The Flying Frisby - money, markets and more

Back in 2007 comedian Susan Murray phoned me up with a question.She was just arranging a new mortgage and she wanted to know where I thought interest rates were going. Should she get a fixed or a variable rate mortgage?I couldn’t make that decision for her, of course. But I could see there were underlying problems with the economy – quite serious ones – so the safest option, if there was affordable, seemed to be a fixed-rate mortgage. In the event something goes seriously wrong in the broader economy, at least she was protected against spiralling interest rates.Susan went and fixed her mortgage at 6%. Turns out it was pretty much the top of the market for mortgage rates. They duly plunged as central banks slashed rates and then printed money following the financial crisis. She’s never forgiven me. “Cost me a ruddy fortune that bloke” she always complains whenever my name comes up.Cheaper mortgages mean more expensive housesI may have seen 2008 coming – I was such a gold bug at the time – but I did not  foresee quantitative easing nor the extent to which interest rates would fall. Money got so cheap.By September 2021, barely a year ago, you could get a five-year fixed rate deal for 1.3%. It seems inconceivable today that money could be so cheap. To be fair, it seemed almost inconceivable at the time. No wonder everyone levered themselves up the eyeballs.I have long argued that, more than anything, it is cheap money that has driven up house prices. Everywhere you look the standard solution to unaffordable housing is that we need to build more, especially in and around London. But London has been a building site for a decade or more. Goodness knows how many new build flats there now are, but all that new build hasn’t brought prices down. As I’m forever quoting: 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%.Then you see that mortgage lending over the same period went up by 370% and you quickly realise it was newly created money that pushed up prices in a decade of loose lending, which gave birth to the national obsession that is house prices. Houses were no longer places to live, but financial assets. If you introduce new debt into a market, the higher prices will go. Look at student loans.Mortgage lending doubled again in the ten years from 2009 to 2019 and house prices rose by over 50%.Cut off the tap that is cheap money, and house prices will quickly come to levels concomitant with earnings. The two have long since been distant friends.In 1995 the house price to income ratio was below three – even in London it was only just above. Now it’s seven. The average house is seven times average income. In London it’s 11. And we wonder why families have got so small.Are interest rates only going one way from here?With inflation spiralling, bond rates rising and the US dollar spiking, money is suddenly not so cheap any more. And it’s getting more and more expensive. The UK is not alone in this, by any means, but the problem is more acute here because our economy is so geared to house prices.The Bank of England has made an absolute mess of protecting the currency, declaring it will not hesitate, while hesitating. Rather like the way it broadcast its gold sales to the market between 1999 and 2002, thereby sending the gold price to all time lows around $250/oz, so it is now broadcasting its gilt sales and quantitative tightening – and it has sent that particular market plunging too. The announcement sparked the sharp sell-off in gilts that began the day before Chancellor Kwasi Kwarteng’s mini-Budget. It’s as though the two departments – the Treasury and the Bank of England – don’t coordinate.The trigger may have been the Bank of England’s announcement, or Kwarteng’s budget. Whatever. The cause is over ten years of QE, zero interest policies and all the rest of it.It’s interesting through. At the first signs of panic, they started printing again. That tells us where they will go. Yesterday morning I would have said that interest rates can only going to go one way, and that means the cheap money taps that drive house prices to such unaffordable levels are now being turned off. Lenders clearly felt the same way. I gather over 900 mortgage products were removed from the market in under 24 hours. Smashing the record around 400 set during the Covid panic.But then the Bank of England started printing again.The UK housing market, particularly in and around London, has been an irrational, insatiable monster for decades. Anyone who calls the top has ended up with egg on their face. But we are levered up to the eyeballs. It’s not just a matter of no more cheap money coming in. There is also the other side of the coin, something I remember from 1989-1993. People can’t make their interest payments, so they start to sell. If house prices come down 10% or 15%, it’s often the case that the house becomes less valuable than the debt – negative equity strikes. I really like Kwarteng’s Budget. I think he has made the right choices. Cutting taxes is good. But a falling housing market, no matter how much growth there is elsewhere, will see the Tories kicked out at the next election. How do they prop up the housing market without cheap money? I’m sure they’ll find a way. They always do. Or will they?If you are worried about what is going on and want to buy physical gold or silver, my recommended bullion dealer is the Pure Gold Company with whom I have an affiliation deal. More here. My guide to buying bitcoin is here:Thank you to all those who came to my lecture with funny bits, How Heavy?, last night. What a great evening. Next West End show is November 23 at Crazy Coqs - that’s not a lecture, but me and the band with lots of unacceptable songs. Tickets here.The Flying Frisby is a reader-supported publication. To receive new posts and support my work, consider becoming a free or paid subscriber.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

Bitcoin was built in reaction to all the money printing that went on in the wake of the financial crisis. The Times’ headline “Chancellor on Brink of Second Bailout for Banks” was even embedded into the very first block in the blockchain – the genesis block. Here was a money system that nobody, whether government or hacker, could print or debase. The rules were set in code. The inflation rate was clearly laid out. And the system, rather than rely on trust – whether in banks, central banks, payment providers or governments – was based on mathematical proof and computer power.So here is an apolitical, censorship-resistant, trust-less, hard money.And we saw a very good use case for it this week.PayPal plays the cancel gameJournalist Toby Young, who is associate editor of The Spectator, has, for as long as I’ve known him, been setting up organisations to try and improve people’s lives. Disappointed with the lowering of standards in schools, he was one of the founders of the first Free School in West London. In 2020 he set up the Free Speech Union to help defend people threatened with cancellation. And his news and commentary website the Daily Sceptic was born in reaction to all the misinformation and censorship, especially by big tech, that emerged during Covid. Young’s views are actually pretty moderate. He’s a centre right, old school Conservative. But his ideological enemies do not like him at all and they work tirelessly to bring him down. He has lost something like five jobs because of what he calls the “offence archaeologists” digging up things he said decades ago, quoting them out of context and then being offended.Last week, PayPal, out of the blue, closed down his personal account for “breaching its Acceptable Use Policy”. Then, barely a few minutes later, it shut down the account for his news and commentary website the Daily Sceptic. Then a few minutes after that it closed down the accounts for the Free Speech Union.This is no small disruption, and it undoes the many hours, days, months and years of hard work his team have put in building up their subscriber bases. About a quarter of the Daily Sceptic’s donor revenue arrives via PayPal and a third of the Free Speech Union’s 9,500 members pay their dues via PayPal, Young says.Young says, “I did some Googling and discovered that numerous organisations and individuals with dissident political views have had their accounts closed by PayPal recently, particularly on the three issues you’re not allowed to be sceptical about: the lockdown policy and other Covid restrictions, the mRNA vaccines, and the ‘climate emergency.The Daily Sceptic frequently publishes articles on those subjects and the Free Speech Union may have fallen foul of another taboo – defending people who’ve got into trouble with HR departments for expressing their gender critical views.” How is PayPal able to do this without warning? Because it can.Young is by no means the first. It did the same thing to Wikileaks in 2010, probably under pressure from the US government about whom Wikileaks was disclosing unwanted information. (Unfortunately, this backfired as donors began using bitcoin and the bitcoin Wikileaks received rocketed in value to make Wikileaks a potentially very rich organisation (assuming it managed to hold on to some of them).It did the same to Alex Jones. Earlier in the year it cancelled academic and biologist Colin Wright for articulating his criticisms of the view that sex is a social construct. Just yesterday Us For Them, the parent group which campaigned to keep schools open during Covid lost their account, and so did another group Gays Against Groomers.PayPal founder Peter Thiel is an outspoken libertarian and probably on the same philosophical side of the argument as Young, but he is also a businessman. Paypal will do whatever is asked of it in order to survive. You can be sure that, in order to survive as a business and effectively become a challenger bank, especially early in its evolution, it will have had to demonstrate that it could not be used as a vehicle for any kind of illicit activity, especially money-laundering, and this is why it can be so stringent. It will toe the line wherever necessary.But Thiel is no longer Paypal’s CEO and, like so much of big tech, what started out one way is now not on board with the free speech ideals of its founders, as evidenced by all the censorship that goes on. Indeed more and more evidence is growing that big tech, especially Twitter, is censoring content according to the instructions of the US government.A number of prominent individuals have spoken up in favour of Young - from Lord Frost to Joanna Clery to Luke Johnson - and a number of others have closed their PayPal accounts, so it may be that the Young accounts get re-instated under pressure.But the moral of the tale remains. You are using trusted third parties that can no longer be trusted. If you use non-government money - ie bitcoin - the taps cannot be turned off quite so easily.The Flying Frisby is a reader-supported publication. To receive new posts and support my work, consider becoming a free or paid subscriber.Separating money and stateMore than anything else, in every book or every column I’ve ever written , I have argued for one thing: the separation of money and state.When one body in a society has the ability to create money at little or no cost to itself, it is inevitable that body will have disproportionate power and influence within that society. If you are looking to understand how it is the state in western societies has grown to be so enormous - something like 50% of GDP compared to the 10% area it occupied at the turn of the 20th century - then look no further than our system of fiat money.If you want to understand the inequality gap, why young people can’t afford a house, all that - look no further than our system of moneyIf you are looking to understand why western families so small, look no further than our system of money, in which government now owns more than 50% of your labour.  The primary reason given when asked why people have small families is that they can’t afford bigger ones. Both parents are having to work. The government - at over 50% - is their biggest cost. Only the very bottom on large welfare and the very rich can afford big families The 90% in the middle can’t. So we import our youth from abroad instead and then wonder why British culture is being eroded away. It’s the same across the west.Of course some states are more benign than others and our 21st century social democracies, for all their woeful waste, are preferable to many of the governing systems found in other, more tyrannical corners of the earth, but the damage has still been enormous and now we seem to be careering towards a far more nefarious destination.Money should just be money - a means of exchange, a store of value and a unit of account. Instead it has become a tool of government. A weapon of government.Whether it is suppressing interest rates to boost the housing market, printing money to bail out banks or the entire economy during Covid or freezing the accounts of political enemies (the truckers in Canada, or the entire country that is Russia), finance is being weaponised. Governments weaponise money because it is an easy tool for them to get the results they want quickly. It’s a lot easier to sanction Russia and freeze it out of the banking system than it is to go to war. It’s easier to cut off the truckers’ funding than it is to confront them. It’s a lot easier - and quicker - to print the money you need to bail out the banking system than it is to collect it in taxes – which is what rulers from another age would have had to do. It’s a lot easier to suppress interest rates and collect the inflation tax than it is to impose direct taxes or rein in spending.But the net result of all of this is that money gets debased, the state grows and is empowered, the inequality gap gets bigger, freedom is eroded, families get smaller, nobody can afford a house and yet more government becomes the answer to everything. We get top down diktats instead of bottom up growth. One decision up top counts for way more than the aggregation of millions of individual decisions from the bottom. And so on.The weaponisation have money has already begun. The irony of such actions is that, as with Wikileaks, they will accelerate the adoption of censor-free, non-state alternatives, of which bitcoin is the most prominent example. The US, by confiscating Russian dollars and freezing it of the banking system, will accelerate the creation of a non-US international system of money to be used by nations, especially Russia and China, that do not want to be beholden to the dollar. In the long term it may backfire, but in the short term it works: it shuts off the funding taps and creates considerable hardship and inconvenience.What to do? I use Paypal all the time, as buyer and seller. It’s convenient. But I really should switch to another payment processor. The others may not be as censorious as PayPal, but they will be if pressured, you can be sure of that. Do not leave large amounts of money with these companies.As we head into a cashless society we are even more vulnerable. This is why the prospect of central bank digital currencies, which, by the way, are almost inevitable - technology is destiny - fills me with such dread. Programmable money will give the state even more control and influence. Your every transaction can be monitored, putting us in the world of Orwellian surveillance states. Certain transactions could simply be outlawed. You might not, for example, be able to buy from or sell to bodies that are not government approved. Taxes and fines can be deducted without your approval. Central bank digital currencies give huge scope to behavioural economists and the ministries of nudges. You can be goaded into all sorts of decisions you might not otherwise have made. Social credits systems can be imposed. Are you a good citizen? Then you get the favourable rate of interest, good loan deals and other incentives. Do you articulate wrong-thought on the internet? Did you not have the vaccine, like we asked you to? Are you suggesting the climate emergency is not real? Then you will be given less favourable rates. If you are a really naughty boy, your account might be frozen altogether.I gather that the European Central Bank and perhaps even the Bank of England already have the tech ready to go for CBDCs. They are just waiting for the crisis to implement them.In such a world, and that does seem to be where we are heading, there is a very strong use case for bitcoin. I urge you to own some.If you are in London or nearby on September 28 or 29, please come to my lecture with funny bits, How Heavy?, about the history of weights and measures. It’s in the West End at the Museum of Comedy and it’s a 7-8pm show so you can come along and go out for dinner after. You can buy tickets here. This is a very interesting subject - effectively how you perceive the world. Hope to see you there.If you want to buy physical gold silver, my recommended bullion dealer is the Pure Gold Company with whom I have an affiliation deal.If you want to buy bitcoin, my guide is here:The Flying Frisby is a reader-supported publication. To receive new posts and support my work, consider becoming a free or paid subscriber.A shorter version of 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

About 25 years ago, I was giving a speech at my father’s 65th birthday party. There were seventy or eighty people at the dinner and, as Dad was a playwright, most of them were theatricals.I’m a comedian, it was a fun occasion, so I wanted the speech to be funny. There were a few entertainment VIPs in the room, so there were professional as well as personal reasons to make sure my speech was as good as possible. But it was also a very personal occasion - a landmark in my dad’s life - so there was no way I was going to crowbar in bits from my act. I wanted the speech to be special: I love my Dad very much and I wanted to say so publicly. But I also didn't want the speech to descend into an embarrassing, gushing, sentimental affair. It was by no means the hardest speech I've ever had to give, but there was still a balance that I had to get right, and I felt a bit of pressure because there were so many professional performers in the room who were way more experienced than me.As I was speaking, and I guess I was feeling a little nervous, I noticed someone looking at me. Of course, the whole room was looking at me, but this was the only person I noticed. He had friendly blue eyes, narrowed in a frown of intense concentration, and he seemed deeply interested in what I had to say, and very sympathetic to the difficulties I was having making such a speech. I don't know if I was projecting my own imagination, but there was a wise, kindly look to him. I’d never noticed anybody listen like that before.It was a few moments before I realised it was the actor, Timothy West. Thinking about it later, it made sense to me why Timothy West had been such a popular actor with his peers. He listened so well. In a room of eighty people all doing the same thing– his was the listening I noticed.(Any aspiring actors reading this: work on your listening. It’s a crucial, yet underrated skill and one that is rarely taught. Teaching is concentrated around the bits when you are doing the talking. Watch what wonderful listeners many great actors are.)Fast forward a couple of years and I was doing a set on the Radio 4 show, Loose Ends. This was around 1999 and, in those days, the show was recorded live, but the only audience you would have were the four or five other guests on the show who would be sitting in the studio with you, along with the host, Ned Sherrin. You got some real VIPs on that show - I used to do it quite a bit. Off the top of my head, I remember appearing with Jackie Collins, Danni Minogue, Divine Comedy, Mariella Frostrup, Sir Humphrey Burton, The Proclaimers, and many more besides. But most of them would be thinking about their own bits, so doing comedy in that little studio to four or five people who weren’t that interested could be a bit like doing comedy into the void. Comedy is hard without an audience - even if by the time it made it out of the radio, it seemed to work. I think it was the first time I had done the show, so I was nervous. There I was, doing my Ludwig The Bavarian act, all dressed up in my lederhosen costume, with all sorts of nerves rushing through my head as I did my act to no audience, when there it was again. The look. The kindly, listening, I-know-what-you’re-going-through-and-I’m-on-your-side look. This time it was Michael Parkinson, one of the guests on the show. While all the other guests, and, to an extent, Ned, were wrapped up in their own stuff, Parkinson took time out to listen to me. Straight away I understood why he had been such a successful chat show host.Thank you for reading The Flying Frisby. This post is public so feel free to share it.The Today ProgrammeWe move on over ten years to 2012 and my first book, Life After the State, which, as the title suggests, makes the case for a lot less government in our lives. On the day it was published I was invited onto Radio 4's Today programme to talk about the role of the state. My publisher, Dan Kieran of Unbound, told me 'getting on the Today programme is the Holy Grail for an author. You’re very lucky. You’re on at the best time, peak listening time, just before 9. Everybody will be listening. The prime minister will be listening.”To say I was nervous is an understatement. 'This is the Today programme,' I told myself. 'For really clever people. It’s not for comedians who’ve decided they want to write about economics. It’s the BBC, the Ministry of Media. The last thing they’ll suffer is some non-economist comedian calling for a smaller state. You are so going to be found out.’In the Green Room beforehand, I could barely speak. 'Would you like a cup of coffee?' 'Oh, no thanks. Actually, yes please. Er no, no. Actually, yes. Erm, not sure.' ‘I’m sorry?’I was to be interviewed by James Naughtie and there was a nice chap by the name of Neal Lawson from left-wing think tank, Compass, who would take the opposing side of the debate. There were various other people in the studio, all deep in notes and preparation for their next slot. None of them looked up as we came in. If I had my life again I’d answer one key question about collectivism differently - and I still get cross with myself about it - but overall I guess I did ok. However, mid-interview, while I was talking, I could feel somebody looking at me. I looked to my left, away from the people I was talking to, Naughtie and Lawson, and there, staring at me intently, was John Humphrys. He’d looked up from me his notes and, with his eyes narrowed slightly, now seemed to be deeply interested in what I was saying, even though he was nothing to do with this segment. His listening carried that same mixture of interest, intense focus, kindness and understanding that Timothy West’s did all those years ago.Just as with West, I felt I gained some understanding as to why John Humphrys has been so successful in his extremely competitive profession.Afterwards I went and gave him a copy of the book.“Have a read and see what you think,” I said. “But I doubt you’ll be on board with all this anti-state stuff.”“You’d be surprised,” he replied.Keynote FarageJust a few months later I was speaking about gold at an investor’s show. Tom Winnifrith, the organizer, had managed to get Nigel Farage as his keynote speaker. This was years before the Brexit vote, but, thanks to the internet, his speeches at the EU Parliament were already starting to go viral.Afterwards, he and I sat down and started talking. All sorts of people were bombarding him for photos and signatures, and he was very gracious to everybody who pestered him, but at the same time he managed to convey the impression that he was really interested in talking to me. And, as I talked, there was that same look again – eyes narrowed slightly, kind, wise, interested, focused on you and you alone.If you say the names John Humphrys or Nigel Farage, kindness is not the first word that springs to mind with either. But that was what I saw. Nor is Farage known as great listener, but my experience was that he is. I’m sure it’s his listening to people as he travelled up and down the country that made him so popular at grass roots level and helped him build such a following.Farage in person, as his GB News show, especially Talking Pints, is proving, is a far cry from the monster many of his opponents, especially the Centrist Trots who write for the Guardian, have made him out to be. My dinner with Jordan PetersonA few days ago I was lucky enough to be invited to dinner with Jordan Peterson. It’s funny. Peterson is one of the biggest stars on the internet. He is adored by so many yet there are still quite a few people who have no idea who he is. My manager thought I was going to dinner with Jordan Henderson.Andrews Doyle and Shaw, the organisers of Comedy Unleashed, comedian Simon Evans and author Jeremy Hildreth were there as well as Peterson’s minder (who took the photo below).It was amazing how quickly we got through the niceties and moved on to the interesting stuff. Within a few minutes of sitting down, we were talking about lucid dreams - these are dreams that you know are dreams while you dream them.I had a lucid dream last year, in which I met my father (who died in 2020) at a house party and, in the kitchen, started updating him on the progress I had made with Kisses on a Postcard, the new songs I’d written, the edits and so on. After a while I said, “This is a dream, isn’t it?” Dad smiled and nodded.So I mentioned at the table that I had had this lucid dream last year in which I had had this conversation with my dead father. Peterson’s head flashed round and he looked at me as I spoke. And there was that look again. That same Timothy West, Michael Parkinson, John Humphrys, Nigel Farage, slightly squinting, focused look of kindness, sympathy, empathy and genuine interest.Never mind how articulate he is, I’ll bet one reason Peterson is so popular is because he listens. In fact, one reason he is so articulate is because he listens. He replies to what people actually say, rather than what he thinks they’ve said, and that centres him in the moment and thus in the truth.So there we are: people who have the look. What’s the moral of all this? Listen, I guess. Don’t talk. Listen.ADDENDUMI saw just how popular and loved Jordan Peterson was only an hour or two later. Over dinner somebody suggested that he do a set at Comedy Unleashed later that evening, and he agreed to read a comic poem he’d written. I was MCing, and I introduced him as the open spot, saying something like “we like to bring on new talent at Comedy Unleashed, so we give people short spots and if they’re any good, they can progress to a full spot, please welcome Jordan Peterson”. The audience at first couldn’t believe what they had heard. Then, as he came to the stage, they rose to their feet and gave him a standing ovation.I might have ended up compering what may be Jordan Peterson’s only ever comedy spot. Thank you for reading The Flying Frisby. This post is public so feel free to share it.If you are in London on September 28 or 29, my lecture with funny bits, How Heavy?, about the history of weights and measures is coming to the Museum of Comedy. It’s a 7-8pm show so you can come along and go out for dinner after. The lecture will give your evening a strong intellectual foundation. You can buy tickets here. This is a very interesting subject - effectively how you perceive the world. Hope to see you there.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

US inflation numbers came in on Tuesday at 8.3%. The markets were expecting something lower – after all, the oil price had fallen back, not to mention most commodities.8.3% was above expectations and the markets did not like it one bit. Down they went like liquid through an open sluice. Hopes and dreams of a sustained recovery since the June carnage went with them.Actually, not totally.While the S&P 500, which I use as a barometer for global markets, has been making a sequence of lower highs since the beginning of the year – ie, the broader trend is down – it has also been making a series of higher lows since June, meaning the intermediate trend is up.Yesterday’s lows are still higher than last week’s lows, which were higher than the July lows, which were higher than the June lows. So there is something of an intermediate term up-trend in place.If you draw a trendline off both the lows and the highs, they are both still intact and you end up with something of a wedge pattern, as the chart below shows.If you dabble in such dark arts as day trading, or short-term flips, I would wager that the odds – in the short term – favour going long with a stop just below that rising trend line, with a target  somewhere near the falling blue line around 4,200. That said, as we have just seen, rallies could fail at any time, so if the market moves in your favour, you would want to keep moving your stops up to protect any gains.Unlike some patterns – double tops, head and shoulders highs and lows, for example, which I find quite useful – I have over the years found wedges to be utterly useless as predictive tools. So I am not going to forecast off the back of it.A long-term downtrend will, in a month or two, assuming both those trend lines hold, which is some assumption itself, shortly butt up against a jittery, shorter-term uptrend and one of them will prevail. Seasonally, we are in a bad time of year for markets. The last four Septembers have all seen sell-offs of between 5% and 20%, so stockmarket-wise, I do not  see this as a time to be taking huge risks or making large bets. It’s a time for prudence and capital conservation.Silver – huge potential that’s never realisedI was, however, encouraged by the action in precious metals, in particular the dogs of recent months silver and platinum. Yes, they sold off, but on a relative basis they help up well.This comes on the back of an extraordinary day on Monday when silver rose some 5%. My ambivalence towards silver is long since documented. There is no other metal with as much potential. It is both a monetary metal and an industrial metal, used in virtually every computer related application you can think of – every phone, every computer contains silver –  not to mention all the bio and other tech.It “should” be a play on both currency debasement and technological progress. Yet in practice it proves to be neither and, at $19, is trading at the same price it was in 1980. There is about 15 times as much silver in the earth’s crust as there is gold, hence there is an argument that silver should be 1/15th the gold price, which is what it was historically – over $100, in other words. But I have been listening to such arguments for 20 years and the metal never delivers.Silver aficionados scream manipulation, but they have been screaming that since the 1970s. Why would you want to own something whose price is deliberately suppressed by powers far greater than you? Surely you would want to own something whose price is artificially boosted. There’s more profit in it.I own silver, quite a bit in fact, and I own some silver miners. Because one day, you never know, it might actually go to the moon. That’s its planet after all. I want to make sure I’ve got a seat on the rocket if it does. I don’t think I could live with myself if it went there and I didn’t have exposure, having written about it so much over the years. But I’ve long since stopped holding my breath. Thank you for reading The Flying Frisby. This post is public so feel free to share it.Silver could be about to go on a multi-week bull run That said, I do think silver could enjoy a multi-week rally from here and I’ll explain why. The COMEX is the world's largest futures and options trading exchange for metals. There are three groups of traders: the commercials, the large speculators and the small speculators. The commercials tend to be seen as the smart money, and, as they are often acting on behalf of miners, they tend to be sellers and so they tend to be short.Every Friday evening, the positions of the various traders the previous Tuesday, three days before – the open interest, as it is known – is announced. On Friday we discovered something extraordinary. That the commercials are net long – ie buyers – for only the third time in 40 years. That suggests a genuine shortage of metal. Meanwhile the speculators, who for the most part do not have metal to deliver, are net short. This opens up the possibility for a short squeeze. Anecdotally, I’m also hearing of silver shortages. It’s hard to acquire bullion anywhere close to spot prices.Now this is silver, so don’t get your hopes up and don’t take on too much risk. If it can go wrong it will. But there is every reason to think a multi-week rally is on the cards. If the broader markets correct, then silver will come tumbling down with them. But if they can remain flat or rising slightly, then silver could enjoy a good run.Buying silver is justifiable on a value basis – silver is cheap below $20. It has displayed lots of relative strength over the past two days. My moving average crossover system is also on a buy signal. Go silver!But, remember folks, it’s silver …If you want to buy physical silver, my recommended bullion dealer is the Pure Gold Company with whom I have an affiliation deal. My guide to buying silver is here: If you are in London or nearby on September 28 or 29, please come to my lecture with funny bits, How Heavy?, about the history of weights and measures. It’s in the West End at the Museum of Comedy and it’s a 7-8pm show so you can come along and go out for dinner after. You can buy tickets here. This is a very interesting subject - effectively how you perceive the world. Hope to see you there.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

I’m as guilty of this as anyone, but many of us make life more difficult than it needs to be. Achieving basic happiness, or at least avoiding what depresses us, might actually be quite simple.Is happiness, simply, when reality exceeds expectation?When I was a young man I was chronically ambitious. I would lie in bed as a student, dreaming about my future, making Faustian pacts, yet nothing would satisfy me. You could have offered me fame, glory, wealth, the keys to the city and more, and it would not have been enough. I wanted everything. When we discussed our futures, my friend, Gideon, gifted and hugely competent, but not remotely ambitious, used to say: “I just want to be happy.” I thought that was loser talk. Looking back, he was probably right.How often do you watch a film or a show because somebody was raving about it for it to turn out nothing like as good as you were hoping? You end up disappointed. But if you saw the same film with no or low expectations, and it’s pretty good, you might walk away feeling quite elated. Life is the similar. If reality comes in below expectation then we end up disappointed. If it comes in above expectation then we end up happy. Hence this useful formula:Reality > expectation = happinessExpectation > reality = unhappinessBy this formula, then, to achieve happiness you should simply lower your expectations.There is a lot to be said for that. But then there is also a lot to be said for ambition and optimism, which the mindset of low expectation negates. Ultimately, this way of thinking boils down to perception. Your life is no different - it’s the same film - it’s just a matter of how you look at it. Thus should we practice gratitude.Nevertheless, I’m not sure perennially low expectation is a way to live.We are all animalsDespite what we may think of ourselves, no matter how cultured, we are, when all is said and done, animals. If you keep a dog, you will know that, to be happy, a dog needs plenty of outdoor exercise and fresh air, regular and proper food, sleep, love and company. Absent any of these and the animal quickly becomes depressed. Human beings are the same. We have certain basic needs without which we end up depressed. The cause of depression is often (not always) the continued absence of one of these basics.With that in mind, here are seven animal essentials we all need to be happy. If you are depressed, it’s not unlikely one of these is missing in your life. Get it back and you might find other things fall into place. (The problem with depression is that you lose the motivation to do so).I’m not saying that you can’t be depressed or unhappy, if you have all of these things. You can. But a lot of the time, the cause is that one of these is absent. Get it back in your life, and you will find your depression sorts itself out.1 SunThe sun is the giver of all life on Earth, the source of all energy, of light, heat and gravity. Most of us do not get enough of it. We spend too much time indoors under artificial lights. The darker your skin, the more sun you need - and sun can hard to come by in colder northern European climes - but you need sun, whether you’re light or dark. Our ancestors spent most of the day outdoors. When the opportunity presents itself, get plenty of sun, all over your body. We need sun. Only use enough sun block to prevent burning. As soon as you can, wean yourself off. A close family member got herself into the most terrible depressed state last winter. I’m convinced it’s because she did not see sunlight for months, instead lying in bed all day watching crap on her phone.It’s no accident the sun is often depicted with a smile on his face. Get more sun.2 WaterIt’s as obvious a basic requirement as the sun, yet most of us don’t drink enough. Got a bit of a headache? Constipated? Feeling stiff? Allergic? Lethargic? Hungry when you know you’re not? Drink a large glass of water.Just under a pint should do it. That would be pound of water, roughly half a litre. You’ll be amazed how many niggles it clears up.A large glass of water should be the first thing you drink every morning, when you wake up. And don’t drink it cold. Drink it at room temperature or just below. 3 Food Two meals a day is plenty. Avoid snacks. Don’t eat crappy, processed food. Avoid seed oils and ingredients the names of which you don’t understand. Use simple foods - meat, fish, veg, fruit - close to their naturally occurring state (ie unprocessed). Spend time preparing food. Ideally, eat with other people - eating should be a shared communal activity. Regular eating times - routines - are good. And say grace before you eat - it focuses the table, it unifies the group, it expresses gratitude, helps mark where you are and grounds you. Doesn’t matter if you don’t believe in god, saying grace is still a good ritual.Also, rather than eat crap on the run, skip meals. Fasting is good.If you are overweight and want to lose weight, fast. The 5:2 diet works and, most importantly, it is sustainable.But the basic rule is eat regular, healthy meals and don’t eat crap.4 ExerciseGet plenty of it. I’m convinced exerting yourself and getting your heart pumping cures depression. Walk, swim, run, cycle, go the gym, play football, play tennis, lift weights, do HIT, ski, do yoga - it’s all good. Do as much as possible outside, so you get sun and fresh air. And drink plenty of water afterwards.5 AirAs basic as water, food and sun, get plenty of fresh air. Sea and countryside air is better than city. Park air is better than busy street air.Plenty of exercise will get you breathing properly. Breathe deep. Breathing exercises are good, though must of us can’t be bothered. 6 SleepGet plenty of sleep too. Don’t deprive yourself. We need sleep. The body and mind replenish during sleep. I have many of my best ideas when I’m asleep. I often solve problems in my sleep. It’s because the mind carries on working at stuff you have been thinking about in the day.Alcohol and drugs affect sleep badly. I drink too much. Most of us do. Try to avoid drinking at home. Fasting is good as, if nothing else, it stops you drinking. Thus fasting improves the quality of your sleep. There’s nothing wrong with going to bed early. Sometimes I struggle to get to sleep - and that is when the demons come to visit. The best cure for that is plenty of exercise earlier in the day, so you go to sleep tired. Don’t drink caffeine or orange juice after 6pm. Don’t eat too heavily late at night. Don’t shower or bathe just before bed - it will wake you up.Reading helps get you to sleep quickly too. Don’t look at your phone, computer, TV or iPad for at least an hour before bed. The blue light wakes you up.7 CompanionshipAnimals, for the most part, are social. Humans certainly are.I am an only child and quite a solitary person. But I still need the company of others, be they friend or family. We all do.Nature designed humans to live in families, large ones. Unfortunately, the modern world - in particular the big state - is destroying that: the state destroys family by eroding its responsibility. For me that is a major factor in the decline of the west. But that is another issue for another day.Not always possible, but try to live in as big a family unit as possible. The Asians have it right. Your family knows you better than anyone. They know what is good for you and what is not. They monitor you. Humans are happier in family units. Their roles are more clearly defined. Find a partner to share your life with, someone with plenty of shared loves and interests. Don’t burden them with unreasonable expectations. The waitress test is good: if you have a really bad experience in a restaurant, watch how they treat the waiter or waitress. Because that is how they will treat you when things get bad. Do you want that?We need friends almost as much as family - they are the next best thing, and they make for a good substitute in the absence of family. Surround yourself with good people, and people you think are good for you. Hang out with bums and low lives, and you will become a bum and a low life. What you can control and what you can’tMost of the above you have some control over, but so much of what happens in your life is beyond your control. You can’t control who your parents are, at what point in history you were born or where, what is going on geo-politically around you. One example of this, as Malcolm Gladwell observes in Outliers - the Story of Success: neither Bill Gates nor Steve Jobs would have been the men they were if they were born a couple of years earlier or later. There was a cluster of computer geniuses who were all within a one year timeframe that meant they were coming of age at just the point computers were taking off.Your health is not always within your control. (But you can affect it by eating, sleeping, drinking and exercising well - and getting plenty of sun). If you are at school or university or work in a large establishment, you cannot control what is happening above you there. Similarly, if you are freelancer, you cannot control what is happening in the broader work place or the economy. You can only position yourself for it. Any stock trader will tell you, you cannot control markets, only react to them.The loss of a loved one, natural disasters, unforeseen catastrophic events, the talents bestowed on you - there is so much you have no control over. With that in mind my daughter and I put this ‘graph of life’ together yesterday. The black line is your life. Beneath the black line is stuff you can control, above it stuff you can’t.I’m minded of the great line from JRR Tolkien’s Fellowship Of The Ring.“I wish it need not have happened in my time,” said Frodo. “So do I,” said Gandalf, “and so do all who live to see such times. But that is not for them to decide. All we have to decide is what to do with the time that is given us.”You can work hard, position yourself, play your hand well, make good decisions, but so much of what happens in life you have no control over. I gather a standard sports psychology, something Sven-Göran Eriksson used to bang on about, is to only worry about what you can effect. The animal habits outlined above you can, for the most part (companionship is harder), effect. This is obviously a huge subject, and one I will return to, but I think I’ve banged on enough for one day. When I was in my 20s trying to figure out what I wanted to do with, my father always used to say “There are only two that matter: who you love and what you love” - by which he meant your work. Work, tradition, prayer and spirituality, and their relationship with happiness, are things I would like to explore in another post. But we have enough for now.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

“Pound crashes to weakest level since 1985 in blow to Truss” ran the headline on the Telegraph website yesterday.“The Bank of England had one job today”, as economist Shaun Richards put it, “which was to talk up the pound and instead their waffling sees it at US $1.14.” Theresa May Flash Crash aside, that’s a 37-year low.And that’s measuring it against the dollar. If you measure the pound’s purchasing power against essential basics such as energy or houses, its performance has been way more woeful.It’s not just the pound, even if it is one of the worst offenders. It’s all fiat money. I’ve been banging on about it for 20 years but I may as well bang on some more: fiat money and its devaluation is the greatest and most pernicious intergenerational theft in history. Devaluing your currency boosts assets but devalues labour When you devalue money, among numerous other things, you devalue salaries, which is to devalue labour. All the young have is their labour. You boost the value of assets meanwhile, which is what the old have acquired over the course of their lives. The net result is to transfer wealth from young to old. Compounded over decades, 5% one year, 8% another, this process has been devastating. Don’t get me started on the knock-on effects: smaller families started later in life and all the rest of it. So many people of my generation and above think they are business geniuses because they paid the market rate for a house 30 or 40 years ago. You are not. Systematic and incremental devaluation by successive administrations was “what did it”.The Bank of England, the Federal Reserve Bank, the European and Japanese Central Banks – central banking has a lot to answer for. It feels like we might finally be in some kind of endgame for fiat money now. Mind you, I thought we were in the endgame in 2008, so I’m probably wrong this time around as well. I’ve no doubt some new magic words even more unintelligible than “quantitative easing” are being conjured up as I write.Right rant over. I had to get that off my chest. Let us move on. Does a new PM mean you should go long the pound?We have a new government. Money is the issuance of government. The weak pound is all over the headlines. So I thought it would be an interesting exercise today to look, first, at the performance of the pound by successive governments over the past generation. And then to consider whether one should be buyer or seller here.“Buy on silence, sell on headlines,” is a good little investment motto that I’ve just invented. When something makes the headlines, there is often not a lot of narrative left in the tank,  the story is mature and the next stage is exhaustion. It’s standard contrarian market psychology. Does the fact that the weak pound has made the headlines mean it’s time to take the other side of the trade and go long? Could be.We’ll start with a chart of the pound against the dollar – aka cable – since 1970. And by the way, the dollar has a much larger market cap than the pound, so what is going on on the other side of the pond tends to have a greater effect on cable than what is happening here. That is the case at present. The pound is weak, but so is the euro, the yen and any other number of currencies you care to mention – except the Russian rouble. Current pound weakness is as much a function of US dollar strength as anything. The chart of the pound against the euro over the last three years is much flatter.In any case, cable is the benchmark, so here is the pound against the dollar since 1970, when it was $2.40 (!).The broader trend is down, but there are periods of relative strength – 1976-1981, 1985-1991, 2000-2007. We’ve basically been in a downtrend since 2007, shortly after Tony Blair stood down and Gordon Brown became PM. It is what is known in the game as a secular bear market. Now we consider the same chart, but this time I have overlaid the government. Even though several prime ministers have led successive governments – Wilson, Thatcher, Major and Blair for example – for the sake of clarity and simplicity I have marked the chart by PM. Needless to say the dates of the red and blue lines are approximate. The first observation I make is that, despite their reputation for fiscal competence, the Tories have not been good stewards of the currency. In the case of Edward Heath and David Cameron, the pound was marginally stronger when they stood down than it was when they took office. Despite his presiding over Black Wednesday and the ERM fiasco, for John Major the pound was only a few per cent lower than it was when he started.But in the case of – and this surprised me – Margaret Thatcher, plus Theresa May and Boris Johson it was lower. Labour’s record is mixed. Harold Wilson saw it lower, Jim Callaghan higher (that surprised me too). Tony Blair has the best record of all – it went from roughly $1.60 to $2.10 – and Gordon Brown the worst.That said Blair was one of the few PMs – perhaps the only one – to stand down from a position of strength. Normally PMs are stood down because there is something voters or MPs or both are not happy with, which will be reflected in a weak currency.Lower taxes and higher spending should encourage growthBack to today. This latest move in the dollar has been extraordinary. I’ve long been suggesting the US dollar index could go as high as 120 (another 10% from here – though exhaustion indicators are starting to appear), but at a certain point purchasing power parity will kick in and currencies will reflect relative valuations. On a purchasing power parity basis the pound is very cheap at $1.14. The other observation I make about the above chart is that new administrations have often marked turning points in the currency. This, one could argue, was the case for Wilson, Callaghan, Major, Brown, Cameron, May and Johnson.Despite the Tories’ record for incompetence, Liz Truss has put together a cabinet that is, broadly speaking, actually conservative. Unlike previous administrations, it is not full of wets and social democrats, who happen to be in the Conservative Party. Lower taxes and less spending (I’ll believe that when I see it) should lead to economic growth, which should help the currency. The big kahuna though is where the Bank of England base rate goes – and indeed the Fed Funds Rate.I’d say there is a not unreasonable chance that, with a new government, we could mark a turning point for the pound. We’re at a point of extremity where such a turn could happen. But let’s see what government does first, before we get too excited. As I say, another not totally unreasonable possibility is that we are in the endgame for fiat. In that case the pound slides below parity. If you want to buy gold to hedge yourself against all of this, my recommended bullion dealer is the Pure Gold Company with whom I have an affiliation deal. If you are in London on September 28 or 29, my lecture with funny bits, How Heavy?, about the history of weights and measures is coming to the Museum of Comedy. It’s a 7-8pm show so you can come along and go out for dinner after. You can buy tickets here. This is a very interesting subject - effectively how you perceive the world. Hope to see you there.The Flying Frisby is a reader-supported publication. To receive new posts and support my work, consider becoming a free or paid subscriber.This article first appeared at Moneyweek. This is a public episode. 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Morning All,A slightly admin-y email today.First up: How Heavy? - the surprisingly popular "lecture with funny bits" I did at the Edinburgh Fringe this year- is coming to London’s West End for a short run later this month at the Museum of Comedy on September 28th and 29th.It's a show about the history of weights and measures, and is, I promise you, a VERY interesting subject. Weights and measures effectively determine how you perceive the world. It's a nice, early 7pm start. You'll be done by 8pm - free to go and have dinner or whatever you fancy - and will give your evening a strong intellectual foundation.Please come along. You can get tickets here.Second up: there have been some significant announcements by two of the companies in my portfolio - major holdings - in the last 24 hours. I will be updating paid subscribers on these asap, hopefully later today.Third up: this article was supposed to all subscribers last week, but due to a cock-up at HQ it only went out to paid subscribers. The YouTube version has been very popular - it’s obviously caught a nerve - so in case you want to read it, here is a link:Until next time.Dominic 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

My apologies if you have received this twice. Cock up at HQ.Over a Zoom call earlier in the week,  I heard some people discussing the “Russian Davos” which they had attended back in June. I didn't even know such a thing existed, such is my Western, Ptolemaic view of the world. (Ptolemaic, by the way, to save you having to look it up, means you think you are at the centre of the universe, and everything revolves around you).So the Russian Davos, or as it’s properly known, the St Petersburg International Economic Forum, held in June, is an annual event that began in 1995 to signal the (then) new Russia. It would attract global political leaders, business titans, finance bigwigs and all the usual shizzle. The event went ahead this year, though, for obvious reasons, the VIP headcount was significantly down. Gone were the likes of (once) German chancellor Angela Merkel, ECB chief Christine Lagarde, Goldman Sachs' Lloyd Blankfein, Citi's Vikram Pandit and ExxonMobil's Rex Tillerson. Top billing went to presidents of Egypt (via video link), Kazakhstan, Armenia and other allied states.There were representatives from the likes of China, India, Iran, Serbia, Turkey, Venezuela, Egypt, Belarus, Central African Republic, Nicaragua and the United Arab Emirates. Quite a collection. Non-Western nations that have not imposed sanctions had greater prominence. The Western economy has been shaped by cheap commodity prices The official title of the forum was "New Opportunities in a New World", and the recurring theme was how to improve trade between non-Western powers in a US dollar controlled world of sanctions. "A new form of international cooperation: how will payments be made?" was the title of one such talk. Time and time again the conversation came back to a new, non-Western international currency.Which brings me to the second strand of thought that makes up today’s piece: the latest contribution from Credit Suisse analyst, Zoltan Pozsar. Pozsar has long since argued that Bretton Woods III, a new world monetary order, is happening before our eyes and that new money systems east of Europe will be based around commodity-based currencies.In his latest, War and Industrial Policy, Pozsar, who I am fast becoming a fan of, argues that there were three forces that shaped the western economy before Covid - cheap immigrant labour, cheap Chinese goods and cheap gas. Such a trinity is no longer possible in a world in which international trust is fast evaporating. “The “cartoon” version goes like this: China got very rich making cheap stuff, and then wanted to build 5G networks globally and make cutting-edge chips with cutting-edge lithography machines, but the US said “no way”. As a result, Chimerica is going through a messy divorce. The two sides don’t talk anymore.” Meanwhile, “Russia got very rich selling cheap gas to Europe, and Germany got very rich selling expensive stuff produced with cheap gas.” Those two sides aren’t talking any more either. “Chimerica does not work anymore and Eurussia does not work either,” he says and now, in the divorce, it seems Russia and China are “getting it on”. Meanwhile, out west, QE and zero interest rate policies are no longer possible in a world without cheap Chinese and Russian exports. There is now a rush to regain control of key technologies, especially microchips, and key commodities, especially oil and gas (and soon in my opinion metals and grains). Pozsar adds straits to the key list - the Taiwan Strait, the Strait of Hormuz, and the Bosporus Strait.“I think that four themes (re-arm, re-shore, re-stock, and re-wire the electric grid) will be the defining aims of industrial policy over the next five years … the global order is at stake.”Inflation or not, high rates or not, there is a commodity-intensive demand shock coming that “could easily drive another commodity super-cycle.”So to the third strand. “The issue of creating an international reserve currency based on a basket of currencies of our countries is being worked out,” Vladimir Putin said last month.In this regards we have former Kremlin adviser, now Minister in Charge of Integration and Macroeconomics of the Eurasia Economic Union (EAEU), and an influential economist, Sergey Glazyev. He is, according to some reports, supervising the adoption of a new money system for the EAEU and China. “The world’s new monetary system, underpinned by a digital currency, will be backed by a basket of new foreign currencies and natural resources”. “A currency like this can be issued by a pool of currency reserves of BRICS countries, which all interested countries will be able to join. The weight of each currency in the basket could be proportional to the GDP of each country (based on purchasing power parity, for example), its share in international trade, as well as the population and territory size of participating countries. In addition, the basket could contain an index of prices of main exchange-traded commodities: gold and other precious metals, key industrial metals, hydrocarbons, grains, sugar, as well as water and other natural resources.”You can bet your bottom dollar that many of China and Eurasia’s brightest minds are plotting such a system, but it’s a lot easier said than done. Apart from anything else there is the issue of storing all these commodities. Not all of them keep. Others take up a lot of space. Which is why, in the past, gold alone has been used to back money. It keeps very well and you don’t need a lot of space to store it. The bullish backdrop for commodity prices Russia and China both have lots of gold - we have long argued that China’s gold reserves are ten times what they say they are. It would be a lot easier to use a gold-backed international currency. Or, well, gold. But governments everywhere, whether controlled by tyrants or technocrats, are always going to want to maintain the option to print, debase and manipulate, so gold alone is unlikely. But you never know. It works as an international money.Against this highly-bullish-for-commodities backdrop, we have a situation here in the west that looks like the dead cat bounce in stocks is now over, and the bear is again gnashing his teeth. That teeth gnashing has extended to commodities, be they metal, fuel or grain, and now, once again, there is a rush for the exit. The main priority is to preserve capital, not positions. The price action - certainly in metals, less so in oil and gas - has the hallmarks of a bear market, not a supercycle.I keep saying these markets are difficult. But they are. While there is a liquidity squeeze all bets are off. But at a certain point, to my eyes at least, it looks like commodity prices are going to rocket. If only I knew when.To hedge yourself and buy gold or silver, check out the Pure Gold Company.I will be performing my lecture with funny bits, How Heavy?, about the history of weights and measures at the Museum of Comedy in London on September 28 and 29. You can buy tickets here. Please come along. You will not be disappointed. It is a surprisingly interesting and entertaining subject.The Flying Frisby is a reader-supported publication. To receive new posts and support my work, consider becoming a free or paid subscriber.This article first appeared at Moneyweek. This is a public episode. 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While on holiday in Sark this week, I stumbled across a book in the local post office: “Silver Mining On Sark” by David Synnott, which describes an ill-fated mining operation on the island between 1836 and 1847. Books are distilled knowledge, and I love the stuff you can find in them. Often stuff you don’t find online.“Plus ça change, plus c’est la même chose”, runs the old French saying. It applies to mining, it seems, as much as anything.  We don’t use canaries any more; mines are powered by diesel and electricity, not horse-, donkey- or and manpower; helmets have torches instead of candles and there is underground lighting; and a higher premium is placed on human life than in the early 1800s, when workers were much more disposable. But the game is exactly the same: you’re trying to extract metal from rock and sell it at a higher price than you mine it for.  The tricks of the trade, aka scams, are the same too. So let me tell you the story of Sark’s silver mine.  How a silver mine brought the boom times to a tiny island Sark, by the way, is a tiny island about two miles square, located between Guernsey and Jersey in the English Channel – much closer to France (25 miles) than England, which is over 200 miles away.  Remains show the island was inhabited in Neolithic times, but for many periods in the island’s history there was nobody here at all. Today it has around 500 residents. There are famously no cars on the islands – only tractors, horses, bikes and mobility scooters – and no street lights, giving you probably the best view of the night sky in Europe. It’s famous for its harsh, windswept landscape with sheer cliffs and jagged rocks. It still has a feudal lord – who, by the way I beat at table tennis – and its own parliament. In the early 1800s the language spoken here – the patois – was similar to Old Frankish. Very different from the Cornish spoken by the miners who would soon settle there.  If you take a boat trip round the island, there are visible copper salts leaching in the cliffs – which no doubt explains its appeal during the Bronze Age – and it was these visible salts that attracted prospectors to the island in the early part of the 19th century. The Cornish at the time had one of the most evolved mining cultures in the world (also dating back to the Bronze Age), and they were operating mines as far afield as Argentina, North America (especially California, Wisconsin, Pennsylvania, Michigan and Virginia – in Chesapeake they even have a Cornish accent) and South Africa, where they operated the world’s largest copper mine at Okiep, 300 miles north of Cape Town. They were in Australia and New Zealand as well.Even the great Mark Twain – he of “a mine is a hole in the ground with a liar standing next to it” fame – was of Cornish descent. In 1835, funded by an English mining adventurer called John Hunt – adventurer is a far better term than entrepreneur, is it not? – a team of Cornish miners arrived on the island to mine the copper. They soon found lead and silver nearby, and began mining that too. And so was Sark’s Hope Mine built.  They should have called it the No Hope Mine – what was prospering in 1839 went badly wrong. How?  Profits erased by extravagant dinners and lax accounting In the age old tradition of mining, management misled the shareholders. When the ore body was clearly not enough to support the mine, the mine captain deceived where possible to keep the game going.  Management had a vested interest in doing so, even if it was no longer profitable. Their salaries depended on it. There were also some two hundred Cornish workers were employed by the mine, together with their wives (who may also have been employees – “bal maidens”, they were known as) and their families. Sark’s population soared to 790, the highest ever recorded. Management no doubt felt loyalty to its people, as well as their own salaries.As they chased ore, expanding the mine with the promise of finding more silver, the mine extended some 800 yards and with tunnels 300 feet out to sea where they were mining 20 fathoms – 120 feet – below sea level. You can imagine the noise in those tunnels when there’s a storm blowing overhead, waves crashing and all the rest of it. They actually had quite an ingenious device in play should the mine ever flood that would save the mine and some of its occupants.  General equipment could be brought in from Guernsey, but the speciality stuff had to be acquired from Cornish suppliers, with the effect that Guernsey and London shareholders capital went to the “picks and shovels” suppliers in Cornwall.  Management would go on jollies to Guernsey for their count house dinners, a tradition they had brought over from Cornwall – dinners which acquired legendary status for their extravagance – where news of the mine would be delivered to shareholders.  (The count house is the mine office, where the managers worked and where the miners were paid. You’ll still find pubs or estuarants in Cornwall called the Count House.) Mining has a long and rich history of this. I remember the boom of the 00s and you would see management of non-producing exploration companies living it up at the Savoy, driving Ferraris to expensive lunches and dinners. Who’s paying for it all? The cost of dinners would be buried in the company accounts. On another venture one outadventurer - an investor or shareholder - is said to have asked why he couldn’t see the spirits from a recent count house dinner in the accounts. The bursar, or what we might today call the CFO, declared that the spirits are there, you just can’t see them.  There was a long Cornish habit of swindling “outadventurers” – investors – from London. It seems they took the habit with them to Sark. Of course, sometimes mines work - and everybody makes a lot of money. That’s the same lure that draws people in and will always draw people in. It’s only when the mine doesn’t work that things go belly up.That’s not to say working mines was easy. Many lost their lives to it – 20% of Cornish miners were killed or incapacitated before they reached 40, so Cornwall became known as the county of widows. If you saw someone’s window open in Cornwall in winter, it’s likely that the occupier was a former miner gasping for air as his lungs were so damaged from breathing in the dust of thousands of gunpowder explosions. As things went wrong in the early 1840s, the Seigneur of Sark – the feudal lord – borrowed money to try and keep the business going. But in 1847 the business finally collapsed. The Seigneur lost a lot more than his shirt. He died a year later, crushed with debt. His creditor, one Marie Collins, foreclosed on the debts and his son lost the fiefdom to her.  The son, Peter Carey, would become “a low life scamp”, to quote the (probably biased) archive of the Seigneurie. Sark got a new Seigneur - a Dame actually - and that same family retains the fiefdom to this day. The mine has never been reworked or re-explored. Now it’s all grown over.   Irony of ironies, in Guernsey there is still a record of all the money paid out to shareholders, but those that recorded the company’s income have been “lost”. Still, the episode had some long-term effects on the island For a period there was an influx of capital. Prosperity then depression. It brought Methodism to the island from Corn wall, a school for girls and a doctor. It kick-started the tourist industry. The area around the mine – previously just heath – began to be farmed. The English language came to the island. The houses that were built for the mine workers housed the Sarkese for many decades to come. Apparently because they weren’t built by the Cornish, but by the locals – so they were built with more longevity in mind “In this spot,” said local historian Edgar Barnes in 1890, “centred anticipations never to be fulfilled, and hopes doomed to dire disappointment. At the bottom of the mine lie buried the fortunes of an ancient family, the hard earned savings of people who had little to spare, and the wasted energies of hundreds of stalwart men who had hoped to share in the wealth which their efforts were to have won. And now all has vanished, as if it had never been, save that there still remain – ghostly monuments of failure – the shafts and the chimneys and the ruins of the various offices.” This is a story that has played out many times through the history of mining, and still plays out today. Investors – caveat emptor.If you are interested in buying bullion - safer than miners - check out the Pure Gold Co.If you are in or close to London towards the end of the month, I will be performing my lecture with funny bits, How Heavy?, about the history of weights and measures at the Museum of Comedy in London on September 28 and 29. You can buy tickets here.The Flying Frisby is a reader-supported publication. To receive new posts and support my work, consider becoming a free or paid subscriber.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

A interview in today’s programme with a highly eloquent young man, Peter Young, of the Free Cities Foundation. Peter discusses China (he lived there for ten years), the Free Speech Foundation and, finally, whether today’s young will end up poorer than their parents. For details on Peter’s October conference in Prague, visit Life Time Liberty.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