What If?” when he asked what would happen if pension funds, which currently had a 0.15% weighting to gold, increased that allocation. Miles decided to run that scenario in today’s marketplace.“According to the OECD’s most recent data, global pension assets are $56 trillion. I could easily see pension funds getting up to 1% of their portfolio in precious metals on average. But let’s be a bit more conservative and go with two-thirds of 1%, or 66bps… which is $373,903,924,800.“That amount of money …  could buy every single company that makes up the Philadelphia Gold and Silver Index… which would set them back a cool $297 billion.  Then they could buy every share of GLD, even taking delivery of all that gold if they wanted, as it’s all sitting in a vault somewhere.  That would cost another $56 billion. Then with the scraps left over, they could buy every share of the GDX… GDXJ… SIL… AND the SILJ.” (Those are the gold and silver mining ETFs).In short, there’s a lot of money out there. On a relative basis, there isn’t a lot of trade-able gold, and there aren’t that many gold mining companies. A small shift in the narrative could send the gold and silver markets a long way higher. “It’s an environment,” says Miles, “where almost no major pensions have a portfolio manager focused on metals and mining. The infrastructure is totally gone. It’s hard to add supply, the mines are old, it takes ten+ years to build new ones, these are really long lead time projects.”You can conduct the same thought experiments with oil, gas and coal. Very little allocation (largely because of ESG), and very little investment leading to tight supply and long lead times.You can conduct the same experiments with bitcoin. What happens to the bitcoin price, if bitcoin were to become a core, mainstream portfolio holding?They all go a lot higher.You can’t say the same about tech, the S&P 500, or government bonds. They are already owned.The narratives for gold, fossil fuels or bitcoin may not change, but if they do, look out above.On this note, here is the S&P500 relative to gold since 2000. When the chart is rising, gold is rising relative to the stock market and vice versa. At $1,920/oz gold is a lot cheaper today, relative to the stock market, than it was when it was $1,920/oz back in 2011. It’s a third of the price. To get back to those equivalent levels, assuming no change in the price of the S&P500, gold would have to triple. I like the sound of $5,700/oz gold!$5,700 gold - that’s a stat worth sharing.Gold and gold minersHere are the gold miners relative to gold. With the plethora of new ways that opened up to get exposure to gold in the 2000s - ETFs, online bullion dealers, CFDs, spread bets and all the rest of it - investors stopped bothering with miners, and who can blame them?Too much incompetence, too many frauds, too much political and environmental risk - and all the rest of it.Miners have been falling since 2003. But they stopped falling in 2015. Since then they’ve gone sideways. They are, as the technicians say, “building cause”.I reckon the low is in. It came in 2015. And we re-tested it last year.What do you think? Post your comments below.If you are interested in gold miners, please consider becoming a paid subscriber. I cover gold mining extensively.If you’re buying gold, 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. You can deal with a human being. I have an affiliation deals with them.If you’re buying bitcoin, be sure to read my special report.And make your Number One resolution for 2023 to listen to Kisses on a Postcard.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

It’s that time of year once again when I get out my crystal ball and tell you exactly what is going to happen in this the Year of our Lord 2023 (here’s how I performed last year).   You can normally rely on your intrepid author to have strong, even if wrong opinions on markets, but I must confess to not feeling as strongly about things as I usually do. My biggest concern is how Chat GPT - the new chatbot that can generate intelligent text about, it seems, almost anything - is going to change the world. In fact, my greater concern relates to the extraordinary influence its designers are going to wield on the global narrative.So it is a humble Dominic Frisby you find today, one lacking in clear vision, nervously looking up at the egg that is no doubt going to be on my face in a year’s time. Nevertheless here are 14 things I think we will see in the year ahead.* Commodities have a good year. Oil is currently in a downtrend, so it may have a bit more to fall. Metals took their hit in mid-2022 and appear to have made their lows. For the last couple of months, they have been rising, but both fossil fuels and metals have suffered from many years of underinvestment, which has hurt supply. China opening up should see increased demand. I see a good market for metals and energy in the first half of 2023 at least. Possibly the second half as well. Let’s set some targets. Brent, currently at $80/barrel, revisits three figures.* And Copper revisits with $4.80/lb.* Yield becomes a thing again. With choppy, uncertain markets, but sticky inflation, investing for yield rather than capital growth becomes a much bigger theme in 2023 than it has been for a decade or more.* This is a classic recessionary bear market. This bear market proves to be more of the recessionary variety, rather than an all-out collapse. It’s a tricky, grinding market, but the S&P 500 gets back towards its old highs at 4,800. Briefly.* Emerging Markets outperform. That’s something we haven’t seen in a while, but their time has come again.* Biotech becomes a thing again too. Remember how back in the day biotech was all the rage? Somehow it was overlooked in the last tech bull market. Not anymore.* European banks have a good time of it too. Thanks to Swen Lorentz for pointing out to me just how uninterested people are in them. Normally a good sign.* Bitcoin also has a good year. It’s hard to think of a time when sentiment in bitcoin has been as low as it’s been these past few months and yet it’s still $17,000. It has a market cap north of $300bn. The mining hashrate hit all-time highs this autumn, meaning the network is more robust than it has ever been. The tech is stronger than ever.Usage is growing in East Asia, Africa, especially in Nigeria, and anywhere there is a currency crisis (which is a lot of places - Turkey, Lebanon, Argentina, and Venezuela). It solves the many issues facing the member nations of the Shanghai Cooperation Organisation - China, India, Russia et al - which are desperately seeking a non-dollar alternative money to trade with that doesn’t rely on trusted third parties. (I doubt they’ll go for bitcoin by the way, even though it does everything they want it to).Bitcoin’s Lighting Network solves the problems facing Elon Musk who is looking to incorporate a payments system into Twitter.There are so many reasons to be bullish about bitcoin, yet sentiment could not be worse. It will not always be this way. My prediction for 2023: bitcoin will have a good year.Tell your friends about this amazing article.* Silver fails to deliver yet again. I’m getting so complacent with my predictions about silver that I’m bound to be proved wrong. If you can count on anything in this cruel world, it’s that silver will let you down. Silver can’t get above $30.* The US dollar - up and down. It’s perhaps the world’s most important price and it has periods of strength and of weakness, but it ends the year higher than where it started.  As I write, it’s at 102.* CBDCs - they’re coming. Currently, there are two countries in the world with functioning CBDCs - the Bahamas and Jamaica. Several other Caribbean nations are at the pilot stage, including St Lucia, St Kitts, Dominica and Grenada. As demonstrated by the reaction to Covid-19, risk-averse governments tend not to trail blaze, but to follow the lead of their neighbours. In this regard, it is likely that a couple or more Caribbean nations could have functioning CBDCs before the end of 2023. Such a roll-out is easier in nations with small populations.But my forecast is that in 2023, probably in the latter part of the year, a nation with a population greater than 15 million rolls out its first CBDC, likely one of Canada, China, India, France, Saudi Arabia, Ghana or Nigeria.* Ukraine. I know Dominic Frisby is the first person you turn to when you want insights into the Ukraine conflict, so here they are: The Ukraine War will not end before October. There will not be a nuclear war and Vladimir Putin will still be Russia’s president by year's end.* Gold. Everyone always wants to know what I think about gold, however. "Well, this is a bull market, you know!" While it’s currently overbought, so don’t rule out a pull back, I think it goes up. Miners have a good time of it too. Gold retests its old highs around $2,080. But then it finds a way of being frustrating. It always does. It’s gold. * Your Bruce-y Bonus sports prediction. Manchester City wins the League. Southampton, Wolves and Bournemouth go down.So there we are folks. Everything you need to know about 2023 in one handy list.Have a great year folks - and stick to those resolutions. Make your Number One resolution for 2023 to listen to Kisses on a Postcard.Interested in protecting your wealth in these extraordinary times? Then be sure to own some gold bullion. My current recommended bullion dealer is The Pure Gold Company, whether you are taking delivery or storing online. Premiums are low, quality of service is high. You can deal with a human being. I have an affiliation deals with them.Please subscribe to The Flying Frisby. You’ll enjoy it.Finally, folks, the good folk over at Visual Capitalist put together the graphic below. I thought you might find it useful.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

Later this week I’ll be posting my predictions for 2023, but first we revisit my predictions for 2022 to see how I got on.This is more an exercise in entertainment than anything else because, in case you needed reminding, risk management changes - and so do forecasts - as events unfold. As Mr Keynes once said, “When the facts change, I change my mind. What do you do?” So when you leap back a year, and there’s stuff that’s wildly out, and I have egg on my face, because, for example, a certain man ordered the invasion of a certain country and that threw things off rather, by all means chortle at my expense - but don’t think I didn’t revise my opinions.Right that’s the excuses over and done with. A reminder of the rules: I get 2 points for a direct hit, 1 point for close but not a bullseye, 0 for a miss and minus one for a howler. There were 14 predictions (you can read them in full here) and the first was a humdinger of a howler. My view was that, because of the scalability of tech, the Nasdaq would continue its relentless march higher and we would see 19,000. The opposite happened. Tech gave back all its post Covid gains. Minus one.Prediction Two was that oil (Brent), which began the year at $77, would revisit $100. We hit that target in March, and some. Two points.Prediction Three was that the US dollar would start weak, with support at 95, and later go higher. Longer term “the dollar looks like it can go a lot higher”. Support did prove to be 95, and it went a lot higher. Two points. Prediction Four was that gold, which began the year at $1,825, would go north of $2,000. It went to $2,080, then it went down. Two points.Prediction Five was for the S&P500 to go to 5,000. Wrong. Bear market. Minus one.Prediction Six was for the crypto market cap to go above $3trn. The year started quite well, but no. Minus one.Prediction Seven was that two other nations would follow El Salvador’s lead and adopt bitcoin as legal tender. Just the one did - Central African Republic back in April. Zero points.Prediction Eight was that copper goes above $5/lb. It did. For one day in March. Technically, it’s a two pointer but I’m only going to give myself one because it had such a horrible bear market later in the year.Prediction Nine was for house prices to continue their inexorable march higher. Amazingly, house prices have marched higher. “Average UK house prices increased by 12.6% over the year to October 2022,” says the ONS. That will come down as the data for the last part of the year comes in. I’ll give myself a point, but not two. The backdrop for house prices is looking shakier than it’s looked in a long time.Prediction Ten was that the pound would get to €1.24. It didn’t. €1.21 was the high, and it ended the year lower than when it started. Zero points.Prediction Eleven was that silver would disappoint, as always, and can’t get above $30. You can always depend on silver. It disappointed. As always. $27, or just nigh, was the high. Two points.And so to Prediction Twelve which was that, to everyone’s surprise, Boris would still be Prime Minister. Ha! We’ve had two since then. Prime Ministers are like buses. Uh-uh.Prediction Thirteen, your Bruce-y bonus sports prediction, was that Manchester City would win the league and that Watford, Norwich and Burnley all go down. A bulls-eye, sir. This year’s table will be much harder to get right.And, finally, my Prediction Fourteen, “based on my own instincts, not data or science” was that “Peak Covid has now passed and something akin to free movement can slowly return”. It looks obvious now. It was not then. I lost Christmas last year to Covid. And so to the score. Maximum possible would be 28. Minimum minus 8. Both so extremely unlikely as to be impossible. I’ve got a middle-of-the-road, deeply mediocre 11. Could do better, as my school teachers so often noted.Happy new year, everyone, hope you have a great 2023 and that prosperity makes a welcome return to our portfolios.And make your Number One resolution for 2023 to listen to Kisses on a Postcard.Interested in protecting your wealth in these extraordinary times? Then be sure to own some gold bullion. My current recommended bullion dealer is The Pure Gold Company, whether you are taking delivery or storing online. Premiums are low, quality of service is high. You can deal with a human being. I have an affiliation deals with them.Subscribe to this most learned of publications.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