The Flying Frisby - money, markets and more

It’s my pleasure this week to once again interview Paul Kingsnorth, author of many books and the excellent Substack, the Abbey of Misrule.This is thought-provoking interview in which we discuss how we would like society to be designed: the best systems of rule, our philosophical journeys to small and local government, radical localisation, the failures of modern politics and globalisation, the destruction of the environment and local culture, and old school conservatism. I love talking to Paul.Please like and share if you enjoy this interview.If you want to see what we look like, the video version of this interview is here:Here’s Paul’s excellent Substack: 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 went to a mining conference on Monday - the Mining Journal Select London. As well as being on a panel, I wanted to catch up with the management of a couple of companies I hold shares in and get a feel for the state of the industry.Mining is cyclical. If there’s a shortage of some metal or natural resource, the price of that resource will go up. Rising prices encourage people to start looking for more said resource, investing in it and mining it. Suddenly there’s a mining boom.This eventually leads to an increased quantity of whatever the resource in question is, and the price comes back down again. The price of mining companies comes back too. Investment goes away. Suddenly we have a mining bust.In today’s fiat world of wild price swings, boom seems to turn to bust with increasing rapidity and violence. We are definitely not in the boom phase of the cycle.“Look at the room,” an investor came up to me and said after the panel I was speaking on. “It’s empty. It’s a classic bottom-of-the-market sign.”I can’t help thinking he may have a point. But I also want him to be right, as my own portfolio is so exposed to mining. An analogue industry in a digital worldIn our 21st-century world of billionaires, leverage, booming tech stocks and cryptocurrencies doubling overnight, value is digital and digital is quickly scalable. Ten grand can be enough to be trading portfolios in the hundreds of thousands. Write a bit of code, upload it to the app store and it can be downloaded billions of times. Upload a funny video, watch it go viral and find yourself with a million followers. And then there is old analogue mining. Getting to some remote and unexplored part of the globe. Sampling a bit of rock. Getting a licence. Sticking a drill into the rock. Hopefully, finding something. Sticking a few more drill bits in. Hopefully finding something more. Getting what you have evaluated. Persuading investors that what you have is meaningful. Getting more permits. Drilling more, evaluating more, persuading investors more and on and on for 20 years until you eventually complete the mine construction and start producing. It takes an average of 16 years to take a mine from discovery to production, more if you factor in prior exploration. 16 years before the company is profitable. Who’s got 16 years in today’s fast-paced world? 16 years is a lot of time for something to go wrong. There could be a change of government, a change of local attitude to mining, a change in underlying commodity price or a change in the investment landscape to name just a few of the risks. Mining is slow. Mining has not seen the breathtaking improvements in technology that other industries have seen. Yes, there are massive trucks, and huge machines, but the basic principles, extract metal from rock, are not far off what they were in the Bronze Age. And yet mining is essential. We could not enjoy the world we enjoy without mining. The picture below is of a cabinet at the Camborne school of mines that shows the 70 different elements we need to make a typical smartphone: copper, silver, gold, tin, indium, tantalum, silicon, not to mention the gadolinium, europium and dysprosium.These elements cannot be digitally created. Midjourney serves no purpose here.Should investors ignore mining stocks? At present, retail investors shun mining. So do institutions. Who can blame them? Never mind the ESG deterrent, the sector is down around a third or more on this time last year. The small-caps by much more. It takes time, I was constantly told yesterday, but investors don’t like looking at stocks in their portfolio that are down 30 or 50% from where they were last year. They don’t have 16 years.At the conference, there was some dissatisfaction that retail investors are no longer interested in mining, but can you blame them?Culture is a factor too. Most mining investment comes from people within the industry who understand the sector. Here in the UK, mining is no longer part of our culture as it once was. People like to invest in things they understand. Mining requires so much capital, it needs promoters. It needs the guy with the suspiciously white teeth telling you that this stock is going to the moon and that you are going to be a millionaire. Without the promotion, without the blue sky, it can’t raise the capital it needs. The problem is that a lot of promoters are scoundrels. Investors get ripped off. What did Mark Twain say about a mine being a hole in the ground with a liar standing next to it?But even without the scoundrels, capital gets destroyed. Sometimes unscrupulous governments in far-flung parts of the world seize control of profitable mines. Sometimes unprincipled governments bow to environmental lobbies and remove their licences. Most of the time the regulator is Mother Nature. The mine is simply uneconomic. There is not enough metal in the ground to justify mining it at current prices. Metals prices need to be twice as high or more before this mine is viable. Just one in a thousand exploration properties make it to production. Think of the capital destruction of those other 999 properties. Few prudent money managers invest with those odds. Even the mine that makes it is, 90% of the time, comes in late and over-budget. In this fast-paced modern world, no wonder the industry is on its knees. High commodity prices will drive more spending They say the cure for high prices is high prices. You could say the same about low prices. Mining needs higher metal pricesHaving to tighten their belts, the conduct of those in the industry is much better than it used to be. Execs are staying at the Travelodge, not the Savoy. The numbers being presented are better. Companies are having to work harder, there is more competition for capital - this has all contributed to improvements in standards, as is often the way in bear markets.I’m slightly obsessed at the moment with AI and the economic boom that is coming as a result of the improvements to productivity it is enabling. I was delighted to meet two different people who are looking at ways to employ AI in this most analogue of industries. Anyone who has ever been to a core shack will tell you, there is a lot of data in mining. Miles upon miles of drill core stored in shacks, with the rock contents recorded and analysed. Surely AI will have a role to play in analysing all that data, comparing it to the data of existing producing mines, as well as failed, non-producing discoveries. One of the chaps I spoke to said he thought his AI might be able to get to a point where the success rate gets from one in a thousand to one in three. Then again, he did have very shiny teeth. We need mining. We will always need it. Our failure to invest in it is going to come back and bite us very hard. Meanwhile, we soldier on and try to find the best projects, with the best management, with the highest probability of success. We also need patience. Interested in buying gold? Then visit The Pure Gold Company, whether you are taking delivery or storing online. Premiums are low, quality of service is high. They deliver to the UK, US, Canada and Europe, or you can store your gold with them. I have affiliation deals with them.Please consider becoming a subscriber.An earlier 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

In your time bestriding the narrow world like a Colossus, you might have heard the term, “bearer asset” or “bearer instrument”.That would be an asset that you take physical possession of - cash or bullion, for example - an asset that is effectively owned by whoever has possession of it, that can be transferred from one person to another by just handing it over.The ownership of the asset is not registered with a central authority, so that makes it vulnerable to theft or loss, but it also means the asset is nobody else’s liability. Unlike money in the bank or a government bond, it carries no promise from a third party. The value of the asset is thus not dependent on the creditworthiness of any issuer or guarantor, but rather on the inherent value of the asset itself.So, in today’s interlinked financial world, a bearer asset becomes an asset outside the system.Like Tottenham Hotspur, bearer assets have their strengths and their weaknesses. Their strength is that they are nobody else’s liability. Their weakness is that their liability is yours. The two main bearer assets in today’s financial marketplace are gold and bitcoin. Bitcoin rallies as investors seek safety Bitcoin is not a physical asset of course. But the technological genius behind it means that it is a “digital bearer asset”. No such thing previously existed. With bank runs, bail-outs and another banking crisis now upon us, both gold and bitcoin have suddenly fetched a bid. No surprise: they both are means to store value outside of the system. You don’t have to rely on third parties. I thought, given everything, we should check in on both today.Here’s bitcoin, which, at $28,000, has broken out to 9-month highsIs that a bullish, inverted head-and-shoulders pattern I see before me? I think so. On that basis, what would the target be? The distance from the top of the head (around $15,000)  to the shoulder line at c.$25,000 is $10,000 - so you would have a target of around $35,000, perhaps a little higher.Some are even calling out for hyperbitcoinisation: a hypothetical scenario in which the widespread adoption of bitcoin occurs so rapidly that its price rises dramatically and it becomes the dominant form of money in use. In this scenario, bitcoin would be widely accepted by merchants and individuals alike. The term "hyper" refers to the extreme and rapid level of adoption. In a way, it is an inversion of hyperinflation. The fiat system would remain, it wouldn’t necessarily collapse, it would just be overtaken and superseded by bitcoin.There are many who believe hyperbitcoinisation is both inevitable and desirable. Bitcoin is better money than fiat. The traditional banking model is dysfunctional and reliant on constant bailouts. One such advocate is billionaire Balaji Srinivasan, who has grown so concerned at the goings-on in US banking, he has made a million-dollar bet that bitcoin will hit $1 million by June 17.The odds are against him. Some are suggesting he is just doing it for the attention. But to be fair to Balaji, he has a good track record spotting trends. I’m a bitcoin bull, but maybe I lack ambition. I can see it getting to $35,000 or $40,000 by June. I’m not so sure about $1 million. But hey, I’ll take $1 million dollar bitcoin if it’s offered. I’ve heard this kind of prediction before. You used to hear them all the time about silver. I’m not holding my breath.My rather drab observation is that, after a miserable 2022, tech has suddenly caught a bid. Even Meta’s going up. Bond yields have fallen with the banking panic, and suddenly growth stocks look attractive again. Sorry to be so prosaic and unsensationalist. Meanwhile, that other bearer asset, gold has also found a bid, and with it silver and platinum. Gold this week has been flirting with $2,000.The gold price surged after bank collapse My buddy Josh Saul at the Pure Gold Company reports to me that, with the panic at Silicon Valley Bank, his company saw a 385% increase in new enquiries last weekend and a 274% increase in investors purchasing physical gold bars and coins last Monday, compared to its normal daily average. “One client said they are moving £16 million out of their current bank provider owing to fears of instability”, he says.Volatility in the stock market isn’t helping either. “This year, we have also seen a 712% increase in people removing exposure to equities and cash in their pensions and SIPPs in order to purchase physical gold bullion in the same vehicle”. My other buddy Ross Norman reports that visitors to his site Metals Daily have risen 763% in a month.Gold is now at all-time highs in almost all currencies, except the US dollar. What do new highs normally lead to?In the short term, gold , breathing down the neck of $2,000, is a little overbought by most sentiment readings. The miners have been quite flat in comparison, which is not a good sign. That suggests the spike is temporary.But longer term I think it goes higher. I have long argued that everybody should have exposure to both gold and bitcoin in their portfolio, and it is crises like this one that demonstrate why.Few people realise that by keeping your money in a bank, you are lending the bank money. The difference between money and credit has become conflated, along with many other things in this mad world. Even Switzerland no longer looks safe. All the same arguments we heard in 2008 are coming back. At the heart of them lie fundamental questions as to the nature of money and banking. Fractional reserve banking, and even full reserve banking, became sujets du jour. The words fiat money entered the lexicon.In 2008 there was a chance to address and put right the fundamental flaws in the system. It was not taken. Bail-outs brushed the problems under the carpet, and left them for another day. The free market meanwhile came out with an alternative, bitcoin. It is now a trillion-dollar economy, and there are no bailouts. With each collapse - there have been plenty and there will be plenty more - the system gets stronger.But with traditional banking, however, the more you bail out the system, the more precarious it becomes. You can’t take the risk out of a market. Without risk, you have no market. With risk comes responsibility. Don’t blame the players. It’s the game that’s at fault. If you are interested in buying bitcoin, my guide is here:My current recommended bullion dealer in the UK is The Pure Gold Company, whether you are taking delivery or storing online. Premiums are low, quality of service is high. They deliver to the UK, US, Canada and Europe, or you can store your gold with them. I have affiliation deals with them.An earlier 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

With the latest developments in AI, ChatGPT, Midjourney et al, we are experiencing something that, in terms of impact, will prove as big as the internet was in the late 1990s, if not bigger. Following on from my chat with Andy last week, which has had really good feedback from those watched/ listened (some haven’t had time yet), we have another really interesting conversation for you today about the implications of the amazing developments that are happening in the world of tech, this time with Danny Richman. It is only for paid subscribers. I will make it available to one and all in due course, when I will also release the podcast version for those who prefer to listen.Danny is a seasoned tech professional with 38+ years of experience helping organizations like BBC, Vodafone, and Salesforce streamline operations and improve online visibility. He's now focused on practical AI applications in business, education, and non-profit sectors. Danny volunteers for the Prince's Trust, supporting disadvantaged youth to start their own business. Follow Danny on Twitter.Going forward, I am looking to make more of these videos - please let me know what you think in the comments, or by liking and sharing (assuming you like!).If you want to watch or listen to my chat with Andy, it is here. This is a public episode. If you'd like to discuss this with other subscribers or get access to bonus episodes, visit www.theflyingfrisby.com/subscribe

Once upon a time, the business model of war was straightforward. You attacked some neighbouring realm, overpowered it, then plundered and taxed the conquered people. The Vikings were great pioneers of the model, as was Ancient Rome: it worked for as long as the empire kept expanding and Rome kept winning wars. When the expansion stopped, Rome had to replace the plunder with some other form of income. That’s when the currency debasement started.Often, but not always, the conquerors built infrastructure - buildings, roads or train lines (in the case of the British) - they stabilised the currency and introduced functioning bureaucracies, leading to the common argument that the conquerors actually improved things, which in many ways they did.The business model didn’t always function well, especially if the fight was ideological or, more importantly, if you lost. Europe “came second” in the Crusades and the grand part of the bill fell to the lowly European tax-payer. The various tithes of Henry II, Richard I and John, for example - with the Saladin tithe being the most famous - have gone down in history as some of the most punitive taxes ever imposed. There were even cowardice taxes, “scutage”, for those who didn’t want to go to war. On the other hand, the Catholic Church and the papacy, which, broadly speaking, initiated the expeditions, made extremely good by the whole affair: the church experienced an enormous increase in wealth and power, the papacy especially.Something changed with the great wars of the twentieth century. The Nazis may have vigorously pursued the traditional business model of war - to overpower, plunder and then tax. But the Allies emerged victorious and Britain, in particular, did not enjoy the spoils of victory that were enjoyed after the wars of previous centuries. There was little plunder, loot and taxation. Instead, the cost of the war fell on the British citizen. Taxation in 1947 was three times as high as it was in 1938. The cost of living doubled between 1938 and 1951 - put another way, the pound lost 50% of its purchasing power. The US supplied Britain with all sorts of essentials during the war and then after the war provided all sorts of credit. But it would not accept pounds as repayment, instead demanding gold or dollars. It took Britain two generations - 60 years - to settle the debt. Germany, on the other hand, had its debt written off in 1953. The British were not rewarded for their sacrifice.Today, the US’s enormous military-industrial complex has had its coffers tremendously enriched by its various wars in Vietnam, Iraq, Afghanistan and elsewhere, and through America’s role as world policeman. From defence contractors such as Lockheed Martin and Boeing to oil giants, such as Halliburton, which benefitted from lucrative contracts gained in the aftermath, billions have been made. But who actually foots the bill?Broadly speaking, there hasn’t been the “traditional” plunder and taxation of the newly conquered territories in the wars that the US nominally won, and it lost quite a few others. Some of the cost has been covered by the “exorbitant privilege” of the US dollar and the ability the US has to print and loan. But probably the largest portion of the cost of war falls on the US citizen, paid for in taxes. Roughly 12% of total US government spending (21% of federal spending) - so roughly 12% of everything an American pays in tax - will go on what the US disingenuously calls defence (I don’t recall any nation actually invading the US). That same citizen will be the one hit to get hit if/when those debt chickens come home to roost.With the enrichment of the military-industrial complex, and the worship of many of those who operate in it, there are many parallels between today’s US war business model and that of the Crusades. Some large organisations are enriched and empowered by it, others pay.You might say the current model is unsustainable, which would be true. But that doesn’t mean it can’t go on for a long time. The Crusades went on for two hundred years.And what about the current war in Ukraine? At first glance, I suggest Russia was hoping for a traditional plunder-and-tax affair with its invasion. But Ukraine has since attracted vast support, the original source of which is the western tax-payer. I guess we have a blend of the two models.Thank you for reading The Flying Frisby. This post is public - please like and share.West End 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.AI and the FutureI recorded this 90-minute interview about AI the other day with Andy - super interesting - and it’s now available to free subscribers:GoldInterested 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. 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

Jonathan Johnson, from recruitment company, Auxato, got in touch and asked me to write a piece for him, explaining how it is I got from being stand-up comic and voice actor to a renowned (his words) longstanding, financial writer for Money Week. I thought readers would like it and he kindly gave me permission to republish it here. The questions are Jonathan’s.Stand-up comedy – what life skills did it teach you?Stand-up comedy teaches you lots of things. How to stand on stage in front of a bunch of strangers. How to present yourself. How to entertain people. How to cope with pressure. How to deal with difficult situations and difficult people. How to think on your feet. Communication. Clarity.These are all really useful life skills that you might call upon in any number of other situations. Everyone should go and be a stand-up for a bit. But there is a lot more to being a stand-up than what you see on stage. Behind the scenes, every comic is running a small business. Every day you are trying to get gigs. You’re sending out emails, making phone calls, posting on social media, all with the aim of pushing your brand, getting noticed and getting better work. You’re running a diary. You’re invoicing for the gigs you have done. You’re chasing money from slow payers, while trying to extract money from the unsavoury promoters who are trying to wriggle out of paying you at all.You are travelling up and down the country four, five, sometimes seven nights a week to places you have probably only ever heard of, meeting all sorts of different people. As a result comics often know the country as well as anyone - all the while trying to keep costs down so that you can exit the gig at a profit. On top of all of that, but most fundamental of all, you have got to write an act that people find funny. You learn so many skills doing comedy. Even if you are not destined for stardom, which most of us aren’t, the discipline still equips you for life. You just need to look at the many people who started out as comedians who have since gone on to achieve huge success in other fields, from Joe Rogan to Volodymyr Zelensky, to know there must be something in it.Yet, if you’re a potential employer looking at someone’s CV and you see the word comedian, I bet that makes you less likely, rather than more likely, to call them in for an interview.In fact, most comedians who decide they’ve done it for long enough and now want to try something else, find it near impossible to find employment because of the fact they have comedian on their CV. The only option for most is to set up another business. Please tell your friends on Twitter, Linked and Facebook about this really interesting article.What a random hotchpotch of a career you have. How did it happen?I’m now 53. The longest I’ve ever lasted in a “proper” job is three months. This was back in 1992, when I was 23. I used to get up every morning, get the tube into Leicester Square and then do 10am to 6.30pm in an office. I hated it. It was not that bad a job either, but I hated being stuck in an office all day with no fresh air and not owning my own time.That’s not to say I’m not hard-working. I’m extremely hard-working. You just need to look at my output to see that. I would spend the next 15 years working occasionally as an actor, regularly as a voiceover (for some reason I always got more voiceover work than acting) and then, from 1997, as a comedian. All the while, I was trying to get stuff published - I wrote two novels and a million articles - but never with any success. I think I got one article in the Big Issue.But by 2006, I had made a bit of money, some in property (by accident) and some from voiceovers: I had been, at various points, the voice of such eminent products as First Direct, Nintendo 64 and the National Lottery. My dad had made a bit of money, too. Between us, we were trying to figure out how to turn our bit of money into a lot of money; because we were trying to raise five million quid to bring Kisses on a Postcard into the West End. From what I was reading at the time, commodities and gold, especially, seemed to be the place to invest, particularly with all the growth that was taking place in China. There were all sorts of people talking about it. But how to meet them and talk to them, without having to pay them? A podcast …What gave you the inspiration for the podcast interviews?I always knew I’d be a good presenter, even though I’d never actually done it. I was good at hosting comedy clubs and other such stuff. I approached a mining PR company called Commodity Watch and suggested we start a podcast. They didn’t really understand what I was talking about, so I did it anyway and began interviewing all these various people I’d heard on the internet talking so wisely about stuff.My very first interview was with the billionaire, Jim Rogers, who had run the Quantum Fund with George Soros. My next two were with noted silver analyst, David Morgan, and the gold expert, James Turk. I quickly learnt that you could secure interviews with people “above your station” quite easily, if they have something to promote, such as a book. A lot of the time people are happy to help out, even if they don’t have something to promote. To my surprise, there were far fewer walled gardens in the worlds of investment and commodities than in comedy and TV. People were much more open.Subscribe to The Flying Frisby.What brought about the job at Moneyweek?One of the people I interviewed was Merryn Somerset Webb who, at the time, was editor at Money Week. “We need people like you to come and write for us,” she said. “Come into the office next week and meet Toby, the MD.”So I did. Here I am, 17 years later and I am still writing the same weekly column, a column that has been popular and, in terms of longevity at least, successful. I’ve since published three books with a fourth on the way. I’ve written several documentaries, one of which was a huge internet sensation (even if I was never properly credited) and more besides. I think it’s fair to say that partnership with Moneyweek has worked - for them and me. But if I had sent my CV in to Merryn, all she would have seen was stand-up comedian, voiceover artist, occasional actor, Johnny-come-lately podcast host and unpublished novelist. I don’t think she would for a second have gone, “I need to get this bloke writing for us.” Pretty much any employer would have looked at my CV and passed it by.I now have this ridiculously random hotchpotch career that I can’t begin to explain. I’m a financial writer, comedian, singer-songwriter, comedy music video maker, TV presenter and voiceover artist. A very nice chap who works in internet marketing and likes my output - but despairs at its lack of clarity - with whom I correspond frequently, put this graphic together to try and explain what I do.What can we learn from that episode with Merryn?Two things. One, I don’t believe there is any substitute for face-to-face meetings. Meeting someone in the flesh inspires trust in a way that not a million emails can. (That, by the way, is, I think, why I never had stuff published. I just sent it in. I’m not even sure it got read. It’s much easier to ignore a letter or an email than someone in person).Often it works in reverse too. You really admire someone online for whatever it is they’ve written or said, but then you meet them in person and realise this is not the type of person you should be listening too.Second, when you meet someone through the medium of an interview for a podcast, rather than just a meeting, it’s like a heightened encounter. You get through so much more in an hour than you otherwise would. Get to know anyone who hosts a regular podcast and you will see they are total mavens. How many people do Joe Rogan, Konstantin Kisin or Steven Bartlett know as a result of their podcasts? How powerful are their networks? They are super connected - and trusted. Any introductions they make will carry weight.As it turns out, stand-up comedy was the ideal training ground for being a financial writer. In comedy, if the audience doesn’t understand you, they don’t laugh. If they don’t laugh, you die. Thus does the comedian quickly learn the vital discipline of clarity. You also learn that you have to entertain people if you want to keep their attention.No such discipline exists in the world of financial journalism. Obfuscation is everywhere. It almost pays to be obfuscatory because then you can say, “Oh I didn’t mean that, I meant this.” Some of the broadsheet journalists - guys who regularly win Finance Journalist of the Year or whatever - are as dull as ditch water and about as clear. Half the time, you have no idea what it is they are droning on about. I barely make it past the first paragraph.But do you know what? They probably got the job because their CV was right. Thank you for reading The Flying Frisby. Please like and share this post if you enjoyed it. .Other stuff: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.AI and the FutureI recorded this 90-minute interview about AI the other day with Andy - super interesting - and it’s now available to free subscribers:GoldInterested 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.Here is some more info about Auxato: At Auxato, we don’t just rely on your CV to get to know you. A key aspect of our approach to recruitment for our clients and candidates is the importance of building a long term relationship, learning about those skills that don’t make it onto a CV. Want to experience a different recruitment way? Get in touch with us today and start your journey. 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 90 minute interview about AI, the latest developments and the implications for our future with Andy. Andy is an experienced technical architect and lifelong technologist, coder and hacker.He designs systems that span security, finance, automation, IoT and proptech - and devotes a lot of his time to thinking about how technology will continue to transform our world. 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’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