Yesterday, the US and Israel launched a joint attack on Iran, targeting key military and other strategic facilities. The Ayatollah Khamenei - supreme leader of Iran for 36 years - has already been confirmed dead, killed in the strikes along with several other senior officials.

In retaliation, Iran has struck US military bases, Israel, and targets across the Middle East. Supposedly safe Dubai has been hit.

We pray for every innocent caught up in this, wherever they are.

We have a major conflict in the Middle East on our hands. Again.

ICYMI, here is the week’s commentary. I’m glad we were positioned for this oil rally.

The early signs

This operation was reportedly planned for months and rumours about its imminence have been circulating for as long.

President Trump has promised to obliterate Iran’s nuclear programme and end the regime.

Many Iranians have been pictured celebrating in the streets. This regime was massacring protesters only last month. Iranians may not mourn its end.

The succession question seems open. One hopes Israel and the US have plans in this regard, but, with no vice-supreme-leader position, there is bound to be something of a power vacuum, even if a three-person council has temporarily assumed power.

The US-Israeli intention may be for this conflict to be swift and decisive, but the pattern of US warfare, as long as I can remember, is that it scores big, decisive victories early - so convincing that you think it will be a walkover - and then the enemy regroups, and the conflict drags on far longer than anyone hoped.

The nature of the military industrial complex, and how it is funded, means the incentive is rarely to wrap things up quickly, I am sorry to say, and that might have rather a lot to do with this repeating pattern.

We don’t yet know how this one ends, but the US already has a typically big early score with Ayatollah Khamenei now dead. I really would not be surprised to see the rest of the pattern repeat.

If you live in a third world country such as the UK, I urge you to own gold or silver. The pound will be further devalued, as will the euro and dollar. The bullion dealer I recommend is The Pure Gold Company. More here.

What happened last time

You’re no doubt wondering what the effect of this will be on prices and the answer is: perhaps not what you expect.

Geoffrey Chaucer wrote The Canterbury Tales in around 1400, and it is considered one of the first great works of English literature.

Try reading it today and you might question the “English” part. Here’re the opening lines:

Whan that Aprille with his shoures soote,The droghte of March hath perced to the roote,

It does not get much easier.

Canterbury Tales is the story of group of pilgrims who walk from Southwark to Canterbury Cathedral. I have done the pilgrimage myself and I would urge you to as well.

The structure is quite simple. To pass the time, the pilgrims have to a storytelling contest and so each tells his or her tale. There are around thirty pilgrims - in effect, thirty professions, and so we get the Knight’s Tale, the Miller’s Tale, the Wife of Bath’s Tale and so on.

Here is the interesting part. Since the story was written in 1400 we have had, off the top of my head, the printing press, the Agricultural Revolution, the Industrial Revolution, steam power, fossil fuels, the internal combustion engine, electricity, aviation, nuclear power, computers, the internet, smartphones and now artificial intelligence.

And yet, if you look the list of characters below, every single one of Chaucer’s professions still exists in some recognisable form today.

You could go all the way back to the dawn of civilisation and argue the same thing. We still have farmers. We still have merchants. We still have lawyers, doctors, religious people, soldiers, landlords, craftsmen, entertainers, administrators and hustlers.

AI will change the nature of the job, but it will not erase the underlying human needs that created it.

Machines put many farm labourers out of work at the turn of the 19th century, but they also generated enormous productivity, which created new industries and new jobs, and, it’s worth noting, productivity which enabled us to be able to ban slavery. The net result was not mass permanent unemployment but rising prosperity.

What Actually Changes

What does get destroyed is power structure.

Feudalism has gone. The Church no longer dominates European politics - not the Christian Church, anyway. Guilds have faded. The landed aristocracy has all but gone.

In their place we have the modern State, bureaucracy, multinational banks, global corporations, Big Tech, Big Pharma, the mainstream media and so on.

AI is more likely to erode existing hierarchies than to eliminate work altogether. It will compress middle layers. It will reduce friction. It will concentrate power in some places and decentralise it in others.

If you live in a third world country such as the UK, I urge you to own gold or silver. The pound will be further devalued, as will the euro and dollar. The bullion dealer I recommend is The Pure Gold Company. More here.

The winners are likely to include: platforms, energy producers, owners of scare assets, large scale infrastructure, those who control distribution. AI is already being used in manufacturing, agriculture and mining, but so much to replace jobs as to increase productivity. You can’t help feeling the physical economy is a better place to be than parts of the digital - at least for now, though I guess robots are next if those Chinese videos doing the rounds are anything to go by.

Who else wins? AI and machine learning engineers, obviously, certain content creators, those who get good at prompting will find it useful for anything from medicine to plumbing to consultancy.

The losers will be among those whose job is mainly to control access to or verify information that AI can now do instantly. Think: interpreters and translators, proofreaders and editors, coders, copywriters and journalists, graphic designers, sales reps, basic financial advisors. I think long-distance drivers’ days are numbered too.

The work doesn’t disappear but the pricing power and margins collapse.

Legacy media distribution - not the content creators themselves, but the distribution gatekeepers who controlled which creators reached audiences. Publishers who mainly performed filtering rather than editing, talent agencies for routine work, certain music labels.

The job may technically exist but the power and economics drain away.

Chaucer’s Cast, Modernised

Finally, below is Chaucer’s professional cross-section of medieval England. I have added approximate modern equivalents.

* Narrator – content creator (!)

* Host – Event organiser, podcast presenter

* Knight – Army officer

* Squire – Cadet, trainee officer

* Knight’s Yeoman – Bodyguard, fixer, executive assistant

* Prioress – Headmistress, senior religious leader

* Second Nun – Clergy

* Nun’s Priest – Chaplain

* Monk – Monk

* Friar – Fundraiser, community organiser

* Merchant – Import–export, trader, entrepreneur

* Clerk – Researcher

* Man of Law – Barrister, judge

* Franklin – Wealthy landowner, landlord, businessman

* Haberdasher – Fashion retailer, Etsy seller

* Carpenter – Builder

* Weaver – Textile manufacturer

* Dyer – Industrial processor

* Tapestry-maker – Textile artisan

* Cook – Chef

* Shipman – Merchant mariner, sailor

* Physician – Doctor

* Wife of Bath – Self-made businesswoman

* Parson – Parish priest

* Plowman – Smallholder farmer

* Miller – Construction materials supplier

* Manciple – Buyer, procurement officer

* Reeve – Estate manager, COO

* Summoner – Bailiff, compliance officer

* Pardoner – Carbon credit broker

* Canon – Serial start-up founder, “entrepreneur’

* Canon’s Yeoman – Startup engineer

The Real Question

I think a fear frenzy is being whipped up - and I say this as someone who has lost his primary source of income (voiceovers) to AI.

The work changes. The tools change. The leverage changes. The power centres change. The underlying human needs do not.

There will still be farmers because people eat. There will still be merchants because people trade. There will still be storytellers because people crave stories. Most importantly of all, there will still be opportunities, if anything there will be more of them.

AI will reduce headcount in some sectors. It will elevate productivity so dramatically that fewer people are required to produce more output. That is economic evolution.

If you are worried about AI taking your job, ask yourself this: are you positioned inside an old power structure that is about to weaken? Or are you aligned with the next one forming?

Join the gang.

Until next time,Dominic

ICYMI here is this week’s commentary

Finally, Charlie Morris and I appeared on In The Company of Mavericks this week to discuss what’s been going on with gold, silver and bitcoin. (Charlie writes Atlas Pulse which I heartily recommend. Get your copy here - it’s free.)

Links to Spotify and Apple podcasts are here:

I’m watching amazing video after amazing video made by AI. They’re almost as gripping as the Lowe-Farage blood feud.Hollywood is being “dis-intermediated”, to use the tech lingo. Just as television went from scheduled to on demand, now the content itself is moving that way. Want a different ending to Game of Thrones? Soon you will generate it.

And that’s just video. What about everything else?

Even if just a fraction of the AI hype actually scales, one thing is certain: we are going to need more electricity

More data centres. More compute. More cooling. More fabrication. More automation. Doesn’t matter where you are in the world - Asia, Africa, America, Europe - energy consumption is going to go up.

Because that is what humans do. As we evolve, we consume more energy. We also get better at consuming energy. It’s called progress.

Despite ESG orthodoxy, wind and solar subsidy and build, and everything else, global oil consumption keeps rising. That’s because it is currently the best form of energy.

Cheap energy is the foundation of industrial competitiveness. An economy cannot compete if its energy costs twice as much as its rivals.

Despite this inevitability, those in charge of energy policy - and Western Europe is the biggest offender - would have us consume less energy, and make it more expensive.

So, because of the idiots, this sector has been starved of investment capital.

It’s all summarised here in the bell curve.

Even in the US, the sector has been starved of investment. Currently energy represents about 3.3% of the total S&P 500 market value. I know times have changed but in the early 1980s this was above 25%.Here is S&P energy to S&P ratio over the last 25 years.

Time to put your capital to work, folks, if you haven’t already.

The house view is that oil and gas companies are where gold miners were 18 months ago. Unloved and under-owned, often tightly run, often cash generative and cheap.

We’ve been calling for higher energy prices in 2026 and we’ve been rolling investment capital into the sector. Dr John’s timely article early in the new year should be your starting point.

Today we go a step further.

We’ll explore how to invest in this theme, plus I’ll tell you the three largest oil and gas positions in my own portfolio.

I’ve got an exciting small-cap Colombian gas story to tell you about. Exotic.

The setup

Here is the 5 year chart of Brent Crude. We have seen the spike, the collapse, the rebound and the drift. What matters is that the market has repeatedly found support around $59 (blue line), a level of support which goes back to April 2021

Today we are $67.After a strong January, Brent has eased back, but if you can take a 12 to 18 month view, weakness toward $60 looks more like opportunity to me.

On the equity side, XOP, the US oil and gas explorers and producers ETF, has carved out what looks like a massive inverted head-and-shoulders base over the last ten years. It traded near $270 in 2014. Today it’s $145.

That is super bullish.

Good Sunday to you,

In case you missed them, I put out two articles this week. Here they are.

By now I am sure you will have stumbled across Matt Shumer’s essay Something Big Is Happening, which has gone bananas viral. Eighty-one million views on X alone. That’s even more than We’re All Far Right Now.

Shumer describes how AI capability is improving exponentially, meaning that most screen-based jobs face imminent and major disruption. By that he means all but disappearing. His advice is blunt: get good at using AI now; assume much of what you do will be automated, and thus your doing it will soon be redundant; and start saving up, there’s economic upheaval coming.

It’s perhaps the best articulated essay there is describing this bleak view of what is coming.

From my own little vantage point, I’m not nearly so pessimistic. I use AI a lot, and I use it more and more. Its rapid improvement over the last six months has been obvious, though it still cannot recognise humour, let alone write it - humour that’s actually funny, anyway. So it’s rather like the BBC comedy department in that regard.

EDIT: Having written that last paragraph, I just watched this. It is a perfect Frat Pack joke. I’ve now watched a load of other clips made with AI movie generator Seed Dance 2.0 from Byte Dance (parent company of TikTok), and I’ve a mind to short Disney first thing on Monday morning. The content is breathtaking, even the comedy.

I use AI as a sounding board, for legal and regulatory questions, bureaucratic procedures, personal advice, career and business advice, videos, images. I use it to proof read copy, in the case of PR which I hate writing, I use it to actually generate copy; it helps me with titles, SEO summaries and research. I am not at the point where it writes my articles for me, and I like to think I would not let that happen, but I know others are: I am increasingly reading pieces in respectable broadsheets that are clearly written by bots.

That represents a lot of work I might once have given to other people.

On the other hand, if I had needed to pay someone proper money to do it, I probably would not have done it at all.

In that sense it is not so different from the democratisation of media that followed the turn of the 21st century, when filmmaking, podcasting and publishing suddenly became accessible to anyone with a laptop.

From a personal point of view I know I have lost a shedload of voiceover work to AI, and what used to be my main source of income no longer is. More annoying, my voice, with the countless documentaries, promos, trailers and ads I’ve voiced over the years, has been harvested, modelled and copied like mad. Not a lot I can do.

But the net result to the world is more content, better content, produced faster and at lower cost.

I’m not sure quite how end-of-days it all is. But Shumer’s finger is on the pulse in a way mine is not.

Let’s assume he is more right than I am. What then?

Two things follow.

First, AI is deflationary. Services get cheaper. Productivity rises. Labour loses bargaining power.

Second, governments will not sit back and watch demand collapse. If employment and incomes come under pressure, the political response will be fiscal support, especially if it win s elections. This means more borrowing, therefore lower interest rates, and more money-printing.

Different routes, same destination: easy money.

That is essentially the conclusion reached by analyst Lyn Alden in her latest newsletter, though her reasoning is more technical. The Federal Reserve has already moved from balance sheet reduction back to ongoing expansion. Not a dramatic “QE moment”, but a structural, steady increase to keep the financial plumbing functioning. She calls it the “gradual print”.

Jefferies’ Chris Woods, whose Greed & Fear letter I have come to rather like, arrives at a similar place via politics. The US government is now so sensitive to interest costs that sustained tight policy is unrealistic. If markets wobble or growth weakens, intervention returns. Monetary restraint will not survive contact with fiscal reality.

Hedge fund billionaire, Ray Dalio’s argument, laid out in his latest offering, is similar, though simpler and colder. The United States is late in a long-term debt cycle, with borrowing rising faster than income. There are three ways out: austerity, default or money printing. The US will choose the third. If foreign buyers will not fund the deficits at acceptable rates, the central bank ultimately does. Different language, same conclusion.

Which brings me to an interview I listened to this week, between Grant Williams and Rabobank’s Michael Every. Every thinks stable coins will act as the funding vehicle.

Every’s argument is more macro than AI or the Fed. He believes we are seeing a structural shift in the global economic system, comparable to the late Soviet period.

With Communism in its final throes, Gorbachev tried to transform the USSR from a military-industrial economy into a consumer one. It failed and the system collapsed.

The United States, Every argues, is now attempting the reverse. After decades of financialisation and consumption, it is trying to rebuild industrial and military capacity. That means: industrial policy, trade protection, supply-chain control and capital directed toward production, rather than asset inflation. Instead of buying US treasuries, foreign dollars get recycled into US manufacturing, industry and, yes, its military.

This is not the liberal globalisation model of the last thirty years. It is economic statecraft. This means growth may be slower and inflation structurally higher, while financial markets less dominant relative to the real economy.

Success is by no means guaranteed, but the direction of travel is toward a more managed, more political, less free market economic system.

So … large forces are converging. Different stories, maybe, but the destination is be rather similar.

* AI will improve productivity, but lower labour power

* Governments will be forced towards fiscal support

* No longer independent, central banks will drift towards balance sheet expansion

* Geopolitics will drive reindustrialisation and energy demand

Which brings us to the question that matters.

What are the implications for your money?

Where do you put it?

We need to talk about bitcoin.

Since peaking at $126,000 in early October, the bitcoin price has been in freefall, and the declines have accelerated this year. Earlier in the week, it touched $60,000 - declines of over 50% from peak to trough. Today it sits at $67,000.

Call it what it is. It’s a bear market.

Here’s a 2-year chart so you can see the price action. All the gains of 2025 have been given back and we are back at 2024 levels.

Bitcoin has become a software proxy

My first observation is that bitcoin’s decline since October has coincided exactly with a brutal selloff in software stocks, even as hard assets - gold, silver, and other metals - have caught one heck of a bid.

Just a few years ago, hard assets had no value, it seemed. Forget land, mining, the real economy. It was all about digital, software, IP, trademarks. How things have changed.

This chart appeared in a WhatsApp group and I don’t know who made it to give credit, but the story is clear: Bitcoin has become a software proxy and vice versa.

The correlation is striking. As concerns around AI have hammered software more generally, bitcoin has followed.

Hardware plays within tech have held up Maybe they're next to be hit. That remains to be seen.

When the mainstream media calls the bottom - the next wave of bitcoin obituaries

The Financial Times, wrong about bitcoin since 2009, came out with its latest stupidity this week claiming that bitcoin is $69,000 overvalued.

Yesterday the Daily Mail joined the Retard Gang in telling us bitcoin will go to zero.

Remember: just as media frenzy often indicates the peak of a market, so does a media scrum at the bottom.

All we need is a high-profile article from the Economist and the lows will be in.

I get that some people don’t like bitcoin, and bitcoiners can be obnoxiously vocal when the price is rising, but nocoiners can be just as bad. The amount of people trolling me about bitcoin - cc-ing me into tweets telling me how badly it’s doing, slagging off Michael Saylor, sharing “going to zero” articles - has risen sharply.

The more evolved and widespread these narratives, the more people repeating them, the closer we are to an end.

On which note, here is a longer-term weekly chart of bitcoin. That weekly RSI is close to all-time lows. Doesn’t mean this is the end. But you get these kinds of sentiment extremes at the end of cycles, not at the beginning.

Join this elite readership.

Where we go from here

This is a bear market. Crypto winter is upon us once again. The trend is down.

But the trend will end. It always does.

Looking at the above charts, there’s a lot of price memory in the $50-70,000 range. Bitcoin spent much of 2021 and 2024 here. I expect $50,000 - or just below - to hold. I give that a more than 50% probability.

But it’s bitcoin. So anything is possible. A typical bitcoin monster correction would see us go all the way back to the 2022 lows at ~$15,000. I don’t see that as likely - especially as the preceding bull market wasn’t that mammoth - maybe 10% probability.

It’s also possible the lows are already in, but my gut tells me this bear market has a bit longer to play out. It’s not a short sharp correction like we saw in the spring of last year around the Tariff Tantrum ™, but more of a grinder. Corrections happen in price and time, and I feel this one has a few more twists to it, especially as markets generally are not quite as easy as they were a couple of months ago.

My outlook at the beginning of this year was that the S&P 500 would follow the typical trajectory of the second year of a US presidency - and that points to a rocky second and third quarter with a strong final quarter. That has implications for liquidity and sentiment more generally.

Bitcoin is the same technological genius creation it always was. It hasn’t changed. Only perception has changed, as it always does.

It has been repeatedly demonstrated that bitcoin is a volatile asset that goes to the extremities of both pessimism and optimism, that it is cyclical and that it crucifies hubris. Those cheering the bear market clearly haven’t learned.

Instead of celebrating, I urge the skeptical to take advantage of this bear market and use it to learn.

On which note, if you’re new to bitcoin, my 2014 book Bitcoin: the Future of Money? is a good place to start.

Bitcoin isn’t dead. It’s just going through a bear market. They happen.

What’s the story that takes bitcoin higher, then?

Remember: narrative follows price.

When the price starts rising, all sorts of reasons will get attached and the story will form. Just as now with the price falling, all sorts of bearish narratives have emerged. Quantum Computing is going to end it. Jeffrey Epstein hijacked it. The core devs have fallen out. Strategy (NASDAQ.MSTR) is going bust. Whatever.

It doesn’t matter what the story is. That will come. Price leads.

Quantum BS

When you go to a bitcoin conference, one thing that’s notable is just how intelligent, educated, informed and ambitious the participants are. There is not the proliferation of midwits that you might find on, for example, the FT payroll. The bitcoin community is super bright.

Do you think those involved haven’t thought about and prepared for Quantum computing and the threats it may or may not present? Of course they have.

Is bitcoin more likely to be ready to deal with the quantum computing threat than say SWIFT, the BBC, the NHS, or some bank?

And which is likely to cope with it better - a sector crammed full of genius computer scientists with their own capital at stake, or some institution run by a government?

If you actually had a computer capable of taking down bitcoin, there are much easier, more satisfying things to take out, such as the House of Commons email server.

Way more important than the actual threat of quantum computing is the perception of what that threat is, even if that perception is bogus. But, as I say, perceptions change, just as bull and bear market cycles do, and so will this narrative die except among the most ardent nocoiners.

Of course I would rather bitcoin was at $150,000. But I am not worried. I won’t like it if bitcoin goes to $50,000. I’ll like it even less if it goes to $15,000. But we have been here before, and we’ll likely be here again.

We know how this story ends.

A prediction for the record

Here it is: It may have to go lower first, but bitcoin will outperform precious metals over the next 18 months, and probably over the next 12.

Let’s mark the price: gold is $5,000. Silver is $78. Bitcoin is $67,000.

By the way, I advocate owning both: gold and bitcoin. So at this point I should really plug Charlie Morris’s BOLD, an ETF you can buy through your broker which owns both gold and bitcoin.

Until next time,

Dominic

Bitcoin: the Future of Money? by Dominic Frisby is available at all good bookstores.

Have I seen this video, read this article, looked at this data, listened to this podcast. JP Morgan is about to go bust, the paper markets are overwhelmed, the price is manipulated, China is setting the real price, this is a reset. And so on.

The problem with speculative manias, especially when silver is involved, is that enormous amounts of misinformation get spread, much of it about things you and I, as ordinary investors, can do nothing about.

Take it all with a pinch of salt is my advice.

What I find interesting is that similar amounts of misinformation are being spread about bitcoin. The price is being manipulated on the futures markets, Strategy is about to go bust, Michael Saylor is this, that and the other, and so on. It’s game over.

The only real difference is that one is in a bull market, which may or may not be over, and the other is in a bear market, which may or may not be over. Sentiment for both is at extremes, albeit at different ends of the investment spectrum.

During every crypto winter I’ve known, people start to give up on it. The future is no longer what it once was. The tech is flawed. It’s going to zero. It’s not real. It’s a scam invented by the CIA, Jeffrey Epstein, Elon Musk, take your pick.

Again, take it all with a pinch of salt.

Remember, neither situation is permanent.

There is a case for owning both, and I do in my portfolio.

I’d rather bitcoin was $150,000 and more, of course I would. But I’ll take a sportsman’s bet that, from current levels over the next 12 months, bitcoin will outperform gold, and probably silver.

I know some readers prefer tangible precious metals. Others prefer bitcoin. Both points of view are fine. Each to their own. But I’m an own-both guy. Over the past six months the disappointment in bitcoin has been more than offset by the gains in precious metals. In previous years the reverse has been true, and the reverse will be true again.

With the extraordinary accumulation of gold by central banks, the rising price, Triffin’s Dilemma, and de-dollarisation, I do think it is possible some kind of reset is coming as far as gold is concerned. The price does need to go much higher for it to overtake the dollar as central banks’ primary reserve asset. It has already overtaken US Treasuries.

But that does not mean silver is going to be remonetised. Silver’s monetary role was always as a medium of exchange, and we now live in a world where exchange is almost entirely digital. Yes, I would prefer to be paid in physical silver. There is something quite spiritual about being paid for a job in physical silver. But so what. Convenience wins.

Silver’s role as a store of wealth was minimal. That is where gold still has use.

Yes, silver has umpteen industrial uses. It is a critical metal and in short supply. A rising gold price will carry silver higher too, just as it has platinum in recent months. But I don’t buy the monetary reset arguments as far as silver is concerned.

I do get them about gold though.

Anyway, good Sunday to you.

This week I appeared on Geoff Norcott’s podcast. If you fancy a watch or a listen, here are links to Spotify and Apple podcasts.

If you live in a third world country such as the UK, I urge you to own gold or silver. The pound will be further devalued, as will the euro and dollar. The bullion dealer I recommend, whereever you are int he world, is The Pure Gold Company. More here.

ICYMI here is this week’s commentary

This coming week I’ll be looking at the tax loss trades and I am aiming to have more on oil as well.

Until next time

Dominic

Phew. I need to write about something else apart from silver and gold. But I have to look at the price action we have seen this week, and I will say this. It was violent. Extraordinary, even. But it wasn’t necessarily bearish.

Sharp sell-offs like those we saw on Friday and Monday are characteristic of bull markets. In bear markets, corrections are grinding and protracted. Selling pressure is persistent. Value erodes slowly amid deteriorating fundamentals.

Bull markets behave differently. They flush. Explosively.

Late entrants and overleveraged speculators get shaken out. Stops are tight. Everyone is climbing the wall of worry. When a correction comes, a cascade of stop losses gets triggered all at once. Hence the violence.

BTW the latest Atlas Pulse came out on Friday, as level-headed as always. It’s the best gold and silver newsletter out there, in my view. Get your copy here - it’s free.

This is not just a precious-metals phenomenon. It’s a broader market truism. I’ve seen it in equities, other commodities, you get it all the time in tech - especially bitcoin. Indeed the action we are seeing in bitcoin at the moment is typical of a bear market. The selling is grinding and relentless, rather than sharp and explosive.

What’s more the gold and silver miners behaved well, and in a way that is consistent with a bull market flush. Yes, they saw significant selling. But gold corrected 21% and silver 41%. GDX (the large mining companies) only corrected 19% and SIL (the large silvers) 24%. Most importantly, they recovered faster. You would not have got a bounce like that in a bear market.

The relative strength is telling. If this were a reversal, the miners would have sold off by more. They didn’t.

If you live in a third world country such as the UK, I urge you to own gold or silver. The pound will be further devalued, as will the euro and dollar. The bullion dealer I recommend is The Pure Gold Company. More here.

What’s more, theh miners only need $4,000 gold and $50 silver to be highly profitable. But if higher prices are the new normal, then a lot of previously uneconomic mines - particularly the low-grade, bulk-tonnage in Canada - are going to become economic. Heck, even STLLR Gold (TSX.STLR) might work. I should probably delete that last sentence.

How the landscape has changed from a couple of years ago.

Such huge potential, but …

In other news, I sat through the Comstock Inc (AMEX:LODE) conference call yesterday. An hour of my life I won’t get back.

The asymmetric potential of this company remains enormous. But that call was a red flag bonanza.

With the silver story what it is, and a clear path for this company to become North America’s largest silver producer, this stock should be trading above $15.

I am rotating some of my gold and silver profits into oil and gas, as I think energy is next. I will have more on this very soon. I promise. But we need to talk gold and silver today, plus we have an update on top pick Metals Exploration (MTL.L)

I thought Monday was the top. Silver went from $100/oz to $115/oz over the weekend and then on Monday in US hours reversed and gave back all those gains. It looked like we were shaping up for an island reversal.

Here we are on Wednesday and, as I write, we are at $115 again.

This is one strong market.

If you live in a third world country such as the UK, I urge you to own gold or silver. The pound will be further devalued. The bullion dealer I recommend is The Pure Gold Company. Pricing is competitive, quality of service is high. They deliver to the UK, the US, Canada and Europe or you can store your gold with them. More here.

Let’s all do the Randolph?

I have a friend. We’ll call him Randolph (which I read means “”wolf shield” - cool, huh?). He’s about 30 and he works in the City, as a quant analyst or something. After some extensive research, a few months back he put 95% of his entire portfolio into a silver mining company by the name of Hycroft Mining (NASDAQ.HYMC). It was $5.

Bear in mind, he has no real estate, so to put 95% of his entire portfolio into something can’t be that far off 95% of his entire net worth.

The research he’d done into both silver and, specifically, into the situation that was Hycroft, and the trust he had in his own judgment, gave him the conviction he needed to go for it.

Today the stock is trading at $50. He’s 10xd his money.

Randolph was talking to me about the company in December when it was $13. I resisted. I got so many ideas thrown at me, I can’t buy them all and I already had my silver exposure via Sierra Madre (SM.V) which was going and continues to go great guns. (It has almost tripled since December so it’s not like I can complain).

But you always hear about the ones you should have bought. The ones you were tipped that then collapsed - they get forgotten very quickly.

So good for Randolph. Events have proved him right. You’ve got to be in it, to win it, and all that.

But what if events had gone against him? What if silver had turned down 30%? He’d have been up the proverbial, and some.

But it didn’t and he’s been proved right.

My buddy Simon Catt, by the way, who was in Hycroft even before Randolph, thinks Hycroft can go up another 10x from here.

He could be right. I am just too cautious about buying things that have moved this much. Maybe I shouldn’t be. I didn’t buy bitcoin at $10 because it had just 10xd.

But, as I say, you only remember the ones that went up.The price is always there to remind you and eat away at you.

The ones you didn’t buy that collapsed - the gazillion of shitcoins and shitcos I’ve avoided over the years - I’ve no idea what they even are. I should put them all on a spreadsheet, calculate how much I’ve saved by avoiding them and use the money I haven’t lost to buy myself a new frock.

I don’t advocate doing what Randolph did because there is so much that can go wrong.

When it does go wrong, the person who advocated it will get the blame as much as the person who actually did it. More importantly, it’s a poor way to manage risk

But I’ve done something similar myself. And ballsy bets can and do work - when you get them right.

But they are better done when young I’d say. If they do go wrong, you still have plenty of time to recover.

My mate Swen Lorentz, who writes the exemplary Undervalued Shares says he sees it among his readers. “Many went from 10k to 100k and then from 100k to 1m with ballsy bets. Thereafter things can become more normal.”

The problem is when you ‘re wrong.

Position sizing - especially when using leverage - is everything.

Charlie Morris’s monthly gold report, Atlas Pulse is, in my view, the best gold newsletter out there. Get your copy here. No pay nada.

Where you need to be with silver right now

With all the above in mind, here is where I think you need to be with silver. The easy money has been made. In the miners and leveraged silver plays, the asymmetry is no longer what it was.Yes, I can see a bananas scenario in which the calls of the most ardent silver bulls prove true and silver goes to $300/oz or even $700/oz. Unlikely, though possible. In such a scenario, Hycroft and Sierra Madre and many other silver miners besides will be 10 baggers and more, even from today’s prices.

But silver could just as easily top at $125, and go back to $25.The more elevated a price gets the more vulnerable that market becomes. It’s only a month ago that silver was $50 and that felt high.

Many will feel differently and want to be all in. Animal spirits and all that. But Auntie Dominic says you should be in a position with speculative silver plays, where you now have your original investment off the table, and have banked some profit.

The rest you can let run, in case those higher prices do actually come into play.

Every time we feel at a point of extremity take a little bit more off the table.

But you do not want to be in a state where this winning position could still turn into a loss.

There is a bullet-proof vest available to you. You may as well put it on.

We need to look at Metals Exploration (MTL.L)

Joshua Saul has been dealing gold and silver bullion for 20 years. He’s never seen anything like what’s happening now.

His key points: silver is catching up from decades of undervaluation. The gold-silver ratio historically sat at 15:1. In recent years it hit 100:1. That’s not a price quirk - it’s a structural anomaly that’s now correcting.

Supply can't keep up. Most silver comes as a byproduct of other mining, so production can't respond quickly to price spikes. Industrial demand is surging (solar, EVs, data centres). Mints are sold out. China's quietly accumulating. Physical premiums are spiking globally

The Pure Gold Company has metal, but only because they have large contractual commitments with the Royal Mint, but he’s clear - this is unprecedented. Even 2008 didn’t look like this.

Find out more about the Pure Gold Company, here.

NB: I was trying out a new camera and I know it looks crap. Won’t happen again.

Meanwhile, ICYMI, here is this week’s commentary.

Until next time,

Dominic

PS Let me give my buddy Charlie a plug. His monthly gold report, Atlas Pulse is, in my view, the best gold newsletter out there. Get your copy here. No pay nada.

This has been for ages one of those things that has been going to happen that never actually happens.

But on Monday there were signs it is actually going to happen.

I’m talking about some kind of financial crisis in Japan, whether in its currency, its debt markets or a bit of both. Because it’s so far away, we tend to overlook in Western Europe what a big deal Japan is: but it’s the world’s 4th largest economy - only the US, China and Germany have greater GDP.

But its debt-to-GDP is 230% - 4 times Germany’s (~63%), more than double the UK’s (100%) and almost double the US’s (~124%). But it has sustained these “unsustainable” levels for so long it’s now normal. Shorting the yen has been the great widow maker.

In addition to roughly $10 trillion of government debt, Japan also carries around $8 trillion of non-financial sector debt, including corporate and household borrowing. This is not new. What may be new is the market’s willingness to continue absorbing it at the margin.

On Monday Japan Prime Minister Sanae Takaichi called a snap election for February 8th, seeking a stronger mandate for her coalition government. She has high approval ratings, I read, and is looking to capitalise on them, restoring the Liberal Democratic Party's majority in the powerful lower house. Even so, though she is favourite, this is also a gamble.

If you live in a third world country such as the UK, I urge you to own gold or silver. The pound will be further devalued. The bullion dealer I recommend is The Pure Gold Company. Pricing is competitive, quality of service is high. They deliver to the UK, the US, Canada and Europe or you can store your gold with them. More here.

Takaichi will run on a platform of more stimulus. The worry is how she “pays” for her proposed cuts to food taxes. It’s not totally unlike the Liz Truss situation, when she proposed tax cuts without material cuts to spending.

How much is enough?

I just don’t get it with governments. Something doesn’t have the desired effect. Instead of stopping and reassessing, they do more. Ooh, this petrol isn’t putting out the fire. Let’s add more petrol.

But the result of her announcement was that Japanese borrowing costs rose sharply to all-time highs (again). 30-year yields posted their biggest daily jump since 2003, and 10-year yields surged 19 basis points. Not quite such a record breaking rise but the sharpest since 2022.

Japan’s bond market, long regarded as the safest and dullest corner of global finance, is suddenly being treated as risky. Compounding the problem is the fact that Japanese insurers, historically reliable buyers of long-dated bonds when yields rose, have become net sellers. That removes a key stabilising force.

Charlie Morris monthly gold report, Atlas Pulse is, in my view, the best gold newsletter out there. Get your copy here. No pay nada.

At some point the Bank of Japan may step in and buy bonds to calm things down. That’s what usually happens. The risk, however, is that Japan is deemed even more fiscally permissive, the yen weakens further, and inflationary pressures stoke.

If the yen carry trade unravels - that is the financial world borrowing Japanese yen at low rates and using the money to invest elsewhere - then everything unravels, and we get the 2020s version of 2008. It’s been threatening to happen a long time, but it never quite does. But hot money - aka liquidity - will get sucked out of everything from gold and silver to the stock market to the bond markets to bitcoin, and the world gets a massive margin call.

The bottom line is that this raises the risk of more global market volatility. If Japan, long the calmest corner of global finance, becomes unstable, everything priced on the assumption of low and stable interest rates needs to repice. Risk-on flips to risk-off. Speculative assets get hit.

Add all the Greenland stuff to the mix and everything looks very shaky all of a sudden.

Periods like this are not necessarily about bold calls. They’re about deciding where you refuse to be sloppy. So I am taking some action.

Switzerland last week froze his accounts and the accounts of some 36 others with close ties. We don’t know how much money he had in them, or how many accounts there were, but the figure doing the rounds is $10 billion.

It has also emerged that Tether has been freezing “wallets identified as being involved in the Venezuelan oil trade.” As much as 80% of Petroleos de Venezuela’s oil revenue is believed to be transacted in tether. This could be a total figure in the billions too.

We also know that Venezuela was mining bitcoin for many years - when the price was a lot lower - but we don’t know what they did with the coins. Did they fall into Maduro’s hands? Were they sold? Were they held?

The number doing the rounds here that it owns 600,000 BTC (~$60 billion). That would put Venezuela up there with Michael Saylor and Strategy. It’s three times the 198,000 coins the US government itself is said to own.

There’s a seed phrase I’d like to know. Where are the keys, I wonder?

And where did the proceeds of Venezuela’s enormous oil, gold and other natural resource exports end up, exactly? Only some of them we know.

At this point we remind you that the Venezuelan currency itself - the bolivar - collapsed in hyperinflation and has little to no value. Beware national currencies, particularly under socialist regimes. They don’t last.

There are several things I take away from all of this.

First, the US dollar - whether via SWIFT or stablecoin - remains the number one international currency of choice, even for America’s enemies.

Second, tether and other US dollar stablecoins might be convenient - you don’t have to use banks - but Tether will do what the US government tells it to do, and if the government wants your assets frozen, Tether will freeze them.

Stablecoins, then, have a central point of failure. If someone can freeze them, they are not sovereign. And just as the US froze Russian US dollar assets after its invasion of Ukraine, so can and will it freeze the stablecoin assets of its enemies too.

What did that 2022 freezing of Russian assets trigger? The mother of all bull markets in gold, and then silver and miners.

What will this freezing trigger? A bull market in bitcoin. Possibly. Likely.

It’s already creeping back up.

While the US does its geo-political, strategic, critical minerals thing, quaint old Western Europe is sinking deeper into higher taxes and - I’m sure they’re coming eventually - capital controls. In fact, capital controls already exist in effect, banks are so heavily regulated and limiting of what you can send and to whom.

The value of permissionless, international money just went up.

You need to own money that they can’t touch, whether by seizure or debasement.

Meanwhile …

Gold and silver continue to go bananas - the latter especially.

So many roads lead to gold at the moment, it’s hard to see when this stops.

The inevitable debasement of national currencies off the back of uncontrollable government spending. Gold. Dedollarisation. Gold. Increasing geo-political uncertainty - Iran, Venezuela. Gold. Reshoring of US industry - highly inflationary. Gold. Revaluation of US gold holdings. Gold. Looming crisis from Japan as yields spike. Gold. China’s ambitions for its currency and trade. Gold. Triffin’s dilemma. Gold. AI putting everyone out of work leading to more money printing. Gold. Declining competence of and as a result faith in institutions worldwide. Gold.

The dollar has now fallen to a 40% share of global central bank reserves, while gold is now at 30% on the back of its higher price and central bank accumulation. (Note currency and reserves are not the same).

We are in a major capital rotational event the like of which occurs only every few decades.

Typical portfolios are still underweight gold.

If you live in a Third World Country such as the UK, I urge you to own gold or silver. The pound is going to be further devalued. The bullion dealer I recommend is The Pure Gold Company. Pricing is competitive, quality of service is high. They deliver to the UK, US, Canada and Europe or you can store your gold with them. More here.

Own both

As regular readers will know, I advocate owning both bitcoin and gold. The two assets have many similarities in that they are non-government, independent money. But the fundamental difference is that one is physical and one is digital.

Both have their uses, and I have little patience with this notion that one must choose one or the other.

In that regard, as with many others, my worldview is aligned with that of Charlie Morris (whose newsletters I urge you to subscribe to. There are lots of free options, including Atlas Pulse, which I love). Remember many years ago Charlie was calling for $7,000 gold by the end of this decade and many thought he was dotty. His call is looking perfectly sensible now, which it was - and which he is.

Charlie previously managed a multi-billion-dollar fund for HSBC, before going solo. Aside from his newsletter, one his main endeavours has been BOLD, and he has been trying to get it listed for years. But the UK’s Financial Conduct Authority is retarded.

BOLD is a fund you can buy through a broker which is 75% gold and 25% bitcoin - all properly audited and backed, of course, with institutional-grade custody.

Over the past five years, BOLD has returned 186%, while bitcoin has returned 202%, gold 128%, and equities 77%. The average return of bitcoin and gold together was 165%, yet BOLD was 21% ahead. This is because every month Charlie rebalances the portfolio, effectively buying more of whichever is the weaker asset to retain that 75:25 ratio. This act of rebalancing both strips out the volatility and increases the gains.

Since Charlie first conceived of it in 2017, over pretty much any timeframe, BOLD (in blue) has beaten everything.

Since its listing in Europe in 2022 BOLD has returned 123% since launch (in GBP to end 2025 including fees) compared to 111% for bitcoin and 113% for gold.

It would have been nice to have been able to enjoy these gains in the UK. Thank goodness the FCA has protected us from them.

Not for much longer.

I was delighted to be at the London Stock Exchange yesterday to see the listing of this product which delivers “bitcoin-like returns with the lesser volatility of gold.”

Congratulations, Charlie, for finally getting this listed. I wish you every success.

Now we can actually invest.

Obviously, if gold AND bitcoin both turn down, BOLD will suffer. But this is a classic buy-and-forget product, perfect for the Dolce Far Niente portfolio. You can own it in your pension, your ISA and it should become a mainstay of any portfolio.

The 21Shares Bitcoin Gold ETP, BOLD, has the ticker LSE:BOLD.

I am a buyer.

PS some brokers such as AJ Bellend have only made this product available to pro investors. The broker I use is Interactive Investor, who are pretty good about getting these kinds of things live. If you open an account via this link you get a year’s free. I am just on the phone to them now to get this listed.

Disclaimer:

The Flying Frisby is not regulated by the Financial Conduct Authority (FCA) or any other regulatory body as a financial advisor. Therefore, any information provided in this newsletter does not constitute regulated financial advice. It is solely an expression of opinion. Please conduct your own due diligence and consult with a financial advisor, if you have any doubts. Remember, markets can both rise and fall, especially in the case of small and mid-cap stocks. I am not aware of your individual financial circumstances, so only invest money that you can afford to lose.

What’s going to happen? What does the future hold?

We all want to know.

Knowing what’s going to happen makes you feel better.

NostreDominic is here to tell you.

Here are 19 predictions for 2026

1. Gold Breaks $5,000

Gold doesn’t quite have the year it had in 2025, but it has a good year nonetheless and rises above $5,000/oz

On which note: Charlie Morris’s monthly gold report, Atlas Pulse is, in my view, the best gold newsletter out there. Get your copy here. No pay nada.

2. S&P 500 Frustration

The S&P500 will spend much of 2026 in a frustrating range trade with a couple of nasty pullbacks. We see an interim peak in April-May, followed by a weak summer, but a strong final quarter means we end the year with a 10-15% gain.

The problem of disproportionately few stocks (41 is it?) being responsible for most of the gains remains.

3. Inflation Finds New Forms

Inflation doesn’t die, it mutates. Headline inflation looks reasonably controlled (by recent standards), enabling leaders to declare that it is controlled or some other BS. Despite this “victory”, inflation finds other ways to rob you.

4. Bitcoin Hits $150,000

Bitcoin has a good year. With escalating geo-political conflict, as well as capital controls and tax grabs, more and more people wake up to the value of permissionless, apolitical currency. Falling trust in fiat - never mind government institutions - becomes more culturally entrenched. Bitcoin goes to $150,000.

5. Starmer Survives (Just)

Prime Minister Keir Starmer manages another year. His position gets even more precarious after a bad showing in the May local elections, but it is still only 2026 and the next General Election is not till 2029. Too early to oust him just yet.

6. Government Spending: The Unstoppable Force

Government spending keeps on increasing. Even if they wanted to, they just can’t stop it.

Western Europe continues, therefore, its great march on the road to serfdom

7. But No Sovereign Debt Crisis

Despite the mathematics verging on the impossible, government debt continues to outpace GDP (it has grown at three times the pace this century) but the inevitable sovereign debt crisis that is coming to the UK, Western Europe and perhaps even the US, is somehow averted.

By saying it won’t happen, it will happen. I know it.

8. British Stocks Shine Despite Economic Stagnation

Britain’s economy continues to stagnate, but British stocks do well. Rather like Japan circa 2015, the valuations are so cheap that mergers and acquisitions are inevitable. Foreign money takes advantage.

9. Oil Recovers

Oil, currently lagging metals, begins to turn around. Brent crude stays above $55 and flirts with $80 a barrel.

10. UK Energy Costs Stay Elevated

Energy costs in the UK remain high because Millibrain. Limited growth is the result.

If you live in a Third World Country such as the UK, I urge you to own gold or silver. The pound is going to be further devalued. The bullion dealer I recommend is The Pure Gold Company. Pricing is competitive, quality of service is high. They deliver to the UK, the US, Canada and Europe or you can store your gold with them. More here.

11. Critical Minerals Boom

I would venture that the decision to overthrow Venezuelan President Maduro was as much about critical minerals - so-called strategic metals et al - and China’s chokehold on them, as it was oil and gas, narco-terrorism, Russian drones and liberating the poor suffering people.

To the US’s credit it is trying to put the China chokehold problem right. The UK and Europe are hopeless. But this process, especially re-shoring industry, is highly inflationary, hence my comment about inflation finding new forms.

It is a good year to be invested in both industrial and critical minerals, and the related stocks end the year considerably higher than when they began.

This is something I’ll be looking at a lot next year

12. Emerging Markets Rally

Emerging markets have a good year. Commodities, innit.

13. The Pound Weakens A Bit

The pound gradually weakens against the US dollar. High is $1.37, low is $1.25. Or thereabouts.

14. Silver. Triple Digits.

Silver goes above $100. There I’ve said it. Now watch it crash.

15. AI-Powered Government Overreach

A highly worrying development. Government Blob bodies, such as Ofcom and HMRC in the UK (though this problem is global), make increasing use of AI to make their processes more efficient. This enables them in a really bad way.

This is already happening. In 2026 people start to wake up to the fact.

I like AI. But it enables Big Bureaucracy. Beware.

16. UK Property: More Stagnation

The stagnation, particularly at the upper end of the market, continues. And why wouldn’t it? Moving is too expensive.

While nominal prices might be flat or slightly up, real prices are down, liquidity is poor, transactions fall.

17. Rents Stay Elevated

Because so many now prefer to rent so they don’t have to pay moving taxes, and because the game is now over for amateur landlords, who continue to exit the market due to the increased cost of regulations, rents stay elevated.

18. Official Reassurance = The Biggest Mistake

The biggest mistake of 2026, as with every year, will be trusting official reassurance. Governments and central banks remain behind the curve. Markets lead, policymakers follow. The crisis won’t come from what they warn us about, but from something they’ve missed.

19. Your Bruce-y Bonus Sports Prediction

Arsenal win the League. West Ham, Burnley and Wolves all get relegated.

Have a wonderful 2026. Let’s hope as with last year I’m wrong about everything and we make a potload of dosh.

Until next time

Dominic

Happy New Year to you.

This time last year I did something I’d never done before, which was to publish my New Year’s resolutions.

I was nervous about doing it because, despite constantly putting stuff out on the internet, I’m actually quite private about some things, and it made me feel quite vulnerable publishing them.

However, publicly stating goals pushes you to achieve them. You’re making yourself accountable, so you’re more likely to deliver. It also clarifies what you’re actually looking for, and solidifies goals beyond abstract ideas. It can also prompt those reading them to help in some way, whether through advice, introductions or collaboration.

I’m glad I did it, and I’m sure it helped me achieve a lot of those goals.

Here they are, in case of interest:

The health, body and mind stuff I pretty much succeeded at - I stayed fit, I drank even less (to the point of barely drinking at all), my fasting fell by the wayside and so my weight has crept up a little. I hit my reading target - just - though really I should read a lot more.

Money was also a goal hit with gold, silver and most Flying Frisby tips all performing well (though let’s be honest last year was a bonanza year for pretty much everyone except bitcoin maximalists).

On the love and family side of things, I think I did ok - you’ll have to ask my kids and mother if I have been a good father/son. My other big target of settling down with a certain Miss Downing was an abject failure, which is probably for the best all things considered, and I am grateful to my Guardian Angel for stepping in there.

On the work and career front I should consider the year a success. The live shows were brilliant, sold out, we have a lot of dates in for the spring.

The book has also done well. It’s coming out in the US next year.

Above all I have got Kisses on a Postcard moving forward, which was the most important target of the year.

The two big failures were that I didn’t finish two writing projects I had in mind - my Gilbert and Sullivan and Peasants Revolt musicals - nor did I do many gigs in the US or practice my uke every day, but I probably asked a bit too much of myself.

All in all I should consider 2025 an annus perhaps not quite mirabilis, but certainly bonus, prosperus, felix et secundus - and be very grateful for it

So what are my goals this year?

They’re not unlike last year.

Love and Family

* Be a good dad to Samuel, Eliza, Lola and Ferdie, and to daughter-in-law, Millie.

* Be a good grandad to Cecilia.

* Be a good son to my mum.

* Get a girlfriend.

Kisses on a Postcard

* Get the script as good as it can possibly be (happening as we speak).

* Get a s**t hot director and cast

* Raise 10 million quid

* Shoot the next great musical.

Easy!

Money

Same as last year. Invest well and grow my net worth - and the net worth of Flying Frisby readers - by at least 20%. I beat that by some margin in 2025 in what, looking back, was a gift of a year thanks to gold, silver and the miners.

If you live in the Third World Country such as the UK, I urge you to own gold or silver. The pound is going to be further devalued. The bullion dealer I recommend is The Pure Gold Company. Pricing is competitive, quality of service is high. They deliver to the UK, the US, Canada and Europe or you can store your gold with them. More here.

Hard to see things being as easy in 2026, but I’ve got my eye on a few things. I will keep you very much in the loop.

You know you should.

Work & Career - Laughter, Acclaim, Opportunity

* Grow the Flying Frisby by 20% in subscribers and revenue. Break into the Top 50. (Currently 60th)

* Comedy - keep storming the gigs, land more tour dates in bigger venues selling more tickets

* Promote The Secret History of Gold really well in the US when it launches in May

* Build my online presence as both comic and commentator - I’ve got a specific plan for this

* Keep writing songs and material, get better at the uke and make a start on guitar

Health, Body & Mind

I’m 76kg (12 stone/167lb). My weight has crept up these last few months, mainly since my habit of fasting has fallen by the wayside. I hit 67kg (10 ½ stone, 147lb) at one point in 2024 leading to several interventions from friends telling me I looked like a lesbian Gary Lineker. Maybe. But I felt great. I reckon my ideal weight is 72kg (11st 7, 160lb). So get there and stay there. Which means:

* Fasting more regularly

* Weights two or three times a week

* Something aerobic two or three times a week

* Daily stretching - dead hangs, pelvic floors, neck exercises

* Stay off the booze

* Eat more protein and starve that sweet tooth

* Play more racket sports (good for the brain apparently). More tennis and table tennis, get into padel and pickleball.

PLUS

* Morning breathing practice and regular meditation/prayer

* Read another 15 books

Wish me luck!

What about you - what are your goals for the year? Stick them in the comments if you fancy making yourself accountable too

In the meantime, let me wish you a happy, healthy and prosperous 2026.

I’ll be back mid-week with my annual predictions piece.

Until next time,

Dominic

PS I was planning to take Christmas and New Year off. Never mind.

PPS The tax loss trade is now positioned and ready to go. Take a look.

Before we begin, let me flag this week’s commentary.

This a trade with a remarkably successful hit rate, a clear timescale and a relatively easy risk to manage - you know pretty quickly if it isn’t working. 8 of last year’s 9 ideas worked. By my reckoning you will find the biggest bargains of the year tomorrow, Monday December 22, and Tuesday December 23. So take a look:

Right, so today I am marking my own homework.

Every year, as old timer’s will know, I like to offer some predictions for the year ahead - usually 10, but with inflation being what it is, it ends up higher.

Today we look back and see how I did.

The usual disclaimers apply - the more outlandish the prediction, the more entertaining - so the more likely I am to make it. But the less likely it is to actually happen. I try to strike a balance …

As events change, so do opinions. Process is gradual. But when you jump a year, with no scope to revise as events turn in a different direction, quoted out of context and with the benefit of hindsight, predictions can look really, really stupid. Don’t judge me, bro.

I often find that the worse my predictions, the better my portfolio performs, which is odd, but there you go.

If you want to read last year’s piece in full, it’s here. But I’ll quote quite copiously below.

A reminder of the scoring system: 2 points for a direct hit, 1 for a quite good, 0 for a miss, and -1 for an epic fail, giving me a maximum of 30 and a minimum of -10.

How did I do? Let’s find out.

1. The long overdue correction in the UK housing market finally begins.

You can read my reasoning here, but it boiled down to: richer people being net sellers as they leave the UK, few foreign buyers, fewer buyers more generally because of high moving costs (Stamp Duty etc), little bullish sentiment in the economy meaning a reluctance to borrow and invest and the 18-year-property cycle turning down.

What actually happened is by no means clearcut, but I’ll try and summarise.

Price growth and transaction volume were relatively high in the first 3 months, until Stamp Duty changes came into effect in April, after which the market became “subdued”. Overall, the north saw some increase, while London fell 2.4% in the year to October. Average growth was 1.7%, which is some 2% below official inflation rates - real inflation is of course much higher - meaning there have been price falls in real terms. This is even with the Bank of England bringing rates down, thereby enabling more money to enter the market via increased borrowing.Overall, transactions volumes increased by 9% on 2024, to get back in line with the 10-year average, though there is a very different story at the upper end of the market.

The housing market has big problems, especially in the south, but it hasn’t cratered - though nor has it soared. I’m giving myself 1 point.

2. Keir Starmer survives

Everyone thought he was toast this time last year - and he is - but my argument that “it’s too early for Labour MPs, worrying about their seats, to give him the shove” prevailed. 2 points.

3. Gold hits $3,000.

And the rest. It’s $4,300 as I write and going higher. I was too conservative. 1 point.

BTW. If you live in a Third World Country such as the UK, I urge you to own gold or silver. The pound is going to be further devalued. The bullion dealer I recommend is The Pure Gold Company. Pricing is competitive, quality of service is high. They deliver to the UK, the US, Canada and Europe or you can store your gold with them. More here.

4. Microstrategy (NASDAQ:MSTR) becomes a top 100 company by market cap.

Oops. When Strategy hit $450 in July, its market cap would have been around $130 billion, making it perhaps a top 300 company but not a top 100. It would have needed to get above about $250 billion to make the cut.

And since then it has the skids so badly it’s now a tax loss opportunity.

-1.

5. Bitcoin goes to $200,000 then crashes

I got the crash bit right. Sort of. $126k was the high, having begun the year at $91k. Today it’s $88k. 0 points.

6. Sterling has big problems

Nope. It’s had a good year. -1.

7. X thrives, Blue Sky dies, Blogging Blue Skies

Well sort of. X saw strong numbers growth in the first part of the year, but these have tailed off. It is now a key place to go for breaking news and a leading news app, but by no means the Governor. The exodus to Blue Sky has slowed, but BS (LOL) is still growing albeit at a much slower rate. Blogging, as evidenced by Substack, is thriving. I’ll give myself 1 point.

8. The S&P500 Rises 10%

15% actually. We predicted a decent year, despite year 1 of the electoral cycle tending to be the weakest. 1 point. Do I get 2? Nah.

9. Oil ranges.

Oil would neither crater nor moonshot, we argued. We saw a range of $60-90. Its actually been $55-80. 1 point.

10. Small Caps Thrive

The Russell 2000 has had a good year - rising 12% - but the large caps are still winning. 1 point.

11. The US Dollar Index breaks out to 20-year highs.

Oops. I was looking for a high around 117 in the US$ index. It didn’t get above 110. It fell! -1

12. The BRICS don’t come out with a proper US dollar alternative … yet

Everyone says it’s coming, but it never actually does. 2 points.

13. Silver disappoints … as always

$33 is the high, $22 the low, I said. Ha! $28 was the low, and the high - $68. To be fair to myself, I said multiple times it was going to $50 and if it gets above there it goes to $90+, but the call was still an epic fail.

Irony: silver has been a huge winner for readers this year and our pick, Sierra Madre Gold and Silver (SM.V), has been a joy to own. From 45c north of $1.50 :(

I still get -1 though.

14. Despite all the crap, the world becomes a better place to live.

We live longer, we eat better, tech keeps improving things. We advance. AI makes us more productive and betters living standards.

It’s so obvious I can’t believe I even said it. I’ll give myself a point, but not 2.

15. Your Bruce-y bonus sports prediction.

Liverpool win the league. Ipswich, Southampton, and Leicester all go down.

Bullseye. I should take up sports betting. 2 points.

I don’t actually follow football any more, but one of my son’s told me that’s what would happen.

So, overall, a very poor showing for the DF Predictions, possibly my poorest year ever: totalling a measly 7 points.

And, as always seems to be case, a much better year for my portfolio of companies.

Here’s hoping I get all next year’s predictions similarly wrong.

I’ll be making those early next year - so look out for that.

Thank you so much for being a subscriber to the Flying Frisby. I wish you and your family a very happy Christmas. Don’t eat too much, go easy on the booze, pray, sing, get plenty of exercise, avoid toxic people and the lurgy, and be thankful for the many good things there are in your life.

Once again - I urge you to take a look at the tax loss opportunities. Tomorrow and Tuesday are the buy days.

Here’s to a healthy, wealthy 2025.

Until next time,

Dominic

PS This Wednesday being Christmas Eve I almost certainly won’t be putting out any commentary.

I was having breakfast with my son, daughter-in-law and grand child earlier in the week. He is 25, she is 24, and baby is 5 weeks old.

They’re both pretty successful in their jobs - both in sales, on commission, so very much performance-based - and they both work very hard. They are ambitious. They want a big house with a big family, and plenty of money to live off. Pretty normal ambitions, really, and once upon a time not so impossible to achieve.

I’m extremely proud of them both for having gone against the grain and had their first child so young. I’m also proud of how they have both adapted to parenthood. They live with me, so I see every day how utterly devoted they are, how much effort they put in, how they are learning and flourishing. The way Millie has thrown herself into motherhood and totally dedicated herself to her child is a thing to behold. Breast feeding on demand, everything. It really is a joy to see.

Because they’ve started a family young, there is a very real chance they will go on to have a very big family. They both say that is what they want.

My son, Samuel, has now gone back to work, while Millie is on maternity leave. But having both made several successful deals, and with a backlog of outstanding commission coming payable too, they found themselves between them paying £26,000 of taxes last month - 50% of the £53,000 they earned was taken, when you factor in the student loans they have to repay. (They might get some of that back at the end of the year).

To earn that kind of money in a month at such a young age is just brilliant - I see how hard both of them work, the hours they put in, early morning after early morning, late night after late night, the persistence - and I’m proud of them. It is not easy. None of their university colleagues are doing anything like as well, at least in financial terms.

With the bonanza month they both had, they could have paid off significant chunks of their student loans. But no such luck. The tax man cometh first.

Meanwhile, they are so far from being able to buy a house for their young family - not just in the area they grew up, but anywhere in Greater London - it’s a joke. I like having them live with me, don’t get me wrong, but the fact that even a couple as successful as this are miles away from owning a property of reasonable enough size to start a family makes my blood boil.

We live in a Victorian terraced house in South London that was built 150 years ago for a working-class man and his family. Yet a working-class man could never afford to buy this house now, even though it’s 150 years old - never mind the highest-earning couple in their peer group.

The most commonly given reason why people do not have bigger families earlier in life is expense. And what is the greatest expense in your life? Altogether now, “your government”. By far and away. Lower that expense and people will have bigger families again, earlier in life.

(Even the cost of housing itself - the second biggest expense in a typical life - would come down with less government - less planning permission, less building regulation, less market intervention for political ends, less fiat and so on).

Quite a few of the houses in our street are owned by the council. An old lady who lived in one of them recently died, and her house was given to a Somali family. So the taxes that Samuel and Millie are paying, and would like to have been able to use towards their own family, are being used to house another family not just from another country, but another continent never mind another culture. I’ve no doubt their needs are great. They get the house they need. We pay. How many more families not from the UK are we expected to sponsor - and delay/minimize our own procreation for?

We are literally taxing our own to enable to the procreation of others. As I say in the title, we are taxing ourselves into oblivion.

“Have you ever known taxes to actually go down?” My son asked me.

“Well,” I said. “They came down a bit in 1980s under Thatcher”.

It might feel relatively recent to me, but that was a good 15 years - half a generation - before my son was born in 2000. And even under Thatcher and Reagan, it’s worth remembering, the state actually grew.

The state continued to grow in the 90s and 00s, and, by the time you factor in all the various stealth taxes that got introduced, not least fiscal drag - perhaps the most odious of the lot - as well as currency debasement, so did taxes.

Now, because of fiscal drag, you see teachers paying higher rates of Income Tax. It’s not in any way exceptional in London to earn more than 50 grand. You haven’t got a hope of having any kind of lifestyle, if you don’t. I dread to think how many Londoners - those that work hard at least - are paying higher rates of tax. And for what?

What chance do these people have of buying a home and starting a family?

And all this money is being taken to spent on what, exactly? Not potholes, that’s for sure.

I think the question my son was really asking was, “Is there any chance taxes come down?”

Well, if you look at Britain since World War II - actually since World War I - the growth in the state has been relentless and inexorable. So the rise in taxes we must pay has been inexorable. I’m not just talking about Income Tax. As I say, I’m talking about all the stealth taxes and debasement of currency as well. Is there any realistic chance they’ll come down? Liz Truss only tried to slash government spending by two and a half percent. And look what that did.

It’s incredible to think that at the turn of the 20th century taxation - or the state - amounted to less than 10% of GDP.

Even if Reform were to win the next election, how would they realistically cut state spending by more than a couple or three percent? The institutional resistance - the blob, the civil service, the quangos, the media - would fight them at every turn.

In short, taxes are unlikely to come down by anything meaningful.

We cannot get this country purged until the currency collapses. That’s the only way I see it happening. It’s very sad.

If you live in a Third World Country such as the UK, I urge you to own gold or silver. The pound is going to be further devalued. The bullion dealer I recommend is The Pure Gold Company. Pricing is competitive, quality of service is high. They deliver to the UK, the US, Canada and Europe or you can store your gold with them. More here.

My son, who is not particularly political, observes the absurdity of it: many people who build wealth, the most productive and talented, are leaving because of high taxes, and we replace net contributors with net takers. The country is systematically driving away the people who create value while importing those who consume it. It’s economic suicide by design.

As readers of Daylight Robbery will know, I regard taxation as the best measure of freedom there is. The more heavily taxed societies - where obviously there is limited economic freedom - tend to be the societies where there is limited freedom of speech, freedom of movement, freedom of thought, freedom to experiment and all the rest of it.

Freedom of movement in the UK is limited by the cost of movement - whether it’s transport costs, petrol costs, Stamp Duty, fines, charges, new mileage taxes - all reduce movement. They’re all a tax. There might not be laws preventing movement in the way there once were if you were, say, a serf, but taxes give you a similar outcome. They restrict movement - and thus possibility - because people cannot afford to move.

You don’t need me to demonstrate how freedom of both thought and speech are being attacked. The two-tier justice system sees people committing violent crimes getting released early - indeed often not even getting convicted - while people who just said words get locked up.

I’m sorry to say it, but I don’t think even Farage and Reform can turn this one around, particularly when Farage is watering a lot of his policies down in order to give the media less to smear him with, and make himself more electorally palatable. Starmer did something not so totally dissimilar.

And if something should happen to Farage, what then? What would Reform be without him? I like Richard Tice a lot, but there is not exactly a huge queue of people waiting to fill Farage’s boots.

Tell someone about this great article.

So I come back to my point that I’ve made on these pages many times. If you are young and wanting to build a good life for yourself, and you want to be rewarded for the hard work you put in, your chance of doing that in the UK is limited. You’re best off going somewhere else. Sorry to sound negative. There are many things to be positive about in this world, but the future of taxation and freedom in the UK is not one of them.

Remember the golden rule of Daylight Robbery: fix taxation, everything else follows.

But there is no sign of us doing that.

Until next time,

Dominic

ICYMI, here is this week’s commentary - also prepping for the North American tax loss trade.

And, finally, I appeared on the mighty Tom Woods Show this week. I love Tom, and he is fast becoming one of my best buddies. Here are links to the interview on Apple podcasts, Spotify and YouTube.

Before we come to the main thrust of today’s piece, there is something I need to flag. We are just coming into North American tax loss selling season, and a number of you have asked if I will be putting together a portfolio of tax loss trades this year.

The answer is, “maybe”.

I’m not sure how well it will work this year for reasons you are about to find out, but it’s something I am still considering, and I will I try to have a list of options for next week’s missive. By my reckoning the dates when you’ll find the biggest bargains this year will be Friday December 19, Monday December 22 and Tuesday December 23, though the window stretches from next week all the way to New Year’s Eve.

What am I talking about?

At the end of the year in the US and Canada, investors (both retail and institutions) sell their worst performing stocks in order to realise losses to offset against gains elsewhere in order to reduce their tax bill.

This selling tends to climax in the last two or three days of trading before Christmas and it means badly performing stocks, particularly illiquid ones, get way oversold only to experience something of a rally in the first few weeks of the following year as the selling dissipates.

So the trade is simple: buy as the selling climaxes and then flip sometime in February (my Canadian broker says March and last year this proved very true).

Nothing is guaranteed in this cruel world (except the further debasement of your national currency), but it is a trade with a remarkably successful hit rate, and a clear timescale. It also becomes apparent pretty quickly if it isn’t working, enabling you to exit any losers early.

If you live in a Third World Country such as the UK, I urge you to own gold or silver. The pound is going to be further devalued. The bullion dealer I recommend is The Pure Gold Company. Pricing is competitive, quality of service is high. They deliver to the UK, the US, Canada and Europe or you can store your gold with them. More here.

By all means go back and audit me, but last year I believe 8 of the 9 ideas worked.

Some picks work better than others. Some years work better than others, but gains of 20-50%, even doubles sometimes, are not uncommon. The trade works particularly well in smallcap Canadian resource stocks, as, when they are bad, they are really bad, and can get hugely oversold. However, this year Canadian resource stocks, particularly gold and silver miners, have had a bonanza year, so there won’t be much tax selling there. In fact, markets more generally have been strong, so there is not the normal flood of dogs to be sold.

However, I have some ideas. Crypto Treasury Companies, for example, could be big winners because of the huge losses they have generated. So keep an eye out and I will try and have something for you this time next week. Be ready to move quickly, as well, so have some cash to play with.

Right. Changing the subject.

Why both legal and illegal immigration is set to increase

I can’t go online now without seeing something about uncontrolled immigration. Yesterday saw the sentencing of two Afghan 17 year olds for raping a 15-year-old girl in Leamington Spa. (Spoiler: they weren’t 17. They’ve lied about their age, on that I’ll bet the house. Not that anyone in authority will have noticed). And it’s not just online, it’s in the world around me. I live in south London, so I see it all the time. I travel a lot around the country doing gigs and the changing demographics of the UK are everywhere, even in the remotest parts of the country. I think a little bit of immigration is a good thing, but this is happening too fast and on too big a scale.

When a business messes up badly, it goes bust and another, better run business comes along and does the job better. When a state body messes up badly, a load more money gets spent on an inquiry - in the case of the rape gangs £65 million - usually headed by a Blob insider (in this case Starmer appointed peer Baroness Anne Longfield). The mess gets whitewashed as much by time as anything, and the state body continues as before, dysfunctional as ever, if not more so.

Unlike those operating in a free market, the state as it currently functions, is incapable of reacting to the new realities of the world around us. There are more people than ever before in the world, and more of them than ever are on the move. Thanks to better planes, trains, boats and cars, they are able to move further and faster than ever before. Thanks to smart phones, which over 90% of the world’s adult population now has, better information about how and where to go gets spread. Smart phones also create FOMO - you gaze at the life you could have - so there is more desire to move than ever before. And the fact that 3 billion people earn less than $40/day means there is a greater urge to move than ever. This is the reality of the world in which we live. It is patently obvious mass migration of people is going to increase.

And yet the British government, nor most Western governments, have no plan in place to deal with it all. They can’t even deal with current levels of migration, let alone illegal migration or future migration. There has been no debate or agreement on what the right levels of migration should actually be. With no clarity, policy is, inevitably, both incoherent and inadequate. Promises by every government since Cameron’s coalition have been broken. The courts and legal system were designed for a different people in a different age and are no longer fit for purpose. This all assumes, of course, government could actually lower migration levels if it wanted, which I don’t believe it actually can because of sheer weight of numbers. Thanks to the ECHR and a general unwillingness within the Blob to address this, there is not even the ability to properly tackle this issue anyway. State institutions and infrastructure - from roads to health to education to welfare - cannot cope with the increased numbers and are crumbling. Wealth creators are leaving to be replaced by net takers, resulting in an increased tax burden and eventual likely bankruptcy of the country. Trust has gone and we are accelerating along the road to ruin.

Such repeated failure by a business over many years would result in the extinction of that business. But the state operates by a different set of rules, and the only thing that can end it is the destruction of the currency itself. Hence why I say own gold.

So that’s where we are.

Exploiting the end of Britain: blood money and crony capitalism

You can rant and rail and make a noise. But I don’t see what you or anyone can actually do about it. A Reform majority at the next election is what many are pinning their hopes on, but a hung parliament looks more likely. Would even a runaway win for Reform at the next election change much? I doubt it, myself. There’s too much opposition within the system. Liz Truss only tried to slash government spending by 2.5% and look what happened there.

As investors our job is not to pass moral judgement on the rights and wrongs of all this. Many think it’s a good thing the West gets destroyed! Our job is to navigate the waters as best we can.

As you know I urge readers to own non- government currencies, money they can’t debase - gold and bitcoin.

But having just said our job is not to pass moral judgement, I do pass moral judgement when I invest. I shouldn’t, but I do. I don’t buy government bonds, especially gilts, for example, because in doing so you enable government, when government is the problem. Starve the monster is my take.

I’m also not participating in the trade I am about to outline here, because it would make me feel dirty. But the more ruthless of you will be fine with it, and you’ll get no flack from me. I hate getting ripped off at airports and train stations, so I have a bit of WH Smith in my portfolio as an offset. This is a little bit like that.

There are companies making an absolute fortune from illegal migration. And while this situation continues, they are going to continue making money. Why shouldn’t you as well?

Their customer, the government, is a bureaucrat spending somebody else’s money so will pay pretty much whatever. Demand for their services is only going to increase as migration increases. There is no competitive marketplace - you’re not having to compete with other hotels, for example. These companies are all paid by the government - you in other words - to provide facilities for asylum seekers. The contracts are juicy, and those bureaucrat fingers are fat with taxpayer cash.

Here’s how to profit from illegal migration in the UK.

I found myself at a very VIP event last night at the home of a well-known politician. There was a heck of lot of money, age and experience in the room. I felt like I’d gone back in time to the City of the 1980s.

I got talking to an old boy who, it turned out, had made his money in mining. He had worked at one point for the Hunt Brothers (who famously tried to corner the silver market in 1980). He had speculated in Australian’s Poseidon bubble (1969-70), one of the mothers of all speculative mining frenzies. He recalled a stock he had bought at 10c, offloading his final shares at A$120, only to watch it go to A$280. (50 years on, he was still cross with himself for selling too soon, even though it soon went all the way back to 10c).

“Are we in a secular bull market for mining stocks now?” I asked him.

He didn’t seem to think we are.

“What about gold and silver?”

“Silver’s at $53,” he smiled.

“$58,” I corrected him.

“$58!” he said. “Gosh. I must go home and sell the cutlery.”

There was a photograph in a large silver frame on the sideboard. We discussed the merits of selling that.

I tell this story for a reason. Bull markets like this one in silver do not come along very often. The old boy know that - and he knew what to do. Because silver bull markets don’t last forever.

And when they end, they really end.

You can make informed and educated guesses where the top will be. Getting out at the absolute top can be done but it requires so much good fortune that it is near impossible.

In the Poseidon bubble, the old boy was selling on the way up, only to see his stock double and more again after he’d unloaded his final tranche. He made money. A lot of money. He didn’t make as much as he could have made - and is still, more than fifty years on, cross with himself.

Yet he also didn’t lose anything when the bubble popped.

Is that not more important?

Yet, bizarre thing the human mind is, we seem to get more cross with ourselves for selling too early than we do for overstaying our welcome and riding the collapse all the way down.

If you live in the Third World Country such as the UK, I urge you to own gold or silver. The pound is going to be further devalued. The bullion dealer I recommend is The Pure Gold Company. Pricing is competitive, quality of service is high. They deliver to the UK, the US, Canada and Europe or you can store your gold with them. More here.

That amazing cup and handle

Silver has now broken out of that incredible cup-and-handle formation that has been building since the 1970s. We have spoken about it before. The standard view is that, in a cup-and-handle pattern, the distance from the rim to the bottom of the cup will be your target to the upside. In this case, $3.50 was the low in the early 1990s. The distance from $50 to $3.50 is $46.50, giving us a target of $96 or thereabouts.

$96.50 then. It could get there. I don’t say it will, but it could.

You can argue that based on logarithmic charts and percentage falls, the targets should be even higher. I’ve read some as high as $700/oz. It’s possible. $50 in 1980 was a similarly elevated figure.

A bit of admin before we come to today’s thought piece.

First, in case you missed it, here is this week’s commentary, mostly ranting about the budget, the UK’s inept leadership and what actions you, as an investor, should take:

And this week I also appeared on comedian Geoff Norcott’s podcast, What Most People Think. Here are the links to the show on Apple and Spotify, if of interest.

But for your thought piece today, we have another great little World War Two gold story which didn’t make the cut.

The farcical journey of Albanian and Italian gold

(NB: a tonne of gold is about a medium-sized suitcase full).

As the Nazis took both Austria and Czechoslovakia with ease, Italian Prime Minister Benito Mussolini grew anxious to flex his own muscles.

Albania would be his target. Geographically, culturally and historically, it made sense: Albania had been part of the Roman Empire even before northern Italy.

In April 1939, Italy invaded with a force that contained 400 planes, 300 small tanks, 12 warships, and 22,000 men. But some untrained Albanian locals with the help of a few soldiers managed to drive them back into the sea. Such was 20th century Italian warfare.

The Italians made it on the second attempt, however, and the capital, Tirana, fell.

The Albanian King Zog gave an impassioned speech on the radio, urging resistance, but nobody heard it because Albania at the time had fewer than 2,000 radios, and the Italians soon managed to jam the airwaves anyway. Shortly after giving the speech, like the true patriot he was, he fled the country, taking enough gold with him to lead a long life of luxury in exile, eventually ending up in Egypt as a guest of King Farouk, to whom he had to pay $20 million for refuge.

Albania's founders believed in gold, and their currency, the lek, was based on it. Inflation, as a result, had been nonexistent. The central bank was established in the summer of 1925, and it had worked hard to build up its gold holdings. At home, it had encouraged citizens to swap their jewellery for paper money. That private gold was then added to the nation's gold holdings. Whenever possible, the country increased its gold holdings in London.

But by the time of the invasion in 1939, most of Albania's 2.3 tonnes was in Italy anyway, where it had been sent for safekeeping. The Italians managed to confiscate quite a bit more in coins and jewellery from citizens.

We fast forward four years.

The Italian dilemma: give their gold to the Nazis or the Allies?

In 1943, Allied forces moved north from Africa into Sicily and then Italy: the invasion of the soft underbelly of Europe had begun.

Hectic days followed the ousting of Mussolini in July. The Italian Fascists were still nominally in charge. They declared Rome an open city in the hope of avoiding Allied air attacks. But by September 1943, the Nazis had control of the capital and central Italy, and they wanted Italy's gold moved to Berlin, while they still had control of the area.

They began confiscating the gold of Italian citizens in Rome, especially Italian Jews. The amounts demanded were unrealistic, but Roman Jews reached into their family treasures, their synagogues and institutions to turn in what they had. The Pope, Pius XII, heard about the demands and authorised Catholic churches to lend Jews gold so they could reach the quota.

But the big prize was in the Italian Central Bank, and several Nazi organisations had their eyes on it: Himmler's SS, Göring's Four Year Plan, von Ribbentrop's Foreign Office, and Funk's Reichsbank.

Even the Bank of International Settlements (BIS), which was worried about its investments in Italy, started making demands that Italy send it gold. Initially, the governor of the Italian bank, Vincenzo Azzolini, made out that he was offended by the idea, but he soon realised the BIS was a better option than Berlin, whichever Nazi department received it.

The Italians did not know what to do. On the one hand, they did not want the Nazis to have their gold, but nor did they want the invading Allies to have it either. They thought of sending it to Sardinia, they thought of sending it to the Swiss border. They sent small amounts of gold to branch offices around Italy, but the Bologna gold went missing, as did much of the Milan gold - now supposedly in Turin, but actually hidden in a well. They even sent some to colonial outposts in Benghazi, Rhodes and Addis Ababa.

The Albanian gold Italy had stolen was still sitting in the Italian bank's vault, so, under pressure from the Nazis, they sent that up to the Reichsbank in Berlin, while they tried to come up with a solution.

The following day, Niccolò Introna, the Italian bank's deputy general manager, had his plan: to build a false wall in the bank's underground vaults. He would then backdate documents to show the gold had been moved to Potenza, a town in the Italian south that was about to fall into Allied hands, but hide the gold behind the wall.

Bank governor Azzolini approved the plan, but then ruled that only half the gold should be hidden. The next day the wall was built. The day after that, the official order to ship the gold to Berlin came in from the German ambassador. If the bank did not agree, the Germans would simply seize it. At this point, Azzolini learned that the Germans had seized government records, from which they would know the size and location of the country's gold. Azzolini lost his nerve and had the wall torn down.

The next day, the German military unit arrived at the bank with orders to move the gold north by air. Azzolini stalled them, saying it would be safer by train. The Germans sent 5 tonnes by air, the rest - 119 tonnes - was sent by train to Milan. From there, it was shipped to Fortezza, Bolzano, close to the border with Germany and under their control, where it stayed for several months. The now-ousted Mussolini even signed his approval that it be sent there.

The following spring, Azzolini, who above all wanted to stop the gold going to Berlin, struck a deal with Swiss and German representatives that would see 26 tonnes sent to Switzerland, some to the BIS and some to the Swiss National Bank.

Göring, however, insisted he needed money and suggested giving Italy Reichsmarks for its gold. The deal was signed without the Bank of Italy knowing about it. 50 tonnes left Fortezza, which included 8 tonnes Italy had stolen from Yugoslavia earlier in the war in "restitution" (that’s another story). The delivery arrived in Berlin a tonne light. As almost always by this point in the war, someone had their hands in the till.

The process of shipping the next batch of Italian gold - some 22 tonnes - went on for months, as some (but not all) Italian officials tried to stall. But eventually, that too was dispatched. That too arrived in Berlin a tonne light.

When American forces eventually liberated Fortezza, they found 25 tonnes. It was handed over to the Bank of Italy.

What a mess.

Stories like this fill the pages of The Secret History of Gold (although this one didn’t actually make the cut).

The Secret History of Gold is available at Amazon, Waterstones and all good bookshops. I hear the audiobook, read by me, is excellent.

And it would make a wonderful Christmas present!

Chancellor Reeves’ budget was designed to placate left-wing back benchers, who want greater spending, and the bond markets. In that, it has succeeded. For now.

The ever-shrinking part of the country that actually builds wealth (and remember there are only 3 ways to build real wealth: you grow stuff, you mine stuff or you make stuff. Everything else is just pushing it about) is being further taxed to pay for it all. There are now extra taxes on property, dividends and savings, while fiscal drag means more people will pay higher rates of income tax (closing in on 25% of workers by 2030, apparently), further diminishing their chances of improving their lot. Never mind the currency debasement of the money they are being paid in.

Stealth taxes, such as fiscal drag, get my goat because they are so disingenuous. But perhaps of greater concern are doors which have been opened to new sources of taxation. The extra levy on high value properties, for example, has been set at £2,500 per year for properties in the £2-£5 million bracket, and £7,500 for properties above.

A £2 million house in London is not some decadent billionaire plaything: it is often a mere terraced house built 150 years ago for an ordinary working man and his family.

My friend, who is uber successful and very left wing, has an expensive house in Hampstead. She was actually happy about this tax, because she thought it was fair - and because she thought she was going to get hammered for higher taxes elsewhere. What she doesn’t realise is that this is just the beginning. The door is now open to further property taxes and the only way is up.

What’s more, as currency gets debased, fiscal drag means more and more properties will fall into this category.

Income Tax began as a tax only on higher earners. Within a few decades, ordinary workers were hit. Now they’re paying higher rates. These new property taxes will go the same way.

Never mind that you bought the property with taxed income, and then paid stamp duty. It’s endless.

Between that, landlord taxes, extra tenant protection, Section 24 and the plethora of petty regulation, the age of the small landlord in Britain is now over. Renting, like so many other parts of the economy, will become the domain of larger corporations. And we will all lose because of it.

It also means that real estate is over as an investment. All it really was was a shield against currency debasement, but those days are now behind us.

Similarly, the door is now open for local authorities to charge a visitor levy. This tourist tax will start small and then rise, like every other tax in history. We already have the tax on moving that is stamp duty, now we have this. If you tax movement, people will move less. If you have no movement, you have no growth. It really isn’t that difficult.

They do not seem to understand that capital flows to where it is welcome. If you tax it, it will not come; it will go.

What is the golden rule of the magnum opus? More taxes or higher rates do not equal greater revenue. But the reverse.

We are now, as you know, taxed at the highest rate since the Second World War. What is the money going on? You don’t need me to tell you how much is being spaffed. Waste, fraud, incompetence, misallocation. Government is the most inefficient means of spending money there is. As if to prove my point, they couldn’t even make the announcement about how they’re going to spend your money competently.

They’ve spent the last few months leaking stuff. Leaking is a tool of government, so when it backfires, at least we have some karma.

Meanwhile, the source of the leak, the OBR, rarely if ever gets a prediction right. How much is being drained from the productive to fund that thing? How many bad choices are made as a result of its utterances?

The state is already disproportionately large and it is only going to get bigger

Where do the salaries of those who work for the state come from? The ever-decreasing sector of the economy that actually builds wealth.

Even if you are providing some essential state service and are being well paid to do it, you are still a dependent, because it is the shrinking part of the economy that actually builds wealth that is the ultimate source of your wages.

Millionaires and billionaires, assuming they haven’t made their wealth through crony capitalism or government subsidy, are not the problem - they are the solution. We want to attract them here, not frighten them away. They create employment. Our lives are better for likes of Jeff Bezos and Elon Musk, not worse. The same goes for investment, profit, saving, trade, growth. We want to attract them not deter them.

The opposite applies to deficit spending, money printing, currency debasement, suppressed interest rates, high taxes, tax traps, welfare, dependency, regulation and bureaucracy. You want to deter them not attract them. Yet I am afraid all we are doing is the latter.

If you pay people to be unproductive, you will get more unproductive people. If you tax people who are productive, you will get fewer productive people. What is so hard to understand?

We can rant and rave. It won’t do any good. This is the path we are on. We are following the template of South Africa. (It was actually me that coined the term “the South Africanisation of everything”, something I am quite proud of). We keep thinking that things can’t get any worse. But they can and will. It is gradual and incremental. We are frogs being boiled while suffering water torture. The country is going to get even more socialist. All you can do is look after yourself and your family.

If you are young and reading this, the best thing you can do is leave, as so many are already doing. It is just so hard to build a future for yourself when you are so heavily taxed, and then the money you are paid in is being debased. Leave, travel the world, have adventures, learn, become a Sovereign Individual. The world is a big place. There are better futures to be had elsewhere.

It’s all happening just as I said it would in Daylight Robbery, by the way, even the mileage tax

Many of us, however, because of our circumstances, do not have the option to leave.

So what to do?

Real estate, as already mentioned, is now dead as an investment. It’s too easy a target for taxes.

UK companies are going to find life that much harder - the rising minimum wage will reduce employment (and thus increase the burden of dependents). It’s also going to mean higher costs for you as this tweet demonstrates

If companies do well, they will face further taxes. Dividend taxes are a deterrent too. We are not quite at the point where UK companies are un-investible (in fact there is a wall of US capital that wants to buy the UK), but the foundations are not exactly enticing.

The one compensation for saving in fiat was interest, but taxes here are going to go up too. So cash is crap

As we have long argued on these pages, you need to park capital where governments can’t touch it, tax it or debase it. The best forms of non-government money are gold, if you want something physical, and bitcoin, if you prefer something digital.

We are not yet at the point where they try to tax or confiscate your gold and bitcoin, but we are on the trajectory I’m sorry to say.

All those horrible bitcoiners crowing about how much money they’ve made - do you honestly think taxing or confiscation of bitcoin won’t meet with public approval? You’re just another one of those loathsome rich people creating inequality.

It’s coming, but we are not there yet.

Bitcoin is in one of its down seasons. But it is still the best performing asset class of the last 15 years. And if you don’t like it, fine, own gold instead. There is plenty more gas in that particular tank.

Reeves may have staved off a tantrum in the gilt markets, and a resulting fall in the pound, but she has created an even bigger problem for her successors.

We need fewer taxes, lower taxes and simpler taxes. It all starts there. Reeves has chosen a path in the opposite direction, the road more travelled. And it takes us further along the road to serfdom.

If you live in the Third World Country such as the UK, I urge you to own gold or silver. The bullion dealer I recommend is The Pure Gold Company. Pricing is competitive, quality of service is high. They deliver to the UK, the US, Canada and Europe or you can store your gold with them. More here.

Sunday’s thought piece has become the most viewed piece in this Substack’s history. Take a look, in case you missed it:

Until next time,

Dominic

We have crunched the numbers across 5,000 years of human civilisation, and ranked the results. What we found will surprise you - and might just change how you think about the past.

Substack subscribers see this first, before it goes to X, Facebook, Insta and YouTube next week.

Know others who should see this?

If of interest, the research for this video can be found here.

My thanks go to Goat, for making the video, and to Andy at Red Creative for the studio.

If you live in a Third World country, such as the UK, I urge you to own gold or silver. The bullion dealer I recommend is The Pure Gold Company. Pricing is competitive, quality of service is high. They deliver to the UK, the US, Canada and Europe or you can store your gold with them. More here.

Moving onto other matters, ICYMI here is this week’s commentary

Meanwhile, have you read it yet? “Possibly the best-time book ever,” says Merryn Somerset Webb.

The Secret History of Gold - Money, Myth, Politics and Power is available at all good bookstores.

Finally, I appeared on the Shepheard Walwyn Podcast, interviewed by Jonathan Brown, this week. Here it is - talking gold.

Until next time,

Dominic

I don’t mean to get all bearish on you.

Bearish copy - it’s all going down, it’s going to crash - gets more eyeballs than “everything’s fine”. Bearish commentators usually have bigger followings. Bad news sells.

But bears are usually wrong. They’ve predicted 13 of the last two corrections.

The fact is, as human beings progress and economies grow, markets tend to rise. This is doubly so when the underlying unit of account - the pound, the euro, the dollar - is being systematically debased. (Which makes the underperformance of the FTSE these last 25 years even more incredible by the way). Stock markets, especially in the US, have become places to park capital, where you can reduce erosion by inflation.

So that’s my disclaimer out of the way.

I’m feeling bearish

We’ll start with bitcoin. It’s a leading indicator for the Nasdaq and tech. It’s sold off - from $125,000 in early October to $90,000 a coin on Monday. Remember: I targeted $90,000 a coin a few weeks back.

The crypto summer was muted, so we can expect this crypto winter to be similarly muted - no 90% corrections in other words. But we are almost 30% down already.

Strip out the noise and HODL is my advice. That’s what I’m doing. There has been no better investment strategy over the last 15 years and I’m sticking with it. But a crypto winter is upon us, it seems. Let’s hope it’s a mild one.

Here’s the chart. Look at the 50 day moving average in red. This is the third time in since 2024 that we have been in this situation.

One correction lasted most of 2024 - well, March to October - the other took up the first five months of this year. They passed.

Also worth noting is how each correction seems to have three spikes down - three drives to the bottom. This time around we have only had one, so maybe a couple more to go. That is not a prediction by the way: just an observation.

The corrections in gold and silver have been more muted. But I have to say the silver chart concerns me. Double top or what?

I thought the October correction would go deeper than it did, but it held up at the 50 day moving average (red line). That’s a sign of strength. This rebound rally, dead cat bounce - whatever you want to call it - has taken us right back to the old highs, while gold and the S&P500 both made lower highs. That is also a sign of relative strength.

But the second high was not confirmed by the silver miners, that is not good. And now we have a double top on our hands, until we don’t.

I would think we have one more leg down to get through plus some sideways consolidation to digest the gains of earlier this year.

Here is gold, FYI, which has conspicuously made a lower high. This one might want to go into the $3 thousands for a bit.

The stock market has this ridiculous Nvidia situation to get through. $4.4 trillion market cap - and that’s after the recent pullback. 40 stocks account for something like 60% of the market cap of the five hundred stocks in the S&P. It needs to rebalance, otherwise it’s an index of 40 stocks with 460 hangers-on. Corrections are how these things happen.

So I am feeling über cautious. There is nothing wrong with having cash in times like this - it means you can buy stuff.

On the other hand, the year end rally is approaching - so maybe we should just stay long. As with bitcoin, the way to play the stock market since 2009 when the S&P500 reached 666 - it is ten times that today! - has been simply to hold on through. With so many conflicting messages, it’s hard to know what to do. Dolce Far Niente … Italian for HODL.

With all that in mind, I want to just skim through some of my speculative positions and give you my latest opinion on them. we are going to look at Metals Exploration (MTL.L), Comstock (LODE.NYSE), Lightbridge (LTBR), Minera Alamos (MAI.V) and more. Time to sell? Time to buy more?

Let’s see.

A review of the speculative portfolio

We’ll start with Metals Exploration (MTL.L), my largest position.

As your thought piece this week, we have my interview with Kitco News, talking gold, tax, deficits and more with Jeremy Szafron. I’ve ripped the audio so that those who listen to the podcast can hear it as well.

These signed copies of Secret History of Gold have proved quite popular, so I have ordered another box. (They make good Christmas presents). If you would like one, please email me - frizzers at gmail.com. Note: they are cheaper via Amazon (via me I have to charge you postage) but you don’t get my signature or a message.

Finally, ICYMI is this week’s commentary, in which we check in on the Dolce Far Niente portfolio.

Until next time,

Dominic

I urge you to own gold or silver, especially if you live in the Third World Country such as the UK. The bullion dealer I recommend is The Pure Gold Company. Pricing is competitive, quality of service is high. They deliver to the UK, the US, Canada and Europe or you can store your gold with them. More here.

I’ve been writing so much about gold and silver lately, I need to cover something else.

But my quick take: as seemed likely, gold and silver have gone into one of their corrective phases. This is likely to last several months, in the humble opinion of this writer. There’ll be false dawns, which catch everyone out, and false deaths too, with the overall trend being sideways.

In the event of a broader stock market correction - which is long overdue given the scale of this rally since the Tariff Tantrum™ in the spring - gold and, especially, silver will sell off along with everything else. That doesn’t mean gold isn’t a safe haven. It just means there is a lot of hot money in gold, which quickly gets liquidated in a sell-off.

But, yes, this incredible rally we have seen in the S&P500 since the Tariff Tantrum™ is looking exhausted and seems to be rolling over.

Bitcoin is taking a hit too - although not as big a hit as the broader crypto space - and bitcoin is what I want to look at today.Here is one crypto trader’s desk, as pictured on Twitter during Tuesday’s sell-off.

That’s what happens when you use too much leverage.

What do they say about taking the emotion out of trading?

Bitcoin - what gives?

So many things have happened this year which have blown winds in bitcoin’s favour

* A newly elected US administration which very pro crypto

* A deliberately weaker dollar and the debasement trade

* The launch of the bitcoin ETFs in the US increasing access to much larger flows of capital

* Strength in tech stocks generally

* A risk-on appetite

* The halving cycle

And more

Yet bitcoin feels like it hasn’t quite delivered. A new high of ‘only’ $125,000.

The latest narrative doing the rounds is this idea that the launch of the bitcoin ETFs is like bitcoin’s IPO. Just as when a big tech stock IPOs, a lot of early seed money takes the opportunity to exit, so are many early bitcoin investors - so-called OGs - now moving on. That would explain the many coins that have been moved from previously dormant wallets to exchanges over the last six months.

Maybe.

What can I say?

You can either decide that bitcoin’s time is done. It’s game over. Move on.

Or you can treat this like another of the numerous shake-outs that have taken bitcoin in the 16 years since its inception. The story was getting a bit tired. It needs a shake-out to ruffle a few feathers and purge.

The moral of every previous correction can be summed up in 4 letters: HODL.

It looks like we may have got a bit of a crypto winter to get through. If the winter reflects the previous summer, then this one shouldn’t be too bad. But consolidation phases can be frustrating, so the secret is to be quite zen about the whole thing and keep your eye on the bigger picture.

Bitcoin bear markets can be painful, but the beauty of them is that, unlike mining bear markets which can go on for a decade or more, they tend to be short lived.

Treat bear markets as opportunities. They’re a good time to build positions, build businesses and more. Go and watch some Michael Saylor videos and re-indoctrinate yourself.

But on no account lose your position. Bull markets come along when you least expect them.

Everything is looking a bit red at the moment - gold, silver, the S&P500, bitcoin. It might be the end of this cycle. but it’s not the end of the world.

I don’t know when or where this bitcoin correction ends. My guess is around $90,000 but that’s nothing more than a guess. Perhaps we revisit $75,000 - which is the level we hit during the Tariff Tantrum™ earlier this year.

But it’s just as possible that dip below $100k on Tuesday was a fake-out, and the bear market is already done.

I thought this graphic was interesting.

There is plenty more room for future buying as governments and corporations try to increase their positions.

By the way I get that some readers like bitcoin and others don’t. That’s fine. Each to their own. However, if you are in the latter camp, you do not need to email me and tell me bitcoin is not real money/quantum computing is going to destroy it/it is an invention of the deep state/ it is a scam. Please also feel no need to regurgitate Peter Schiff tweets either. (I’m fairly sure he is paid to slag bitcoin off by the way).

Turning now to the clusterfook that is the UK

Buying bitcoin ETFs in the UK - t he hows, whats and whys

It’s semantics, but you can’t actually buy ETFs in the UK you have to buy ETNs. I’m not even going to bother trying to explain it. It’s regulatory bollocks and not worth wasting time or brain power over.

October 8th, the date when the FCA decided UK citizens are allowed to buy bitcoin ETNs is now behind us, but the farce is not.

I first found out about bitcoin in December 2010 when it was 22c. I was sent my first coins soon after. I wrote the first book on bitcoin from a recognised publisher in 2014. Yet this morning I just attempted to complete the FCA’s form to get me approved to buy a bitcoin ETN - so that I understand the risks - and I failed it.

The “correct” answer to their questions is actually the wrong answer. Absolute farce of an organisation and accountable to no one, so it will continue.

In the US, meanwhile, JP Morgan is in the process of enabling bitcoin to be used as mortgage collateral.

It’s like being in Spain in 1492, the ship is setting sail to the New World and somebody from the FCA is standing on the gangplank with a clipboard stopping UK citizens from getting onboard.

Amongst the plethora of moronic barriers which the FCA has laid down is that bitcoin carries the same risk as any other cryptocurrency - including the latest meme, scam or shitcoin. Bitcoin is not fartcoin, and categorising the two together reveals the scary depths of FCA ignorance.

Meanwhile, from next year you won’t be able to buy bitcoin ETNs in your ISA, you will have to get a special ISA. They are trying to kill us with bureaucracy, I’m convinced of it.

Which broker and which ETN?

In terms of enabling their customers to invest, the UK brokers have ranged from excellent - Interactive Investor, which went live on day 1, as boss Richard Wilson proudly tells me - to totally useless - Hargreaves Lansdown and AJ Bellend.

Hargreaves Lansdown, apparently trying to give the FCA a run for its brainless money, even put out the following statement.

“Bitcoin is not an asset class, and we do not think cryptocurrency has characteristics that mean it should be included in portfolios for growth or income and shouldn’t be relied upon to help clients meet their financial goals … Unlike other alternative asset classes, it has no intrinsic value.”

Talk about retarded.

If you want to be able to invest in these things via your SIPP or ISA, move your account to Interactive Investor is my advice. Use this affiliate link and you get a year for free.

I should stress buying bitcoin via a broker negates many of bitcoin’s uses. Yes, you get the store-of-value benefits, but you can’t send and receive it; you can’t use it to make payments or donations; you don’t have sovereignty - the fund manager does - and so there is considerable counter-party risk - the coins could be confiscated, the fund could go bust etc. You don’t have anonymity either.

Still it’s better than no exposure at all.

But which ETN should you go for? And what about the treasury companies?

And, what indeed about Semler Scientific (SMLR)?

I am headed to Birmingham and Huddersfield week after next. If you are in either neck of the woods, come and see the show.

Don’t it always seem to go That you don’t know what you’ve got ‘til it’s gone

Joni Mitchell

Back in the 1980s I remember the newly privatised British Telecom, in its wisdom, decided to get rid of Britain’s red telephone boxes and replace them with things made of glass or was it perspex?

The originals were designed, I’ve since read, by one Giles Gilbert Scott, who got the gig as a result of a design competition. (I’ve since learned he also designed Battersea Power Station, so he was quality).

British Telecom wanted a rebranding, so somebody at HQ decided to waste lord-knows-how-much money getting rid of however many phone boxes there were around the country - they’re cast iron so this was not an easy job, nor a cheap one - and replace them with something better, which inevitably turned out to be worse.

Here’s the iconic before:

Here’s what they replaced them with:

I barely remember these. You probably don’t either. Because they were soon got rid of and replaced with these.

Why did they bother?

The glass replacements are just so bland you cannot not even describe them as ugly. They are just characterless nothings.

Why people in corporations feel this need to glassify everything - it’s happened to buildings as well, of course - is beyond me. I guess they think it’s “dynamic”. (Indeed, they’ve done something similar to language).

BT justified the rebranding by saying existing phone boxes got vandalised: prostitutes and mini cab drivers left their calling cards in them, people pissed in them. All of this is true, but there were other ways of dealing with these issues. (It’s not unlike the many invented problems being cited today to justify hoisting digital ID on us).

The bottom line is that the powers that be wanted a rebrand. Good for their egos, I guess. And thanks to the privatisation they now had bucket loads of capital to spend on it.

Whatever. They spent a shedload and made it worse.

So there I was walking along Parliament Square the other day and what did I see but a this huge queue of tourists lining up to have their photo taken by a phone box. Not one of the glass ones obviously.

And I mean huge queue.

See for yourself.

I would say there are 40 or more people in that queue. If they each take 45 seconds for their photo, that’s a good 30-minute wait.

The rest of the world loves the English for who we are. For our history, our culture, our style, our character, our charm, our order, our beauty. That’s why so many tourists flock here. Why are we incapable of appreciating ourselves and loving what we have created? - instead choosing to self-hate and apologise for what we have done.

The rest of the world wants the England of red phone boxes, afternoon tea, good manners and Downton Abbey. They don’t want England for its diversity (diversity is not London’s greatest strength, despite what they mayor may tell you - London’s greatest strength is that it is the capital of England, not Diversityland), nor for its gender-neutral toilets, glass fronted buildings, low trust communities or its street crime. They want England for the English.

So the point of today’s missive.

A few years ago somebody got the no-doubt-very-well-paid gig erecting cycle sheds around the capital.

Here was an opportunity to design something iconic, something which added to London - like the old red buses, black taxis, post boxes and, yes, the phone boxes. Things that characterise London, and thus things that people love London for.

Here’s what we got.

They even put a picture of a bicycle on the side, just in case you’re totally moronic.

Talk about a wasted opportunity.

They look like budget Anderson shelters.

And what’s the shelf life of one of those. Ten years, maybe?

Can you see tourists seventy or eighty years from now queuing up for half an hour to get their photo taken next to one?

Oh well.

If you enjoyed reading this, please share it far and wide.

Lots of things to share with you this week

* Here ICYMI is this week’s commentary:

* Here is a piece from my comedy Substack about Prunella Scales, who died on Monday. It also contains an episode of a 1975 sitcom you’ve probably never heard of but in which she was absolutely brilliant. I urge you to watch it - you will thank me.

* I made an appearance on Jeremy McKeown’s new podcast, along with Tim Price, to talk gold.

If you live in a Third World country, such as the UK, I urge you to own gold or silver. The bullion dealer I recommend is The Pure Gold Company. Pricing is competitive, quality of service is high. They deliver to the UK, the US, Canada and Europe or you can store your gold with them. More here.

* And, finally, on Friday morning at 07.34 GMT, I became a grandad. Please welcome Cecilia (name not yet confirmed) to the group.

As we are headed into Christmas present season, if you are unable to follow the tradition of the Wise Men and gift actual gold, how about a book about gold instead?

I deal for anyone at home or at work.

The Secret History of Gold - Money, Myth, Politics and Power is available at all good bookstores

Until next time,

Dominic

As it turns out, they were not.

Gold and silver have put in a top - an interim, mid-cycle top, in my view, not the top - and we can now expect many months of sideways, shake-out, frustrating consolidation to generally piss everyone off.

It’s important, in such times, to keep your eye on the bigger picture, which in this case is the inevitable debasement of currency, so as not to lose your position.

You’ll know, I’m sure, the story of Joe Kennedy’s shoe shine boy. In 1929, so the story goes, the boy who was polishing the celebrated investor’s shoes started giving him stock tips. If the shoe shine boy has bought in, thought Joe Kennedy Snr, who else is left to buy? That persuaded him that the top was close and he famously sold just before the crash.

That story is often cited to illustrate the idea that retail investors are sheep. They’re stupid. You should do the opposite to what retail is doing and so on.

I don’t think it’s anything like that simple.

There are some retail investors who are stupid. There are plenty who are rookies and naive. But there are plenty who are thoughtful, wise and, as a result, very good investors.

By the same token, I have met many fund managers, analysts and more from respected institutions who are thick as pigshite. (I have met plenty of geniuses too).

Give me the choice between some blogger and an institutional research report, you’ll often get far more insight from the former. I frequently read bulletin boards, or chats on Twitter, as part of my research into a company.

It wasn’t institutions who got into bitcoin early, it was retail. Even now many institutions shun it, particularly in bureaucratic banana republics such as the UK. Who were the smart guys? The people that bought earliest. Retail.

Obviously, if you start getting investment tips from a shoe shine boy/taxi driver/barber (my Albanian barber is forever shilling me shitcoins) or your nan’s carer’s mate, that is usually a bad sign, but it doesn’t mean that ordinary folk are stupid.

With the above in mind, I stumbled across this video from another legend of American investing, Jim Simons. At the time of his death in 2024, the hedge fund manager’s net worth was north of $30 billion, making him the 55th-richest person in the world.

He describes January 21, 1980, when, at the afternoon fix, gold went to $850 /oz - a blow-off top that would not be seen again for almost 30 years.

I write about that 1980 blow-off top, by the way, and how it was “illusory” in the Secret History of Gold (BTW the audiobook is getting barnstorming reviews).

The point I draw from the Simons talk is that retail was selling gold. People were not buying, they were selling.

In other words, retail nailed the top of the market.

My mum remembers the gold fever - and indeed the silver fever (silver spiked to $50 three days earlier on January 18). Even today, 45 years on, the silver price is lower than it was then - that’s how insane that spike was.

She recalls people queuing up to sell their family silver. Not to buy it. To sell it.

So that is something I am looking for to tell than this bull market is close to an end: when retail, ordinary people, start selling their physical in droves.

We are not there yet.

Even towards the end of the last bull market which peaked in 2011, everywhere you went, there were signs saying, “We buy any gold”. Retail was selling.

Comedian Gary Delaney and I even wrote a sketch in which a wizard (Gandalf) pulls a ring from the fire, reads the inscription, hands it to a hobbit (Frodo), who nods thoughtfully and says something along the lines of, “I understand what I must do.” We then cut to him going into a shop with a sign outside that says, “We buy any gold.”

I still think that sketch is funny, but of course TV didn’t want it. Wrong age, wrong sex, wrong colour - never mind wrong views.

If you enjoyed today’s article, please tell a friend..

Until next time,

Dominic

If you live in a Third World country, such as the UK, I urge you to own gold or silver. The bullion dealer I recommend is The Pure Gold Company. Pricing is competitive, quality of service is high. They deliver to the UK, the US, Canada and Europe or you can store your gold with them. More here.

Before we go to today’s piece, let me flag this week’s commentary - on the action in the gold and silver markets, in case you missed it. A blip or the start of something more significant?

So to the osteopath who isn’t an osteopath

I first met Michelle Davies at a James Delingpole event. She was buying one of my books and wanted to pay in bitcoin, which got her an immediate gold star. She mentioned quite matter-of-factly that she was an osteopath who had been struck off and, “would I like some treatment?”.

As a man with many ailments accumulated over the decades, a large portion of which I have given up trying to heal, I couldn’t see much downside to the offer. She might even be able to cure one of the incurables. “Why not?”, I thought.

A few days later, in a studio near Worcester, she placed her hands behind my head, went still for a moment, announced that my energy channels were “terrible - blocked, nought out of ten,” manipulated my neck and head for a bit, muttered to herself, sighed, told me off for swearing, got me to speak into a microphone, and then began “sending me frequencies.” I left feeling oddly lighter.

So I went back.

“I’m trying to have a lucid dream,” I told her. “But I’m not making much progress.”

I explained the difference between a vivid dream, which is what it says on the tin, and a lucid dream, which is a dream in which you know you are having a dream, while you have the dream. Keener readers will remember to “get better at lucid dreaming” was one of my ambitions for 2025.

“Oh,” she said. “I might be able to help with that.” And she went to work on my channels again.

That night, I had nine dreams. Nine. Normally I’d be lucky to remember one or two. None were fully lucid, but still - progress.

I went back again. “Can you help me with my ankle?” I’ve got flat feet and my ankles are very stiff as a result. I’ve broken my right ankle five times.

She held it, paused, and began to cry. “There’s so much pain here,” she said.

“I can’t fix it completely,” she declared, “but I can make it much better”.

My ankles are one of the many banes of my life. I still play football, but I am incapable of “putting my laces through it” - that is shooting with my instep. I’ve not been able to shoot properly since I was in my early 20s. It hurts so much - my foot involuntarily winces moments before I strike, so my whole game is little passes with the inside of my foot. It’s limiting. I might get one goal in a game of six-a-side, maybe two if I’m lucky. Usually I don’t score.

“When are you playing next?” she asked.

“Tomorrow.”

“I’ll broadcast to you,” she said.The following night I scored six goals. SIX.“Have you been having shooting lessons?” one of the other players asked, both miffed and baffled.

“What is your biggest goal in life? Michelle asked at another session.

“To get Kisses on a Postcard made,” I said.

I explained what it is. We came up with a mantra, which I recorded and she layered with one of her frequencies. I began playing it each morning while doing the gentle stretches, which she told me to do, in bed. Three weeks later, I closed the seed funding round I had up to then been struggling with - oversubscribed, no less. All coincidence, I’m sure. But Kisses on a Postcard is finally moving forward.

Osteopath No More

Michelle Davies was a local osteopath in Worcester who had been practising for 25 years. Among the many things she found she was good at treating were sinusitis, asthma, anxiety, depression, baby colic & reflux, sleep issues and infections. The patient testimonials on her website confirmed as much.However, in 2016 the General Osteopathic Council (GOsC) got in touch. In case you are not familiar, GOsC is osteopathy’s contribution to The Blob, the army of unaccountable regulators which runs, if that’s the right word, Britain, answerable to no man. (If you think the government is in charge, you’re deluded).

In the great British tradition of unelected bureaucrat, GOsC has discovered the elixir of Blob: a toxic mix of arrogance, incompetence, paperwork and regulatory overreach, which will satisfactorily obstruct any attempt at progress. GOsC explained to Michelle that osteopathy can only cure 12 things, and these do not include the items which Michelle had found she could treat. Unless she removed the 75 patient testimonials, she would face a Fitness to Practise case. She did as she was told and removed the lot.

“But I can and have treated these things,” she thought. “I’ve got 75 testimonials to prove it”.

So, in 2021, she brought a claim against GOsC for damages, arguing that their actions had limited her professional scope and censored the public’s voice. GOsC questioned her fitness to practise, demanded a psychiatric assessment and access to her medical notes. She refused and was struck off. She could no longer call herself an osteopath. In fact, she eventually got a criminal record for, checks notes, “impersonating an osteopath”.

(Read her google reviews, if you want the patients’ side of this)

BTW I know nothing of GOsC and I haven’t researched their side of the story, nor do I care to. They’re regulators, so my default position is biased against, and unless they can demonstrably prove they warrant a better opinion, that will remain my position.

So Michelle began marketing herself as the osteopath who was stuck off. Three years on she has a practice in Harley Street, charging several times her old rate.

Note to any osteopaths reading this: get yourself struck off. It’s great for business.

If you live in a Third World country, such as the UK, I urge you to own gold or silver. The bullion dealer I recommend is The Pure Gold Company. Pricing is competitive, quality of service is high. They deliver to the UK, the US, Canada and Europe or you can store your gold with them. More here.

A Healing Week

I later discovered she also offers “healing weeks.” She comes to stay with you and your family for seven days and treats everyone daily. I thought we could all use a tune-up, and to my surprise when I proposed the idea, the Frisby household agreed: my eldest son (24), his heavily pregnant girlfriend (23), and my eldest daughter who lives nearby (22).

Each of us had 60–90 minutes of treatment every day - osteopathic manipulation, cranial work, red and blue light therapy, terahertz wand, frequencies, castor oil packs, and more.

My pregnant daughter-in-law was having problems with acid reflux and carpal tunnel numbness. Michelle got rid of the former in one session, the latter took a couple. My son’s hips and ankles loosened up, and he started sleeping better. My daughter’s pelvis, inflamed from a childhood incident involving a pillowcase and a staircase (news to me), finally began to settle, and she has reported improvements to her PCOS. I also sent Goat, my bassist and who makes many of my videos, for some treatment (in exchange for filming the video below). He’s had a heavy stammer all his life, After three sessions, you can actually have a normal conversation with him.

Meanwhile, I have become an even more astounding human being.

We’re all still flawed humans, but by the end of the week everyone felt lighter, happier, and healthier, and the house had a different atmosphere.

Maybe I’m a sucker. Maybe it’s all placebo. Does it matter? I narrated a documentary once about the placebo effect: it is real. If it works, that’s all that counts, surely.

Imagine a regulator approving placebo treatment …

If you fancy a healing week with Michelle, find out more at www.healingwithmichelledavies.com. Just don’t tell the GOsC I sent you.

And if you live abroad, don’t worry: one of the reasons she has started offering these weeks is that she wants to travel more. I gather she has just been booked to go to Singapore.

Here’s the vid:

If you enjoyed this, please tell a friend.

Full disclosure: Michelle gave me a discount in exchange for helping her with above vid and for a review. I insisted the review be impartial, which it was, though if my experience had been negative, I probably wouldn’t have published it.

Until next time,

Dominic

PS Here, again, is this week’s commentary.

We worried it would come, and now it has.

The dreaded correction.

Silver and gold have been clobbered, hit for something like 6 and 9% from their highs at one point. The miners have been hit for more. GDX is down 15% from its Friday highs.

This is quite the slap down, the biggest I can remember for years.

What can I say? It was coming.

How cruel a mistress is silver! She did exactly what she needed to do to suck everyone in, even the doubters like myself: went through $50 to $54, persuaded everyone that this time it’s different, sucked them in and then slapped them down. Oh, silver!

Today we consider what to do next, and we’ll start with the big picture.

There are several possible scenarios. Here are three of them:

* That’s it. The bull market’s over. Silver reached $50, as it did it 1980 and 2011. Now it corrects, and it’ll be another decade or more before it gets there again. Batten down the hatches: we are going into another bear market. What we saw in the miners was just a 9-month relief rally, much as we got in 2016. Normal gold mining behaviour - relentless declines, in other words - will soon resume.

* You don’t understand, gold is being remonetized. This is a new paradigm. Buy the dips. We’ll be back at new highs before you know.

* Nothing goes up in a straight line, not even gold when it is re-entering the money system. Bull markets shake you off. We are going into a sideways correction that is going to last as long as a year. Possibly longer. It is going to frustrate everyone, bull and bear alike. The weak, hot money needs to be purged, the system cleansed of excess, before this thing can get going again. It’s a mid-cycle shake out.

Which of these is it?

And, most importantly of all, what do we do now?

I’m going to give you my opinions on gold, silver, the miners, and the speculative positions in which we own stock.

I’m also going to give you some target prices.

This is what I think happens next.

First, my interview with Konstantin Kisin and Francis Foster for Triggernometry has been released. Here it is on YouTube, Spotify and Apple Podcasts

Second, using a different methodology to that which I used in Secret History of Gold (have you read it yet?), I am going to estimate China’s gold reserves.

I was planning to take a look at top silver pick, Sierra Madre Gold and Silver (TSX-V:SM) today, after my meeting with CEO Alex Langer last week, but I will leave that till tomorrow now, meaning you get an extra piece this week you lucky things.

China’s Hidden Gold Empire: How Much Does Beijing Really Hold?

I regard this as one of the most important subjects in geo-politics, which is why I repeatedly come back to it.

It doesn’t matter if you issue the global reserve currency, if you don’t make anything you are in the doo-doo, and this is something the Trump administration is attempting to address with tariffs, a weaker dollar and, more subtly, the managed decline of the US dollar as global reserve currency. It’s all part of Triffin’s Dilemma. As a result, neutral gold’s role as global reserve asset is re-surging.

History’s “golden” rule will soon apply again: he who has the gold makes the rules. (If you are interested in the origins of the phrase by the way, it’s all here).

This different methodology only came to me overnight, and I don’t know what the conclusion will be yet, though I suspect it will arrive at a figure which is more conservative than what I have argued previously. Here we go.

Here, for context, are world central bank holdings, as officially stated.

My argument has long been that China has considerably more than the 2,300 tonnes it says it does.

The People’s Bank of China (PBOC), by the way, is the main custodian, but other state entities, such as China Investment Corporation (the sovereign wealth fund), State Administration of Foreign Exchange and the army also own gold.

Remember China is the world’s largest importer of gold, the largest consumer and the largest producer. it’s been that since 2007 when it overtook South Africa.

I am going to use round numbers, as they are more digestible, and when there is a spread - eg 500-1,000 tonnes, take the middle number, ie 750 tonnes.

It is impossible to know just how much gold China has imported, because so many transactions are private, particularly those which go through London, Switzerland or Dubai. The Hong Kong gold is better disclosed.

However, most - though not all - of the gold which goes to China goes through the Shanghai Gold Exchange (SGE). SGE withdrawals from 2007 to mid 2025 total 29,500-30,000 tonnes, based on aggregated data from the Shanghai Gold Exchange (SGE) and World Gold Council (WGC) reports.

However, the SGE is just a flow metric. It does not represent total consumption. Some of that gold which passes through will have been double counted, either as a result of re-selling and re-cycling, or because of China’s booming money-laundering business and the circular trade with Hong Kong. Estimates for double-counting range from 10% (World Gold Council) to 30% (analyst Koos Jansen). Let’s take the middle 20% figure - 6,000 tonnes - and that leaves us with 23,250 tonnes of SGE gold.

Undisclosed gold

The PBOC likes 400oz bars, as traded in London, and these do not trade on the SGE, which uses smaller kilo bars, 3kg or 12.5kg bars. 400oz is about 12.4kg by the way. So a lot of those London imports will not go through the SGE, and so are in addition to the numbers above.

Analysts mostly concur that, while reported imports via London, Switzerland and Dubai total 3,500-4,500 tonnes, another 2,000-3,000 tonnes (mostly post-2009, accelerating since 2022) have gone unreported.

2,500 tonnes is the middle figure, then. Add that to the 23,250 tonnes of SGE and our total is now 25,750 tonnes.

If you live in a Third World country, such as the UK, I urge you to own gold or silver. The bullion dealer I recommend is The Pure Gold Company. Pricing is competitive, quality of service is high. They deliver to the UK, the US, Canada and Europe or you can store your gold with them. More here.

Chinese gold production

Around 55% of Chinese gold production is state owned, and this century China has mined roughly 7,500 tonnes.

70-80% of Chinese production is sold through the Shanghai Gold Exchange (SGE) - so we have already counted that - the other 20-30% goes to the state.

Using estimates from the mid-range. 25% of those 7,500 tonnes, therefore - 1,875 tonnes - has gone to the state. The rest has been sold through the SGE.

Add 1,875 tonnes to the total and we are at 27,625 tonnes.

By the way, I have not included overseas Chinese gold production, of which there is a lot. Some of this product is sold on international markets and never actually reaches China. But what does reach China gets sold through the SGE and so has already been counted.

Finally, we have to add in gold held in China, whether as bullion or jewellery, prior to 2000. The World Gold Council estimates a figure of 2,500 tonnes in privately-held jewellery. Added to domestic mining and official reserves, you get a figure of around 4,000 tonnes.

This brings our grand total to 31,625 tonnes of gold in China.

Putting it all together

Previously, I have argued that 50% of that gold would go to the state. That would mean roughly 16,000 tonnes. Almost twice as much as the US’s reported 8,100 tonnes! When audit?

My thinking has changed.

Let me propose another methodology. And this has come as a result of my conversation with Konstantin (see above).

Annual gold demand last year was roughly:

* Jewellery 47%

* Investment 25%

* Central Bank 23%

* Industry 6%

This obviously varies from year to year, with investment and central bank demand being the big variables. But if we assume Chinese demand roughly matches global demand (this is an easy argument to challenge), that would mean that of the 31,625 tonnes:

* 14,864 is now jewellery

* 7,910 is now bullion held by investors

* 1,900 tonnes went into manufacturing

And, drum roll for the Big Kahuna

The Chinese government has 7,294 tonnes.

Obviously, it’s easy to make the case that since China is such a big manufacturer, Chinese industrial demand is likely to be higher than 6%. It’s also easy to make the case that, because the Chinese like gold so much, and the state has been encouraging them to invest since 2007, that both Chinese jewellery and investment demand is higher than 47% and 25% respectively.

It’s also easy to make the case that, because of de-dollarisation, PBOC demand is higher than 23%.

In any case, I have been transparent about my methodology. You can make up your own minds. You’re all grown ups.

Maybe my 20% estimate for SGE double counting is too low, for example.

Regardless, China’s stated reserves of 2,300 tonnes are laughingly lowball.

In a funny kind of way, it’s actually better for investors if China has less gold - because it means they have more buying to do and that should help drive prices higher.

Its stated 2,300 tonnes only account for 7% of its US$3.4 trillion reserves. To get above 70% and match the US, Germany, France and Italy, at $4,200/oz gold, it would need something like 18,000 tonnes. That’s a lot of buying yet to come.

Why does China understate its reserves? Softly, softly catchee monkey, and all that: we must not shine too brightly. It doesn’t want to rock the boat, particularly while it’s still accumulating.

This is where we are going, folks.

You want to own gold.

This might mark the top of the market, folks.

The BBC just invited me on to talk about the gold price.

Though it was the World Service, not BBC 1, so maybe this is just an interim top.

Here’s the interview, in case you want to listen:

Another danger sign. Jim Cramer, the world’s greatest contrarian indicator, to everyone’s surprise, is all of a sudden a “confirmed gold bug.”

Gold is at $4,000. Silver is at $49.

Many of the miners are spiking. Capital, so hard to come by for a mining company barely six months ago, is now being thrown at them. And it’s being taken. Who is going to buy all this paper in four months’ time when it comes free trading?

‘The whole population are going crazy . . . Old as well as young are daily falling victim to the gold fever.’

That was an old man in 1849 talking, quoted in the Secret History of Gold. It could just as well be now.

By the way, folks, with gold at record highs, The Secret History of Gold should surely should be the next book you read.

I must confess, folks. I am torn.

There is just too much hot money sloshing about. Everyone’s talking gold. That is usually time to take cover.

Then again, this market has the potential to go a lot higher. There is a very real chance both the silver and gold price could double before this is over. What that would do to the mining companies …

Today we offer eight reasons this market could go a lot higher.

And, in the interests of balance, we offer five reasons it is peaking right here, right now.

We will start with eight reasons it is going higher.

1. Institutional Money Is Still on the Sidelines

The investment world is under-allocated to gold. In the last bull market we reached 8% allocation. Today we are only at 2%.

Even gold ETF holdings themselves are below 2021 levels.

We are even more under-allocated to miners.

2 The 60/20/20 Revolution: Gold Gets Equal Billing with Bonds

Traditional portfolio allocation Is m hanging. It used to be 60:40 equities to bonds. But, with the generational secular bull market in government bonds now over, Morgan Stanley’s Chief Investment Officer, Mike Wilson is advocating instead for a 60/20/20 mix. Where one leads, others follow. Gold would have equal status to bonds, as it should. Funds the world over 20% allocated to gold! This one is potentially huge.

3 Bull Markets Last a Decade -We’re Only a Few Years In

1971 to 1980, 2001 to 2011. When did this one start? Late 2018? Late 2022?

We might only be three years into this one.

Higher prices beget higher prices.

4 The Debt Monster Has Barely Woken Up

This debt crisis has barely got going. Further fiat debasement is inevitable. Your pound, euro or dollar is going to buy you a lot less 10 years from now. That is INEVITABLE. It’s inherent to the system.

You don’t want to be storing your capital in fiat.

If you live in a Third World country, such as the UK, I urge you to own gold or silver. The bullion dealer I recommend is The Pure Gold Company. Pricing is competitive, quality of service is high. They deliver to the UK, the US, Canada and Europe or you can store your gold with them. More here.

That’s four strong reasons already - and we have another four to go. Followed by five warning signs we could be at the top right now.

5 Central Banks Are Re-M onetising Gold (unoffically)

With bitcoin breaking out to record highs overnight, what a good morning it is indeed.

Below is this week’s commentary in case you missed it. Gold keeps on going up. So does silver. So do miners. When does the party end?

On the subject of which here are the results of my twitter poll, which make for interesting reading.

General consensus is, as I argued, that gold is in innings 6 of 9.

But silver is only in innings one, apparently, even if breathing down the neck of $50. Gotta to love those silver bulls!

Mining too is early.

\

We shall see.

For you consideration today, I thought I would share this podcast I recorded with Aussie Josh Szeps earlier in the week, talking about everything, really.

Enjoy!

If you live in a Third World country, such as the UK, I urge you to own gold or silver. The bullion dealer I recommend is The Pure Gold Company. Pricing is competitive, quality of service is high. They deliver to the UK, the US, Canada and Europe or you can store your gold with them. More here.

Until next time,

Dominic

PS Secret History of Gold is going great guns. If you haven’t got your copy, here are links to get it on Amazon and Waterstones and all good bookshops. I hear the audiobook, read by me, is excellent.

Amazon is currently offering 20% off.

It might be, as Merryn Somerset webb says, “the best timed book" ever.

NB I have further thoughts on the Semler Scientific deal (NASDAQ:SMLR) which you can read at the end of today’s piece.

It’s hard, nigh impossible to call the top in a bull market.

If you can get out within 10% of the top, you have done very well. Most don’t.

We have been waiting a long time, but we are in a bull market now: not just for gold, but for silver, platinum and the companies that mine these precious metals.

It feels very frothy.

But is this just a rush before an interim top early in a secular bull market?

Or are we nearing the top?

Where are we in the cycle now? Which innings of nine, to use the baseball analogy?

The other day I suggested we were in innings six - for gold at least. I got a lot of stick for saying that, which probably means I’m right.

But I put some polls up on my various WhatsApp chats and the general consensus was 6 for the metal, 3 for the miners.

I also have this poll running on X, so you can see current consensus. It’s far from conclusive.

It’s important to remember that a bull market in gold and a bull market in gold mining companies are not one and the same. Of course, there is a lot of crossover between the two, but it is possible to have one without the other.

From 2022 to 2024, for example, as gold climbed, mining stocks were largely flat or falling. The reverse can also happen. Gold can be going nowhere, while mining stocks can rise. In fact, this is not uncommon, because when gold is flat and volatility disappears, investors get a clearer idea of what the price of the final product is going to be, what the profitability of a mine will be, and that security can enable investment to flow.

As you know I have a target of $7,000 gold by the end of this decade, maybe even $10,000 if we get a proper blow-off top.

If you live in a Third World country, such as the UK, I urge you to own gold or silver. The bullion dealer I recommend is The Pure Gold Company. Pricing is competitive, quality of service is high. They deliver to the UK, the US, Canada and Europe or you can store your gold with them. More here.

We’re closing in now on $4,000. But just because I have a target of $7,000 gold doesn’t mean we will get there. Anything but.

Another target I’m looking for is for central banks around the world to hold roughly 40% of their reserves in gold. We’re currently just above 25%. We were at 20% barely a year ago. A combination of higher gold prices and increased reserves through accumulation will mean we get to 40% pretty quickly.

Central banks’ total gold holdings are currently 36,000 tonnes, according to the ECB. For some context, all the gold that has ever been mined - and of course still exists - amounts to 216,000 tonnes. 36,000 tonnes is quite the share.

Central banks are currently accumulating at a rate of 1,000 tonnes per year, says Reuters, which has been the case since 2022 and the freezing of Russian US dollar assets. Annual gold supply is 3,600 tonnes or thereabouts. Given that half of that is taken up with jewellery, that doesn’t leave a lot left over for everyone else (only about 800 tonnes - hence this bull market).

Central bank holdings have already overtaken US debt, as you can see from the chart above, and the euro. Next stop is to exceed their US dollar holdings (currently 48%). We’ll get there soon enough, as they accumulate gold, the gold price rises and the relative value of the US dollar holdings recedes.

$7,000 gold would take us there near enough.

Another target is a Dow-to-gold ratio well below 10, perhaps at 5 where it reached in 2011. (Some have a target below 2 for this one, as we saw in 1929 and 1980, which would mean a gold price in the tens of thousands. Unlikely, I would have thought, but not impossible: it has happened before).

With the Dow currently at 46,400, and gold at $3,900 we are currently at 12.

Note that the gold to oil ratio has never been this low ever, barring the insanity of Covid when oil went negative. Does that make oil a buy and gold a sell? Probably.

This is a key reason mining companies are starting to do so well. Energy is their biggest input cost. Gold is their output. If they can’t make money now, they won’t ever make money.

I have lived through a long and painful bear market for mining. It began in 2011. It’s been over a decade, with brief respites in 2016 and 2020, almost relentlessly down. It’s made me extremely cynical. Maybe I’ve got too much recency bias.

But the HUI, the index of unhedged gold producers, is butting up against its old 2011 highs, rather like silver, which we will come to in a moment. I know this chart is not adjusted for inflation, but even so it is a concern. Then again, if it goes through, there is no overhead resistance. It would be a proper, mega breakout.

Either way, these last few months have been nuts.

I remain of the view that for gold, the metal, as I said the other day, we’re in innings six. Mining I’m not so sure.

I stole these pictures from Winston Miles of Stifel Wealth Management. They were taken at the Denver Gold Show a few weeks ago. The place is dead. That is not end-of-a-bull-market behaviour

“There were hardly any new generalist investors” he says. “Zero retail, everyone was a specialist, and occupancy at the main stage was literally 10% full for most of the presentations.”

Then again the Munich gold show - Edelmetallmesse, which ran from 2006 but ended in 2019 with the bear market effectively putting it out of business - is reopening this year and something like 120 mining companies have signed up to attend. That’s quite the reversal.

It’s because mining companies are finding investment again. That means they’re issuing paper. Will there be buyers for it?

Capital is flowing. Share prices are multiplying in some cases. Animal spirits are high.

So many contradictions and mixed signals. Such is the bull market wall of worry. What to do? What to do?

I have a short announcement today, one I’m very excited about, as this week’s thought piece.

Please feel free to comment, share, or get in touch if it sparks your interest.

Thank you for being a subscriber to the Flying Frisby.

Until next time,

Dominic

Here, ICYMI, is the week’s commentary:

Before we begin today’s piece, let me flag this video I made based on my recent article about Triffin’s Dilemma. 13 mins long and hopefully worth the effort. Might be the most important thing you watch this week.

With all the narratives that come with a gold bull market - and also a bitcoin bull market - that we're heading to some kind of money reset, the dollar or the pound is going to collapse, we are going to end up on a gold or bitcoin standard and so on - you have an end goal. The bull market will continue until we reach that eventuality.

However, I doubt very much we go back to a gold standard. Yes, gold's role as reserve asset increases, ditto bitcoin, but I don't see a return to the gold standards of the 19th or 20th century. Much more likely is a Hayekian world of competing currencies.

The 20th century gold standards were bogus anyway - which is why they failed. There was no gold in circulation. Americans weren't allowed to own it. When Britain returned to a gold standard in 1925, the British government ensured there was little gold actually circulating. It minted zero gold coins, while the Bank of England hoarded what it already had. ( It's all in the book, if you're interested).

The Secret History of Gold is available to at Amazon, Waterstones and all good bookshops. I hear the audiobook, read by me, is excellent. Amazon is currently offering 20% off.

There was plenty of gold in circulation under the gold standards of the 19th century, but we are not going back to them because we barely use physical cash any more. We are not going to pay for physical things with gold or silver coins in the way we once did.

It might be that China gives the yuan some gold backing, and makes its (digital) notes interchangeable with gold, but I find that unlikely. It might also be that gold backing is used to make US Treasuries more attractive, as economist Judy Shelton, former advisor to Donald Trump, has proposed.

Again, though possible, I would give it a low probability.

The gold bull markets of the 1970s and 2000s did not end with gold standards. I doubt this one will. A gold standard is a political ideal. Real life is a lot more mucky.

Unlike gold, gold bull markets do not last forever, any more than tech or any other kind of bull markets do.

And this bull market is getting hot. That's for sure. Gold is at $3,700/oz. While the mainstream press are not really covering it, there has been a definite change in tone online. Silver is starting to lead. Gold miners are starting to deliver.

Towards the end of previous gold bull markets, I usually get invited on to the BBC to talk about gold. Massive name drop, I was actually fraternising with BBC Director General, Tim Davie, this week - enough to get a selfie at least - but I am currently so far from being invited on to the BBC, whether for my satirical songs or for my market commentary - even with a new book on gold just out - that I believe we are a way from that.

(In another age, I would have been a fixture on BBC radio. I have got the voice. I have got the intellect. But obviously, wrong age, wrong sex, wrong colour and all of that. Wrong views too).

Anyway, back to more important matters.

Things got hot and spicy with gold in the spring, as we warned, not unlike now. But we didn't feel it was the top. We just needed to go sideways for a few months, which we have.

With physical gold, especially if you live in a Third World country like the UK, there is a strong argument never to sell. Even during gold's bear market (2011-2020), gold was a brilliant hedge against woeful sterling.

If you buying gold or silver to protect yourself in these “interesting times” - and I urge you to - as always I recommend The Pure Gold Company. Pricing is competitive, quality of service is high. They deliver to the UK, the US, Canada and Europe or you can store your gold with them. More here.

You could just hold your gold and then pass it on to your heirs. Bitcoin's the same. But then again you might want the money for something else.

In the 1970s gold went from $35/oz (an artificially low price due to US suppression) all the way to $850/oz.

But that $850 mark was just as much an illusory price. Though it has been logged in people's minds for decades ever since, the reality is it reached that price during one spike on one afternoon. The Cold War was looking grim: the Soviet Union had just invaded Afghanistan a month before. The Iranian hostage crisis was making everyone panic (the hostages were released the day before the spike). It was the day after US President Ronald Reagan had been inaugurated. Nobody yet knew what a success he was going to be. There was an ongoing and severe crisis in the US bond markets, which had sent interest rates above 10%.

In other words, there was a lot going on. And yet gold only hit $850 for an afternoon. Hardly anyone sold the top of that spike.

The launch to $850 gold began in December 1979 with that Soviet invasion. Gold broke above $450. The day after the spike, gold collapsed like a stone. By March it was below $500.

Gold then did something you commonly see at the end of bull markets. The Nasdaq did something similar in 2000. Silver did it in 2011. It rallied. That rally persuaded people the bull market was still on. It was a suckers’ rally.

But the retest did not even make it back to the old high. It was a lower high, in other words.

Then the relentless declines kicked in. By 1982 - 18 months later - gold was at $300/oz. It then spent the next 20 years - 20 years! - trading between $300 and $400, before eventually hitting a low in 1999 at $250/oz, when Gordon Brown sold. Idiot.

My point is that in 1980 it looked to some like a return to gold standards was coming. The US had only abandoned gold 9 years earlier - and, in President Nixon's words, temporarily. Gold was still normal in people's minds. But the gold standard never came and gold was a rotten investment for 20 years.

2011, by the way, was not of 1980 standards but the price still shot from $1,500 to $1,920 in a couple of months with the Greek debt crisis. There followed another gruesome bear market which saw gold go all the way back to $1,050.

There is so much anti-dollar sentiment out there now, it might be that everything turns on its head - as things are wont to do - and we get a dollar rally.

I recognise that things are looking frothy. Anytime silver starts doing well, that is usually a warning sign.

A lot of American commentators like to use the baseball analogy. I would suggest maybe we are in inning six of nine. Something like that, possibly.

So when to sell?

However, I do not buy this narrative that she took bad advice. She's no different to the rest of us. She doesn't like paying tax. She wants to minimize what she has to pay.

I've taken advice many times on all matter of subjects. We all have. Often I've been given advice I didn't want to hear - and as a result I've chosen to ignore it. Instead, I've listened to the advice that was what I wanted to hear, even if it was bad.

Trying to fob this off on bad advice is both disingenuous and a deferral of responsibility.

We all know what is or isn't going to be our main home. It's only when confronted with the option of paying £70,000 or £30,000 that we start mentally to fudge things and get into grey areas and legal niceties.

Of course, she knew she had to pay the full £70,000. But like anyone faced with an OTT £70 grand tax bill, she's thinking "Shoot, that's a lot of money. I don't want to pay that." I don't blame her for thinking that. The reason most people in this country who would otherwise be moving are not is that same cost of Stamp Duty.

It's patently an awful tax. It punishes people for moving, and so creates immobility. It gums up the housing market. It gets in the way of all the knock-on economic activity that stems from people moving. It taxes transactions not wealth: two people with identical houses pay totally different amounts of tax depending purely on whether they've just moved. It hurts the young and mobile most. It disincentivises downsizing. And on and on and on.

Now this "house tax" has undone, of all people, the Housing Minister. Surely that in itself should tell the powers that be that it needs doing away with, as, more generally, the complexities of almost all UK taxes. But there is no chance of that happening, and Chancellor Rachel Reeves and those who advise her will go on wondering why they can't get Britain's economy moving.

If you are buying gold or silver to protect yourself in these “interesting times” - and I urge you to the way things are going - my recommended bullion dealer is The Pure Gold Company. Pricing is competitive, quality of service is high. They deliver to the UK, the US, Canada and Europe or you can store your gold with them. More here.

I used to go out with a tax lawyer once upon a time and she would always say, “Don’t try and evade taxes. It’s not worth the agro”. Here we have a case in point. Now Rayner not only has to pay the full amount, plus fines, she has lost her job and a large chunk of the income by which she would pay it with the result that, not only has trying to dodge forty grand cost her her career, she might lose her new flat to it as well. And - do you know what? - given the way the housing market is going, because, in part, of Stamp Duty, I bet she won't find a buyer who'll pay the £800 grand she paid for it.

After all the times she has called out others for not paying taxes, and nastily, there is a lot of karma here. Whatever. The more important message is that for umpteen reasons Stamp Duty needs abolishing.

Until next time,

Dominic

PS If you missed my midweek commentary here it is:

PPS And if you haven’t yet bought my book, WTF?!

The Secret History of Gold is available to at Amazon, Waterstones and all good bookshops. I hear the audiobook, read by me, is excellent.

Amazon is currently offering 20% off.

It had a great review in Moneyweek this week from Dr Matthew Partridge - “this book is destined to become a classic that should be at the top of your reading list.” You can read that review here.

“Gold will be slave or master”Horace

In 2021, a metal detectorist with the eyebrow-raising name of Ole Ginnerup Schytz dug up a hoard of Viking gold in a field in Denmark. The gold was just as it was when it was buried 1,500 years before, if a little dirtier. The same goes for the jewellery unearthed at the Varna Necropolis in Bulgaria in 1972. The beads, bracelets, rings and necklaces are as good as when they were buried 6,700 years ago.

In the Egyptian Museum in Cairo, there is a golden tooth bridge — a gold wire used to bind teeth and dental implants — made over 4,000 years ago. It could go in your mouth today.

No other substance is as long-lasting as gold — not diamonds, not tungsten carbide, not boron nitride. Gold does not corrode; it does not tarnish or decay; it does not break down over time. This sets it apart from every other substance. Iron rusts, wood rots, silver tarnishes. Gold never changes. Left alone, it stays itself. And it never loses its shine — how about that?

Despite its permanence, you can shape this enormously ductile metal into pretty much anything. An ounce of gold can be stretched into a wire 50 miles long or plate a copper wire 1,000 miles long. It can be beaten into a leaf just one atom thick. Yet there is one thing you cannot do and that is destroy it. Life may be temporary, but gold is permanent. It really is forever.

This means that all the gold that has ever been mined, estimated to be 216,000 tonnes, still exists somewhere. Put together it would fit into a cube with 22-metre sides. Visualise a square building seven storeys high — and that would be all the gold ever.

With some effort, you can dissolve gold in certain chemical solutions, alloy it with other metals, or even vaporise it. But the gold will always be there. It is theoretically possible to destroy gold through nuclear reactions and other such extreme methods, but in practical terms, gold is indestructible. It is the closest thing we have on earth to immortality.

Perhaps that is why almost every ancient culture we know of associated gold with the eternal. The Egyptians believed the flesh of gods was made of gold, and that it gave you safe passage into the afterlife. In Greek myth, the Golden Apples of the Hesperides, which Hercules was sent to retrieve, conferred immortality on whoever ate them. The South Americans saw gold as the link between humanity and the cosmos. They were not far wrong.

Gold was present in the dust that formed the solar system. It sits in the earth’s crust today, just as it did when our planet was formed some 4.6 billion years ago. That little bit of gold you may be wearing on your finger or around your neck is actually older than the earth itself. In fact, it is older than the solar system. To touch gold is as close as you will ever come to touching eternity.

And yet the world’s most famous investor is not impressed.

‘It gets dug out of the ground in Africa, or some place,’ said Warren Buffett. ‘Then we melt it down, dig another hole, bury it again and pay people to stand around guarding it. It has no utility. Anyone watching from Mars would be scratching their head.’

He’s right. Gold does nothing. It does not even pay a yield. It just sits there inert. We use other metals to construct things, cut things or conduct things, but gold’s industrial uses are minimal. It is a good conductor of electricity, but copper and silver are better and cheaper. It has some use in dentistry, medical applications and nanotechnology. It is finding more and more use in outer space — back whence it came — where it is used to coat spacecraft, astronauts’ visors and heat shields. But, in the grand scheme of things, these uses are paltry.

Gold’s only purpose is to store and display prosperity. It is dense and tangible wealth: pure money.

Though you may not realise it, we still use gold as money today. Not so much as a medium to exchange value but store it.

In 1970, about 27 per cent of all the gold in the world was in the form of gold coinage and central bank or government reserves. Today, even with the gold standard long since dead, the percentage is about the same.

The most powerful nation on earth, the United States, keeps 70 per cent of its foreign exchange holdings in gold. Its great rival, China, is both the world’s largest producer and the world’s largest importer. It has built up reserves that, as we shall discover, are likely as great as the USA’s.

If you buying gold or silver coins to protect yourself in these “interesting times” - and I urge you to - as always I recommend The Pure Gold Company. Pricing is competitive, quality of service is high. They deliver to the UK, the US, Canada and Europe or you can store your gold with them. More here.

Ordinary people and institutions the world over use gold to store wealth. Across myriad cultures gold is gifted at landmark life events — births and weddings — because of its intrinsic value.

In fact, gold’s purchasing power has increased over the millennia, as human beings have grown more productive. The same ounce of gold said by economic historians to have bought King Nebuchadnezzar of Babylon 350 loaves of bread could buy you more than 1,000 loaves today. The same gold dinar (roughly 1/7 oz) that, in the time of the Koran in the seventh century, bought you a lamb would buy you three lambs today. Those same four or five aurei (1 oz) which bought you a fine linen tunic in ancient Rome would buy you considerably more clothing today.

In 1972, 0.07 ounces of gold would buy you a barrel of oil. Here we are in 2024 and a barrel of oil costs 0.02 ounces of gold — it’s significantly cheaper than it was fifty years ago.

House prices, too, if you measure them in gold, have stayed constant. It is only when they are measured in fiat currency that they have appreciated so relentlessly (and destructively).

In other words, an ounce of gold buys you as much, and sometimes more, food, clothing, energy and shelter as it did ten years ago, a hundred years ago or even thousands of years ago. As gold lasts, so does its purchasing power. You cannot say the same about modern national currencies.

Rare and expensive to mine, the supply of gold is constrained. This is in stark contrast to modern money — electronic, debt-based fiat money to give it its full name — the supply of which multiplies every year as governments spend and borrowing balloons.

As if by Natural Law, gold supply has increased at the same rate as the global population — roughly 2 per cent per annum. The population of the world has slightly more than doubled since 1850. So has gold supply. The correlation has held for centuries, except for one fifty-year period during the gold rushes of the late nineteenth century, when gold supply per capita increased.

Gold has the added attraction of being beautiful. It shines and glistens and sparkles. It captivates and allures. The word ‘gold’ derives from the Sanskrit ‘jval’, meaning ‘to shine’. That’s why we use it as jewellery — to show off our wealth and success, as well as to store it. Indeed, in nomadic prehistory, and still in parts of the world today, carrying your wealth on your person as jewellery was the safest way to keep it.

The universe has given us this captivatingly beautiful, dense, inert, malleable, scarce, useless and permanent substance whose only use is to be money. To quote historian Peter Bernstein, ‘nothing is as useless and useful all at the same time’.

But after thousands of years of gold being official money, in the early twentieth century there was a seismic shift. Neither the British, German nor French government had enough gold to pay for the First World War. They abandoned gold backing to print the money they needed. In the inter-war years, nations briefly attempted a return to gold standards, but they failed. The two prevailing monetary theories clashed: gold-backed versus state-issued currency. Gold standard advocates, such as Montagu Norman, Governor of the Bank of England, considered gold to be one of the key pillars of a free society along with property rights and habeas corpus. ‘We have gold because we cannot trust governments,’ said President Herbert Hoover in 1933. This was a sentiment echoed by one of the founders of the London School of Economics, George Bernard Shaw — to whom I am grateful for demonstrating that it is possible to have a career as both a comedian and a financial writer. ‘You have to choose (as a voter),’ he said, ‘between trusting to the natural stability of gold and the natural stability of the honesty and intelligence of the members of the Government… I advise you, as long as the Capitalist system lasts, to vote for gold.’

On the other hand, many, such as economist John Maynard Keynes, advocated the idea of fiat currency to give government greater control over the economy and the ability to manipulate the money supply. Keynes put fixation with gold in the Freudian realms of sex and religion. The gold standard, he famously said after the First World War — and rightly, as it turned out — was ‘already a barbarous relic’. Freud himself related fascination with gold to the erotic fantasies and interests of early childhood.

Needless to say, Keynes and fiat money prevailed. By the end of the 1930s, most of Europe had left the gold standard. The US followed, but not completely until 1971, in order to meet the ballooning costs of its welfare system and its war in Vietnam.

But compare both gold’s universality (everyone everywhere knows gold has value) and its purchasing power to national currencies and you have to wonder why we don’t use it officially today. There is a very good reason: power.

Sticking to the discipline of the gold standard means governments can’t just create money or run deficits to the same extent. Instead, they have to rein in their spending, which they are not prepared to do, especially in the twenty-first century, when they make so many promises to win elections. Balanced books, let alone independent money, have become an impossibility. If you seek an answer as to why the state has grown so large in the West, look no further than our system of money. When one body in a society has the power to create money at no cost to itself, it is inevitable that that body will grow disproportionately large. So it is in the twenty-first century, where state spending in many social democracies is now not far off 50 per cent of GDP, sometimes higher.

Many arguments about gold will quickly slide into a political argument about the role of government. It is a deeply political metal. Those who favour gold tend to favour small government, free markets and individual responsibility. I count myself in that camp. Those who dismiss it tend to favour large government and state planning.

I have argued many times that money is the blood of a society. It must be healthy. So much starts with money: values, morals, behaviour, ambitions, manners, even family size. Money must be sound and true. At the moment it is neither. Gold, however, is both. ‘Because gold is honest money it is disliked by dishonest men,’ said former Republican Congressman Ron Paul. As Dorothy is advised in The Wizard of Oz (which was, as we shall discover, part allegory), maybe the time has come to once again ‘follow the yellow brick road’.

On the other hand, maybe the twilight of gold has arrived, as Niall Ferguson argued in his history of debt and money, The Cash Nexus. Gold’s future, he said, is ‘mainly as jewellery’ or ‘in parts of the world with primitive or unstable monetary and financial systems’. Gold may have been money for 5,000 years, or even 10,000 years, but so was the horse a means of transport, and then along came the motor car.

A history of gold is inevitably a history of money, but it is also a history of greed, obsession and ambition. Gold is beautiful. Gold is compelling. It is wealth in its purest, most distilled form. ‘Gold is a child of Zeus,’ runs the ancient Greek lyric. ‘Neither moth nor rust devoureth it; but the mind of man is devoured by this supreme possession.’ Perhaps that’s why Thomas Edison said gold was ‘an invention of Satan’. Wealth, and all the emotions that come with it, can do strange things to people.

Gold has led people to do the most brilliant, the most brave, the most inventive, the most innovative and the most terrible things. ‘More men have been knocked off balance by gold than by love,’ runs the saying, usually attributed to Benjamin Disraeli. Where gold is concerned, emotion, not logic, prevails. Even in today’s markets it is a speculative asset whose price is driven by greed and fear, not by fundamental production numbers.

Its gleam has drawn man across oceans, across continents and into the unknown. It lured Jason and the Argonauts, Alexander the Great, numerous Caesars, da Gama, Cortés, Pizarro and Raleigh. Brilliant new civilisations have emerged as a result of the quest for gold, yet so have slavery, war, deceit, death and devastation. Describing the gold mines of ancient Egypt, the historian Diodorus Siculus wrote, ‘there is absolutely no consideration nor relaxation for sick or maimed, for aged man or weak woman. All are forced to labour at their tasks until they die, worn out by misery amid their toil.’ His description could apply to many an illegal mine in Africa today.

The English critic John Ruskin told a story of a man who boarded a ship with all his money: a bag of gold coins. Several days into the voyage a terrible storm blew up. ‘Abandon ship!’ came the cry. The man strapped his bag around his waist and jumped overboard, only to sink to the bottom of the sea. ‘Now,’ asked Ruskin, ‘as he was sinking — had he the gold? Or had the gold him?’

As the Chinese proverb goes, ‘The miser does not own the gold; the gold owns the miser.’

Gold may be a dead metal. Inert, unchanging and lifeless. But its hold over humanity never relents. It has adorned us since before the dawn of civilisation and, as money, underpinned economies ever since. Desire for it has driven mankind forwards, the prime impulse for quest and conquest, for exploration and discovery. From its origins in the hearts of dying stars to its quiet presence today beneath the machinery of modern finance, gold has seen it all. How many secrets does this silent witness keep? This book tells the story of gold. It unveils the schemes, intrigues and forces that have shaped our world in the relentless pursuit of this ancient asset, which, even in this digital age, still wields immense power.

That was Chapter One of The Secret History of Gold

The Secret History of Gold is available to pre-order at Amazon, Waterstones and all good bookshops. I hear the audiobook, read by me, is excellent. The book comes out on August 28.

Hurry! Amazon is currently offering 20% off.

Until next time,

Dominic

There is a shift of enormously significant proportions taking place. In magnitude it will prove as significant as Bretton Woods in 1944, when the dollar became the de facto global reserve currency, and the Nixon Shock of 1971, when the US abandoned the last vestiges of its gold standard.

This shift is going to shape the global financial landscape over the next few years. You need to understand what is happening, so that you can position yourself and your family.

You may even be able to profit handsomely from the transition.

Today we explain US dollar policy: what is going on and, more importantly, where it is all going.

Ready? Here goes.

The Manufacturing Imperative and The Curse of the Reserve Currency

America wants to bring manufacturing back on shore. We all know this. US President Donald Trump has said it repeatedly, his VP JD Vance has said it, and so has his Treasury Secretary Scott Bessent, who keeps reminding us that it is now time to prioritise Main Street over Wall Street.

Part of the reshoring of US manufacturing involves tariffs, as we know all too well. Part of it involves weakening the US dollar to make US exports more competitive. Again Trump, Vance and Bessent have all said it.

However, there is a problem, and that problem has a name: Triffin's Dilemma.

You might think it's an advantage to issue the global reserve currency. You can issue dollars. Everyone else has to work for them. The French called it "America's exorbitant privilege." But this was a status the US engineered for itself during the Bretton Woods Agreement that determined the monetary order at the end of World War Two.

What has happened, however, is that it has made the US fat and lazy, especially since 1971 when the US abandoned the ties of the dollar to gold.

To supply the world with dollars, the US must run trade deficits. That is to say it must buy more than it sells. Persistent trade deficits have, over time, eroded its industrial base. Factories and jobs have gone offshore. Foreign nations have used their profits to invest in US capital markets and its debt. Meanwhile financial markets - aka Wall Street - have grown and grown, as America financialized.

The Trump administration gets it in a way its predecessors did not. Vance has actually called the dollar's reserve status a "tax" on American producers.

What's more, as this process has continued, the credibility of the dollar itself is being called further into doubt.

Trump wants to revitalise America's Rust Belt. But there is more to it than that. As the curtains pulled back with Covid, the extent to which the US has been operating with its trousers down was exposed: an excessive dependence on China and its supply chains for too many strategically essential products, especially related to health, tech and the military.

Then, during the Ukraine conflict, NATO found itself unable to match Russian production. The US, in short, is struggling to produce critical goods. It's why Trump keeps harping on about rare earth metals. It is vulnerable.

The answer is to engineer a "managed decline" of the dollar as global reserve asset.

The Golden Exit Strategy

This was already happening organically. China, for example, has been reducing its holdings of US treasuries for ten years now - quite gradually - although its US dollar holdings remain above $3 trillion.

Meanwhile, China - and many other countries along the Silk Road besides - have been increasing their gold holdings, and quite dramatically. (In my view China has at least four times as much gold as it says it does. You can read more on this in my book). The process is known as de-dollarisation. Just a few months ago gold overtook the euro to become the second most held asset by central banks, while the dollar itself fell beneath 50% for the first time this century.

We are not seeing a move towards any other national currency as global reserve, but towards the neutral but universal asset that is gold, as analyst Luke Groman points out. That suits all the main players. Gold is neutral, and both the US (supposedly) and China have lots of it.

Indeed, a gold revaluation would be a "win-win" for both. A higher gold price would strengthen US fiscal flexibility while boosting Chinese consumers' wealth, encouraging domestic consumption and reducing trade imbalances.

There is the potential to leverage the US's 261 million ounces (8,133 tonnes) of gold reserves, currently marked to market at just $42/oz. There are two ways this might be done. Economist Judy Shelton has proposed issuing Treasuries that are in part backed by gold to offset the inflation/debasement risk to make them more attractive to buyers. The other possibility (which has gone from, as Bessent put it, "we are not doing this" to "we are not doing this yet") is to revalue the gold from $42 to the current price of $3,300/oz, which would create over $850 billion of reserves without having to incur any extra debt. That would help with the US's current fiscal challenges: true interest expenses (including entitlements and veterans' affairs) currently exceed 100% of Treasury receipts.

If you buying gold or silver coins to protect yourself in these “interesting times” - and I urge you to - as always I recommend The Pure Gold Company. Pricing is competitive, quality of service is high. They deliver to the UK, the US, Canada and Europe or you can store your gold with them. More here.

In short, the US administration is leaning into a weaker dollar and neutral reserve assets like gold to rebalance trade and rebuild domestic industry, even at the cost of short-term economic pain.

Your really should subscribe.

Bitcoin's Digital Advantage and The Stablecoin Bridge

Bitcoin, as the world's best neutral digital currency, is going to have a role to play in all of this as well.

The US is quite happy with that, as evidenced by its pro-bitcoin rhetoric. At the national, corporate and individual levels the US has a lot of bitcoin. The US itself has 198,000 coins, the most of any nation, Strategy (NYSE:MSTR) has 630,000 and many other companies besides also hold, and at least 15% of US citizens own bitcoin. Of the eventual 21 million supply, of which probably 15% has been lost and another 1.3 million are locked up by Satoshi Nakamoto and will likely never appear (he is almost certainly dead), the US has a hefty chunk.

Which brings us to the recent Genius Act. This effectively nixed CBDCs just as the EU's Christine Lagarde was planning to phase them in (LOL). However, it supported stablecoins (that is coins backed by dollars). The more bitcoin grows the more the stablecoin market will grow. As the stable coin market grows so will its demand for treasuries. Today, roughly half the entire US dollar stablecoin market, estimated at $250 billion, is invested in US treasuries (maybe 2% of the overall treasuries market). Tether is the world's 7th largest buyer.

The market is small, but growing rapidly. 2035 projections include $500 billion (J.P.Morgan's projection) to $2 trillion (Standard Chartered) and $4 trillion (Bernstein) by 2035.

"If the stablecoin market meets these growth projections," says the Kansas City Fed, "it could lead to a substantial redistribution of funds within the financial system."

In other words the stablecoin market is going to help the US fund its debt, just as other nations move away from treasuries to gold and bitcoin.

Gold might suit the US, but bitcoin suits it better, especially if there are complications surrounding the Fort Knox gold, which it seems there are. Why no audit yet?

Tell people about this.

Gold vs Bitcoin, Analogue vs Digital: The Coming Showdown

It's likely a few years from now there is going to be some sort of showdown between gold and bitcoin in the battle for primary reserve asset status. It's unlikely to be both. Governments will favour gold, as they have lots of it. Tradition is on their side. Eternal gold has a track record that is unrivalled. But it is an analogue asset in a digital world. Bitcoin is much more practical. Which will win out? Practical digital or impractical analogue?

This is a contest that is still a way off. For now all roads lead to gold and bitcoin as the world de-dollarizes.

Own both is what I say.

Needless to say the UK is absolutely clueless in all of this, having sold two-thirds of its gold in 1999, made it near impossible for UK citizens to buy bitcoin, now planning to sell its bitcoin holdings, now the largest holder of US treasuries in the world after Japan and making no attempt to buy any gold.

With the threat of AI and automation to America's jobs - especially in driving where millions work - there is the risk of mass unemployment coming quite quickly, and with it plentiful defaults on mortgages and loans. This could force the U.S. to print money, driving inflation and providing yet another reason to own gold and bitcoin, which cannot be debased.

From October 8th, UK citizens will finally be able to buy bitcoin ETNs.

I was lucky enough over the weekend to find myself as a house guest under the same roof as Interactive Investor CEO Richard Wilson. We talked a lot. He knows how landmark the date October 8th is for UK investors and has made sure II are well positioned in a way that other brokerages are not. You might not be able to buy the US ETFs due to FCA nonsense, but anything listed in the UK will be available. So if you don't already have an account at II you might do well to open an account now. Click this link and the first year is free.

In short, the dollar will weaken significantly over the next three years. The pound is a basket case. National currencies are not stores of wealth. Gold and bitcoin are. Own both as the Trump administration addresses Triffin's Dilemma through a managed dollar decline. They will use gold and potentially bitcoin to restore US industrial and military strength.

You have been warned.

Tell people about this post.

Watch your inboxes. Tomorrow I’ll be putting out a 15-minute film all about gold called The Eternal Metal. On which note, The Secret History of Gold is out now. Got yours yet?

The Secret History of Gold is available at Amazon, Waterstones and all good bookshops.

Amazon is currently offering 20% off.

Watch the video version of this article here:

We are now into launch week, so lots to promote: Secret History of Gold Fever

This week I’ve been in interview mode

* Above we have me telling Ian Collins on Talk TV how rubbish the government is.

* Here is me talking to Tom Winnifrith

* Here James Delingpole.

I have been working on a short film as well, which I hope to have ready for tomorrow.

The book also had its first review - in the Telegraph.

Here is what people have said so far

“A fabulous, fascinating, fantastical tale” Matt Ridley, author of How Innovation Works

”It doesn’t just tell you about gold – it makes you feel its weight through history. It’s just so interesting," Toby Young, Spectator

”Written with both insight and Dominic’s signature humour, this is essential reading for anyone who wants to understand the lengths human beings will go to for the promise of riches,” Rory Sutherland, author of Alchemy.

“This delightful book is a most insightful and enjoyable romp through history and a well-researched, educational tour de force,” James Turk, author of The Money Bubble

”Dominic Frisby’s writings about economics and finance are, like his comedy, intelligent, beautifully crafted and always ahead of the curve. The Secret History of Gold is well-informed, utterly coherent and very, VERY timely.” Liam Halligan, Telegraph

“Dominic Frisby is most trusted source of information for anything to do with gold,” Konstantin Kisin, Triggernometry

”Well-researched and razor-sharp. Written with passion, principle - and the occasional punchline,” Al Murray, comedian and historian

”Possibly the best-timed book ever,” Merryn Somerset Webb, Bloomberg

“A brilliant, highly readable guide to the most alluring material of all,” Luke Johnson, investor and entrepreneur.

"Understand the history of gold, and you start to see what politicians and central banks would rather you didn’t. Dominic reveals all with clarity and force,” Rob Dix , author of The Price of Money.

“Frisby entertains impressively and convincingly … his tales of German and Japanese gold-hunting during the Second World War are eye-popping … a colourful and sly adversary to contemporary financial and political pieties,” Simon Ings, the Telegraph

The Secret History of Gold is available at Amazon, Waterstones and all good bookshops. The book comes out on August 28.

Amazon is currently offering 20% off.

Until next time,

Dominic

“I'm Henry the Eighth, I am!Henry the Eighth, I am, I am!”Fred Murray and R. P. Weston

History has given Henry VIII mixed reviews.

Never mind the wife-killing, he was the king who boldly stood up to papal supremacy, paving the way for freedom, Reformation and the buccaneering spirit which marked the Tudor age. That said, I doubt Henry knew at the time what the long-term consequences of his papal stand-off would be.

His Great Debasement, however, must be one of the greatest inflationary thefts by a ruler on their people in British history. Even William Pitt pales in comparison. Never speak ill of the dead and all that, but extravagant (and not in a good way), power-mad, and hypocritical are all adjectives that spring to mind about Henry VIII.

Historian Simon Sebag Montefiore goes further, declaring him egotistical, paranoid and tyrannical, and listing him as one of History's 101 Monsters, alongside Vlad the Impaler and Adolf Hitler.

How prosperity ended serfdom

When Henry VIII was crowned king in 1509, the national finances were in rare good shape. His predecessor Henry VII had broken the mould of mediaeval English monarchs. Rather than wage war, he avoided it. His reign saw just one overseas conflict. He pursued marriages and alliances overseas instead. He had a formidable business brain: rather than resist economic change and new technology, he encouraged it - and then taxed it. In doing so, he built up extraordinary wealth for the Crown. He became the first English king for centuries to run a surplus. Imagine! His taxation and legislation of the nobility ended the power of the barons and, effectively, feudalism itself, while establishing the freedom of the mercantile classes to trade. England got its first blast furnace, and so began its iron industry. The wool trade blossomed, and the farming of sheep accelerated the decline of serfdom (land no longer needed working in the same way), and the country was changing to a money- rather than land-based economy.

Henry VII also had new coins issued to ensure a standard currency. Weights and measures were also standardised (though not for the first nor the last time).

Things however changed with his son, Henry VIII - and rapidly. One of Henry VIII’s first acts, two days after his coronation, was to arrest the two men responsible for collecting his father’s taxes, Sir Richard Empson and Edmund Dudley. He charged them with high treason and they were duly executed. Today’s HMRC officers don’t know how lucky they are.

War is an expensive business, when you lose.

Not a man known for his humility, he was happy to usher in the idea that kings had Divine Right, an issue that, 100 years later, would cause a civil war and the death of 200,000 people. Never mind his Great Debasement, which we will come to in a moment, the idea that a king was appointed by God and had Divine Right must be another of the greatest frauds perpetrated on a nation by its rulers. Anyone who dissented was treasonous or heretical, often executed without formal trial - or simply banished.

He got involved in numerous costly and largely unsuccessful wars both on the continent and up north in Scotland. War is an expensive business when you lose. These, coupled with a personal extravagance that people are still talking about, meant he was constantly on the verge of financial ruin.

To pay for it all he introduced numerous new taxes, including a tax on beards, which, given his own facial hair, has to go down as one of the ruling classes’ great do-as-I-say-not-as-I-do moments. In 1523 he demanded 20% of people’s income. (20% seems like a pipe dream today). He sold crown land, dissolved monasteries, and seized the assets of over 800 religious houses—land, gold, silver, everything—under the guise of reforming the church and rooting out corruption. Any money paid to Rome and the Pope was “redirected” to the royal coffers. In doing so he robbed local communities of their support systems - almshouses and so on.

But still he couldn’t get enough money - and so he ordered what became known as the Great Debasement. The amount of gold and silver in coins was reduced and, in some cases, replaced entirely with copper.

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Bad money drives out good - Gresham’s observation which became law

It began in 1542 with a secret indenture. Production of current coins would continue, but new coins would also be secretly minted, including the previously unsuccessful testoon, with significantly less gold and silver. The coins would be stockpiled in Westminster Palace.

But in 1544, a lack of bullion arriving at the mint prompted the government into phase two of the scam and the debased coins were allowed to enter general circulation. Merchants soon discovered the new silver groats had been debased, and they began fetching a lower price. Coins of a similar value but with a higher precious metal content were hoarded and so disappeared from circulation - a classic case of bad money driving out good, as Gresham’s Law goes. Not only a classic case - the actual case which made Thomas Gresham articulate his law in the first place.

The king's testoons were copper coins with a thin layer of silver on top, not unlike Diocletian’s denarii. Over time the silver would wear off, especially around the nose on Henry’s face on the coin, which protruded a little and so wore away quicker, exposing the copper underneath. So did Henry VIII get the nickname Old Coppernose.

If you are interested in buying gold and silver coins which haven’t been debased, as always I recommend The Pure Gold Company. Pricing is competitive, quality of service is high. They deliver to the UK, the US, Canada and Europe or you can store your gold with them. More here.

The debasement continued after Henry VIII’s death in 1547, and was eventually revoked by his successor Edward VI in 1551. Over the course of the seven year debasement, the purity of gold coins slipped from 23 carat (96%) to 20 carat (83%), while silver coins steadily fell from 92.5% (sterling silver) as low as 25%. That’s a theft of 83% of the silver.

When Elizabeth I came to power in 1558, the debasement had affected both trading relationships (foreign merchants often refused to accept English coins) and confidence in the monarchy. Elizabeth’s advisors William Cecil and Thomas Gresham persuaded her that these problems could be solved with sound money. Following Gresham’s advice, the government passed a law which ended the legal tender status of debased coins but also banned “good” coins from entering foreign markets. Then in 1560 Elizabeth I had all debased coinage removed from circulation, melted down and replaced with higher fineness, newly minted coins - soon to be harder-to-clip milled rather than hammer-struck coins.

The crown made a tidy £50,000 from the recoinage. That’s seignourage for you.

if you enjoyed this article, please like, share etc - it helps a lot.

Stories like this fill the pages of The Secret History of Gold (although this one didn’t actually make the cut).

The Secret History of Gold is available to pre-order at Amazon, Waterstones and all good bookshops. I hear the audiobook, read by me, is excellent. The book comes out on August 28.

Hurry! Amazon is currently offering 20% off.

Until next time,

Dominic

Bitcoin, Gold and Hidden Taxes

I recorded this interview when I was in Prague earlier in the summer. I actually forgot I did it, but Archie has just released it now, so if you fancy a fireside chat, here it is:

"The only thing that really frightened me during the war was the U-boat peril."Winston Churchill

Now that France had fallen, it was time for Operation Sea Lion: Germany's invasion of Britain. It would start with air and naval attacks to soften British defences before an amphibious assault. The Battle of Britain was about to begin.

Britain had 501 tonnes of gold stored overseas, more than half of which was in Canada—over 10,000 bars. (Head of the Bank of England, Montagu Norman, had been buying Canadian mine production steadily through the 1930s.) But in the vaults of the Bank of England, it had some 1,100 tonnes of gold stored, along with another 800 tonnes stored for other nations. They could not let Adolf Hitler have it.

Safety lay on the other side of the Atlantic Ocean, but German U-boats were hunting. Over the course of the war, they would sink over 3,000 Allied ships. History was not reassuring either, given the sinking of SS Laurentic in 1917, when some 39 tonnes were lost to the bottom of the ocean just off the coast of Ireland.

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But beyond keeping the gold from Hitler, Britain needed weapons, food and other war essentials. America's strictly enforced Neutrality Act meant Britain had to pay in gold or US dollars.

In 1940, the British people were forced to register any securities — bonds and stock certificates — they owned. The Churchill government, with its newfound wartime powers, then confiscated them and, wishing to ship British wealth to safety in Canada, secretly moved them, along with several hundred tonnes of gold, to the Scottish port of Greenock. (Take note: your wealth is not safe if your country goes to war).

From there, in June 1940, they were shipped to Halifax aboard the light cruiser HMS Emerald. HMS Emerald made it. The British treasure was put on trains, with the gold sent to Ottawa, and the securities shipped to Montreal, with the Bank of Canada now acting as a sort of surrogate Bank of England.

Buying gold or silver to protect yourself in these ‘interesting’ times? I urge you to. The bullion dealer I use and recommend is the Pure Gold Company. Pricing is competitive, quality of service is high. They deliver to the UK, the US, Canada and Europe or you can store your gold with them. More here.

But the following month, July 1940, saw the big gamble. 1,500 tonnes of gold were loaded onto five ships. $163 billion worth in today’s money.

Offshore, they met the battleship HMS Revenge, a cruiser, and three destroyers, which served as their escort across the Atlantic: a flotilla of nine under the command of Admiral Ernest Archer. En route, two ships encountered fog and came to a halt for fear of icebergs. Another had engine trouble and had to drop out of the convoy, to be escorted by HMS Bonaventure. But somehow the mission was a success. Not a single bar went missing. It was the largest treasure shipment in history, either by land or sea.

At one point, it was thought three cases were missing, but a mess steward who overheard a conversation between two officers said he had been tripping over something in the kitchen: three boxes had been stored among the whisky.

Most of the gold was spent buying weapons and other essentials from the US, and never made it back to the UK.

Perhaps they needn't have bothered. Over the next months, to the surprise of many, the Royal Air Force successfully defended British airspace against the German Luftwaffe. Victory in the Battle of Britain would be a turning point in the war. In September 1940, Hitler shelved Operation Sea Lion and his plans to invade Britain. He had other battles to fight.

Stories like this fill the pages of The Secret History of Gold (although this one didn’t actually make the cut).

The Secret History of Gold is available to pre-order at Amazon, Waterstones and all good bookshops. I hear the audiobook, read by me, is excellent. The book comes out on August 28.

Hurry! Amazon is currently offering 20% off.

Until next time,

Dominic

The UK Financial Conduct Authority has announced that it is loosening its anti-bitcoin stance. From October 8th retail UK investors will now be able to buy bitcoin ETFs.

Finally.

The ban came in with bitcoin at $5,000. Today it's $115,000. That’s $110,000/coin UK investors have been protected from. Great job guys.

Where will it be on October 8th? Who knows.

Does this announcement mark the top of the market for bitcoin? There would be a poetic irony if it did, but it won't. Bitcoin is so much bigger than the FCA.

At present, it does not even look like a case of buy the rumour, sell the news. Bitcoin has actually sold off a few percent since the announcement.

But this change in tack is going to have a huge impact. It's about a lot more than British retail investors. It's global.

It's going to have an impact on the bitcoin treasury companies around the world, and it's going to have an impact on the bitcoin price itself.

Here’s why.

We’ll start with the announcement itself from David Geale, executive director of payments and digital finance at the FCA:

'Since we restricted retail access to cETNs, the market has evolved, and products have become more mainstream and better understood. In light of this, we're providing consumers with more choice, while ensuring there are protections in place. This should mean people get the information they need to assess whether the level of risk is right for them.'

Blah blah, waffle waffle.

Absolutely no ownership of the FCA's calamitous regulation whatsoever.

Fortunes have been lost to British investors because of the FCA. How is it these bodies are so totally unaccountable? Perhaps everyone who was involved in that decision should be made to compensate British investors for their loss of earnings.

"We're providing consumers with more choice,". Please. There's gaslighting for you right there.

Moving on.

NB Don’t forget my brilliant book about bitcoin, if you want to learn more about the space.

There is also my new book The Secret History of Gold, which comes out later this month. Amazon is currently offering a discount, so order yours now.

Obviously, UK investors are now going to be able to buy bitcoin ETFs through their brokers, which means we can hold them in our SIPPs and ISAs. I gather there is roughly £3 trillion in UK pensions, £750 billion in ISAs, £500 billion in SIPPs and quite a bit more in other brokerage accounts. So that is a lot of capital that can now come into bitcoin which previously could not.

But there is a lot more to it than that.

The institutional floodgates are about to open.

Former HSBC fund manager and ByteTree CEO, Charlie Morris, who knows this world as well as anyone, has this to say.

The lifting of the ban by the UK regulator of bitcoin exchange traded products will have a far greater impact on the market than many believe. It's not just retail but institutions too. Many funds around the world are connected to London whether it be custodians, administrators, distribution, or trade execution. The ban meant that a single touchpoint with the UK would prevent allocation to bitcoin. From 8 October, this will no longer apply. Not only will U.K. retail investors boost demand for bitcoin ETPs, but a far bigger deal will be the opening up to institutions and funds around the world. It's a monumental moment for bitcoin which will become a global institutional asset over the next decade.

(By the way you should subscribe to Charlie's newsletters. They're excellent. There are free and paid options. Here's the link).

You saw my piece a few weeks ago about the global shadowbanning of bitcoin. London and the FCA had a huge role to play in that. One example: a banker I know in Zurich could not buy bitcoin products for one of his high net worth clients because of the ban. He was by no means alone. We have taken a step forward to the lifting of the shadowban, though not the final step by any means. As we noted, the funds buying bitcoin are still the 'pirates' rather than the big players, but this is still a move towards the legitimisation and normalisation of bitcoin.

If bitcoin can get to something like 2% of portfolios worldwide, which it eventually will, well woof is all I can say.

What about the treasury companies? What next for them?

“They will never see their gold again, just as they do not see their own ears.”Josef Stalin

Gold’s strength is that its value exists in and of itself. It’s nobody else’s liability. Unlike money in the bank or a bond, it carries no promise from a third party, and its value is not dependent on the creditworthiness of any issuer or guarantor. Hand it to someone else and its value is transferred. It is a “bearer” asset, effectively owned by whoever has possession of it. For this reason gold has been the target of many a heist. Quickly resmelt it, and its provenance is very hard to prove.

So there is one obvious problem with gold: that is keeping it safe. It’s all very well having a pot of gold, but if somebody comes along and takes it from you, as Alexander did from the Persians, or the Conquistadors from the Incas, then you’re left with nothing at all.

When the Spanish Civil War broke out in 1936, the Soviet Union, under Joseph Stalin, supported the Spanish Republican government. The Nazis supported their opponents, the revolutionary fascist forces led by General Franco. At the time Spanish gold reserves, some 635 tonnes, were the fourth largest in the world.

Much of that treasure had been accumulated during WWI, when Spain had stayed neutral. Selling stuff to the British seems to have been the really big earner: 70% of Spanish gold holdings were British sovereigns.

With Franco just 20 miles from the capital, the Republicans were on the verge of defeat. Never mind the fascists, there were also rumours that Catalan separatists had hatched plans to take the gold from Madrid to Barcelona. All that gold was at risk.

Finance minister, Juan Negrín, and Prime Minister, Francisco Largo Caballero, leant on President Azaña to sign a secret decree to move the gold - some 10,000 cases - to a place “which in his [Negrín’s] opinion offers the best security”. Azaña signed and the gold was moved, starting the next day, to Cartajena on the south coast, as far from Franco’s armies as possible. The Spanish soldiers who transported the cases thought they were lifting munitions. A fifth of it was then shipped to Marseille where it was traded for French francs, which the Republicans used to fund their side of the war. The rest, 510 tonnes, would be sent to Joseph Stalin in Moscow for safekeeping.

Even if Bolshevik sympathisers, what were Negrín and Caballero thinking? The Russians had already demonstrated that they had no qualms about seizing other people’s gold. In 1916, the Romanian government sent its treasury of 91 tonnes of gold to Tsarist Russia for safekeeping, worried that it was vulnerable to the Central powers when Romania had just joined WWI on the side of the Entente. Shortly afterwards, during the Great October Revolution, communists, led by Lenin, seized power, sequestered the gold and refused to give it back. Though small amounts were returned in 1935, 1956, and 2008, “as a gesture of goodwill”, the large majority was retained. As you can imagine, it has been something of a sore spot in diplomatic relations between the two nations ever since.

It seems Negrín and Caballero did not know the story. In any case, Caballero actually wrote to Stalin asking if he would “agree to the deposit of approximately 500 tonnes of gold.” Two days later, he got a reply from the Soviet leader, not previously known for his prompt responses. No surprise: Stalin would be “glad” to take the gold.

Buying gold or silver to protect yourself in these ‘interesting’ times? The bullion dealer I use and recommend is the Pure Gold Company. Pricing is competitive, quality of service is high. They deliver to the UK, the US, Canada and Europe or you can store your gold with them. More here.

Alexander Orlov was the Russian agent in charge of transporting the booty. Negrín gave him fake documents to show he was an US official from the Bank of America, in case he should be stopped. Negrín, who, remember, was finance minister, had thought Bank of America was the US central bank. That would be the Federal Reserve. Russian agent Orlov didn’t realise either. It’s extraordinary.

Four Russian ships came to Cartagena to collect the bounty, and the gold was loaded on. There was a discrepancy of 100 cases between Orlov and Spanish treasurer Mendez Aspe’s number: Aspe said 7,800 cases, Orlov 7,900. Orlov said nothing. He reported the discrepancy to his superiors, who told him, “Do not worry about figures. Everything will be counted anew in Moscow. Do not mention your figure to anybody.” Aspe didn’t even get a receipt off Orlov (who had been instructed not to give him one). “Don’t worry, my friend,” said Orlov, “it will be issued by the State Bank of the Soviet Union, when everything is checked and weighed.” We will never know whether Orlov miscounted or whether those 100 boxes went missing.

It took them three nights to load the four ships. The Russians then left Cartagena for Odessa in the Black Sea, escorted by the Spanish as far as Italy. From Odessa it was loaded onto a freight train bound for Moscow. "If all the boxes of gold that we piled up on the wharfs of Odessa were to be placed here side by side,” said one of the officials. “They would completely cover up the Red Square".

When the gold arrived in Moscow, Stalin celebrated with a banquet at the Kremlin. “They will never see their gold again”, he laughed. “Just as they do not see their own ears.”

The Spanish eventually got their receipt: for 5,619 standard cases and 126 damaged. Some distance below both Aspe and Orlov’s figure. But three months later the Russians completed the audit, calculating that the shipments totalled 510 tonnes of gold coins and ingots, 90% pure, thus around 460 tonnes of pure gold. There were gold coins from across Europe and Latin America, especially those British sovereigns and Portuguese escudos, but also Spanish pesetas, French, Swiss and Belgian francs, German marks,, Russian rubles, Austrian schillings, Dutch guilders, and Mexican, Argentine and Chilean pesos. The numismatic value of the coins was higher than their gold content.

The following year Spain met with a currency crisis. With exceptional chutzpah, even by the standards of politicians, Republicans blamed the inflation on the free market. Nothing to do with the absence of all that gold!

Later, the Franco regime was happy to let the story of the "Moscow gold" stolen by Russia spread, as part of its anti-communist propaganda. And yet it appears sell orders from Negrín were actually carried out in 1937 and 1938, for which Spain received pounds, dollars and francs. Spain also received planes, tanks, machine guns, artillery, rifles, cartridges, food and fuel from Russia. The Soviets demanded some compensation for what they had sent during the war, but it’s believed that aside from various expenses, the Soviets did not abuse their position and defraud the Spanish. Ultimately then, most of the gold went, one way or another, on the cost of the civil war. Such is the way with war. It is expensive.

And just a couple or three years later, as Nazi forces advanced through Europe, the farce of transporting gold would be repeated many times over, and across the continent.

Stories like this fill the pages of The Secret History of Gold (although this one didn’t actually make the cut).

The Secret History of Gold is available to pre-order at Amazon, Waterstones and all good bookshops. I hear the audiobook, read by me, is excellent. The book comes out on August 28.

The idea behind Dolce Far Niente was to create a portfolio of low-risk investments for today’s market conditions, that you can buy and, pretty much, forget about.

You don’t have to keep checking prices every day.

Hence “Dolce Far Niente” - “the sweetness of doing nothing.” No worries would be the Australian translation.

Asset allocation is WAY more important than individual stock-picking. I could pick the best biotech company in the world, but if biotech is in a bear market, I almost needn’t bother. I’m better off out of the sector. But similarly, if a sector is in a full-on bull market, even pigs fly.

The starting point for the portfolio, which we began on October 1, 2023, was as follows.

* Gold: 15%

* Bitcoin: 5%

* Special situations: 10% (the ”fun” part of the portfolio, for example some of the smallcaps I write about on here)

* Uranium: 5% (reduced to 2.5% as things got frothy)

* Oil and Gas: 10%

* Bonds and Wealth Preservation: 20%

* Equities (35%)

* UK & Europe (20%)

* US (25%)

* Smaller cos and private equity (30%)

* Asia (15%)

* Japan (5%)

* EMs (5%)

No allocation to real estate.

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Since that October 2023 starting point, certain assets - gold, bitcoin and US equities - now account for far greater percentages, with energy, bonds and wealth preservation not having done so well.

If you are starting this portfolio now, I would still recommend sticking to the original allocation and letting things grow.

Really, I should re-allocate, but I don’t want to sell any bitcoin and I don’t want to sell any gold.

In fact, to be honest, there is a very strong case for just owning bitcoin and being done with everything else. But that wouldn’t be balanced and that’s not what this portfolio is about.

The only change we have made since October 2023 was to reduce uranium from 5% to 2.5% in February 2024. Uranium felt a bit frothy was the reason. More a gut- than evidence-based decision, and it proved the right one.

I’m going to make one, quite major change to the portfolio today - in the equities department. More on this in a moment.

Lastly, do as I say, not as I do. In my own portfolio, my allocation to bonds and wealth preservation is tiny: maybe 2%. I am overweight gold, bitcoin and special situations (smallcaps mostly).

At some stage, I will get my comeuppance as a result, and it won’t be the first time. Then I’ll swear to change my habits, and then I will - for a bit - and then I won’t.

But a more sensible investor would keep their portfolio to the above allocation.

Let’s examine things in a bit more detail

1. Gold (15%)

It’s done very well. Up about 80% since we started the portfolio.

My firm belief is that everybody should own some gold in their portfolio. Especially now.

(If you do not yet own any, my guide to investing in gold is here. If you are looking to buy gold or silver, the bullion dealer I recommend is the Pure Gold Company.

There is also, of course, the soon-to-be definitive book on the subject. Here it is on Amazon, and Waterstones is currently running an offer.

💥 Pre-order now at Waterstones and get 25% off.Use code SUMMER25 at checkout to get your 25% discount.

Hurry! Offer ends today, July 31.

2. Bitcoin (5%)

A huge win. Up about 450%

The potential of bitcoin remains so extraordinary, as I often say, I see the risk is not so much owning it, but not owning it.

Our bitcoin proxy for UK investors, who have been shut out of the sector by the FCA, is Strategy (NASDAQ:MSTR). That’s done even better. Up over 1,500%.

My sources tell me UK investors will be able to buy bitcoin ETFs from November. That’s what Charlie thinks anyway, and you should all subscribe to his letter.

3. Special situations (10%)

These are the small- and mid-caps that I sometimes write about on here.

We have had some big winners, and some big fat dogs too.

If you want to know what are currently my 7 biggest positions, here they are.

4. Uranium (2.5%)

Glad we reduced this to 2.5% when we did.

Yellowcake (YCA.L) is our vehicle. We reduced around 700p in February 2024. It’s now 500p

Now is probably not a bad time to buy back that 2.5%, but I’ll wait.

5. Oil and Gas (10%)

The iShares Oil and Gas ETF (SPOG.L) - North American oil and gas companies, basically - is my primary vehicle by which to play this. It’s off a little, but it’s outperformed oil itself.

I’m also of the view now that North Sea oil and gas’s time is coming and the government will u-turn on this as well.

Did you see Donald Trump’s comments today? One of the many ways he made Keir Starmer wriggle and squirm.

It tells the epic tale of humanity’s oldest and most treasured currency – from its explosive cosmic origins to its role in the power games of modern geopolitics.

Watch the unboxing above 👆

Waterstones is running an offer. 💥 Pre-order now and get 25% off. Use code SUMMER25 at checkout to get your 25% discount.

Hurry! Offer ends July 31.

Here’s the blurb:

Gold (noun): A precious, yellow metal, prized for its beauty. Inert, immune to corrosion, highly malleable though with little utility. Seen as pure wealth.

The Secret History of Gold tells the epic tale of the world’s oldest, and most treasured, currency. From its origins in the formation of the solar system to its role in both ancient myth and modern finance, Dominic Frisby explores, with wit and brevity, how gold has shaped human civilisation.Gold has inspired men to do the most brilliant – and terrible – things. It has lured explorers, conquerors and thieves. It has sparked wars, it has built empires, it has empowered leaders, good and bad.

What readers have said so far:

“A fabulous, fascinating, fantastical tale, told with panache by a superb taleteller.” Matt Ridley, author of How Innovation Works.

”It doesn’t just tell you about gold – it makes you feel its weight through history. It’s just so interesting.” Toby Young, Spectator

”Written with both insight and Dominic’s signature humour, this is essential reading for anyone who wants to understand the lengths human beings will go to for the promise of riches.” Rory Sutherland, author of Alchemy.

“This delightful book is a most insightful and enjoyable romp through history and a well-researched, educational tour de force.” James Turk, author of The Money Bubble

”Dominic Frisby’s writings about economics and finance are, like his comedy, intelligent, beautifully crafted and always ahead of the curve. The Secret History of Gold is well-informed, utterly coherent and very, VERY timely.” Liam Halligan, Telegraph

“My most trusted source of information for anything to do with gold,” Konstantin Kisin, Triggernometry”Well-researched and razor-sharp. Written with passion, principle - and the occasional punchline.” Al Murray, comedian and historian

”Possibly the best-timed book ever,” Merryn Somerset Webb, Bloomberg”A brilliant, highly readable guide to the most alluring material of all,” Luke Johnson, investor and entrepreneur.”Understand the history of gold, and you start to see what politicians and central banks would rather you didn’t. Dominic reveals all with clarity and force,” Rob Dix, author of The Price of Money.

if you prefer, here’s a link to Amazon.

Prefer to listen? I hear the audiobook, read by me, is very good ;) Here it is on Audible and via Apple.

Please like, share - all that stuff - it helps.

Thank you for your support – and stay tuned. I’ll be banging on about gold quite a lot in the coming weeks…

My old boss and great friend, Merryn Somerset Webb, was discussing portfolio allocation - which assets should make up the 40 in a 60:40 bond-to-equity portfolio - with Nataliia Lipikhana, executive director at JP Morgan . Merryn asked if bitcoin should be one of the assets to include, alongside gold. Lipikhana, who, until then, had spoken widely, fluently and knowledgeably about a range of subjects, suddenly stonewalled.

“We don’t cover it so we can’t talk about it,” she said.

Awkward pause.

Merryn laughs.

“At all?”

“No,” says Lipikhana.

Another pause.

“Ok,” says Merryn. “Totally understand,” and she changed the subject.

This is a symptom of something much bigger that has been at play throughout the institutional world, and not just in the UK, since the emergence of bitcoin and other cryptocurrencies.

They’ve been shadowbanned.

We know of course about the UK’s Financial Conduct Authority, how its regulations went against the pronouncements of various Chancellors, and how it effectively excluded UK citizens from the sector. Something similar has long been happening at the institutional level.

“Most private banks will not accept bitcoin ETF orders for their clients, despite being able to deal with elective professionals,” a fund manager friend (who prefers to stay anonymous) tells me. “This applies in countries where there is no ban because the bank will have links to London. Even in the US, the traditional institutions will ban bitcoin internally.”

Here’s a list of the biggest holders of the iShares gold ETF. Many of banking’s biggest names are there.

Now here’s a list of the iShares bitcoin ETF’s biggest holders.

There is nothing like the same institutional weight.

(Goldman and Morgan Stanley will be market making on behalf of hedge fund clients)

“Lipikhana probably feels she might get the sack if she comments on bitcoin,” my fund manager friend continues. “So she doesn’t”.

You know my saying, “A bubble is a bull market in which you don’t have a position”. For years now, banks have been talking their clients away from this sector, often using that argument that it’s a bubble. This pre-dates the ETFs by ten years or more.

Wall Street and the City don’t like bitcoin because they didn’t get there first. Smelly private investors did. They missed out on this epic opportunity and, rather than embrace it, they ignore it.

They don’t control it. They can’t manipulate it.

Don’t talk about bitcoin. Perhaps it’ll go away.

Well, it hasn’t and it won’t. It is here to stay.

Now with the emergence of the both the ETFs and the bitcoin treasury companies, bitcoin is edging its way further and further into the financial mainstream.

“You get bitcoin at the price you deserve,” runs the saying. Ain’t it so.

What this means for investors is that there is a huge wall of institutional money that is still to come into the sector. It will eventually.

Bitcoin is the most technologically advanced money in history. Now that real estate is gone as a vehicle to protect against currency debasement (too highly legislated and taxed), the need for an effective savings vehicle is only greater.

Bitcoin is the best savings vehicle there is.

I love gold. You know I do. I think it has an enormous strategic role to play in the coming years, and should play a part in every portfolio.

But bitcoin appreciates by more. It beats stocks. It beats bonds. It beats commodities.

But JP Morgan would rather not comment.

If you enjoyed this post, please like or share - it helps :)

PS Don’t forget my brilliant book about bitcoin, if you want to learn more about the space.

Dear Chancellor,

Me again.

I am the author of Bitcoin: The Future of Money? (2014), generally agreed to the first book on bitcoin from a recognised publisher.

I write with regard to the proposed sale of the UK’s bitcoin.

Since bitcoin was first introduced in 2009 - invented in reaction to the loose monetary policies of the Global Financial Crisis - bank bail outs, quantitative easing, zero interest policies etc - and the economic injustices they created, the protocol has grown from nothing to a market cap above $2 trillion. A whole new economy has emerged around the technology where none previously existed, providing countless opportunities for individuals, entrepreneurs and nations alike.

Initially the domain of a few coders, it is now finding mass adoption at the corporate and even national level. The US is recognizing the digital asset’s importance, as it introduces its Strategic Bitcoin Reserve, while China, according to estimates, holds 190,000 coins.

Initially, the UK was at the heart of the Bitcoin story. Satoshi Nakamoto, the pseudonymous inventor, wrote in British English, cited UK media, and many early meetups and conferences took place here. Chancellors George Osborne and Rishi Sunak both expressed their desire for the UK to become a global hub for this emerging technology. But the FCA took an opposing view and made it increasingly difficult for UK citizens to participate, so that we have now fallen behind.

Opinion about bitcoin is divided. Those who use the technology regularly believe it is not just likely, but inevitable, that it will become the world’s dominant monetary network. Many others – typically the older generation, economists or legacy finance – dismiss it as a bubble, often without having tested the tech in any meaningful way.

Whichever side of the debate you fall on, the fact that Bitcoin has become the most desired digital asset in the world is indisputable.

Among the many features that make bitcoin unique is that its supply is finite. With its estimated 61,000 confiscated bitcoins, the UK has been gifted an extraordinary opportunity. We now hold roughly 0.3% of total supply.

I understand that politics demands a focus on the short term – the next Budget, the next election – but I urge you to approach your decision with long-term vision. Please consult with people who regularly use the technology. Do not make this decision based solely on advice from people who never use bitcoin.

Take Bulgaria, for example. In 2017, it sold all of its seized bitcoin to cover a short-term budget gap. Those coins today would be worth enough to eliminate the country’s entire national debt.

From a strategic perspective, the UK’s bitcoin holdings represent a once-in-a-generation opportunity. As fiat currencies decline in purchasing power and the global economy moves toward digital and AI-driven systems, this asset could help Britain re-establish itself as an economic superpower with significant geopolitical leverage and monetary independence.

An opportunity of this kind is not to be thrown away lightly.

Once those coins are sold, we will never be able to buy them back.

If bitcoin becomes a hundred trillion dollar network – as some project – the UK's share could prove transformational. That may sound fanciful today, but every surprise in bitcoin’s history has been to the upside.

There is also your personal political legacy to consider.

You would be the Chancellor who sold Britain’s bitcoin.

That will be how people remember you – just as Gordon Brown, for all else he did, is remembered primarily for needlessly selling Britain’s gold at the bottom of the market. For the rest of your life, every timebBitcoin rises in price, people will look at what you sold our coins for and say: “This is how much she lost us.” You are consigning yourself to that fate.

Do you want that to be your legacy?

So once again, I implore you: take advice from people who understand this technology and its potential. Don’t just listen to nocoiners.

If you sell bitcoin for fiat you are swapping a superior asset for an inferior one. It is that simple.

The trade might bring short-term benefit, but it does nothing to address the underlying structural issues facing this country. If, however, you hold on to the bitcoin – and understand how to integrate it into policy – perhaps create a UK Strategic Reserve - you may find it solves many of our problems.

As bitcoiners often say, “bitcoin fixes this.”

I hope you read and consider this letter with an open-mind.

Yours sincerely,Dominic FrisbyAuthor of Bitcoin: The Future of Money?Writer of The Flying Frisby newsletter

PS Please like, share - all that stuff. Thank you!

It has just been released, so I thought I would share it for your Sunday thought piece.

As always if you enjoy the discussion, please like it and share. It he…

I wanted to take a look at gold today.

I’m going to dust off my powers of divination — or as they call it in the City, technical analysis - and see if we can figure out where it is going next.

As things got frothy back in April, I argued that the market was probably due a breather. The summer is usually gold’s weakest season. Why this should be I don’t know, but it is.

You’ll often find it makes a low in May or June, then re-tests that low in July or August, then things pick up in the autumn or fall, as our more literal cousins call it.

In any case, I’m pleased to report that gold has basically range-traded, or consolidated, since the frothy days of April, between $3,500 and $3,100.

The $3,000 level has more than held, which makes me wonder if we shall ever see gold with a $2,000 handle ever again. Unless there is a 2008 or Covid-style panic, I rather doubt we will.

Meanwhile, the RSI (see the bottom panel below) has come off, meaning the heat has come out of the market, which is good.

Since the US confiscation of Russian assets in 2022, pretty much every pull back to 50-day moving average (red line) has been bought, and they continue to be bought. The average is now flattening out, as you would expect with this summer consolidation, rather as it did late last year. Some sideways consolidation is good. Ideally, you want to see the short-, medium- and long-term moving averages all flatten and converge. There often follows a big move higher.

The long-term moving averages (1 year and so on - not shown here) still have a bit of catching up to do (they are around $2,850 at the minute), which they will and fairly quickly as the gold price continues this sideways action.

We also have something of a triangle forming (see blue lines) - with lower highs and higher lows. Triangles are seen as continuation patterns. In other words, whatever was the direction going into the formation will be the direction coming out. Up, that is to say.

I rather think this triangle will complete just as the moving averages converge.

When you look at gold against other currencies, the same process can be seen: a summer consolidation after an excellent winter and spring.

If you are in any doubt as to whether you should own gold or not, let me answer that for you in the words of the former HSBC fund manager Charlie Morris, who now writes Atlas Pulse, one of the best newsletters out there - (you should subscribe it’s free). “Gold should be the cornerstone of an investment portfolio,” he says. “It is remarkable how few professional investors understand this”.

Charlie may have a point. Look how underweight gold western portfolios are. Below 2%. Nuts.

The Trump administration is going to run enormous deficits. It is not attempting to hide the fact. The same goes for the Starmer administration in the UK. The Labour backbenchers, who now seem to control policy, will not allow reduced spending. We saw that last week. Most EU nations have not got their spending under control. It means further declines in the purchasing power of the dollar, pound and euro are inevitable. Gold is your protection.

What’s more, as demonstrated by the enormous buying coming out of Asia from Shanghai Cooperation Nations, China especially, it is clear gold is becoming a highly important strategic asset again. It is this buying, plus some huge options trading in China, that is driving this bull market, and it began shortly after, as I say, the seizure of Russian US dollar assets.

Metals Daily’s Ross Norman, whose track record forecasting the gold price is second to none, tells me: “We are confident that there is significant unreported central bank gold buying which, coupled with some pretty heady options plays from within China, accounts primarily for a near doubling in the gold price over the last 18 months or so.

He goes on:

The days when central banks telegraphed their moves in advance in the interest of transparency are long gone (thank you Gordon) and they are far more nuanced and opportunistic in their approach.

With Asian central banks very much under-weight gold reserves, and energised by a growing debt crisis, further fuelled by the trend to reduce dollar holdings and you have a perfect set-up for a continuing gold bull run.

At the moment the East invests in gold while the West divests which actually sums up the last 30 years between those hemispheres.

This bull market is consolidating. It is not over. Whether it’s because of de-dollarisation or your nation’s deficit spending, there is demand for gold, which is going to send the price higher.

It may be an analogue asset in a digital world. But you will be glad you own it.

Until next time,

Dominic

If buying gold or silver to protect yourself in these ‘interesting’ times, the bullion dealer I use and recommend is the Pure Gold Company. Pricing is competitive, quality of service is high. They deliver to the UK, the US, Canada and Europe or you can store your gold with them. More here.

Some recent articles which may be of interest:

Right, here we go.

Dear Chancellor Reeves

“Revenue cannot be derived unless the land is productive.”— Ali ibn Abi Talib, the fourth caliph

I hope you have a moment to consider what I have to say.

My name is Dominic Frisby. Among other things, I am the author of a well-received book on the history of taxation, Daylight Robbery: How Tax Shaped Our Past and Will Change Our Future.

I am writing to you about Stamp Duty — a tax that is causing stagnation, where you need growth.

At present, if I wish to buy a house, I must first sell other assets to fund the purchase. This incurs capital gains tax. Then, on buying the property, I face another sizeable tax in the form of Stamp Duty. So I am taxed twice on the same money.

The alternative is simply to stay put and do nothing, thereby paying no tax at all. Unsurprisingly, this is what most people do, which is why turnover in the housing market is so poor.

How much economic activity is lost, when I stay put?

* The stocks and shares I might have sold miss out on the fresh investment they would otherwise receive from their new buyer — investment so vital for businesses to grow.

* All the economic activity that follows a house purchase vanishes: estate agents, conveyancing solicitors, surveyors, removals companies, builders, decorators, materials suppliers, architects, furniture shops, DIY stores.

* I do not take out a new mortgage or insurance policy, nor hire tradesmen to upgrade kitchens, bathrooms or gardens, nor set up new utilities, broadband contracts or local services.

* I do not trigger a purchase chain, meaning the person I would have bought from does not buy somewhere else, and all the activity that would create is lost too.

* Nor do I relocate for work, missing new job opportunities, so the economy loses the productivity boost of people moving closer to better jobs.

When I stay put, there is no revenue at all for the Exchequer — neither from Stamp Duty, nor from VAT on all these goods and services, nor from increased corporation tax on profits, nor from higher Income Tax on increased earnings, nor from the local spending that supports countless jobs and wages. Instead, there is stagnation where there could have been growth.

Stamp Duty, largely a creation of the Tories, has immobilised the country.

Britain desperately needs growth. Growth requires turnover. The best way to encourage turnover is to remove barriers to trade. Taxes — whether tariffs or duties, whatever form they take — are the biggest barriers of all.

When Rishi Sunak temporarily reduced Stamp Duty during Covid, we saw exactly this effect: turnover increased, economic activity surged. Revenue to the Exchequer followed.

A permanent removal of Stamp Duty would trigger a powerful boost not just to the property market but to the entire economy, meaning the government, too, would have more money to spend on whatever it sees fit.

There is so much pent up demand, the resulting economic growth might even be enough to save this government at the next election.

What’s more, the Tories imposed these duties, so it is an opportunity to score some points against their failure.

It would, quite literally, get Britain moving again.

Counter-intuitive as it may seem, the golden rule of taxation is that lower taxes and fewer taxes lead to higher revenues. History shows this time and again.

In the words of John F Kennedy

It is a paradoxical truth that tax rates are too high today and tax revenues are too low and the soundest way to raise the revenues in the long run is to cut the rates now.

I hope you will give this serious thought.

With kind regards,

Yours sincerely,Dominic Frisby

PS If you enjoyed this letter, please like, share and all that stuff. It helps.

You can find more on this subject in this video:

Why not upgrade?

If you are buying gold or silver to protect yourself in these ‘interesting’ times - and I urge you to own gold, given how governments are debasing currency - the bullion dealer I use and recommend is the Pure Gold Company. Pricing is competitive, quality of service is high. They deliver to the UK, the US, Canada and Europe or you can store your gold with them. More here.

Finally, ICYMI, here is this week’s mid-week piece:

Many thanks for completing my weekend polls (here they are if you missed them: paying subscribers / non-paying).

Your answers were extremely useful: roughly the right amount of content, stick with the audio, the balance of investment ideas and other stuff is about right, and the price too is about right (interestingly, paying subscribers thought that, non-paying less so — that put a smile on my face). Also: keep writing about what I know.

You’re a bit more equivocal about the video content. There are more gold than bitcoin bugs in the readership, with a healthy number are in the “own both” camp.

And so many of you joined my Comedy Substack, it became one of Substack Humor’s fastest movers. Yippee. Thank you!

Today I am going to tell you about my seven largest investment positions.

Take note: the asset allocation I advocate is the Dolce Far Niente portfolio. This is 15% in gold, 5% in bitcoin, and we have a large allocation to global equities, especially the US. It also has a 10% allocation to risky/fun investments: small caps, special situations and so on (the kind of flutters I write about here). The reason for this allocation is to minimise risk and any damage caused by losses.

Do as I say, not as I do and all that. My personal allocation does not fully correspond to the Dolce Far Niente, partly for lack of discipline, partly because I have a greater appetite for risk and will stomach bad losses, if they come around, partly because I am overweight bitcoin.

My largest positions

As I am sure you know, my two largest positions are in bitcoin and gold. In my view everyone should have an allocation to these assets. Given the debasement of currency taking place worldwide, the greater risk is not owning them.

On which note …

If you want to buy gold or silver to protect yourself in these interesting times, the bullion dealer I use and recommend is the Pure Gold Company. Pricing is competitive, quality of service is high. They deliver to the UK, the US, Canada and Europe or you can store your gold with them. Find out more here.

But we will put those to one side.

After bitcoin and gold, my seven largest positions are:

Oh, my goodness me. I don’t think I’ve ever seen volatility like it.

We have a huge speculative bubble on our hands, and it’s popping.

What’s more, this bubble is full of chancers, charlatans and chief executive officers.

The Mail has got onto the story. That is not a good sign.

If I told you ten days ago that the price of a share you just bought would rise from 6p to 40p in a week, you’d be pretty happy.

Then again, if I told you on Monday that something you owned was going to drop by 60% the following day, you’d be pretty unhappy.

That’s what happened with the UK-listed bitcoin treasury companies.

Nobody said it would be easy.

Today we are going to try and make some sense of what is going on. We have a comprehensive list of all the UK companies jumping on this nutty bandwagon. And, most importantly, we consider what to do next.

Let’s start with a timely reminder: owning a speculative bitcoin treasury company is not the same as owning bitcoin. One is a crazy speculation, the other is the future money system of the world. Bitcoin treasury stocks ≠ bitcoin

I hope that is clear.

Now a rant.

The Great British FCA Crypto Farce

I’m looking at the price of Coinsilium (AQUIS:COIN) this morning. It is ranging from 60p to 30p, i.e. doubling and halving. This situation means the beloved UK market makers might be creaming off enough money to keep them in caviar and truffles for the foreseeable future, but the ordinary retail investor is getting hammered.

In the course of 7 trading days, Coinsilium has gone from 6p to 90p to 30p.

The bitcoin price, meanwhile, is pretty much unchanged.

This situation is almost entirely a creation of the FCA, with its decision to “protect” UK investors from the dangers of cryptocurrencies. That protection began in 2020 when bitcoin was $5,000. Today it’s $105,000. That’s a $100,000 per coin increase—a 21x or 2,000% gain—UK investors were protected from.

Remember UK Chancellor Rishi Sunak spinning his “Britcoin” BS?

“It’s my ambition to make the UK a global hub for cryptoasset technology, and the measures we’ve outlined today will help to ensure firms can invest, innovate and scale up in this country.

We want to see the businesses of tomorrow – and the jobs they create – here in the UK, and by regulating effectively we can give them the confidence they need to think and invest long-term.

This is part of our plan to ensure the UK financial services industry is always at the forefront of technology and innovation.”

Nobody told the FCA! How was any of that even remotely possible when the FCA had banned the sale of crypto derivatives to UK consumers, and effectively regulated cryptoasset technology out of existence in the UK?

Did the two departments even speak before he trotted out that rollocks?

Of course they didn’t. They are different departments.

It’s as though the UK government is inherently incompetent.

Remember UK Chancellor George Osborne publicising himself buying bitcoin at an ATM? The FCA made ATMs illegal.

Remind me. Who voted for the FCA? Or indeed Ofcom? Or Ofsted?

Why do these bodies have such extraordinary power?

It’s enough to make you a libertarian.

In any case, we now have this situation of extraordinary pent-up demand, built up over many years, with hundreds of billions of pounds in ISAs and pensions wanting exposure. The result is this insane volatility in UK bitcoin treasury companies.

Smarter Web Company (AQUS:SWC) went from 2.5p to above 600p, giving it a market cap over a billion. It has just £45 million in assets. Great work, FCA.

Today it’s sitting just below 300p.

Japan has similarly prohibitive anti-bitcoin regulations, and has thereby created the market leader in this second wave of bitcoin treasury companies, Metaplanet (3350:TYO). (Strategy (NASDAQ:MSTR) was the leader in phase one.)

The Japanese company announced this week that it has raised another $500 million, with which it is going to pay down its 0% debt and buy more bitcoins. Why is it paying down its debt? Presumably to clean up its balance sheet so it can raise further capital on better terms to buy more bitcoin (it has targeted 1% of total supply, which would be 210,000 bitcoin). The Japanese market is starved of bitcoin access. Metaplanet is exploiting this situation.

Despite a flat bitcoin price, there was a worldwide sell-off of treasury companies starting on Monday. The sell-off coincided, as these things always seem to, with coverage in the mainstream press. In this case, the Mail marked the top with a piece on the Smarter Web Company.

Pretty much all the treasury sh1tcos are now down 50–70%. Is that it? Game over? Or was that just phase one?

I’ve seen this play out many times over the years. I’ve seen it with uranium sh1tcos in 2006, gold junkcos, silver rubbishcos, graphite flybynights, helium hotaircos and more

It doesn’t take a genius to work out where all this is going, and a lot of people are going to make a lot of money. A lot more are going to lose a lot of money.

These things are not necessarily going to zero - they will have bitcoin on their balance sheet. But when bitcoin has one of its biennial corrections, they are going to get crucified.

But we are also going to see a new corporate model emerge as a result.

It’s dotcom, basically. But which companies will be the Amazons and Microsofts? And which are Pets.com and ClickMango?

Every day we are hearing news of another company “pivoting” - who invented that awful word? - into a bitcoin treasury company. It is all happening very quickly.

Here’s a list of the UK companies getting in on the game. Then we will look at what to do next .

Meet the Players.

Should I say, '‘Monkeys”?

In addition to Smarter Web Company (AQUIS:SWC) and Coinsilium (AQUIS:COIN) we have:

I am writing today’s dispatch from Prague Airport, on my way back to Blighty.

What a splendid city Prague is, and what a lovely bunch the Czechs are.

It feels like this is still very much a high-trust society. Twice I left my bag in public places – full of very nickable laptop, passport and other gubbins – and both times I came back to find my bag untouched, but safely put to one side. At night the city felt safe. It was very clean – I actually started looking out for litter and I couldn’t see any anywhere, whether in the centre or the suburbs, where I was staying. I always think litter – or lack thereof – is a good indicator of how much people really care about their surroundings, how loyal to and invested in their area they feel, and, indeed, how well brought up they are.

The Czechs were lovely: polite, hard-working, respectful, full of ambition and drive, and good looking.

The story is that Hitler went to university in Prague and loved the place that so much that, when the Nazis invaded in 1939, he ordered that the city should not be bombed but preserved. I heard the story last time I was here, and heard it again this time. But then I just fact-checked this story and apparently it is total rollocks - Hitler never went to university anywhere, nor did he visit Prague. Perhaps the city survived because the Czechs decided not put up any resistance, so the Nazis went unopposed, which meant they didn’t need to bomb anything.

In any case, the city is preserved and you can feel the history as you stroll about the stunning centre. It makes you cry for all the cities that did get flattened in WWII and the memories that disappeared with them.

The food was lovely. So was the beer. I even had a couple.

All in all, travel, board and lodging cost half of what they do in London, I’d say, at a guess.

Just as I did last time I was here, I came away enamoured with the place, feeling that I must come back soon.

As for the conference itself, BTC Prague, there were a few GenXers and Boomers – including my new friends Larry Lepard (check out his book), James Lavish (check out his fund) and George Bodine (check out his art) – as well as myself – but 85%+ of attendees were under 50, I’d say, with a large chunk under 30.

If you are young, starting out and wondering what to do, I would urge you to get involved with the Bitcoin movement. There are so many different ways to do so, depending on where your talents, skills or interests lie. You can be artist, scientist or journalist, engineer, entrepreneur, traveller or surfer-dude. It really doesn’t matter. You’ll find a path that suits you. It all feels so dynamic and full of opportunity. It’s brim full of doers. Everyone is so supportive. There is plenty of capital to invest. You can make quick progress.

Another thing to note: there are a lot of extremely clever people in this movement. Average IQ levels in Bitcoin are, I’ve little doubt, much higher than you typically find elsewhere.

Conversation, naturally, was dominated with talk of the bitcoin treasury companies, and the incredible price action we are seeing there. To use the baseball analogy, which innings of 9 are we in? I generally made the case that we are in perhaps 5 or 6, with Michael Saylor and MicroStrategy (NASDAQ:MSTR) in 2020 having been innings one. Some of the old-timers - who, it has to be said, have missed this particular wave - dismissed it as the ICO or DEFI craze of this cycle. They may have a point.

But James Van Straten, the bright young mind behind the transformation of Coinsilium (AQUIS:COIN), told me in no uncertain terms that, as far as the UK is concerned, ball one of innings one has only just be thrown. There is £1.2 trillion of capital in UK pensions and ISAs and, thanks to the FCAs anti-bitcoin rulings, several years of pent-up demand. We shall see.

What’s different between this and ICO/DeFi madness is that the bitcoin treasury companies are holding something real and strong, while the narrative is only just getting going.

People were very kind about my presentation, and I got asked to do a second one the following day, which I hurriedly wrote. I’ll share both with you as soon as I get the vids, but my main arguments were:

* With the changing nature of the global workforce, the rise of the gig and freelance worker, especially the digital nomad (billions of people will soon be on the move), demand for borderless money and portable wealth is inevitably going to grow.

* Save strong currencies; spend weak ones.

* By investing in bitcoin (the currency), you benefit from the cumulative, combined IQ of everyone involved in Bitcoin (the movement).

* With such extraordinary potential, the risk is not so much owning bitcoin as not owning it.

As you would expect from someone with my chequered past, I threw in lots of jokes as well.

Join this amazing movement.

But the main event was the Michael Saylor presentation on Saturday afternoon.

My goodness me, the 60-year-old former aerospace engineer has become a rock star. He was mobbed. He stood there in the entrance hall, patiently smiling for 90 minutes, with a circle of people around him 10-deep, all wanting selfies. The frenzy did not relent, and eventually his bodyguards had to usher him away so he could prepare for his presentation.

That same presentation will no doubt be doing the rounds on the internet over the next few days, and I urge you to watch it, but I will summarise his main points here.

Saylor, his usual intense, charismatic self, first observed just how far bitcoin has come over the past 12 months. Up about 70%, it has, yet again, outperformed gold, bonds, stocks and real estate. The White House has said it wants to make the US the bitcoin capital of the world. The new US administration is extremely pro-bitcoin – he went through the key players one by one. With the ETFs and increasing institutional adoption, bitcoin is altogether more normalised and legit.

He spoke about how he wished he had got involved in 2013, when he first heard about bitcoin, rather than in 2020, but he also made the point that bitcoin still only makes up less than 1% of global capital and that this share will inevitably grow. 99% of global capital doesn’t know about it yet and so, even buying now, you’re ahead of 99% of capital.

Then he began to speak about where this growing monetary network is going. Bitcoin will continue to outperform stocks, gold, bonds and real estate, as it inevitably grows to occupy a larger slice of the global capital pie. Twenty-one years from now, it’s going to be $21 million a coin, he said. There is, therefore, an opportunity to change the destiny of your family for generations to come. You create the future, he said.

To deal with the drawdowns and the crypto winters, be like a seasick sailor: keep your eyes on the horizon. On the bigger picture.

Saylor outlined several strategies to grow your bitcoin position and showed how rich each would make you in 21 years. The lowest-risk method is to dollar cost average (DCA) – buy a set amount each month and each year. But to increase your gains, use leverage. Use it wisely of course: keep interest payments low, fixed and long duration. Otherwise, you risk debt servitude and will end up with nothing.

The principle is to borrow weak currencies, which lose value, and use the money to buy the strongest currency of the lot, which will inevitably gain in value. The gains you make will be extraordinary.

I urge you to watch the presentation when it comes out, as he details the different strategies – and then shows the different outcomes.

Using:

* DCA

* Leverage

* DCA + leverage

* In the case of companies, issuing stock to buy bitcoin

* Issuing stock and using DCA + leverage

It will turn you into a total bitcoin head, I guarantee.

But that’s all for today.

I’ll be back mid-week with more commentary. I’m attending Swen Lorenz’s Weird Sh1t Investing Conference on Tuesday so there will no doubt be lots of good ideas in there.

I’ll also update you on my conversation the day before yesterday with Eric Semler, Chairman of bitcoin treasury company, Semlar Scientific (NASDQ:SMLR). Semlar has been eclipsed in performance by the (once) smallcap UK bitcoin treasury companies - Smarter Web Company (AQUIS:SWC), Consillium (AQIS:COIN) and Helium Ventures (AQUIS:HEV.PL), but it is lower risk and better value given it is trading at the actual value of its bitcoin holdings and looks set to enjoy a decent run should bitcoin catch a bid.

If you enjoyed this article, please like, share - all that stuff. It helps.

Until next time,

Dominic

PS Here’s this week’s commentary in case you missed it:

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. Tech stocks are famously risky, , so please do your own due diligence and if in any doubt consult with a financial advisor. Markets go down as well as up. I do not know your personal financial circumstances, only you do, but never speculate with money you can’t afford to lose.

I am travelling to the bitcoin conference in Prague this week - come say hi if you’re there - so you are likely to get a lot of bitcoin-related content over the next fortnight, as I re-indoctrinate myself.

Indeed, we are talking bitcoin and gold today — and we start with this.

The Bitcoin Treasury Boom

UK-listed Coinsilium (AQUIS:COIN), as flagged last Sunday, is jumping on the bitcoin treasury bandwagon. It has risen over 600% in the 10 days since I covered it. It was 6p. Now it's over 40p.

Its market cap it £135 million. It only owns 25 bitcoins. (Worth around £2 million).

Nuts. But there you go.

I have taken my original stake off the table. I’ll let the rest run, as I think it will. Its recently announced placement was four times oversubscribed.

Bitcoin treasury companies are the new sh1tcoins. There will soon be more of them than there are sh1tcoins, the way things are going. It will probably all end in tears - for which we will have the FCA to thank, because it has outlawed investors from buying bitcoin ETFs and the like - but, while the music is playing, we dance.

The other possibility, of course, is that productive companies follow the zombie company lead, at which point the entire corporate financial model changes. Every company becoms a bitcoin treasury company. I actually think there’s a good chance of this happening, and I’ll explain why in a moment.

But let me just remind you — and myself — that owning a bitcoin treasury company is not the same as owning bitcoin. It’s a speculation, a substitute, but it’s not the same.

(BTW I bought some bitcoin with Revolut the other day, and I found the process very simple - though I quickly sent the money to another, safer wallet. Strike and CoinCorner are other UK options.)

The non-US bitcoin treasury plays are doing better than the US, which is interesting. Strategy (NASDAQ:MSTR) and Semler (NASDAQ:SMLR), for example, are not moving. (They will if bitcoin breaks to new highs above $110,000, as it is trying to do, but for now it’s all about the UK and Japan, and the dumb regulations that have created this situation).

Gold Is Now Number Two

This week has seen something of a landmark development, meanwhile. Gold has overtaken the euro to become the second-most held asset by central banks. 20% of central bank reserves are now held in gold, against 16% in euros.

Also of considerable note — and largely unreported — US dollar holdings have fallen below 50% for the first time in almost 30 years. They now sit at 46%.

De-dollarisation is happening, folks, right in front of our eyes.

If you are enjoying this post, please like it, share it and all that stuff. Thank you.

This 20% gold figure compares with just 10% ten years ago. I’ve little doubt this will double again over the next 10 years - and we’ll be at 40%.

Even ECB Chief Lizard, Christine Lagarde, has noticed. “The accumulation of gold by central banks continued at a record pace,” she says. “Some countries have been actively exploring alternatives to traditional cross-border payment systems.”

That last sentence is telling. It further confirms what we all knew was happening. It’s not just as a store of value that the US dollar’s central role is subsiding, but as a medium of exchange.

Gold is reclaiming its historical role as a core international holding. Make sure you own some.

If you are buying gold or silver to protect yourself in these ‘interesting’ times, the dealer I use and recommend is the Pure Gold Company. Pricing is competitive, quality of service is high. They deliver to the UK, the US, Canada and Europe or you can store your gold with them. Find out more here.

In the same press release Lagarde says:

“Offering solutions for settling wholesale financial transactions recorded on distributed ledger technology platforms in central bank money will increase the efficiency of European financial markets and the global appeal of the euro.”

That’s reptilian speak for “the euro CBDC is coming soon”. The EU CBDC Beast could begin as soon as this year. It will be rolled out first at the institutional level. Then it will be forced on the minions (which I don’t think will work, by the way, for reasons explained [here] — but that doesn’t mean they won’t try).

Turning to what might prove the Big Kahuna.

The Real Crisis: Government Spending Can’t Stop

We have another rapidly developing plotline, and this announcement was widely overlooked by the press - probably on government orders, but perhaps because, as Occam’s Razor would have it, they’re thick.

It is, in my view, a highly significant development, and is going to open the door to a ton of money-printing.

Back in the day, we all thought Steve was going to be a huge star. If there were any justice in the world, he would have been. But there isn’t. We all know that. Steve ended up one of those many jobbing, circuit comedians, with a brilliant act — good enough to storm pretty much any room under any circumstances — but who never seemed to get beyond the circuit. There are plenty of unknown, but brilliant acts like Steve, believe me.

Maybe he didn’t have the right mindset — I don’t know. If you want my opinion, I think he over-thought things. But what do I know?

Steve was always interested in investing and, in his spare time (comedians have plenty of that) he began speculating with his earnings. Steve liked to do things properly, and investing was no different. He studied hard, researched, read loads, watched videos, listened to podcasts, scrutinised company reports and accounts, evaluated the fundamentals. He did everything you’re supposed to do.

It didn’t work out. Steve lost money. Consistently. Bad choices dogged him.

As Covid took hold in 2020, Steve took stock of his 20 years on the circuit. Where was he was in life? What he had achieved?

Just as he never broke out of the circuit, Steve had never broken into the higher tax bracket either. Despite scrupulous and honest accounting, he had never once made it beyond the basic band. He had no property — which, for a man closing in on 50, was unimpressive. He had very little in the way of savings, even though he was frugal. No pension. The comedy circuit was already in recession. Now Covid had shut it down. Things were looking bleak.

Then Steve started watching Michael Saylor videos.

Michael Saylor is the billionaire genius Chairman of Strategy (NASDAQ:MSTR) who, amidst all the money printing during Covid, was trying to protect his corporate treasury from erosion by inflation. This led him to bitcoin, which he embraced. He became one of its most articulate proponents, while his company — which had been all but dormant, share-price-wise, for 20 years — suddenly took off like a rocket. He gave birth to the bitcoin treasury model that is becoming so widespread today.

Everything Saylor said made sense to Steve. Not only that — it chimed with him. Bitcoin is stored energy. Investing in bitcoin is like buying Apple, Amazon, Google, or Facebook a decade ago. They’re all dominant technology networks, so destined to grow. The more you obsess over timing the market, the more mistakes you make. The best strategy is to buy bitcoin and wait. It will have a market cap in the multi-trillions. All that stuff.

Steve had known about bitcoin for many years. But he never invested. He bought shares in Lloyds instead.

He changed tack. He decided he was going to do for himself what Saylor had done for Strategy.

He began buying bitcoin with any spare cash he had. In his ISA, he bought Strategy.He started bitcoin wallets for his nephews, nieces, and godchildren and bought them small amounts of bitcoin on their birthdays and at Christmas.

Something unlikely happened: Steve’s investments started going up.

By now he was obsessing over Michael Saylor videos. Watching and rewatching them. Finding old interviews and presentations and marvelling at the consistency of message — and Saylor’s extraordinary gift for spotting and riding technological trends.

“There’s not a single interview that man has done that I haven’t watched,” Steve told me the other day.

Steve sold every stock he owned. He couldn’t buy bitcoin through his broker — thanks, FCA — so he bought Strategy instead, then other bitcoin treasury companies, last year, including the amazing Metaplanet.

Meanwhile, everything he earned he sent straight to an exchange and converted to bitcoin. Only the bare essentials he needed to cover that month’s bills did he keep in fiat. Steve turned his entire personal operation into a bitcoin treasury.

What’s more, he didn’t told anyone he’d done this. Except with me — because he knows I know and love bitcoin.

He doesn’t mind when bitcoin sells off — it just means he can buy more on the cheap. He thinks it is inevitable — because of its superior technology — that bitcoin becomes the world’s dominant money system. That individuals, corporations and countries will store their capital in bitcoin, rather than fiat, so they do not suffer erosion by inflation (which is inevitable, because governments everywhere are incapable of reining in their spending — even with Elon Musk in charge).

He just keeps on accumulating, keeps on watching Saylor vids, and keeps on keeping his head down.

There are lots of people like Steve. I read about them every day. I just met a load out here at Freedom Fest in California.

I’m headed to BTC Prague next week. I know I’ll meet a load more there. (If you’re in Prague, by the way, come say hi. And if you’re thinking of going, you can get 10% off tickets using code FRISBY)

I’ve said it before and I say it again, if you save in strong currencies, and spend in weak ones, you will change your social status — you don’t have to earn a lot of money to do that

I saw Steve the other day. I’ve never seen him happier (except after he’s just stormed a gig). Guess what? He’s now in a position, just four years later, where he can buy a house. That’s what his girlfriend wants him to do. How about that for a transformation.

You really should subscribe to this amazing publication.

Only problem is: that would mean selling some of his bitcoin.

If only there were vehicles by which you could borrow against your bitcoin … That’s the next chapter in this extraordinary story: borrow against your bitcoin, spend in fiat, keep the asset.

Trouble is, if you’re in the UK — you won’t be able to. Because FCA

Thanks very much for reading this. If you enjoyed it, please like, share - all that stuff - it helps.

Until next time,

Dominic

PS Don’t forget my brilliant book about bitcoin, if you want to learn more about the space. I hear the audiobook is very good indeed.

Greetings to you from Palm Springs, California,

Something most unusual is happening in financial markets, the like of which I haven’t seen for years.

Junior mining companies are behaving well.

Silver is going up. Platinum is going up.

It feels like a proper bull market.

These things have been utter dogs for years. So cripes — is this overdue or what. It had reached the point where I never thought I’d see a bull market in these things again in my lifetime.

It’s worth noting that this phenomenon seems largely confined to precious metals.

The base metals are not seeing the same price action.

By way of reference, here is platinum. It has gone off like a rocket. Almost 40% in two months.

And long-time readers who held onto platinum pick Tharisa (THS.L) are starting to see that come back to life, thank goodness.

Typically, you would expect to see platinum trading at 1.25 times the gold price — $4,000/oz in other words. At the moment it’s $1,250, so there is plenty of future potential in that particular market.

Silver, meanwhile, if it can get above $37, where there is some historical resistance, I think goes back to $50.

Here’s the long-term silver chart, which is looking remarkably symmetrical. We’re butted up against resistance now, as you can see. After that the next line is at $44 — but if it gets to $44, I think it goes to $50.

If that happens, those who hold silver miners — particularly my favourite junior producer — are going to make a lot of money. 🙂

But, as I say, this is, for now, a precious metals thing. Copper doesn’t look too bad, but zinc, tin, lead, iron ore — they’re all either flat or falling.

If you are buying gold or silver, the bullion dealer I use and recommend is the Pure Gold Company. Pricing is competitive, quality of service is high. They deliver to the UK, the US, Canada and Europe or you can store your gold with them. Find out more here.

Gold, meanwhile, is consolidating above $3,300/oz, while the miners and other precious metals play catch up.

How about that for a chart. Talk about trend!

Let’s take a closer look at my two largest holdings.

I think both these junior gold plays are buys by the way, one of them in particular.

Let me quickly flag three things:

* There is a short note at the end of this piece on the subject of bitcoin treasury companies, which I know is of interest to some of you.

* We now have a video version of last week’s thought piece about the housing market.

* I am in Palm Springs, California, all next week. If any readers from that neck of the woods fancy meeting up, I’ll be performing at the Punching Up Comedy Night with Adam Carolla, Thai Rivera and Lou Perez, and also doing various panels at Freedom Fest on gold and bitcoin. You should be able to find me via this QR code. Or send me an email or message.

Right, gold … today we ask:

Should you invest in gold collectibles?

The gold at the Museo del Oro in Bogotá, Colombia, is one of the most stunning collections you will ever see – diadems, helmets and crowns, rings, necklaces and bracelets, beads and breastplates, even fishhooks and penis covers. The smiths of ancient South and Central America were quite brilliant artisans. The Spaniards who saw their work said Aztec goldsmiths were more skilled than their European counterparts.

In Mexico, the conquistadors found life-size figures of men and women, great jars and pitchers, half pottery-half gold vases sculpted in relief with birds, animals and insects, and more. In Peru and Ecuador, the conquistadors found miniature gardens made of gold – earth of gold granules, gold cornstalks, and gold figures of men and llamas.

Unfortunately, what sits in the Museo del Oro is just a fraction of what was made. The Spaniards valued bullion on weight alone, ascribing no value to art, beauty or workmanship. Most got melted down before being sent home. What they sent to their king intact got melted down once back in Europe. “What was being destroyed was more perfect than anything they enjoyed and possessed,” said a young priest travelling with the conquistador Francisco Pizarro.

The conquistadors were by no means alone in this. It has happened repeatedly through history. Though gold may last, art made from gold rarely does. People always seem to melt it down. That should mean ancient gold workings should command an even higher premium for their antiquity, because they have survived the meltdown risk. But for some reason, it doesn’t seem to work like that.

You can’t destroy gold, as I’m sure you know. It lasts forever and never loses its shine. It was present in the dust that formed the solar system, and sits in the Earth’s crust today, just as it did when our planet was formed some 4.6 billion years ago.

That means that little bit of gold you may be wearing on your finger or around your neck is actually older than the Earth itself. In fact, it is older than the solar system. Who knows? It might once have adorned a pharaoh or sat in a conquistador’s treasure chest. Gold may be antique, but it’s very rare that you get vast premiums for its antique value.

Buying gold or silver? The dealer I use and recommend is the Pure Gold Company. Pricing is competitive, quality of service is high. They deliver to the UK, the US, Canada and Europe or you can store your gold with them. Find out more here.

The gold coinage that never was

If you buy a gold sovereign minted recently, you would typically pay £600 to £630. For a Victorian sovereign minted 150 years ago or more – which has the same gold content – you would pay £660 to £680. So, for all that history and antique value, you pay just 10%. Sovereigns are not uncommon. A billion are thought to have been struck. So you get little rarity value. But even so, you’d think you would get more of a premium.

The main exception is the 1937 sovereign struck for Edward VIII. Since he abdicated a few weeks before the coins were struck, they were never circulated. They are often called the “coinage that never was”, and only a few were ever minted. One sold in 2020 for £1 million. That’s quite the premium. But this is rare.

About ten years ago, I picked up a Justinian solidus, minted in 600AD – the solidus was the dominant coin of the Mediterranean after the Roman aureus. I got it for a 20% premium to the spot value of the metal. And I bought it from a shop in W1, so I was paying the Mayfair premium too.

An ingot recovered from the SS Central America, which famously sank off the Carolina coast in 1857 carrying Californian gold to New York (and triggered a financial panic because so much bullion was lost), recently went up for auction. It weighed 649 ounces, but it was only 21-carat gold (.875 purity). If melted down, you would have 568 ounces of pure gold, which, at today’s price of $3,300 per ounce, would have a spot value of $1.9 million. It sold for $2.1 million, including the buyer’s premium – little more than the spot value, in other words.

Antique gold very rarely catches the huge premium you might think it deserves.

Beware graded coins

Unscrupulous coin dealers will often try to flog you graded coins. If a dealer tells you that some recent sovereign, for example, is extremely rare, that it was one of the last coins minted under Queen Elizabeth II, or some such, and that it has been graded and has a special certificate and blah blah... and it therefore carries a huge premium, they are trying to pull a sly one.

The reality is that the extra premium paid is almost impossible to claw back when you come to sell. In almost all cases, they are trying to rip you off.

Don’t pay a premium for graded coins.

A dealer might buy a large stock of coins from the Royal Mint. Coins are often of a slightly different quality. Dealers then send them off and pay a small fee to get them graded according to their “Mint State”. The scale ranges from MS-60 to MS-70, with MS-70 being a perfect, flawless coin. They then charge a large premium for coins with high grades, even though they barely paid any premium when they bought the coins.

The margins when dealing in gold are on the slim side – sometimes just a few percent. But if they get an additional premium for the rarity, that margin can rise to 100%. No wonder there are so many unscrupulous salesman trying to flog graded coins.

Fractional coins – quarter or half sovereigns, for example – or older coins do trade at a higher (though not enormous) premium. These can trade for 15 - 20% above the spot value of the gold content. But you are likely to get that back when you sell.

You are not buying gold to try and be clever and hope that your coin gets some kind of rarity value. In most cases, that will not happen. There are clever people who know this market better than you already playing this game. Don’t get involved is my advice. Your priority is to get as much gold for your money as possible. You are buying gold to preserve purchasing power, not to lose it.

This article was first published in MoneyWeek's magazine.

Some developments in the bitcoin treasury company story - a new kid on the block

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Subscribe to this amazing publication, why don’t you?.

If you are thinking of buying silver or gold bullion to protect yourself in these ‘interesting’ times - and I recommend you do - the bullion dealer I use and recommend is the Pure Gold Company. Pricing is competitive, quality of service is high. They deliver to the UK, the US, Canada and Europe or you can store your gold with them. Find out more here.

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It’s time for my annual slagging off of silver.

Why now?

Because, according to one of my WhatsApp chats, it’s breaking out.

Silver is always breaking out. It never actually does.

Was ever there a metal with as much potential as silver? Probably not.

Was ever there a metal you could so wholly depend on to let you down?

If there is, I’m not aware of it (though these past 15 years, platinum has been running it close).

But maybe, just maybe this time is different.

Really?

Let’s start with a bit of gossip from the front line.

I have three mates who are CEOs of silver mining companies, as you do. All three of them, based in Latin America, have reported back with the same story.

Typically, a miner would pay a company — usually a refiner — to take ore off their hands, treat and smelt it, so it can be sold. So-called off-take agreements would usually amount to $120–180 per tonne of ore. But, at the moment, refiners aren’t charging anything. Somebody is subsidising it all.

Could it be that humongous, commodity-guzzling nation that begins with a C, I wonder?

It wants silver for all those solar panels Ed Miliband is buying.

The way things are behaving and moving at the moment, it’s starting to feel like we are moving into a proper commodities bull market. Maybe 2021–22 was just the appetizer.

Stop! Don’t get excited. It’s silver we’re talking about here.

The case for silver runs roughly as follows:

We are in an age of currency debasement, therefore you want to own hard assets. In such an inflationary environment, the monetary metals — gold and silver — perform best. Silver has been money since forever. It is natural money etc etc.

Let’s just address that before we move on.

Gold is still used as money in the store-of-value sense of the word. National banks keep it. Institutions keep it. Individuals keep it. Gold’s role was always more store of value than medium of exchange. Historically, we used silver, copper and nickel for all but high-value transactions.

Silver was not used as a store of value to the extent gold was. Its function was more, as I say, as a medium of exchange. That role has long gone. The gold rushes of the 19th century did for silver.

Long story — it’s in my book, which comes out in August — but to cut it short, the vast increase in gold supply enabled nations to abandon silver. In the case of the US, it was the Coinage Act of 1873 — or as silver bugs like to call it, the Crime of ’73 — that began the end of silver as official money. In the UK — largely thanks to the Portuguese discoveries of gold in Minas Gerais (again, long story, it’s in the book) — the process began a good 150 years earlier.

In these cashless times, there is little chance of silver regaining its role as medium of exchange.

As a result, looking at gold-to-silver ratios — it now takes about 100 ounces of silver to buy an ounce of gold — and saying we are going back to the historical average of 12 or 15:1 is mistaken. There may well only be 15 times as much silver in the Earth’s crust as gold (making 15:1 the natural ratio) but without its role as money, this is just not going to happen. Not for any prolonged period.

In the last 100 years, we have only touched this level once — Thursday, March 27, 1980. Uncommon circumstances. Two brothers were trying to corner the silver market.

Silver’s role as money is as good as over. Silver bugs hate me when I say that. But I can only say it like I see it.

Physical silver in your possession is nobody else’s liability — I get that — and it is outside of the financial system — I get that too. There are many reasons to invest in silver. I own physical silver. But expecting it to be monetised again should not be one of them.

If you are thinking of buying silver or gold bullion, the bullion dealer I use and recommend is the Pure Gold Company. Pricing is competitive, quality of service is high. They deliver to the UK, the US, Canada and Europe or you can store your gold with them. Find out more here.

If Armageddon comes, you’ll be glad you own silver — maybe — but there will be bigger problems on your plate. Like Armageddon.

Everywhere silver

Silver has widespread industrial use, especially in these times of mass electrification. You could write a book about the industrial uses of silver, there are so many. It might not be a very good book, but it would be long.

From medical equipment to electrical appliances, it’s almost harder to find things that don’t contain silver than things that do. Every smartphone has silver in it; every computer; every jet engine; every solar panel. The best batteries contain silver. It’s used in detergent, deodorant, wart treatment, antimicrobial lab coats, 3D printing, plastics, jewellery, wood preservation, water purification — it’s like a picks-and-shovels play on new tech and the growing middle class of the developing world.

Annual silver demand stands at around 1.2 billion ounces. Roughly 60% of that demand — 700 million ounces — comes from industry (500 million from electrical and electronics, half of which is solar panels); 22% from jewellery and silverware; and 18% from investment.

Annual supply is about one billion ounces (80% mining, 20% recycling) — so the market is in deficit. Hence the current rising price.

Most silver is produced as a bi-product of other mines, especially lead and zinc (eg at one point BHP Billiton was the world’s largest silver producer).

There is, however, a romance to silver. It catches the public imagination — occasionally with explosive results. It did in 1980 when it went to $50 (it had been $2 just a few years earlier). It did again in 2011 when it revisited $50 before collapsing. It nearly took off during Lockdown Meme Mania, but didn’t quite get going.

As a result of this romance, it has a tendency to go bananas every few years — but it never lasts. Does romance? Sometimes, if you’re lucky.

There is also the issue of silver price suppression, which some use to explain every sell-off in the silver markets. There’s nothing any of us can do about that — even if true — so let’s not go there.

Silver will at some point revisit $50. At some other point it will get above that figure. The mother of all narratives will take hold, and silver will probably end up going to $100 or even $200.

At which point you want to be owning silver stocks …

It will also, at some point, revisit $15.

That’s when you don’t want to be owning silver stocks.

Here is 100 years of silver prices. If you give any credence to such things, there is the mother of all cup-and-handle formations appearing (that’s a super bullish pattern), which I have drawn in blue. It projects prices towards the $100/oz mark.

It’s also apparent on the 50-year chart. (I haven’t drawn it here - I’ll let you visualise).

Silver has been in a bull market since summer 2022, but it has, broadly speaking, followed rather than led gold. It’s now come up against a wall at around $35.

You could say it’s a triple top.

Then again, the more times you test a level, the less likely it is to hold — particularly when each low is higher than the last, as is the case here.

But these last few weeks, all of a sudden, silver is leading gold.

What’s more, silver miners are leading silver. That’s what makes me bullish.

Here is the silver miners’ ETF, SIL (NYSE: SIL) — and you can see, just as they’re saying in my WhatsApp chats — the silver miners really have broken out.

I haven’t seen this in a long time. Miners leading!!!!! WTF?

This is why I’m saying it’s starting to feel like a proper metals bull market.

So how am I playing this?

What are the best ways to invest in silver and profit?

I’ve been viewing houses this past fortnight, so I thought I’d share my anecdotal 2p on the state of the London property market.

I’m looking in Brockley, SE4, which, if you don’t know it, used to be rough AF, but is now where all the cool kids are. The area has benefited from the various London rail line extensions – you can be in Shoreditch or Canary Wharf in 15 minutes; the Jubilee and Elizabeth lines are a similarly short step away – and that has attracted the slay crew to the area.

The road links though are still horrendous though, made worse by 20mph speed limits and bus lane misallocation of essential road space. The drive to west London is interminable.

Brockley has a good stock of beautiful detached, semi-detached and terraced Victorian houses. For example:

With its proximity to Greenwich and the river docks, it was once a wealthy area, though, like most of south-east London, it got bombed to heck in the war.

There are plenty of nice parks too. One of them, Hilly Fields, was modelled on Hampstead Heath, and there are many gorgeous houses in the roads running off it. Not quite Hampstead gorgeous, but getting there.

Brockley also has the highest density of cemeteries in London, if you fancy dying any time soon, it’s highly convenient. It is, I gather, London’s most haunted area.

It is only a bit stabby. Nothing like as bad as neighbouring Lewisham. (Maybe “only a bit stabby” will one day become part of estate agents’ jargon, perhaps to replace “vibrant”. I can’t believe how normalised stabbing now is that I’m talking like that.)

The stabbiness is offset, however, by the plethora of nice restaurants, cafés, bars, craft ale breweries, the farmers’ market, mini-festivals, pilates studios et al. I understand, in Browns, the area boasts London’s best coffee and, in Babur, its best Indian restaurant. (Technically Babur is in Honor Oak, but, like England and many of its foreign sporting greats, we’ll claim it as our own.)

I shot this vid from the steps up to the station.

Brockley feels younger and more up-and-coming than the once-cool areas to the west like Queen’s Park, Kensal Rise, Clapham and so on, probably because of its easy access to east London. (A lot of people from Hackney move down here.)

I moved here begrudgingly and skint in 2015 and have grown to really like it.

But what about the housing market?

I’ve known markets in which estate agents don’t give you the time of day, there are so many prospective buyers, but – perhaps because they know I am an unencumbered buyer – the agents are maybe not quite all over me, but certainly on my case: lots of emails, phone calls and the rest of it. That indicates it’s more of a buyers’ market.

But, while I would describe the housing market here as slow, it is not dead. Stuff has been going under offer in the two weeks I’ve been looking, though rarely at asking.

With the costs of moving – Stamp Duty is 10% above £925k, and 12% above £1.5m, plus an extra 5% if you own another property – buyers have got to really want to buy.

Sellers, meanwhile, have to really want to sell, which often entails reducing their asking prices. Stuff which is unrealistically priced is staying on the market a long time. Look at this one (actually up the road in Honor Oak):

This is a 5,000-square-foot property, not so nice inside, but with access to a 2-acre private garden behind with its own tennis court – quite something in London. From £2.5 million to £1.75 million and they still can’t shift it. (It needs a lot of money spending on it.)

On the other hand, there don’t seem to be many forced sellers – people who can’t make their payments – and we won’t get any house price crash, long-awaited or not, until that is a reality.

I imagine Brockley, as a young, trendy area, is busier than other parts of town, but that is my overall feel: slow, but not dead.

I’ve looked at a few family houses. I can’t really comment on flats, but I gather there is an oversupply of 2-bed flats across London, and it is really hard to shift them. I’m not sure if this applies to Brockley or not.

It doesn’t feel as expensive as it did around 2019–2022 (realised sales prices are a fraction lower, but there is obviously currency debasement to consider too), but nor does it feel super cheap. We’re a long way off where we were in, say, 2013, even though grander parts of London – Kensington and Chelsea, for example – are back at those 2013 levels.

Where does the housing market go from here?

It all depends on two things: interest rates and Stamp Duty.

Britain’s zombie housing market, brought to you by Stamp Duty.

If rates go lower, the market will not collapse. There won’t be the forced sellers. We’ll continue as we are: stagnant. If rates go higher, the market is in trouble.

But get rid of Stamp Duty, and you’d have a flurry of activity across the country tomorrow. People aren’t moving because of the amount of dead money involved. Stamp Duty has immobilised the country.

If you’re buying a two-million-pound house, you will pay £153,750 in stamp duty. Cash. Money you’ve already paid tax on once. You can’t borrow the money. You have to be extremely rich, or extremely desperate for a home, to be willing to pay a £150k one-off tax of this kind. Most would rather avoid paying it, so they don’t move.

You will pay more if you are not a UK resident.

If you happen to own another property – which most people in that wealth bracket will, either their first flat they never sold, a property they inherited, or a home in the country – and the house you are buying is not your main residence, the tax rises to £253,750. A quarter of a million quid.

That’s why houses in Kensington and Chelsea no longer sell.

EDIT: My mate, whose kids have now flown the nest, sent me this: "We live in a 4 floor house, 2 floors we don't use, I haven't been to the top floor for about 5 years (seriously). We would love to move and downsize but makes no sense as the costs of buying a new house would use up all the gain on downsizing . IE We just end up with a smaller house."

This happens all the way down the scale. Kirstie Whatsit off the telly was tweeting about it the other day.

My mother’s friend, who is in her 70s, lives in a 2-bed flat two floors up in Wandsworth worth maybe £700,000. She is worried about climbing the stairs at her age, and wants to move to another 2-bed flat. She will pay £25,000 in Stamp Duty on top of all her other moving costs. She doesn’t have 25 grand to throw away.

The result is this nearly dead market. Britain’s zombie housing market.

Stamp Duties were one of the taxes the ignited the American Revolution. If only we had muskets today …

The biggest villains in all this are former Chancellor Gordon Brown for first raising Stamp Duty on property transactions (before him it just one per cent on all properties over £60,000), and, worst of all, George Osborne for raising the rates to today’s ludicrous levels. Rather than address the root causes of unaffordable housing – fiat money, artificially low interest rates, improper measures of inflation and dumb planning laws – he blamed the market, and attacked it with Stamp Duty. But all of Jeremy Hunt, Rishi Sunak, Sajid Javid, Philip Hammond and Alistair Darling must take their share of the blame for failing to do anything about it, when they had the chance. (We’ll give Kwasi Kwarteng and Nadhim Zahawi a pass on the grounds they didn’t have the gig for long enough).

Osborne, Brown et al have given birth to the zombie situation we have now. They have immobilised the country in the process.

Government. Yet again. 0 stars. Would not use again.

It’s enough to make you a libertarian.

Until next time,

Dominic

PS If you enjoyed today’s article, please like, share and all that stuff. It really helps.

PPS If you missed this week’s market commentary, here it is:

As always If you are buying gold to protect yourself in these times or relentless currency debasement, the bullion dealer I use and recommend is the Pure Gold Company. Pricing is competitive, quality of service is high. They deliver to the UK, the US, Canada and Europe or you can store your gold with them.

Find out more here.

I’ve had a flood of new readers sign up to the Flying Frisby this week, I’m delighted to report, largely as a result of this article on bitcoin treasury companies and of this video on North Sea oil and the next Labour U-turn, which has been doing the rounds on the net.

So welcome everyone. I hope you enjoy the ride.

Today’s piece is going to be a bit of a hotchpotch, as I gather my thoughts and tidy up a few loose ends.

We’ll start with the macro. Are we in a bull market? Are the animal spirits back in command? Or have we just gone through a bear market rally?

It all depends on tariffs, I guess, and what is going on in the Great Orange Man’s mind. What plans does he have? That I cannot answer, but I will say the S&P500 looks like it might have just put in a lower high.

We want to be above that blue line.

If he goes full tariff again, all bets - well most - are off.

But thanks to the Great Orange Man’s pronouncements on uranium, our speculation Lightbridge Fuels (NASDAQ:LTBR) is now enjoying another of its spikes. If he goes full tariff again, all bets - well most - are off.

But thanks to the Great Orange Man’s pronouncements on uranium, our speculation Lightbridge Fuels (NASDAQ:LTBR) is now enjoying another of its spikes.

Sell the spikes, buy the dips has been the play here. We are on one such spike now, so if the recent pattern continues (it won’t continue forever, nothing does, but it might for a bit) then lighten up between $15 and $20 and buy if it goes back to $9 is the trade.

Sell the spikes, buy the dips has been the play here. We are on one such spike now, so if the recent pattern continues (it won’t continue forever, nothing does, but it might for a bit) then lighten up between $15 and $20 and buy if it goes back to $9 is the trade.

We have quite a well defined, trade-able range emerging here, as defined by the blue lines below.

I don’t see it going back to the $2.50-$3 area, where we were lucky enough to first stumble upon this stock, but $8.50-9 looks like the new floor. For now.

Remember: this was an $800 stock once upon a time, so there is a lot of upside left. One should probably keep some money on the table, in case we don’t get the dip.

Tell your friends.

The next Starmer U-turn

Turning next to the issue of the re-opening of the North Sea. Since posting that video our Glorious Leader has tightened ties with the EU, and in particular relevance here, its net zero goals. The UK now commits to net zero obligations “at least as ambitious as the EU”. “Want to get out of net zero?,” says Lord Frost in the Telegraph, “Tough: you can’t, unless the EU agrees”.

That said I am sure Captain FlipFlop will find a way of flipflopping his way round any North Sea ties and then spinning it.

There is a review this week. Surely even this government will realise importing Norwegian gas for (net) zero tax take, fewer jobs and a higher carbon footprint than producing our own makes (net) zero sense. More importantly it is gifting Reform. Maybe the needs of the Treasury mean Milibrain - Miliband gets overruled. We will know more as soon as today.

Adding another bitcoin treasury company to my portfolio

In a moment, I am going to take a look at Comstock Lode (NYSE:LODE), further to its AGM this week. I know I keep talking about this company, but it might be the one we all retire on - hence my outsized attention.

But first I also want to continue on the bitcoin treasury company story.

(Despite the outperformance of the treasury companies of late, I still prefer bitcoin and think it should be a core holding. The treasury companies are rather more speculative. However, given the hassle involved, I understand why some in the UK prefer the treasury companies).

How about this for nuts? The UK’s Smarter Web Company (ISIN: GB00BPJHZ015) hit a market cap of £175 million yesterday. Its assets: it has about £5 million in bitcoin.

The dude who founded it, Andrew Webley, was a month ago running a web design firm in Guildford with net assets of less than £50,000. In the company's Retail Investor IPO document, he committed to invest a minimum of £30,000...through his ISA”. (h/t Glen Goodman)

This will not end well.

And we have the FCA to thank. It has made it so difficult to buy bitcoin, investors are buying this company and others like it instead.

If, like many readers, you are playing this one, make sure you get your original investment out, is my advice …

Meanwhile, Metaplanet (3350:TYO) briefly lost a third of its value last week, falling below ¥800. Now it’s above ¥1,200, at all-time highs, trading at 450% of the value of its bitcoin.

It’s a mania all right.

I’m adding another position, in a stock which has some recent history of manias.

What is it? Ah-ha …

I am just on a train home from Glasgow, where I have been gigging these past two nights. I’ve had a great time, as I always seem to do when I go north of the wall.

But Glasgow on a Saturday night is something else. My hotel was right next to the station and so I was right in the thick of it. If I ever get to make a cacatopian, end-of-days, post-apocalyptic thriller, I’ll just stroll through Glasgow city centre on a Friday or Saturday night with a camera to get all the B roll. It was like walking through a Hieronymus Bosch painting only with a Scottish accent.

Little seems to have changed since I wrote that infamous chapter about Glasgow in Life After the State all those years ago. The only difference is that now it’s more multi-ethnic. So many people are so off their heads. I lost count of the number of randoms wandering about just howling at the stars. The long days - it was still light at 10 o’clock - make the insanity all the more visible. Part of me finds it funny, but another part of me finds it so very sad that so many people let themselves get into this condition.

It prompted me to revisit said chapter, and I offer it today as your Sunday thought piece.

Just a couple of little notes, before we begin. This caught my eye on Friday. Our favourite uranium tech company, Lightbridge Fuels (NASDAQ:LTBR), has taken off again with Donald Trump’s statement that he is going to quadruple US nuclear capacity. The stock was up 45% in a day. We first looked at it in October at $3. It hit $15 on Friday.

It’s one to sell on the spikes and buy on the dips, as this incredible chart shows.

(In other news I have now listened twice to the Comstock Lode AGM, and I’ll report back on that shortly too).

ICYMI here is my mid-week commentary, which attracted a lot of attention

Right - Glasgow.

(NB I haven’t included references here. Needless to say, they are all there in the book. And sorry I don’t have access to the audio of me reading this from my laptop, but, if you like, you can get the audiobook at Audible, Apple Books and all good audiobookshops. The book itself available at Amazon, Apple Books et al).

How the Most Entrepreneurial City in Europe Became Its Sickest

The cause of waves of unemployment is not capitalism, but governments …Friedrich Hayek, economist and philosopher

In the 18th and 19th centuries, the city of Glasgow in Scotland became enormously, stupendously rich. It happened quite organically, without planning. An entrepreneurial people reacted to their circumstances and, over time, turned Glasgow into an industrial and economic centre of such might that, by the turn of the 20th century, Glasgow was producing half the tonnage of Britain’s ships and a quarter of all locomotives in the world. (Not unlike China’s industrial dominance today). It was regarded as the best-governed city in Europe and popular histories compared it to the great imperial cities of Venice and Rome. It became known as the ‘Second City of the British Empire’.

Barely 100 years later, it is the heroin capital of the UK, the murder capital of the UK and its East End, once home to Europe’s largest steelworks, has been dubbed ‘the benefits capital of the UK’. Glasgow is Britain’s fattest city: its men have Britain’s lowest life expectancy – on a par with Palestine and Albania – and its unemployment rate is 50% higher than the rest of the UK.

How did Glasgow manage all that?

The growth in Glasgow’s economic fortunes began in the latter part of the 17th century and the early 18th century. First, the city’s location in the west of Scotland at the mouth of the river Clyde meant that it lay in the path of the trade winds and at least 100 nautical miles closer to America’s east coast than other British ports – 200 miles closer than London. In the days before fossil fuels (which only found widespread use in shipping in the second half of the 19th century) the journey to Virginia was some two weeks shorter than the same journey from London or many of the other ports in Britain and Europe. Even modern sailors describe how easy the port of Glasgow is to navigate. Second, when England was at war with France – as it was repeatedly between 1688 and 1815 – ships travelling to Glasgow were less vulnerable than those travelling to ports further south. Glasgow’s merchants took advantage and, by the early 18th century, the city had begun to assert itself as a trading hub. Manufactured goods were carried from Britain and Europe to North America and the Caribbean, where they were traded for increasingly popular commodities such as tobacco, cotton and sugar.

Through the 18th century, the Glasgow merchants’ business networks spread, and they took steps to further accelerate trade. New ships were introduced, bigger than those of rival ports, with fore and aft sails that enabled them to sail closer to the wind and reduce journey times. Trading posts were built to ensure that cargo was gathered and stored for collection, so that ships wouldn’t swing idly at anchor. By the 1760s Glasgow had a 50% share of the tobacco trade – as much as the rest of Britain’s ports combined. While the English merchants simply sold American tobacco in Europe at a profit, the Glaswegians actually extended credit to American farmers against future production (a bit like a crop future today, where a crop to be grown at a later date is sold now). The Virginia farmers could then use this credit to buy European goods, which the Glaswegians were only too happy to supply. This brought about the rise of financial institutions such as the Glasgow Ship Bank and the Glasgow Thistle Bank, which would later become part of the now-bailed-out, taxpayer-owned Royal Bank of Scotland (RBS).

Their practices paid rewards. Glasgow’s merchants earned a great deal of money. They built glamorous homes and large churches and, it seems, took on aristocratic airs – hence they became known as the ‘Tobacco Lords’. Numbering among them were Buchanan, Dunlop, Ingram, Wilson, Oswald, Cochrane and Glassford, all of whom had streets in the Merchant City district of Glasgow named after them (other streets, such as Virginia Street and Jamaica Street, refer to their trade destinations). In 1771, over 47 million pounds of tobacco were imported.

However, the credit the Glaswegians extended to American tobacco farmers would backfire. The debts incurred by the tobacco farmers – which included future presidents George Washington and Thomas Jefferson (who almost lost his farm as a result) – grew, and were among the grievances when the American War of Independence came in 1775. That war destroyed the tobacco trade for the Glaswegians. Much of the money that was owed to them was never repaid. Many of their plantations were lost. But the Glaswegians were entrepreneurial and they adapted. They moved on to other businesses, particularly cotton.

By the 19th century, all sorts of local industry had emerged around the goods traded in the city. It was producing and exporting textiles, chemicals, engineered goods and steel. River engineering projects to dredge and deepen the Clyde (with a view to forming a deep- water port) had begun in 1768 and they would enable shipbuilding to become a major industry on the upper reaches of the river, pioneered by industrialists such as Robert Napier and John Elder. The final stretch of the Monkland Canal, linking the Forth and Clyde Canal at Port Dundas, was opened in 1795, facilitating access to the iron-ore and coal mines of Lanarkshire.

The move to fossil-fuelled shipping in the latter 19th century destroyed the advantages that the trade winds had given Glasgow. But it didn’t matter. Again, the people adapted. By the turn of the 20th century the Second City of the British Empire had become a world centre of industry and heavy engineering. It has been estimated that, between 1870 and 1914, it produced as much as one-fifth of the world’s ships, and half of Britain’s tonnage. Among the 25,000 ships it produced were some of the greatest ever built: the Cutty Sark, the Queen Mary, HMS Hood, the Lusitania, the Glenlee tall ship and even the iconic Mississippi paddle steamer, the Delta Queen. It had also become a centre for locomotive manufacture and, shortly after the turn of the 20th century, could boast the largest concentration of locomotive building works in Europe.

It was not just Glasgow’s industry and wealth that was so gargantuan. The city’s contribution to mankind – made possible by the innovation and progress that comes with booming economies – would also have an international impact. Many great inventors either hailed from Glasgow or moved there to study or work. There’s James Watt, for example, whose improvements to the steam engine were fundamental to the Industrial Revolution. One of Watt’s employees, William Murdoch, has been dubbed ‘the Scot who lit the world’ – he invented gas lighting, a new kind of steam cannon and waterproof paint. Charles MacIntosh gave us the raincoat. James Young, the chemist dubbed as ‘the father of the oil industry’, gave us paraffin. William Thomson, known as Lord Kelvin, developed the science of thermodynamics, formulating the Kelvin scale of absolute temperature; he also managed the laying of the first transatlantic telegraph cable.

The turning point in the economic fortunes of Glasgow – indeed, of industrial Britain – was WWI. Both have been in decline ever since. By the end of the war, the British were drained, both emotionally and in terms of capital and manpower; the workers, the entrepreneurs, the ideas men, too many of them were dead or incapacitated. There was insufficient money and no appetite to invest. The post-war recession, and later the Great Depression, did little to help. The trend of the city was now one of inexorable economic decline.

If Glasgow was the home of shipping and industry in 19th-century Britain, it became the home of socialism in the 20th century. Known by some as the ‘Red Clydeside’ movement, the socialist tide in Scotland actually pre-dated the First World War. In 1906 came the city’s first Labour Member of Parliament (MP), George Barnes – prior to that its seven MPs were all Conservatives or Liberal Unionists. In the spring of 1911, 11,000 workers at the Singer sewing-machine factory (run by an American corporation in Clydebank) went on strike to support 12 women who were protesting about new work practices. Singer sacked 400 workers, but the movement was growing – as was labour unrest. In the four years between 1910 and 1914 Clydebank workers spent four times as many days on strike than in the whole of the previous decade. The Scottish Trades Union Congress and its affiliations saw membership rise from 129,000 in 1909 to 230,000 in 1914.20

The rise in discontent had much to do with Glasgow’s housing. Conditions were bad, there was overcrowding, bad sanitation, housing was close to dirty, noxious and deafening industry. Unions grew quite organically to protect the interests of their members.

Then came WWI, and inflation, as Britain all but abandoned gold. In 1915 many landlords responded by attempting to increase rent, but with their young men on the Western front, those left behind didn’t have the means to pay these higher costs. If they couldn’t, eviction soon followed. In Govan, an area of Glasgow where shipbuilding was the main occupation, women – now in the majority with so many men gone – organized opposition to the rent increases. There are photographs showing women blocking the entrance to tenements; officers who did get inside to evict tenants are said to have had their trousers pulled down.

The landlords were attacked for being unpatriotic. Placards read: ‘While our men are fighting on the front line,the landlord is attacking us at home.’ The strikes spread to other cities throughout the UK, and on 27 November 1915 the government introduced legislation to restrict rents to the pre-war level. The strikers were placated. They had won. The government was happy; it had dealt with the problem. The landlords lost out.

In the aftermath of the Russian Revolution of 1917, more frequent strikes crippled the city. In 1919 the ‘Bloody Friday’ uprising prompted the prime minister, David Lloyd George, to deploy 10,000 troops and tanks onto the city’s streets. By the 1930s Glasgow had become the main base of the Independent Labour Party, so when Labour finally came to power alone after WWII, its influence was strong. Glasgow has always remained a socialist stronghold. Labour dominates the city council, and the city has not had a Conservative MP for 30 years.

By the late 1950s, Glasgow was losing out to the more competitive industries of Japan, Germany and elsewhere. There was a lack of investment. Union demands for workers, enforced by government legislation, made costs uneconomic and entrepreneurial activity arduous. With lack of investment came lack of innovation.

Rapid de-industrialization followed, and by the 1960s and 70s most employment lay not in manufacturing, but in the service industries.

Which brings us to today. On the plus side, Glasgow is still ranked as one of Europe’s top 20 financial centres and is home to some leading Scottish businesses. But there is considerable downside.

Recent studies have suggested that nearly 30% of Glasgow’s working age population is unemployed. That’s 50% higher than that of the rest of Scotland or the UK. Eighteen per cent of 16- to 19-year-olds are neither in school nor employed. More than one in five working-age Glaswegians have no sort of education that might qualify them for a job.

In the city centre, the Merchant City, 50% of children are growing up in homes where nobody works. In the poorer neighbourhoods, such as Ruchill, Possilpark, or Dalmarnock, about 65% of children live in homes where nobody works – more than three times the national average. Figures from the Department of Work and Pensions show that 85% of working age adults from the district of Bridgeton claim some kind of welfare payment.

Across the city, almost a third of the population regularly receives sickness or incapacity benefit, the highest rate of all UK cities. A 2008 World Health Organization report noted that in Glasgow’s Calton, Bridgeton and Queenslie neighbourhoods, the average life expectancy for males is only 54. In contrast, residents of Glasgow’s more affluent West End live to be 80 and virtually none of them are on the dole.

Glasgow has the highest crime rate in Scotland. A recent report by the Centre for Social Justice noted that there are 170 teenage gangs in Glasgow. That’s the same number as in London, which has over six times the population of Glasgow.

It also has the dubious record of being Britain’s murder capital. In fact, Glasgow had the highest homicide rate in Western Europe until it was overtaken in 2012 by Amsterdam, with more violent crime per head of population than even New York. What’s more, its suicide rate is the highest in the UK.

Then there are the drug and alcohol problems. The residents of the poorer neighbourhoods are an astounding six times more likely to die of a drugs overdose than the national average. Drug-related mortality has increased by 95% since 1997. There are 20,000 registered drug users – that’s just registered – and the situation is not going to get any better: children who grow up in households where family members use drugs are seven times more likely to end up using drugs themselves than children who live in drug-free families.

Glasgow has the highest incidence of liver diseases from alcohol abuse in all of Scotland. In the East End district of Dennistoun, these illnesses kill more people than heart attacks and lung cancer combined. Men and women are more likely to die of alcohol-related deaths in Glasgow than anywhere else in the UK. Time and time again Glasgow is proud winner of the title ‘Fattest City in Britain’. Around 40% of the population are obese – 5% morbidly so – and it also boasts the most smokers per capita.

I have taken these statistics from an array of different sources. It might be in some cases that they’re overstated. I know that I’ve accentuated both the 18th- and 19th-century positives, as well as the 20th- and 21st-century negatives to make my point. Of course, there are lots of healthy, happy people in Glasgow – I’ve done many gigs there and I loved it. Despite the stories you hear about intimidating Glasgow audiences, the ones I encountered were as good as any I’ve ever performed in front of. But none of this changes the broad-brush strokes: Glasgow was a once mighty city that now has grave social problems. It is a city that is not fulfilling its potential in the way that it once did. All in all, it’s quite a transformation. How has it happened?

Every few years a report comes out that highlights Glasgow’s various problems. Comments are then sought from across the political spectrum. Usually, those asked to comment agree that the city has grave, ‘long-standing and deep-rooted social problems’ (the words of Stephen Purcell, former leader of Glasgow City Council); they agree that something needs to be done, though they don’t always agree on what that something is.

There’s the view from the right: Bill Aitken of the Scottish Conservatives, quoted in The Sunday Times in 2008, said, ‘We simply don’t have the jobs for people who are not academically inclined. Another factor is that some people are simply disinclined to work. We have got to find something for these people to do, to give them a reason to get up in the morning and give them some self-respect.’ There’s the supposedly apolitical view of anti-poverty groups: Peter Kelly, director of the Glasgow-based Poverty Alliance, responded, ‘We need real, intensive support for people if we are going to tackle poverty. It’s not about a lack of aspiration, often people who are unemployed or on low incomes are stymied by a lack of money and support from local and central government.’ And there’s the view from the left. In the same article, Patricia Ferguson, the Labour Member of the Scottish Parliament (MSP) for Maryhill, also declared a belief in government regeneration of the area. ‘It’s about better housing, more jobs, better education and these things take years to make an impact. I believe that the huge regeneration in the area is fostering a lot more community involvement and cohesion. My real hope is that these figures will take a knock in the next five or ten years.’ At the time of writing in 2013, five years later, the figures have worsened.

All three points of view agree on one thing: the government must do something.

In 2008 the £435 million Fairer Scotland Fund – established to tackle poverty – was unveiled, aiming to allocate cash to the country’s most deprived communities. Its targets included increasing average income among lower wage-earners and narrowing the poverty gap between Scotland’s best- and worst-performing regions by 2017. So far, it hasn’t met those targets.

In 2008 a report entitled ‘Power for The Public’ examined the provision of health, education and justice in Scotland. It said the budgets for these three areas had grown by 55%, 87% and 44% respectively over the last decade, but added that this had produced ‘mixed results’. ‘Mixed results’ means it didn’t work. More money was spent and the figures got worse.

After the Centre for Social Justice report on Glasgow in 2008, Iain Duncan Smith (who set up this think tank, and is now the Secretary of State for Work and Pensions) said, ‘Policy must deal with the pathways to breakdown – high levels of family breakdown, high levels of failed education, debt and unemployment.’

So what are ‘pathways to breakdown’? If you were to look at a chart of Glasgow’s prosperity relative to the rest of the world, its peak would have come somewhere around 1910. With the onset of WWI in 1914 its decline accelerated, and since then the falls have been relentless and inexorable. It’s not just Glasgow that would have this chart pattern, but the whole of industrial Britain. What changed the trend? Yes, empires rise and fall, but was British decline all a consequence of WWI? Or was there something else?

A seismic shift came with that war – a change which is very rarely spoken or written about. Actually, the change was gradual and it pre-dated 1914. It was a change that was sweeping through the West: that of government or state involvement in our lives. In the UK it began with the reforms of the Liberal government of 1906–14, championed by David Lloyd George and Winston Churchill, known as the ‘terrible twins’ by contemporaries. The Pensions Act of 1908, the People’s Budget of 1909–10 (to ‘wage implacable warfare against poverty’, declared Lloyd George) and the National Insurance Act of 1911 saw the Liberal government moving away from its tradition of laissez-faire systems – from classical liberalism and Gladstonian principles of self-help and self-reliance – towards larger, more active government by which taxes were collected from the wealthy and the proceeds redistributed. Afraid of losing votes to the emerging Labour party and the increasingly popular ideology of socialism, modern liberals betrayed their classical principles. In his War Memoirs, Lloyd George said ‘the partisan warfare that raged around these topics was so fierce that by 1913, this country was brought to the verge of civil war’. But these were small steps. The Pensions Act, for example, meant that men aged 70 and above could claim between two and five shillings per week from the government. But average male life- expectancy then was 47. Today it’s 77. Using the same ratio, and, yes, I’m manipulating statistics here, that’s akin to only awarding pensions to people above the age 117 today. Back then it was workable.

To go back to my analogy of the prologue, this period was when the ‘train’ was set in motion across the West. In 1914 it went up a gear. Here are the opening paragraphs of historian A. J. P. Taylor’s most celebrated book, English History 1914–1945, published in 1965.

I quote this long passage in full, because it is so telling.

Until August 1914 a sensible, law-abiding Englishman could pass through life and hardly notice the existence of the state, beyond the post office and the policeman. He could live where he liked and as he liked. He had no official number or identity card. He could travel abroad or leave his country forever without a passport or any sort of official permission. He could exchange his money for any other currency without restriction or limit. He could buy goods from any country in the world on the same terms as he bought goods at home. For that matter, a foreigner could spend his life in this country without permit and without informing the police. Unlike the countries of the European continent, the state did not require its citizens to perform military service. An Englishman could enlist, if he chose, in the regular army, the navy, or the territorials. He could also ignore, if he chose, the demands of national defence. Substantial householders were occasionally called on for jury service. Otherwise, only those helped the state, who wished to do so. The Englishman paid taxes on a modest scale: nearly £200 million in 1913–14, or rather less than 8% of the national income.The state intervened to prevent the citizen from eating adulterated food or contracting certain infectious diseases. It imposed safety rules in factories, and prevented women, and adult males in some industries,from working excessive hours.The state saw to it that children received education up to the age of 13. Since 1 January 1909, it provided a meagre pension for the needy over the age of 70. Since 1911, it helped to insure certain classes of workers against sickness and unemployment. This tendency towards more state action was increasing. Expenditure on the social services had roughly doubled since the Liberals took office in 1905. Still, broadly speaking, the state acted only to help those who could not help themselves. It left the adult citizen alone.

All this was changed by the impact of the Great War. The mass of the people became, for the first time, active citizens. Their lives were shaped by orders from above; they were required to serve the state instead of pursuing exclusively their own affairs. Five million men entered the armed forces, many of them (though a minority) under compulsion. The Englishman’s food was limited, and its quality changed, by government order. His freedom of movement was restricted; his conditions of work prescribed. Some industries were reduced or closed, others artificially fostered. The publication of news was fettered. Street lights were dimmed. The sacred freedom of drinking was tampered with: licensed hours were cut down, and the beer watered by order. The very time on the clocks was changed. From 1916 onwards, every Englishman got up an hour earlier in summer than he would otherwise have done, thanks to an act of parliament. The state established a hold over its citizens which, though relaxed in peacetime, was never to be removed and which the Second World war was again to increase. The history of the English state and of the English people merged for the first time.

Since the beginning of WWI , the role that the state has played in our lives has not stopped growing. This has been especially so in the case of Glasgow. The state has spent more and more, provided more and more services, more subsidy, more education, more health care, more infrastructure, more accommodation, more benefits, more regulations, more laws, more protection. The more it has provided, the worse Glasgow has fared. Is this correlation a coincidence? I don’t think so.

The story of the rise and fall of Glasgow is a distilled version of the story of the rise and fall of industrial Britain – indeed the entire industrial West. In the next chapter I’m going to show you a simple mistake that goes on being made; a dynamic by which the state, whose very aim was to help Glasgow, has actually been its ‘pathway to breakdown’ . . .

Life After the State is available at Amazon, Apple Books and all good bookshops, with the audiobook at Audible, Apple Books and all good audiobookshops.

Many thanks to all the new subscribers who have joined this week, both paid and unpaid. I put this video of my recent North Sea Oil piece up on YouTube, X et al and it generated something of a flurry.

So welcome. I hope you both enjoy and benefit from The Flying Frisby.

Before we get started I just wanted to note that Comstock Lode seems to be catching a nice tail wind, which is good. Enjoy the ride. The AGM is later today for the keener of you out there.

But we are looking at bitcoin today, and exploring an alternative way to invest in it.

I’m going through one of those phases where I feel like I don’t own enough bitcoin.

So I’ve bought more.

And I’ve bought it in my SIPP - UK-speak for my retirement account.

I’ll explain how in a second.

Let’s just have a quick look at the bitcoin price, and note that we are once again breaking out to new highs.

I know it feels like you are late to the bitcoin story, and yes we all wish we bought it at $10, when we first heard about it. But we didn’t. We are where we are, and this story is a long way from being over.

The next chapter in the odyssey is corporate adoption, and that story is just getting started.

I explained the bitcoin corporate treasury model a fortnight ago here, and I’ve made the article freely available to all, so please take a look, but the TLDR is this.

Following a template set by billionaire genius Michael Saylor, more and more companies are converting their treasuries to bitcoin as a means to store value and escape currency debasement. Not only that, they are issuing paper—stock, debt, convertible notes—and using the capital raised to buy more bitcoin. In effect, they are creating fiat money from nothing—it is a debt-based system, after all—and using it to buy a finite digital resource (one that, of course, cannot be created through debt).

Many are scratching their heads and saying, “How can this be? It’s not possible! It’s a bubble.”

What Saylor is actually doing, among other things, is exposing the flaws of debt-based fiat currency. There are now some 70 companies employing this strategy. This will eventually be a stampede, which I urge you to front-run. Corporations have much deeper pockets than private investors, meaning this latest cycle in bitcoin’s mass adoption could become a mega mania.

Shareholders welcome dilution if it means more bitcoin.

The problem of corporate dilution has been flipped on its head. Once, if a company issued 20% more stock, you would expect the stock to fall by a concomitant amount to reflect the dilution. But if you’re using paper to buy bitcoin, the reverse applies. You can’t dilute enough. The purpose of a bitcoin treasury company is to acquire as much bitcoin as possible on behalf of all shareholders, by whatever means.

Here is a case in point.

Japanese hotel company Metaplanet (3350:TYO) had a small chain of low-budget hotels across Southeast Asia. Covid decimated the business, and it never fully recovered.

A year ago, seeking a new direction, CEO Simon Gerovich began copying the Saylor model and started using his cash flow to buy bitcoin, then he began issuing debt. Since spring 2024, when the company began its strategy, the stock has risen thousands of percent from below ¥20 to north of ¥1,000. Last year, it was one of the best-performing companies in the world, if not the best. How about this for a chart?

In the time that bitcoin has risen 60%, Metaplanet has risen more than 7,000%. (Saylor’s Strategy (NASDAQ:MSTR) has also outperformed bitcoin. Bitcoin treasury companies give you gearing).

With its crap currency and suppressed bond yields, bitcoin is an obvious place for Japanese investors to put their capital, except the government has got in the way.

As with the UK, dumb regulations make it very hard for Japanese investors to buy bitcoin directly. (This came as a result of Mt. Gox, the first bitcoin exchange, which went bust after being hacked in 2013-14). To give you an idea how ponderous things are, to register with a bitcoin exchange in Japan , regulators demand you get a letter by snail mail to verify your address. Nuts.

What’s more, when the Japanese sell, they must pay capital gains tax at 55%.

But Metaplanet is a Tokyo-listed company, so investors are buying that instead in their retirement accounts and via their brokers. Far less hassle. Just as, back in 2023, I urged UK readers to buy Strategy as a way to play bitcoin (we are up around 1,000%), Metaplanet has become Japan’s bitcoin vehicle—indeed, much of Asia’s.

For several days in a row, the company has gone limit-up, and trading has been halted. The mother of all short squeezes seems to be taking place. It’s the most shorted stock in all of Japan - and the short sellers are struggling to cover.

This bubble has, quite literally, been caused by state regulation. We wouldn’t be in this situation if it was easy to buy bitcoin. It’s enough to make you a libertarian. It’s amazing that both Japan and the UK were at the vanguard in bitcoin’s early days. Satoshi Nakamoto had a Japanese name and used British English. Now we are both retarded (in both the old sense of the word and the new).

How to profit from the mania

In the UK, Avis-listed The Smarter Web Company (ISIN: GB00BPJHZ015) is now following suit, as several readers have pointed out to me (thank you). It’s gone from 5p to 45p in a month. Currently, The Smarter Web Company has a market cap of £72 million, while it holds only £3 million in bitcoin (rounded numbers). Insane, you might think. Probably.

Bitcoin Treasury Companies are outperforming bitcoin. They are the new sh*tcoins.

So which bitcoin treasury company have I gone for?

Here is how I am playing all this.

Tell your friends about this vid.

You’ll find the full list of North Sea Oil Cos here, in the second half of the article:

Subscribe to this wonderful publication.

If you are thinking of buying gold to protect yourself in these uncertain times, the bullion dealer I use and recommend is the Pure Gold Company. Pricing is competitive, quality of service is high. They deliver to the UK, the US, Canada and Europe or you can store your gold with them. Find out more here.

I made the argument that it was John Cleese. My initial pitch has just been released, so here, for your Sunday morning consideration, it is.

I ended up winning the debate, but it was a close shave.

Who, in your view, is the greatest? And why? Please let me know in the comments.

If you enjoyed this video, please give it a like, share it somewhere, all that stuff. Thank you!

And please subscribe to this excellent Substack, if you haven’t already.

Speaking of comedy, there are still a handful of tickets left for my show on Tuesday, if you happen to fancy some subversive musical satire. That’s the Mid-Year Review on Tuesday, May 20 in London in sunny East London. I am just going through the set list - it is going to be an epic night.

In other news, for long-suffering shareholders in STLLR Gold, the company just announced its latest PEA and MRE. We have been waiting a long time, and the market did not like it one bit. While the resource, 11 million ounces, is huge, the CAPEX to build this mine, $1.87 billion, is even huger. At $3/oz in the ground, it’s hard to think of a mining company that’s as cheap. But those ounces are cheap for a reason. Here, in case you missed it, is my write up from yesterday.

Until next time

Dominic

If you are thinking of buying gold to protect yourself in these uncertain times, the bullion dealer I use and recommend is the Pure Gold Company. Pricing is competitive, quality of service is high. They deliver to the UK, the US, Canada and Europe or you can store your gold with them. Find out more here.

The political compass, as I’m sure you know, incorporates the, in my view, more important authoritarian and libertarian, as well as left and right.

If you enjoyed this video, please give it a like, share it somewhere, all that stuff. Thank you!

And please subscribe to this excellent Substack, if you haven’t already.

In case you missed them, here are my pieces from earlier in the week.

Gigs Coming Up

Here is a list of shows I have coming up, in case of interest.

The big one is The Mid-Year Review Wearing on next Tuesday, May 20 in London.

Otherwise it’s:

* London, Crazy Coqs, May 14. SOLD OUT. (Waiting list only)

* London, Backyard, May 20. The Mid Year Review Tickets here

* Sevenoaks, Out of Bounds Comedy Club, July 11. Tickets here.

* Bedford, Quarry Theatre, July 27. Tickets here.

* London, Crazy Coqs, Sept 24. Tickets here.

* London, Crazy Coqs, Nov 5. Tickets here.

* London, Crazy Coqs, Dec 3. Tickets here.

Happy Sunday!

Until next time,

Dominic

If you are thinking of buying gold to protect yourself in these uncertain times, the bullion dealer I use and recommend is the Pure Gold Company. Pricing is competitive, quality of service is high. They deliver to the UK, the US, Canada and Europe or you can store your gold with them. Find out more here.

They are mostly seized bitcoin, a lucky legacy from the early days when the UK was at the heart of bitcoin’s evolution. (Remember Satoshi Nakamoto wrote in British English, the Times was referenced in the Genesis block, and many of the early conferences and meet-ups happened here). The FCA, in its wisdom, put a stop to all that, and so we fell behind.

The stupidest thing our Chancellor can do, even with the parlous state of the national finances, is to sell those bitcoin. History would look back on her as an even greater fool than Gordon Brown for selling the national gold.

This legacy has given the UK an extraordinary advantage in the global arms race that is bitcoin adoption. We would be mad to spurn it.

Meanwhile, something extraordinary is taking place in the corporate world of bitcoin adoption, and I think it is going to accelerate rapidly very soon.

It is being spearheaded by Michael Saylor, Chairman and Founder of Strategy (NASDAQ:MSTR).

I recommended MicroStrategy, as it used to be called, to readers back in August 2023, largely because it was a means to get bitcoin exposure via your broker. You wouldn’t have to jump through all the hoops of buying bitcoin through exchanges, which the FCA has made so difficult.

It has been a big win for readers, having more than 12x’d since we tipped it, outperforming bitcoin by a considerable margin. (Bear in mind it has undergone a 10-for-1 stock split since that article.)

You really should upgrade your subscription :)

Strategy now has some 555,450 bitcoin, meaning it has more bitcoin than any other publicly traded company in the world (excluding the ETFs, which now hold 1.35 million). Note again: there will only ever be 21 million bitcoins - rather less if you discount the 2.5 million that have likely been lost, and the 1.3 million that Satoshi never touched and probably never will).

Saylor is also the world’s most articulate and charismatic proponent of bitcoin. The man is a genius, and I do not use that word lightly.

He has turned Strategy from a quiet, business intelligence software firm, which traded sideways for 20 years with a market cap less than $2 billion, into one of the most talked-about and traded stocks in North America with a market cap north of $100 billion. Options traders love it.

His method for doing so - extraordinarily bold at the time, though now it looks easy - was brilliantly simple. He bought bitcoin. He was worried about the erosion of the value of the corporate treasury due to inflation and currency debasement. he started slowly. Then, in buying bitcoin and using it, as tends to happen, he caught the bitcoin bug. He started issuing paper - stock, debt, convertible notes - and bought more bitcoin. Just last week he bought another 1,895 bitcoin, funding the purchase with sales of common and preferred stock.

In effect, he is creating money out of (almost) nothing and using it to buy the hardest money in the history of mankind. (Sorry, goldbugs - and you know I’m on your team - but bitcoin is harder money, because the supply is more finite).

In doing so, he has enabled many of his investors to retire early.

But he has also set in motion something quite extraordinary.

Other companies are starting to follow his model. I’m surprised more haven’t, but it takes extraordinary courage and vision to do what he did, as demonstrated by the fact that more companies haven’t copied him. They’re too cautious. Even with him having blazed the trail and shown the way.

I think there’s a very good chance Strategy becomes a trillion dollar company, while Michael Saylor becomes the world’s richest man.

To call the pre-bitcoin Strategy a zombie company is harsh, but it was not really going anywhere. Interestingly, it is zombie or near-zombie companies with large treasuries that are most likely to follow the Saylor model. Their need for a new direction is greater.

Microsoft (NASDAQ: MSFT) recently gave Saylor 5 minutes - 5 minutes! - to pitch his model to them, and duly ignored it. It is their loss. But Microsoft is Microsoft. At the moment, it doesn’t need bitcoin, and it doesn’t need to take the risk.

GameStop (NYSE: GME), on the other hand, is a different matter. Remember GameStop from 2021 and all those memes during lockdown? The video game retailer had more than 3,000 outlets, and its business model was considered defunct. People buy games online now. But some private investors noted that the short position exceeded 100% of the issued shares of the company, and started buying. The ensuing short squeeze sent the stock from $17 to north of $500, and, it is said, almost broke Wall Street. (Not quite, but you get the point).

The problem is GameStop’s business model is somewhat defunct. This year, it closed over 400 stores. This week, it sold its Canadian outlets.

But the company has about $4.7 billion in cash, low debt, and just raised another $1.5 billion, it announced.

What does it do now?

Bitcoin is the answer.

We don’t yet know how much it has bought, but its earnings call is on June 6, so perhaps we can expect an announcement then.

The Japanese company Metaplanet (3350:TYO) is doing something similar. Formerly a zombie hotel company, now known as the “Asian MicroStrategy,” it has bought some 5,555 bitcoin. It bought another 555 this week after it issued its 13th set of bonds. The stock rose 40% on the news. Since spring 2024, when the company began its strategy, the stock has gone from below ¥20 to north of ¥600.

The same thing is happening as happened to Saylor. Initially, the company bought it as a hedge against currency debasement. It discovered it was onto something. Now it is doing all it can to issue paper - bonds, warrants, stock, you name it - and use the proceeds to buy bitcoin.

Perhaps GameStop will make a similar discovery.

A year ago, Semler Scientific (NYSE: SMLR), which provides technology products and services for healthcare providers, made its first purchase of bitcoin: 581. It couldn’t stop accumulating. Now it has 3,467 bitcoin.

Sol Strategies (CA:HODL), my old company, is doing something similar for Solana, having just announced a $500 million convertible note. This company had a market cap of barely C$20 million a few months ago.

What started as a trickle is starting to flow. The more companies that do this, the bigger the rush is going to get. Corporations are changing they way they store capital. They are changing the capital they store.

The implications for how corporates hold their treasuries are one thing. The implications for fiat money are extraordinary. Issue debt - ie create money - and buy hard digital assets with it.

This is going to be a big, big theme in the next few years.

If you enjoyed this article, please like it, share it, all that stuff :)

Here I am on the mighty James Delingpole’s podcast, talking about most subjects, though squabbling about conspiracy theories.

Then there is this interview with Jasmine Birtles for the Money Magpie podcast, talking mostly about gold and property. (Audio on Spotify; video on YouTube).

Also this radio interview with ABC Australia, I was quite pleased with. Here it is.

And, if bitcoin is your thing, here I am on the Discovering Bitcoin podcast.

Right. That’s all the interviews done.

A Thief in our Midst

Turning to matters closer to home, there is a beautiful cat, pictured below, which belongs to a Chinese lady, who lives three doors up. She visits my garden every morning (the cat not the Chinese lady) as I am getting my 15 minutes of sun, purrs seductively, gets stroked, and then wanders off on its day to do who knows what. If I leave the back door open, she will come into my house and visit me at my desk, stretch out luxuriantly and, if I pick her up, start padding my chest pleasantly. I thought we had become friends.

Well, you can’t trust anyone.

I now discover this feline fiend has been sneaking into my son’s room to steal his socks, which it then brings back to its owner three doors up.

Here it is. Caught red handed.

A Rare Trip to the Theatre

On Wednesday I went to see The Comedy About Spies in the West End. It’s not something I would have normally gone to watch, but my friend Tom Woods had some tickets he couldn’t use and so off I went with my next door neighbour. I thought it was terrific. Thank you Tom!

I’m obsessed with farce. Always have been since I first watched Fawlty Towers as a little boy. (I actually did my university thesis on Fawlty Towers). It’s my favourite form of theatre by a country mile. I love the precision of it, along with the heightened emotion and panic. Done well there is no better narrative form, in my opinion.

Films like Midnight Run and TV series like Curb Your Enthusiasm, in my view, embrace farcical plot schemes. But if you want a farce in its purest form on film, watch What’s Up Doc. Just the best.

The premise of The Comedy About Spies is a little bit forced, but the jokes are fab, there are hundreds of them, one after the other, they are brilliantly executed and with incredible precision - it’s wonderful to see a show this tight. By the end I even found myself moved by the characters. I LOLed many times. What can I say? It’s really good.

What’s your favourite farce? Let me know in the comments.

The South Africanisation of Everything

In other, less positive news, on Tuesday evening I found myself walking down the Kilburn High Road for the first time in about 25 years. It was always a bit rough around the edges - up there with Elephant & Castle and Streatham High Road as one of London's most worst thoroughfares - but my God it was eye-opening as to where the UK is going / has gone.

Litter everywhere, people off their faces, drugs being dealt openly on the street, beggars, a woman knocked over by a bloke cycling a Lime bike on the pavement, the bloke unapologetic, little trust between visible between people in this multi-cultural mayhem. Talk about lack of cohesion.

(I drove through Harlesden the other night and that was bad too).

It confirmed my theory of the South Africanisation of everything. (Actually it’s my friend Alex’s theory, but I have purloined it).

It prompted me to dig up this piece from a couple of years back, which at one point was the most read piece on this ‘ere Substack. On re-reading it now, I’m rather proud of it. Recommended.

The Secret History of Gold

In personal news, I am glad/relieved to say I submitted the final proofs for my new book on gold which comes out in August - the Secret History of Gold (I haven’t actually announced it yet, which I will in due course). Writing a book is an enormous undertaking. Publicising it is an even greater one. I’m glad stage one is complete.

How about this for a fact?

In 1930 the price of gold was £4.25 per ounce, as it was in 1716 when Isaac Newton set the price over 200 years earlier. FOUR POUNDS 25p. Today it's £2,475 per ounce. From £4.25 to £2,475.

That's how much we've been robbed by currency depreciation.

How have they (successive governments) been able to get away with this?

Because representative democracy does not work is why.

Thank goodness for gold. Thank goodness for bitcoin. Speaking of which:

As always, if you are looking to buy gold, the bullion dealer I use and recommend is the Pure Gold Company. Pricing is competitive, quality of service is high. They deliver to the UK, the US, Canada and Europe or you can store your gold with them. Find out more here.

The Mid-Year Review

Wearing my satirical comedy hat, I have a big gig coming up on May 20 in East London. These nights are usually pretty memorable - and for the right reasons.

If you are free, come along. You can get tickets here. It would be great to see you.

Finally, in case you missed this week’s commentary, here it is:

Have a lovely bank holiday weekend.

Fun fact: Mayday - not as in the bank holiday, but as in the distress call for a ship or a plane is actually from the French, “M’aidez” - help me. May Day is an ancient festival to celebrate the beginning of summer (or as is the case in the UK this year, the end of summer), though socialists hijacked it with International Workers’ Day.

So now we are all crying “M’aidez” on May Day.

Tell your friends about this entertaining catch up.

I spoke about gold this week to ABC Australia. This little interview may be of some interest. Here it is.

Meanwhile …

It’s as though the whole tariff thing never happened, the way stock markets are rallying. I think it’s seven green days in a row now.

Everybody is getting very excited about a rare technical signal we got last Thursday - - there have only been 16 of them since the S&P500 was created in 1957, including the latest on April 24, 2025. But this signal has a 100% reliability record, and has been followed by average 6-month returns of 15% and a 12-month returns of 23%.

That’s a pretty stellar record.

So I just wanted to offer my 2p.

The indicator - the Zweig Breadth Thrust Indicator (ZBT) - was first observed in the 1986 Martin Zweig book, Winning on Wall Street (which I confess to not having read). It occurs when a market swings from an oversold to an overbought reading within 10 trading days.

Eight of them have occurred since the book was published: in 2004, in 2009 (shortly after the March lows at 666), in 2011 after the taper tantrum, in 2013, 2015, 2018 and in 2023 twice. Now we have one coming off the “tariff tantrum”, as I’ve just dubbed it.

However, before you go out and gamble your entire life savings, note that back in 2015 technical analyst Tom McClellan published a detailed study of ZBT signals, which went back much further than the 1957 formation of the S&P500 - all the way to 1928.

During the bear market of the 1930s Great Depression, there were multiple occurrences of the signal - 14 of them - and it was horribly unreliable: 10 led to losses or negligible gains, 2 preceded strong rallies, and 2 were flat. It was useless, in other words.

So, in short, it’s been good since 1957, but was rubbish before. A bit like stereos.

There are plenty of reasons to remain cautious. The high levels of volatility we are witnessing are consistent with a bear market not a bull market. There are also high levels of uncertainty: what is actually going to happen with tariffs? Nobody quite knows. I’m not sure even the President.

Plus we are going into May, usually a weak time of year for the stock market.

And it may be that the consequences of Trump’s tariff talk have not yet been felt in the US on the ground. One argument is that there has been a huge drop off in container ships leaving China. A container would typically take 30 days to reach LA, and another 10-20 days to get to the major cities - Houston, Chicago, New York et al. So the drop-off in container ships leaving China after Liberation Day won’t be felt until mid-May. If there is a pick up in shipments, that wouldn’t be felt till another month after that. Some are saying supply shortages are coming to the US. Have a read of this and see what you think. Markets usually price this kind of stuff in, but you never know.

Cui bono?

Among the sectors that should benefit from Trump’s America first policies are US domestic mining and manufacturing. Here the regulatory environment is changing fast. Trump signed an executive order on March 20 with the aim of accelerating production of critical minerals. Federal agencies have actually been mandated to look to the US for priority metals - copper, gold, nickel, uranium and so - when they previously looked abroad. We are already seeing faster permitting. I hear that formerly dormant projects are seeing activity for the first time in years. Emails are being answered promptly, applications are being processed, even in states like California.

This new environment is positive for oil and gas producers, miners, explorers and developers in the US. The problem is that commodity prices have dropped off a cliff. There’s always a catch.

Even so, one company that should benefit from this new macro environment is this potential multi-bagger.

On which, note I wanted to give you a related heads up.

Ever wondered which foods in your supermarket are packed with seed oils? Join me on a clandestine mission around my local shop to unveil some hard truths about pizzas, hummus, sausage rolls, and even granola. Seed oils infiltrate nearly every packaged item—and you should care.

By the way, my original piece on seed oils is one of the most read articles on this substack, interestingly enough. Here is is, if you haven’t already read it:

I hope you find it useful and/or entertaining.

Have a lovely Sunday.

Dominic

PS ICYMI, here’s my midweek commentary:

As always, if you are looking to buy gold, the bullion dealer I use and recommend is the Pure Gold Company. Pricing is competitive, quality of service is high. They deliver to the UK, the US, Canada and Europe or you can store your gold with them. Find out more here.

Gold again today. I just can’t stop writing about it.

Another day. Another new high. We touched $3,500 in the early hours of yesterday morning.

That’s 27 new highs in the gold price so far this year.

Yet there is still something about this bull market that doesn’t feel right or complete: it’s not confirmed by silver, which should be trading north of $50. Instead it’s mired around $32. Nor is this bull market confirmed by the miners, which, in most cases, are nowhere near all-time highs.

Nevertheless, on the basis of gold’s price relative to equities, commodities and houses, as outlined last week, gold is starting to look expensive. Is it time to have an eye on the exit?

In the short term, maybe. It’s overbought. We are going into a weak time of year for gold (May to August). But that’s why I like physical. It stops you trading!

How about this for a chart?

It now takes more work than at any time in the last 100 years to buy an ounce of gold.

This is as much a function of declining wages in real terms, and the erosion in value of fiat, as it is the price of gold, but all the same it’s pretty incredible: how we’ve all been lied to!

There are, though, many signs that gold is now fully valued.

But these are not normal times.

And a “proper” bull market will see blow-off tops in silver and the miners. We don’t have that yet.

Let me give you six more reasons (ie largely previously unmentioned reasons) not to be selling your gold.

1. You live in the UK.

(This is one I have mentioned before). Do not be fooled by the fact that the pound has been performing relatively well in the foreign exchange markets this year. It has lost 37% of its purchasing power since 2020 and has repeatedly proven to be a rotten store of value.

The interest on UK gilts is rising, meaning it is getting increasingly expensive for the government to pay for its own debt. We’re above Liz Truss levels and the trend is rising.

We’ve got high energy costs too.

What this government is actually doing to rein in its spending is one thing. What needs to be done is something else. There is no Elon Musk taking the guillotine to it all. The scale of our government inefficiency, waste, corruption, misallocation of capital is both larger, relative to GDP, and more entrenched than in the US. At the level of government we are not even having a conversation about what needs to be done, let alone actually doing anything.

Nor is there any likelihood of this country re-industriali sing. We’ll just have to hope people buy our services, what few we offer. In the meantime we’ll keep borrowing to pay for stuff.

The only way is currency debasement. There has never been a Labour government that did not devalue sterling. Think this one will be any different? Do not store your wealth in sterling. They take enough from you in taxes as it is. Don’t let them take any more.

As always, if you are looking to buy gold, the bullion dealer I use and recommend is the Pure Gold Company. Pricing is competitive, quality of service is high. They deliver to the UK, the US, Canada and Europe or you can store your gold with them. Find out more here.

2. Chinese retail

I’m endlessly wittering on about China’s central bank buying gold, but one thing I confess I’ve overlooked is Chinese retail buying. Its real estate and stock markets have both been rubbish, the former especially, so they are buying gold instead.

Then think about the sheer size of China’s retail market: over a billion potential buyers. Never mind central bank buying, the potential scale of this thing is enormous. What if they al buy an ounce each?

When do they stop buying and start selling? When their real estate and stock markets pick up …

Meanwhile, China’s central bank, the PBOC, which says it bought 5 tonnes last month, actually bought ten times that.

(De-dollarisation, which is perhaps the biggest factor of the lot, except re-monetisation, does not even make it onto this list as I‘ve covered it so many times before).

3. What about Western retail? What about Western institutions?

Western retail and institutional investors have been slow to this bull market and are under-allocated. As my buddy Ross Norman says, “this gold rally has not, to date, been driven by retail investors buying coins and bars, high net clients clamouring for physical, nor institutions buying the gold ETF, not even speculative flows to any great extent. This has been an incredibly low participation rally. A stealth run even”.

Portfolios are roughly 2% allocated to gold at present. They were four times that at the peak of the last bull market in 2011.

That means a lot of room for more Western buying.

Since the confiscation of Russian assets, central banks have bought every pullback to the 50-day moving average. But it’s not just central banks now, retail and institutional investors the world over are coming to the party.

And if you think they’re underweight gold, wait until you see how underweight they are gold miners. (Even these are slowly starting to move - MTL anyone :)?)

4. Gold vs the Nasdaq - OMG

Trends in this ratio tend to go on for a long time, like ten years or more.

How about this for a chart?

Congratulations to all who bought. Gold is now trading above $3,300. Goldman Sachs has raised its target to $4,000/oz. It’s all going swimmingly. But nothing lasts forever.

(Actually gold does, but you know what I mean).

So, today, I want to ask: when do we sell our gold?

To answer that question, I am going to look at some long-term ratios.

How is gold looking relative to stocks, to other commodities and against house prices? (We’ll look at gold versus house prices in the US, the UK and Australia).

There is a strong argument, by the way, for never selling your gold, especially if you’re in a country such as the UK with an unreliable national currency. If you don’t need the money, keep the gold and pass it on to your heirs - and tell them to do the same. But macro conditions are not always as gold-friendly as they are now. See the 1980s and 90s for more details.

What’s more, given how these trade wars are unfolding, with unpayable levels of debt across the western world and China’s extraordinary accumulation of gold, there is a significant chance - say, 25% - that gold ends up being remonetized somehow.

(If China wants global reserve status for its yuan, it’ll almost certainly have to make it exchangeable for gold - meaning higher gold prices. But even if not, all China has to do is declare it’s real gold holdings, and the price will rocket).

In the event of remonetisation, which also means some kind of crisis, gold prices will be dramatically higher. However, it’s also likely that your gold would either be confiscated or heavily taxed, so that the gains from the revaluation (aka fiat devaluation) pass to the state rather than the citizen, as happened in the US under Roosevelt in 1933.

But let us leave such speculation for another day.

As always, if you are looking to buy gold, the bullion dealer I use and recommend is the Pure Gold Company. Pricing is competitive, quality of service is high. They deliver to the UK, the US, Canada and Europe or you can store your gold with them. Find out more here.

Gold vs Stocks

I want to start with the Dow-to-Gold ratio: how many ounces of gold does it take to buy the Dow?

There is much history in this chart. It’s quite something.

You can see how, most of the time, the ratio stays within that green band. It is only at points of maximum extremity that it goes beyond, such as:

* The peak of the stock market in 1929

* The Great Depression in 1932

* The suppression of gold in the 1960s, ending with the collapse of the gold standard in 1971

* The peak of 1970s gold mania, inflation, and the Soviet invasion of Afghanistan

* The end of the gold bear market in 2000 and the peak of Dotcom

Today, with gold at $3,300 and the Dow at 40,000, it takes 12 ounces of gold to buy the Dow - and we are in the low- to mid-range of that green prediction band.

At the peak of the last gold bull market in September 2011, the ratio reached 5.7.

To reach such a level again, either the gold price would have to double (possible) or the Dow would have to halve (unlikely, I would have thought).

Most probable is something along the lines of the Dow falling 25% and gold rising another 50%.

Would this ratio ever go to 1:1, as it did in 1980? If so, we would be looking at a gold price in the tens of thousands.

It’s possible, I suppose.

I think a ratio of 5-8 is a reasonable possible target.

Here’s a similar history of gold against the S&P 500:

Today, we are at 1.7. It takes 1.7 oz to buy the S&P.

The ratio reached 0.2 in the 1930s and 1940s. It went to 0.13 in 1980.

I doubt we’ll see that again.

But that 2011 level of 0.6, or perhaps even a little below if things get really spicy, is not an unreasonable target, I suppose. That could mean the S&P500 at 4,200 and gold at $7,000/oz. Something like that.

So that’s some bull food for you.

In the interests of balance, let’s now put some bearish fodder on the menu.

We’ll start with gold versus oil - and the bad news. Then we’ll look at gold and house prices.

You may have read my piece on this from a few weeks back. Here it is in video form: a deep dive into the rumours, history, and high stakes surrounding US gold reserves—and what the upcoming audit might reveal.

My thanks go to Will Freeman for all his hard work crafting this.

Whether you’re revisiting the mystery or uncovering it for the first time, this is a story that matters in today’s world. Please let me know what you think in the comments.

Given everything that is going on in the world, we recommend people to own some gold in the portfolio. Our recommended bullion dealer I recommend is the Pure Gold Company. Pricing is competitive, quality of service is high. They deliver to the UK, the US, Canada and Europe or you can store your gold with them. More here.

And if you missed yesterday’s piece - also on gold - here it is.

Gold is your hedge against government, and this is all a creation of government.

Where to park capital? Equities are all over the place and will continue to be for the foreseeable future. With US authorities transparent about wanting it lower, the US dollar is not the safe haven it’s been since 2007 in market sell-offs. As for treasuries, they’ve become a weapon in the trade wars.

Inert gold, on the other hand, is neutral. It doesn’t care which side of the trade wars, the culture wars, or any other wars you’re on, and at the moment, it seems everyone wants a piece.

China, we learn thanks to the sleuthing of analyst Jan Nieuwenhuijs, bought another 570 tonnes in 2024. Who knows how much more it has bought in 2025? To put that 570-tonne number in perspective, the UK’s total holdings are 310 tonnes.

Tell your friends.

What’s driving it all?

This move in gold started shortly after the US confiscated $300 billion in Russian state holdings after Russia’s invasion of Ukraine. It hasn’t been driven by retail. Central bank buying has pushed up the price.

If you’re not on Team US or Team G7, why own assets they can confiscate, like dollars or treasuries?

Own gold instead. The US would have to invade you to take your gold—or send in Kelly’s Heroes.

In 1950, gold made up 70% of international reserves. In the noughties, it was just 10%. The dollar, meanwhile, reached 60%, with the euro at another 20%.

Now gold is at 20%, the dollar at 45%, and the euro at 15%. The trend is clear, as this cool little video from Nieuwenhuijs and Money Metals shows:

In my opinion, we’ll be at 40% five years from now.

Here’s gold since late 2022. Every pullback has been bought. It’s as though someone with deep pockets is saying, “Buy the pullback every time it hits the 50-day moving average (red line).”

The UK seems to have been forgotten in this global rout, but I have little doubt the chickens of our shocking national finances and woeful productivity will soon come home to roost in the form of a sterling crisis. That’s when we overlooked Britishers will be mighty glad we have our gold.

Gold is now £2,475/oz. Another year of this, and we’ll be north of £3,000.

Summer is approaching, and May to August is typically when gold is weakest. Take advantage of pullbacks, is my advice. Do what the Chinese are doing. They’re smarter than we are (when it comes to gold, at least).

With oil having cratered, we should finally see gold miners fetch a proper bid. (They are already moving a little). Energy can represent 15% to 40% of mining costs. Lower costs and a higher price for the final product should mean they make more money, and thus higher share prices. (I’ll cover miners again soon, I promise, though I am worried I’ll jinx it)

Here’s something Charlie Morris observed—and you really should subscribe to his gold newsletter, Atlas Pulse; it’s top dog in a crowded field - it’s free. GDX is the largest gold mining ETF by far. Despite higher gold prices, it’s seen outflows of 25% over the past year. When inflows start, these things will rocket. The sector is tiny relative to the capital out there.

Here’s three years of Brent, FYI. It’s almost the reverse of gold. Good for mining.

If you’re interested in buying gold, by the way - and you should own some, if you don’t already, given everything that is going on - the bullion dealer I recommend is the Pure Gold Company. Pricing is competitive, quality of service is high. They deliver to the UK, the US, Canada and Europe or you can store your gold with them. More here.

A 2-minute video for your Sunday entertainment

I’ve got lots of content coming up over the next fortnight. I’ve just returned from two days of bitcoin conferences, so I’m fired up about that. I’ve got that gold mining piece to write. I have a lot more to say about gold. I have a fab video to share with you which I will send out tomorrow. And I want to explore where we should deploy capital in all this market mayhem: which sectors will do well in tariff wars, and which won’t. So, plenty to come.

You ought to subscribe.

In the meantime, as it’s the weekend, enjoy this silly little 3-minute vid I put together for my comedy Substack - not to be taken seriously - about alien invaders on planet Earth stealing our gold at the dawn of civilization. (Click the image below)

Finally, if you’re interested in gold and haven’t already seen it, here’s my guide to investing int he shiny stuff.

I don’t normally put out market commentary on a Sunday, especially on a Sunday evening, but the events of last week were so extraordinary I feel I have to.

We are in full-on crash mode, it seems. The price action reminds me of the Covid panic or even 2008. It almost doesn’t matter what you own. Portfolios around the world have been battered.

The declines in the final two days of last week, since so-called “Liberation Day”, when President Trump announced his tariffs, are roughly as follows:

* Bitcoin: -1%

* Gold: -3%

* S&P 500: -9%

* Nasdaq: -10%

* Brent Crude: -12.5%

* Copper: -13% (phew!)

Magnificent Seven:

* MSFT: -6%

* GOOGL: -7%

* AMZN: -13%

* META: -14%

* NVDA: -15%

* TSLA: -15%

* AAPL: -17%

We are, of course, very long gold and bitcoin here at The Flying Frisby, so I guess we’ve come out of this comparatively unscathed. What’s more, we have a good allocation to wealth preservation in the Dolce Far Niente portfolio. But our speculative positions, like everyone’s, have been hit, and I’m angry with myself for not getting more defensive sooner. I’ve been saying for some time I don’t like the price action one bit- eg here and here - and the words of that freaky preacher keep ringing in my ears.

In any case, there’s no point beating myself up. Life is easy in hindsight. Investing is even easier.

I spent considerable time on Friday and Saturday reading and watching interviews, trying to understand exactly what these tariffs are about and what the implications are, and I think I have come up with something of a roadmap.

We’ll start by explaining the plan. Then we’ll look at what comes next. And, finally, we’ll look at what to do with some of our recent speculations.

Why our opinion is irrelevant

I’m a free-trade guy, or at least I was. I’m not quite sure what I am any more. But I’m not going to waste my time - or yours - here with arguments about whether tariffs are a good thing or not. There’s no point. My time - and yours - would be as well spent howling at the moon. As far as I know, Donald Trump isn’t a reader of The Flying Frisby. He knows his own mind and he’s not going to turn to this Substack, or any of our social media feeds, for policy advice.

Don’t be like DT. Subscribe to the Flying Frisby.

Tariffs are here, and they’re here to stay. Trump is attempting a major economic redesign - the kind of reset that those who rail against economic injustice have been calling for for years. Now it’s here, and as we look at our portfolios, many of us aren’t so sure we want it.

What I want to understand, first, is the logic behind the tariffs, then their implications, so we can best navigate them.

The first thing to note I’ve already said: Trump isn’t going to backtrack. As I watched tumbling share prices on Friday, I thought to myself—he’s going to backtrack. He has to. But Trump isn’t the Conservative Party, or indeed the Labour Party, changing tack at the slightest sign of discontent.

Critics say he’ll cave if stocks keep tanking, I’m not so sure. His track record suggests otherwise, and he’s put a loyal and strong team together to back him up and implement his plan.

He’s going to give his tariffs longer than a couple of days to have an impact.

Many say Trump hasn’t properly thought this through. Of course, he has. He’s been thinking about it night and day for years. He’ll have been thinking about little else as he wrestles with the problem of how to reinvigorate industrial America. That doesn’t mean his plan will work, but the idea he hasn’t thought about it is just a facile invention of Trump perma-critics to use against him.

Trump may be a bit of a clown - he has a comedic instinct and can’t resist a gag - but he’s not stupid. Clowns rarely are.

Why Trump’s doing what he’s doing

Trump intensely dislikes the decimation of industrial America, which began in the 1980s and still continues, with the outsourcing of manufacturing to Asia and elsewhere. Even 40 years ago , he was giving interviews about this (hence why I say he has thought it through) and he wants to restore it. That’s part of what he means when he says, “Make America great again.”

He can see that while the American coasts may have thrived, thanks largely to finance and tech, much of what is in between has not. This is the America he wants to make great again.

There are two reasons he wants to revive American industry.

First, is that he believes the model by which America takes on debt to buy cheap stuff from China is unsustainable and has to stop - and the sooner the better. So it’s for the good of the American economy.

Second, is for reasons of security. While China and the US may be trading partners now, they are also rivals, and if your rival is making your essential military and strategic equipment and components, whether it’s semi-conductors, industrial and consumer electronics, pharmaceuticals or battery and energy storage systems, you have a big problem on your hands. Covid exposed just how fragile supply chains are, and Trump has taken it as an early warning sign.

Something very similar, as readers of Daylight Robbery will know, happened in the US after its War of 1812 with the British, a war that lasted three years. The war badly exposed US over-reliance on British industrial goods, so the US introduced tariffs in 1816 to try and nurture and grow its own industry. Those tariffs ended up having grave long-term consequences (they were a major factor in the lead up to the civil war - but that was 45 years later). In the short term, they worked. (More on this here).

Coming to America

“Come and build your factories in the US,” Trump is saying. “Then you won’t pay tariffs. Relocate from China, Mexico, Vietnam.”

Here’s a case in point. Jaguar Land Rover has already announced it’s halting shipments to the US for one month. Now, this company’s management - remember its recent rebrand? (see below) - is on the opposing side of the culture war to Donald Trump and MAGA, so that is one factor at play. But when I wrote my piece about how good self-driving Teslas are, a lot of people commented that the Jags are better. I don’t know—I haven’t been in one. But for sure, Jaguar Land Rover won’t want to lose momentum or network effect in this all important arms race, particularly while Tesla is struggling: 45% off its recent highs, victim to nationwide vandalism and Elon Musk no longer the darling but the villain of the eco-warrior left. So what does Jaguar do now? Not sell into the all-important US markets? Pay 25% tariffs? Or build a factory stateside? I think the answer is fairly obvious.

Whatever it chooses to do, it’s going to take longer than a couple of days.

With DOGE and the shrinking of the US state, meanwhile, there’ll be plenty of workers to fill those new positions. As the US state shrinks, its private sector grows. That’s the idea, anyway.

His tariffs may lead to higher prices for American consumers, as many have pointed out, but not as high as widely thought, argues Treasury Secretary Scott Bessent in this recent interview with Tucker Carlson (a recommended watch, by the way). Bessent’s calculations are that tariffs won’t gouge consumers as much as feared. What’s more, the revenue from tariffs could eventually enable lower levels of taxation back home, which will further ease pressure on US citizens, those who work at least.

What about the upheaval Trump tariffs cause to the rest of the world? Not his problem. America first.

Yet he’s creating enormous uncertainty, and markets are tanking. On Friday, markets were in full panic mode, and the baby was being thrown out with the bathwater. What about that?

The amazing stat which shows why Trump won’t give two hoots about the stock market - for now

At this point, I want to press upon you one of the most telling statistics I’ve seen for some time:

* The richest 1% of Americans own 50% of US stocks, worth $23 trillion.

* The bottom 50% of U.S. adults hold only 1% of stocks, worth $480 billion.

If you expand to the top 10%, that group holds 87% of stocks, valued at $36 trillion.

If I’m correctly inferring Bessent’s comments, at this current point, Trump doesn’t care about Wall Street, or Silicon Valley, or the parts of the US economy that have become so rich over the past 40 years. It’s the bottom 50 - or even 80% - that Trump is concerned with. They hardly own any stocks, so the market mayhem won’t matter so much to them. Wall Street has made good for decades. It can suffer a bit of pain while Main Street gets rebuilt.

It’s worth noting, by the way, that US equities were enormously overvalued when Trump took office, so some kind of correction had to happen anyway. The Shiller price-to-earnings ratio was at its third highest level in history (the only times it was higher was 2000 and 2007, and we all know what happened next). That’s why Warren Buffett built up his enormous cash position two months ago ($330 billion). Buffett, by the way, really is a genius.

Best to get the inevitable correction out of the way early in the Presidency. What’s more, as Bessent points out, these market declines began several weeks ago with China’s AI announcement of DeepSeek, the app that can do everything ChatGPT and Grok can do with much lower power use. Prior to that, the Magnificent Seven had driven the extraordinary gains seen in the S&P 500 over the previous 18 months. Strip them out, and the picture was much less rosy. (Now the Mag7’re down 30-45%).

Trump’s announcement may have pricked the bubble, but a bubble is still a bubble and if one thing doesn’t burst it, something else will.

Trump’s plan, meanwhile, (and I’m not saying it’ll work, everyone will have their opinion) is not to boost the stock market. It is to reset the economy. The economy and the stock market are not the same thing.

Some numbers

The US is trapped in a vicious debt spiral.

$36 trillion is the current US National Debt. The US will spend $6 trillion this year, while only collecting $4 trillion in tax revenue. So there is a $2 trillion deficit. It will borrow the difference, and the debt will grow to $38 trillion.

The DOGE plan is reduce the deficit by 1 trillion by getting rid of waste, corruption and more.

The tariff plan is to raise another half trillion in revenue. Plus, as a result of tariffs, more business relocates to the US, which also increases revenue. Mass deregulation will also make doing business easier and further add to both economic growth and tax revenue.

Then there is Trump citizenship plan. According to Grok, 1 million people worldwide could realistically afford to buy a US residency for $5 million. Let’s say 10% of them did that. That’s another $500 billion and the $2 trillion deficit is eradicated.

Suddenly the US is running a surplus.

This all means the US gets in a better position to lower taxes, which will further increase revenue (the golden rule of Daylight Robbery), because trade will increase as a result. Trump could lower corporation taxes to 15% which would be a lot more attractive than the rates of 20-30% paid in Europe. So business relocates to the US. He could lower income taxes, especially for high earners, thereby attracting higher earners to the US.

Meanwhile, the cost of all that debt starts to come down, thereby freeing up even more capital.

And, suddenly, you are in a virtuous cycle.

These numbers make it look easy. But to get there takes an enormous fight - standing up to vested interests, taking on a cultural establishment that detests you, the media, the woke, Trump Derangement Syndrome and so on. It’s not easy, and it requires a lot of backbone.

The three essential keys to the Trump reset

So what fundamentals does this economic reset need, and how does the US get there?

First, it needs cheap energy. Cheap energy is fundamental to economic growth: economies need energy. That’s happening. Crude has fallen more than 10% since “Liberation Day”. Falls were turbocharged when, on Thursday, 8 OPEC nations made the surprise announcement that they were ending output cuts and increasing supply. Plus we have the domestic policy of drill baby drill. What with the plethora of natural gas and other shale energy co-products, we’re going to see a lot of cheap energy. (Which is going to make our own Ed Miliband’s high-energy-cost policies look even more deranged.)

Second, it needs a cheaper dollar. A weaker dollar will encourage investment and relocation from overseas (it makes the US cheaper). That’s happening too. Indeed, what was so unique about this week’s panic is that the dollar—usually the first port of call in a financial storm—didn’t rise (at least not at first). Here is the US dollar index. It’s coming down. It’s already down almost 10% from its highs. That means America just got 10% cheaper to invest in. A move back to the low 90s, or even below, would be ideal.

What is the third component?

And what next for markets?

To watch a video version of this article, click here:

We have more stock tips for you today with multibag potential.

But first, let’s get political.

Remember how the Conservative Party from David Cameron onwards effectively abandoned the right and became social democrats?

Increased state spending everywhere, so that instead of shrinking the state they grew it, more taxes, higher taxes, more planning and regulation, more quangos and experts, ‘owning’ the NHS, green subsidies, Net Zero, social liberalism, MPs who didn’t represent the views of the membership, increased immigration, weaker policing, increased crime - and so on. Those were the days, eh?

The Tories were so bereft of first principle, and so terrified of the left, particularly the left-wing media, that they pandered to it and eventually became it.

I remember going on podcasts 18 months ago making the argument that Labour would do the same thing and lurch right.

After an insert-disparaging-adjective-here first six months, which saw Prime Minister Keir Starmer’s approval ratings drop below even those of Rishi Sunak, we are starting to see that happen.

With the books not balancing, suddenly spending is being cut. Not by a lot, but it’s happening. Starmer has axed NHS England, something the Tories would never have dared do, criticising “two layers of bureaucracy”. We have what the Independent calls “Austerity 2.0” with cuts to disability benefits and welfare spending. The foreign aid budget has been cut to spend more on defence. All of a sudden he is as champion of small businesses. Heck, he’s even fixing the potholes. Meanwhile, he is boasting on X about “securing our borders” and “removing illegal immigrants at the highest rate in 8 years”.

“If you don’t have the right to be in this country, then you shouldn’t be here. It’s that simple,” he said yesterday. Does that sound like a Labour leader or Nigel Farage?

When fantasy meets reality

The next right-wing shoe to drop is fossil fuels.

Ed Miliband’s fantasies of climate justice and clean energy are slowly being exposed. His green delusion is going to be abandoned. If an economy is to grow, then it must consume more energy, not less. Wind and solar power are too expensive and too unreliable, never mind the damage they do to the environment and the carbon footprint they leave. They are already pledging to paint offshore wind farms black because of all the birds they are killing. Finally, an admission of the wildlife these things destroy.

Offshore wind is not going to replace oil and gas. Fossil fuels remain a better, cheaper, cleaner and more reliable source of energy. For an already heavily taxed country that is living well beyond its means, where growth is the only thing that can save it, with the added pressure of Trump tariffs soon coming, needlessly expensive energy is not possible.

The Reform party is making the cost of Net Zero one of its main lines of attack. All Labour has to do is further abandon the left of its party, a process which is already half complete, just as the Tories abandoned the right, and let Miliband go, which is inevitable anyway, and the Reform weapon is blunted.

All the above is preamble to my main argument today. North Sea oil and gas is going to stage a comeback. This is going to happen, as sure as eggs are eggs. Political and economic reality mean it is inevitable. Otherwise, the national finances, and with them the Labour Government, evaporate. Power is more important to politicians than adhering to any zealotry, green or otherwise.

The ban on new North Sea oil and gas licenses will be lifted. The taxes on North Sea oil companies will be lowered to incentivise activity (it’s effectively 78% at present. Are legislators demented?). And all those companies that saw their businesses and market caps decimated by this deluded religion are going to make a comeback. Some will multiply many times over. That’s what I think is going to happen, anyway.

This also means, for we observers on the foothills of inconsequence, the time is nigh to buy North Sea oil and gas companies.

So what are these companies and how do we invest?

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A rant for you this Sunday morning. Enjoy!

If you are buying gold to protect yourself in these uncertain times - and you should if you do not already own some - as always I recommend The Pure Gold Company. Pricing is competitive, quality of service is high. They deliver to the UK, the US, Canada and Europe or you can store your gold with them. More here.

By the way, in case of interest, I have the following comedy shows coming up int he next fortnight.

* Bath, April 3. Tickets here. SOLD OUT

* Bordon, Hampshire. April 12. Tickets here.

* London, Crazy Coqs, May 14. SOLD OUT. (Waiting list only)

* London, Backyard, May 20. The Mid Year Review Tickets here

* London, Crazy Coqs, Sept 24. Tickets here.

* London, Crazy Coqs, Nov 5. Tickets here.

* London, Crazy Coqs, Dec 3. Tickets here.

Based on this article:

From this week’s Moneyweek Magazine …

Two rumours have been swirling around the gold markets for many years. Some have called them conspiracy theories. Others note that conspiracy theories often prove true. What’s the difference between conspiracy and truth? About 30 years.

The first is that China has far more gold than it says it does. We actually now know this to be true. The other is that America has far less than the 8,133 tonnes of gold it says it possesses.

This rumour has been doing the rounds since 1971, when Peter Beter, a lawyer and financial adviser to former president John F. Kennedy, said he had been informed that gold in Fort Knox had been removed. He went on to write a best-selling book about it: The Conspiracy Against the Dollar.

The problem is a total lack of transparency on the part of the US authorities, something that according to current US president Donald Trump, and the head of the Department of Government Efficiency, Elon Musk, will not be the case for much longer.

Roosevelt triggers a boom

But to understand this situation we need to go back in time, all the way to 1933, when US president Franklin D. Roosevelt famously devalued the US dollar and revalued gold upwards by 70%, from $20 an ounce (oz) to $35/oz, in order to bolster growth. US gold reserves would increase to unprecedented levels in the next 15 years.

Some of the gold came from US citizens. It was now illegal for them to own gold and they had to hand any they owned over to the authorities. Some came from the fact that the government then bought all US mined supply (the upwards revaluation of gold triggered a mining boom) and any gold imported to the US assay office. The US even began buying gold on foreign markets to protect the new higher price.

Thus US official holdings in 1939 on the eve of World War II totalled 15,679 tonnes. They would only increase. With Nazi invasions, European nations sent all the gold they could across the Atlantic, either for safekeeping or to buy essential supplies; 1949 saw the high watermark of US gold holdings – 22,000 tonnes, as much as half of all the gold ever mined.

In July 1944, with it clear that the Allies were going to win the war, representatives from the 44 Allied nations met at the Mount Washington Hotel in Bretton Woods for the United Nations Monetary and Financial Conference to design a new system of money for the new world order.

International accounts would be settled in dollars, and those dollars were convertible to gold at $35/oz. Countries had to maintain exchange rates within 1% of the US dollar. In effect, the US was on a gold standard, and the rest of the world was on a dollar standard.

The system relied on the integrity of the US dollar to work, and that integrity was in question, even before the end of the war. The June 1945 Federal Reserve Act reduced required gold reserves for notes outstanding from 40% to 25%, and against deposits from 35% to 25%. Between 1944 and 1954, because of increased supply, the dollar lost a third of its purchasing power, though the $35 Bretton Woods price remained.

“Six major European countries,along with the UK, co-ordinated sales to suppress the gold price”

US government spending was soaring, and it began running balance of payments deficits – made worse by the costs of foreign aid, America’s new welfare systems and maintaining a military presence in Europe and Asia. Gold began leaving the US. By 1965 reserves had fallen by 9,500 tonnes, down 40% from the 1949 peak.

Successive US administrations tried to stop the outflow, without success. Dwight D. Eisenhower banned Americans from buying gold overseas, Kennedy imposed the “equalisation tax” on foreign investments, and Lyndon B. Johnson discouraged Americans from travelling altogether. “We may need to forgo the pleasures of Europe for a while,” he said.

Fears that the dollar would devalue following the election (won by Kennedy) sent the gold price in London to $40/oz. The Bank of England, in collusion with the Federal Reserve, began increasing gold sales to keep the price down.

Thus did the London gold pool begin, with the addition of six major European nations the following year (Belgium, France, the Netherlands, West Germany, Italy and Switzerland), which co-ordinated sales to suppress, or “stabilise”, to use their word, the gold price and defuse unwanted, upward market pressure.

But the pool struggled against growing demand. In 1965, an ounce of gold was still $35, but the purchasing power of the dollar had decreased by 57% from 1945, while gold reserves had also fallen sharply. The culprit was the costs of the US government, in particular the Vietnam War and president Johnson’s enormous welfare spending.

If you are buying gold to protect yourself in these uncertain times - and you should if you do not already own some - as always I recommend The Pure Gold Company. Pricing is competitive, quality of service is high. They deliver to the UK, the US, Canada and Europe or you can store your gold with them. More here.

Bretton Woods under pressure

With inflation rising at home and international confidence in the dollar waning, these programmes were not just costly – they undermined Bretton Woods. Non-American nations felt aggrieved that they had to produce $100 worth of goods and services to get a $100 bill, when the US could just print one. French finance minister Valéry Giscard d’Estaing called it “America’s exorbitant privilege”.

President de Gaulle, meanwhile, had had enough. He ignored the pool to turn all French dollars and sterling balances into gold. The French even sent battleships to New York to collect their gold. De Gaulle became the target of several assassination attempts – coincidence, I’m sure. There were rather more US dollars in the world than there was gold to back them, he felt, and he was right.

By 1967, US foreign liabilities were $36bn, but it only had $12bn in gold reserves – a third of what was needed to back the dollar. West Germany, Spain and Switzerland began demanding gold for their dollars. Even the British, with sterling going through one of its quadrennial collapses, asked the Americans to prepare $3bn worth of Fort Knox gold for withdrawal. Private gold demand was overwhelming.

“The floor of the Bank of England’s weighing room collapsed under the weight of all the bullion”

In November 1967, the British government devalued the pound by 14%, from $2.80 to $2.40, in order to “achieve a substantial surplus on the balance of payments consistent with economic growth and full employment”.

In that month, the London market saw greater bullion demand than it would typically see in nine: as much as 100 tonnes per day. To stem demand they banned forward buying, leverage and the purchase of gold with credit. The pool still lost 1,400 tonnes that year, more than a whole year’s mined supply.

Selling pressure on the US dollar only increased when the Viet Cong and North Vietnamese People’s Army of Vietnam launched the first of a series of surprise attacks on US armed forces in South Vietnam in January 1968.

Desperate to prop up the system, US military aircraft flew tonne after tonne of gold to RAF Lakenheath from where it was trucked in military convoys to the back entrance of the Bank of England: at one point the floor of the Bank of England’s weighing room collapsed under the weight of all the gold.

You really should subscribe to this amazing publication.

Shoring up the system

In the four days between 11 March and 14 March 1968, some 780 tonnes were sold to market. The effort to protect the price was deemed hopeless. On 15 March, UK chancellor Roy Jenkins declared a bank holiday, and the gold market was closed for a fortnight, “at the request of the United States”.

Zurich also closed. Paris stayed open with gold trading at a 25% premium. All in all, the final 15 months saw over 3,000 tonnes sold to market to protect that $35 price. The pool had lost more than an eighth of its reserves.

Two days later, in the rushed-through Washington Agreement, governors of the central banks in the gold pool declared there would be one fixed gold marketfor official government transactions at $35/oz and another, free-market, price for private transactions. Not for the last time, central bankers were living in a world of their own.

Gold is one thing. Gold standards are another. They tend not to last, particularly bogus ones such as this one, under which citizens themselves did not handle gold. Keynes called them barbarous – ironic, perhaps, given that he was one of the architects of this one.

In August 1971, president Nixon took the US off the gold standard, a “temporary” measure that remains more than 50 years later. For the first time in history, gold – Switzerland aside – played no part in the global monetary system.

Of course it was the fault of the speculators. It always is. “I have directed the secretary of the Treasury to take the action necessary to defend the dollar against the speculators,” Nixon said, deflecting responsibility, and “to suspend temporarily the convertibility of the dollar into gold”.

High time for a US gold audit

The US keeps its gold in four places: at Fort Knox, Kentucky (roughly 56% of its 8,133 tonnes); at the Federal Reserve Bank of New York (8%); and the remaining 36% at the mints in Denver and West Point. There has not been a proper public audit of this gold since 1953. There have been internal audits, especially between 1974 and 1986, but these were not transparent.

There are many people, among them gold experts, who do not believe the gold is there. The US spent it trying to suppress the gold price in the 1960s, theysay. But in this new age of American transparency, both Trump and Musk have repeatedly pledged that this gold will be audited.

There is talk of it being done on a livestream. Trump has even suggested the gold has been stolen. “We’re actually going to Fort Knox to see if the gold is there,” he said, “because maybe somebody stole the gold. Tonnes of gold.”

They’ve been making such light of it, one has to assume they know the gold is there. Musk was laughing about the conspiracies on podcasts, and he even posted a picture of a Fort Knox starter kit: a brick and some gold spray. I can’t see how they would be joking if there were any serious doubts.

Secretary of the Treasury, Scott Bessent, has said quite categorically that the gold is there. The last audit was in September 2024, he said in a recent Bloomberg interview, before looking down the camera and assuring the US people that “all the gold is present and accounted for”. But this would only have been an internal audit, and it would not have been a full audit.

According to the US Mint, “the only gold removed has been very small quantities used to test the purity of gold during regularly scheduled audits”. No other gold has been transferred to or from the depository “for many years”. How long is many years, though? As far back as the 1960s?

It’s quite astonishing just how secretive the whole thing is. They opened the vaults for a congressional delegation and certain members of the press to view the gold in 1974. There were rumours swirling about then too. “We’ve never done this before and we’ll probably never do it again,” said the then director of the US Mint Mary Brooks.

“The gold commonly confiscated under Roosevelt contained some copper, and is not pure enough for sale”

Then in 2017, during Trump’s first administration, Treasury secretary Steven Mnuchin and Senate majority leader Mitch McConnell were invited to view the gold. “The gold was there,” Mnuchin said. He is “sure” nobody’s moved it. There are “serious security protocols in place”. But there are more than 4,000 tonnes in Fort Knox. A tonne would be about the size of a medium to large suitcase. Did he see all 4,000 of them?

The other big issue is the purity of the gold. What is there might not all be of good delivery quality, meaning it would not be readily accepted in international bullion markets. If much of the gold is the bullion Roosevelt confiscated in the 1930s, it will be in the form of “coinmelt”: melted down coins.

The commonly confiscated coins, such as the $20 double eagle, were only 90% pure and mixed with copper to make them harder. When melted down, they were not always properly refined to modern standards, while the bars they were melted into weighed 320-330 ounces, not the 400 oz bars of good delivery standard today. In practice, this means Fort Knox gold would not be accepted without additional processing.

But, until a proper audit takes place, this is all speculation, albeit reasoned speculation. We don’t know the full facts. The reasons given for not conducting a full audit are flimsy: we don’t need to, it would be too much of an undertaking. Please!

If the US gold turns out not to be there, then the gold price goes up – potentially a lot. If it is there, it’s business as usual.

For now, I’d say the markets are behaving as though it is business as usual. They are climbing, and every dip is being bought, largely, it seems, by central banks (especially in Asia), who are diversifying their holdings and de-dollarising. But this audit cannot come quickly enough.

Large volumes of physical gold - over 1,000 tonnes by some counts - have recently been transferred from London to New York. One theory is that was the gold was transferred in anticipation of tariffs. Another is that it was the US buying ahead of its audit. We will soon find out.

Finally, I would just like to debunk one theory doing the rounds. US gold is currently marked to market at $42/oz. After the audit, those 8,133 tonnes – assuming they are there and of good delivery quality – could be marked to market at current prices, meaning a significant uplift in the value of holdings.

The theory doing the rounds is that Treasury ecretary Bessent will use some of the upwards revaluation to monetise the balance sheet – not unlike how Roosevelt did in 1933 – to create funds for, among other things, the strategic bitcoin reserve. But Bessent has quite clearly stated that is not his intention.

This article first appeared in Moneyweek Magazine.

Everything looks decidedly shaky all of a sudden. Trump is swinging the wrecking ball. Markets are tanking. What to do?

A bear market was long overdue, but now that we are teetering on the edge of one, it doesn’t feel very nice.

Markets don’t like uncertainty, and there is a lot of it about at the moment. President Trump likes to create it. It’s one of his negotiating tactics. And he is creating one heck of a lot of it.

Unlike his previous presidency, when he made a lot of noise but wasn’t able to get much actually done, this time around he seems to be shaking up a world order that has been in place for decades, both internationally and at home.

Is he serious about America no longer being the world’s policeman? It seems he is. It began with a global freeze on most U.S. foreign aid as part of his “America First” policy, and USAID’s closure is reverberating internationally. Many have lost their jobs; some 10000 grants and contracts have been canceled, disrupting global aid programmes and more. So much of it was illegitimate, bent, or wasteful. Elon Musk called it “beyond repair” and an “evil criminal organization,” boasting of feeding it “into the wood chipper.” Maybe so. Doesn’t mean ending it will be easy. Anything but.

There have been cuts to the federal workforce; numerous bodies, such as the Social Security Administration and the Consumer Financial Protection Bureau, have been targeted.

But at present, the administration is moving quickly and breaking things. Many support what is happening. Many don’t. Nobody knows quite how far this will go, but it seems a lot further than anyone anticipated.

Europe is going to have to pay its way, and he really means it. What are the implications of that?

What is going to happen between Russia and Ukraine? What deal does he have in mind? Will Presidents Putin and Zelensky go along with it?

What’s going on with tariffs? Are they really about the revenue (I don’t think so) or about something else? What are the implications there?

What is the reaction from Trump’s political opponents going to be? They’ve started attacking Tesla factories. They hate him so much they could not even bring themselves to applaud when a terminally ill child with brain cancer was given an honorary Secret Service award. Whether it’s in the courts or on the streets, they will oppose everything he does. They would rather have corruption, waste, and no transparency than have Donald Trump.

The amounts that have been saved so far are disputed. DOGE claimed $55 billion in the first month. Others have it closer to $15 billion. Either is peanuts in the context of the $2 trillion figure Elon Musk touted during the campaign and reiterated post-inauguration. This would represent roughly 30% of the federal budget ($6.75 trillion 2024). We are a long way from that. There are a thousand billions in a trillion.

Musk is aiming for $1 trillion to be cut from the U.S. deficit in the first year. We are a long way from that too. Even with all the cuts, one Reuters analysis shows that spending has actually increased under Trump, largely due to the increase in interest payments on that extraordinary $36 trillion U.S. national debt. President Joe Biden increased that debt by $8 trillion—31%. Though, to be fair to him, Trump increased it by almost $8 trillion (40%) in his first term.

I remember when it was below $10 trillion, and that seemed like a lot.

If you are buying gold to protect yourself in these uncertain times - and you should if you do not already own some - as always I recommend The Pure Gold Company. Pricing is competitive, quality of service is high. They deliver to the UK, the US, Canada and Europe or you can store your gold with them. More here.

Was he right?

Remember this freaky interview I posted back in October?

The preacher man who described Trump’s assassination with uncanny accuracy, then talked about a mighty crash. People are always predicting crashes and getting it wrong, but this guy was amazing.

Aaaaagh. Scary!

As I say, if there is one thing markets don’t like, it is uncertainty. And we have that in abundance. Nobody quite knows how this is going to pan out. I, for one, am incredibly optimistic. The sooner the system is drained of corruption, waste, rent-seeking, non-productive endeavour, crony capitalism, non-accountability, and all the rest of it, the better, in my view.

But I recognise there is a mountain, and more, of upheaval to get through first.

Thank goodness we have such a large allocation to gold. It is behaving like a trooper. Who knows? A mining boom might even come out of this.

But the stock market does not like it one bit.

Beware: imposters! Anyone appearing to be me, but soliciting you to chat on Telegram or WhatsApp or anywhere is NOT ME. It is someone trying to scam you out of your money.

Video version of this article here:

We are talking testosterone today.

I posted this video on YouTube the other day of me breaking the Lewisham dead hang record. Dead hangs are not the greatest spectator sport, so it might be one to watch sped up. In any case, somebody in the comments asked if I had been taking some kind of testosterone supplement. The answer is, “sort of.”

Testosterone is something I have been meaning to write about for a while, and it is something I have been experimenting with, so here goes.

I haven’t had TRT - testosterone replacement therapy - or anything like that, but I have been looking to improve my testosterone levels, and I think I have had some success.

Getting your levels up, whether man or woman, will make you feel A LOT better.

Physically, higher testosterone levels mean more energy, more muscle, more fat burn, better sleep, better cardiovascular health and blood flow, better bone density and less inflammation. These are all super important once you pass 50.

You’re stronger, basically.

Mentally, with more testosterone, your concentration improves, you become more targeted - that’s another way of saying your focus improves (I don’t like the word focus) - your spirits are higher, your confidence improves, you get bolder, more assertive and more driven.

I have noticed improvements to all of the above.

One thing, in particular, I have also noticed is a lower tolerance of fools, a higher appetite for risk and much more of a DNGAF attitude, which is something I’ve always wished I had more of.

I had a blood test in September 2023 and it showed my testosterone level as 577 ng/dL. The normal range is 200-750ng/dL. An athlete in his early 20s might have levels above that. So my levels were above average - upper-middle - without being amazing.

Testosterone peaks at 18 (probably why young men get into such trouble), then declines ever after. After 30 it declines at 1% per annum. But once you pass 45 - take note - there is an acceleration in decline. That is what we need to address.

I haven’t done another test, but I know my levels have improved. I can feel it. And I think I am well above 600ng/dL.

Here is how to improve your testosterone

1. Exercise

Lift weights

Regular strength training boosts testosterone production, especially in the short term. Resistance training stimulates muscle growth, which signals the body to release more testosterone. Intensity matters - heavier weights with lower reps has a bigger impact. Compound movements such as squats, press-ups, bench presses and deadlifts are particularly effective.

Sprint

Sprints are more effective than light jogging. In fact, any kind of HIIT is good. I usually jog for 2 or 3 miles then do 4 30-second sprints up a hill at the end. It takes me about half an hour in total. Short, maximum-effort sprints (even just 6-10 seconds at 90-100% effort) with full recovery periods (1-2 minutes) work best.

Play some competitive sport

Any kind of competitive sport is good. Tennis, table tennis even. I still play footy - 6-a-side. I’ve found in the last year I am going in for challenges that I would not have attempted ten years ago.

But, of the above three, resistance training is the most important.

2. Other habits

Sleep

Good sleep is as important as exercise, perhaps even more so. The majority of your testosterone is produced when you are asleep. 7-9 hours is optimal. 5-6 hours and your levels drop by 10-15% in just a few days. One 2011 study found young men restricted to 5 hours of sleep had testosterone levels closer to someone 10-15 years older.

My guide to sleeping better is here, but … go to bed an hour earlier.

Use mouthtape when you sleep - breathing through your nose is better for testosterone. Lord knows why but that’s what the bros say.

What next?

At the moment it is relentless. I suppose I should take it as a compliment, but every day, sometimes several times per day some new account masquerading as me pops up. I block, report and delete as soon as I get wind of it, but I can’t be in front of my computer 24/7. Please be aware: I don’t use Telegram. I never invite people to chat on WhatsApp. So if somebody who appears to be me solicits you to join them on Telegram, WhatsApp or anywhere else, it is not me. It is someone who is trying to scam you.

Let me start today’s note with a very warm welcome to the many new readers who have signed up the Flying Frisby.

Many have signed up because of the recent promotion for Lifetime Membership. That ends today, so if it’s caught your eye, time is running out. For a one-off payment of just £450/$570 you will get full access to the Flying Frisby for life.

Click the button below and you will see the option - I stress this is a one-off payment

Today, with stock markets looking very wobbly indeed, I thought it would be a good time to check in on the Dolce Far Niente portfolio.

Dolce Far Niente, as I’m sure you know, means “the sweetness of doing nothing”, and the idea was to create a strong, long-term portfolio

* which will grow and thrive

* with which you will not have to constantly tinker

* about which you will not to have to constantly worry.

You can just leave it alone and let it be.

It emphasises strategic asset allocation - being in the right market - above individual stock picking.

So, with so many new readers, and with it being six months since we last looked, let’s check in on it today.

1 Gold (15% allocation)

Gold is the ultimate Dolce Far Niente asset. It does nothing but sit there and look sweet. The shine may be coming off everything else, but it will never come off gold.

It’s up 55% since inception in October 2023 and going strong.

My firm belief is that everyone should own some gold. Especially now.

My guide to investing in gold is here. If you are looking to buy gold, try the Pure Gold Company.

2. Bitcoin (5% allocation)

HODL is another way of saying Dolce Far Niente, and, even with the current shake out, bitcoin has been another winner. It has more than tripled since inception (a 233% gain).

Some will argue bitcoin has no place in a “low risk” portfolio such as this. I’d argue that the greater risk is not owning bitcoin.

For those in the UK who can’t buy it directly or buy the ETFs, our vehicle to play bitcoin via a UK-broker, and circumvent/satisfy ill-conceived-FCA regulation, was to own Nasdaq-listed Strategy Inc (Nasdaq:MSTR).

This is one volatile stock, and the chart now looks nasty, but its President Michael Saylor is a genius. He embraces volatility, seeing it as a feature not a flaw. And the company has been another winner, up 9x since the inception of the portfolio, even after the recent correction.

By the way, Strategy is proving a leading indicator for bitcoin - it was already falling when bitcoin was re-testing its old high. That makes it a super-useful forecaster. Take note.

3. Special Situations (10%)

This is the fun/painful part of the portfolio.

Lightbridge (NASDAQ:LTBR) was a big winner here, as was and the tax-loss trade (time to exit this one if you haven’t already). Junior miners, Condor and tax-loss trade aside, continue to suck.

By the way, check out this nuts Lightbridge chart. The bots must have got hold of it. Surely one be one to buy on the dips and exit on the spikes.

4. Uranium (5% allocation, reduced to 2.5%)

I reduced the uranium allocation to 2.5% in February 2024, because it all felt too frothy. That has proved a good decision, as the price has since come down. We are in proper bear market now.

I don’t like uranium miners. Most of them will not see any production for years, decades even and are, therefore, drains on capital. We own the metal itself.

Another video for this Sunday morning, based on the very popular New Year’s How To Win piece. I hope you draw some inspiration from it.

(I meant to put it out in Jan, but didn’t).

Please like, watch, share and all those other things.

All the best

Dominic

PS Could I draw your attention to a couple of things…

Lifetime Membership

Many people do not know about this, so, for one week only, I am running promotion. For a one-off payment of just £450/$570 you will get full access to the Flying Frisby for life.

Click the button below and you will see the option - I stress this is a one-off payment

Please consider upgrading your subscription - and if one of last year’s flyers - Lightbridge, Novavax or Microstrategy worked for you, then consider this a way of saying thank you!

PPS As always, if buying gold to protect yourself in these uncertain times, I recommend The Pure Gold Company with whom I have an affiliation deal. Pricing is competitive, quality of service is high. They deliver to the UK, the US, Canada and Europe or you can store your gold with them. More here.

PPPS This week’s commentary about my recent experiences in the US and, in particular, Tesla, went down a storm. ICYMI here it is:

And so to today’s piece. Tesla .

I am just back from a two-week trip to the States, and what a time I had.

I felt so privileged to be there at what feels like the dawn of a new golden age for this most amazing of countries.

The first week I spent in Palm Springs, California, visiting my mum, and the second in Naples, Florida. Quite the contrast. One was Meltdown Central, the other was in a state of jubilation. Everyone everywhere was talking about the USAID revelations.

I did not know Naples. What a stunning place. Hot, sunny, green, humid, beautiful (the architecture is lovely, even the newbuilds—that’s traditional measures for you), polite, safe, cultured, healthy, delicious food. Life seems to slow down as soon you arrive. What’s happening elsewhere no longer seems to matter. Were I to go there and settle, I think I would lose all ambition.

The problem with settling there, though, is price. It has the most expensive real estate in the US. One house was for sale for $295 million. Even Satoshi Nakamoto would wince at paying that.

“I told my kids, when they were growing up,” said Mike, who I was having dinner with, “this is not the real world. Naples is not reality. It’s something else. They needed to know that.”

I turned to his son—Matty Ice—the man who had brought me to Naples to talk tax, bitcoin, and other such things on the Runway Pod, an entrepreneur and family man in his early 30s. “Well, I’m not leaving. Why would I?”

It turns out lots of people come to Naples on a temporary basis, then decide to stay.

It’s not just Naples real estate that is expensive, by the way. The whole of the US has got super dear. I paid $18 for a pint of beer in Miami airport. I had dinner at a friend’s—he paid $60 for three steaks for the barbeque. I thought steak was cheap in the US. In a Palm Springs supermarket, I paid $4.99 for three organic onions. They saw me coming.

In general, I would say food is twice the price it is here in the UK. And that’s with a strong dollar. The country has got very expensive. Inflation is a big, big issue.

My eldest son works in recruitment—in the chemicals industry—and most of the time he is recruiting in the US. He says US workers get paid three times the money for doing the same job as a UK worker - in that industry at least,

But, whether it’s Naples, neighbouring Fort Myers, or Miami, Florida; or Los Angeles or Palm Springs, California, there is also a lot of money in America. You can see it everywhere. It is several standard deviations of wealth up from the UK. The wealth is visible in the houses—even the middle-class houses—in the cars, in the clothes, in the prices. We in the UK have been left behind. It was not always like this.

That wealth gap is only going to get bigger, as the UK continues to pursue high taxes, big regulation, mass migration, and zero growth, while the US goes in the other direction. The place is full of opportunity.

Go to the US. Move there if you can, especially if you are young. The US was already something special, but something really special is happening there: the Washington purges are cleaning the place up. You’ve read the news, you’ve been on X, you’ve seen what’s going on. You really don’t need me to tell you.

But watch what you eat.

I put on 5 pounds (2 kilos) in just two weeks. Mind you, I couldn’t stop eating. The food is yum. (People in the gym kept asking me how I got to be so lean - “by not living in America, and not eating American food” I explained).

I don’t believe this level of political reform would have happened to anything like the same extent without the involvement of Elon Musk. He really is doing God’s work rooting out all that corruption. What emerges will be so much cleaner, more efficient, more honest, and more united.

But of all the things I actually witnessed in person, do you know what most blew my mind?

I did not expect this.

It wasn’t $295 million dollar houses. It wasn’t all the private aircraft in Naples airport next to where we were recording.

It was driving in a Tesla on autopilot. I’d never done it before.

I know I am late to this, but OMG.

Matty typed our destination into his computer, put the car into self-driving mode. Off it went.

The Tesla was a noticeably better driver than I am. It positioned itself on the road well, staying in the middle of the lane at all times. It cornered beautifully. It maintained the exact right distance to the car ahead. It knew the speed limits of all the roads we drove on. It knew when the lights were changing and set off straight away. It has a 360-degree awareness—a human can only look in one direction—and knew exactly what other cars nearby were doing. It didn’t get impatient and start doing silly things like jumping lights.

With machine learning, each Tesla is feeding info back to HQ, so that every car is learning from the others’ experiences. Teslas know the roads - every inch of them - better than you, even the local roads. They are learning how to deal with every conceivable traffic incident. This data-driven driving constantly updates.

I am a backseat driver. I often push my foot down on the imaginary brake. As I was getting over my control issues, I did this at a red light in the distance. Turns out it was miles away. The Tesla braked at exactly the right time.

It got us to our destination and then reversed and parked with precision into a tight spot. I’m a good parker. The Tesla was better. Of course it was. It has 360-degree vision, and my neck is getting stiff.

The driving conditions were good. But how much better would it be in rain, fog or ice, I wondered.

Tesla, Matty pointed out, is as much a software company—a platform like Airbnb, Facebook or TripAdvisor—as it is a car company.

The next day, I had an Uber drive me from Naples to Miami airport.

The Uber driver was good, but sometimes he was doing things on his phone—changing the podcast he was listening to, updating the map. “Look at the road,” I found myself thinking. Sometimes overt the 2-hour journey he strayed from the centre of the lane. One time he braked sharply. No such imperfection in the Tesla.

Transport as we know it is about to change

The main barriers to Tesla’s self-driving progress are regulatory, but a certain Elon Musk is now in a position of influence. One of the reasons he is doing what he is doing is to clear out the regulators and bureaucrats who were so biased against him and blocked his progress—whom he came to despise.

I think the regulatory barriers to self-driving vehicles start to come down quickly. Self-driving vehicles will soon be a feature on US roads. Then what happens?

“I will have my car drop me at the office,” said Matty, “instruct it to pick me up at five, and then in the meantime I’ll put it to work”.

In other words, his car will not be idly parked all day. It will spend the day ferrying other people about. It will earn him money.

Other Tesla owners will do the same. Suddenly owning a Tesla will become potentially profitable. A car will not be quite such a depreciating asset. No doubt some will buy fleets of them. Like any platform, Tesla itself is going to take a cut of the profit.

Just to get the self-driving capability added to the software of the vehicle, you must pay another ten grand. Then comes the rent.

Leaving your car parked 95% of the time, as most of us do—my car in London can stay parked for weeks at a time—is so inefficient. Not for much longer. At least, in the US. It’ll be years before we allow it here in the UK or Europe. Of course, it will.

What happens to American roads in the meantime? Fewer people are going to own cars, especially in cities. They won’t need to. They can just call a Tesla. What happens to the rest of the auto industry? Fewer car sales.

The cost of taxis though comes down.

Drivers lose their jobs to robots. I guess something similar happens to the trucking industry too.

The roads themselves are used more efficiently, as robots drive demonstrably better, leading to better traffic flow and less congestion.

Public transport will see fewer users. Why use such a smelly system when you can travel privately in a Tesla?

Self-driving cars were a pipe dream. That is about to change. American roads are about to change.

There are other self-driving operators - Waymo, Cruise, or Mobileye - which are already fully operational in limited areas (ie driverless). They have partnered with the likes of Jaguar, Mercedes, Volvo and Hyundai, but they do not have Tesla’s end-to-end autonomy. Nor do they have Tesla’s immense network effect.

The network effect is an incredibly powerful force in the evolution of a business. It’s often more important that the tech itself (why, for example, VHS beat Betamax or CDs obliterated minidisk). It’s why I advocate bitcoin ahead of other sh*tcoins.

Tesla’s dominance of roads could be on a par with Apple’s dominance of the smartphone market. It is ahead of the pack.

So should we all be buying stock in Tesla Inc (NASDAQ:TSLA)?

Let’s take a financial overview.

Phew! It’s an expensive company. A lot of what I’ve already described must already be priced in.

With a market cap now over $1 trillion, it is among the world's most valuable companies.

Annual revenue in 2024 was $98 billion, with minimal growth on the previous year. The pro-electric narrative of a few years ago has dissipated over the last couple of years.

EBITDA for the twelve months ending in December 2024 was $15 billion. The EV-to-EBITDA, which compares the company's enterprise value to its EBITDA, stands at around 72, indicating a “premium valuation” relative to its operational earnings.

Its trailing P/E ratio is high, high, high at 177, as is its forward P/E of 124. A lot of earnings growth is expected. This could reflect anticipation of Tesla’s expansion into new markets, battery technology, and/or the self-driving revolution I have described, but it also points to a richly priced stock, for which investors are paying a substantial premium. The Price/Earnings to Growth (PEG) ratio, at 8.5, also implies Tesla is overvalued.

Any setback—some kind of bad accident, a large insurance claim, a rival technology becoming suddenly competitive—and this stock can take a big hit.

Turning to the company’s financial health and profitability, Tesla's Return on Equity (ROE) is 10.4%—I’ve seen worse—and its Return on Invested Capital (ROIC) is 6%, which denotes an efficient use of capital, something Musk is known for.

Tesla maintains a relatively low Debt/Equity ratio of 0.18, suggesting a conservative approach to leverage, which should reduce volatility. The current ratio of 2.02 indicates good short-term liquidity, allowing Tesla to meet its short-term liabilities comfortably.

But it is a volatile stock—so perhaps one to buy on weakness. The 52-week high is $488, the low $139. You can more than double your money if you buy this well. Currently at $350 we are in the middle of the range—well up from the lows, but also well off the highs—and in a downtrend.

Analysts, meanwhile, are divided. Predictions range from $115.00 to $550.00. reflecting a wide range of expectations.

Tesla is unique. It has the potential to transform transport as we currently know it. It could have enormous first-mover advantage and a near monopoly on roads, as more and more people “put their car to work,” and what is currently an expense becomes a secondary source of income. It is the market leader, it is the technological leader, it could enjoy something of a monopoly on roads as it drives ahead of its competitors.

To maintain and grow this valuation, it needs to stay ahead of rivals, it needs to overcome the regulatory barriers it faces, and it needs to manage the many inherent risks of the automotive and tech industries.

But one thing Elon Musk has is vision. He will have seen all of this and be working towards it.

I can quite easily envisage a scenario where Tesla’s dominance of roads is near monopolistic—like Apple’s dominance of phones or something.

In such a scenario, its valuation will be a lot higher.

It’ll make money on the car, on the software, then on the rental.

It will also be the most common car on the roads.

Transport is about to change.

Disclaimer:

I am not regulated by the Financial Conduct Authority (FCA) or any other regulatory body as a financial advisor. Therefore, any information provided in this newsletter does not constitute regulated financial advice. It is solely an expression of opinion. Stocks are inherently risky. Please conduct your own due diligence and consult with a financial advisor if you have any doubts. Remember, markets can both rise and fall. I am not aware of your individual financial circumstances, so only invest money that you can afford to lose.

Hundreds of tonnes of gold - so much so that there is now something of a shortage in London - have made their way across the Atlantic to the US to get ahead of Trump tariffs. Something like 400 tonnes have gone to the Comex alone, never mind what's gone to the private vaults of HSBC, JP Morgan et al.

With a shortage of physical gold for delivery in London, waiting times now as long as eight weeks, and the Bank of England refusing to comment, there are all sorts of rumours flying about. It's not a great situation for London, which is normally the epicentre of the physical gold markets.

I don't think we're going to get a proper run on gold, but it's possible nonetheless, and if we do, talk about unintended consequences...

A bit of zip in the normally quite sleepy physical markets.

Today, however, I wanted to give my outlook on gold for 2025. Before I do this, I have two things to plug:

One is my mate Charlie Morris' newsletter, Atlas Pulse. This monthly gold report is, in my view, the best out there bar none, and it's free. More here.

And, two, if you are thinking of buying gold - and I think everyone should own some - my preferred bullion dealer is the Pure Gold Company. You should get your gold or silver from them.

Gold’s Silent Surge

The gold price has been rising relentlessly since November 2022.

Here we are in early 2025, within a few dollars of all-time highs at $2,800.

Gold is at or close to all-time highs against the Japanese yen, the euro, the Swiss franc, the Great British peso, the Aussie and Canadian dollars, and pretty much any other fiat currency you care to mention.

And yet I don't recall seeing much mention of this anywhere. This is very much a stealth bull market, the best kind of bull market. It means there is plenty more hype left in the can.

Private investors are almost completely ignoring gold. In Germany, normally one of the biggest buyers of physical, I gather we are seeing net selling in the retail markets. One reason is there's profit to be had, especially for those who bought during Covid - of which there are many . Two, because the economy is in the toilet and people need the money. Higher rates in recent years have dampened both investment and speculative demand for gold.

A lot of the money that fuels the junior end of the mining markets also comes from retail buying, and if they're not buying bullion, they are certainly not buying miners: hence the atrophy there.

So who is buying then, if the price keeps on going up?

The answer, as regular readers of the Flying Frisby will be able to tell you straight away, is central banks, especially in Asia. This trend accelerating after the US began freezing Russian assets following its invasion of Ukraine.

China imported 124 tonnes just in November, writes Jan Nieuwenhuijs of the Gold Observer. It has bought 1,050 tonnes since the Russian Freeze, and it is buying 400 oz bars from London, which are almost certainly making their way to the People's Bank of China - 400 oz bars do not trade on the Shanghai Gold Exchange. It is also buying roughly three times as much as it declares.

The explanation is obvious. Central banks need reserve assets which other governments can't freeze, so-called bearer assets. Gold, which is value in and of itself, is the answer. There is no equal.

Here we see gold as a percentage of central bank reserves is now at 20%.

I doubt we go back to the heady pre-WWII days when gold made up 80-90% of reserves - money was not fiat then - but you can see the trend is very much up. It has been for 10 years now. The percentage has doubled in that time. I see no reason why it can't double again in the next ten years. 40 % of reserves held in gold seems like a reasonable number, a conservative number.

Nations are, says Nieuwenhuijs, "obviously preparing for a multipolar world in which the dollar's role as a reserve asset will be gently reduced."

You can look at all this and describe the process as natural and sensible asset allocation: diversification away from other government currencies, especially the US dollar.

Or you can proclaim that other nations are preparing to abandon the dollar and for a new gold standard. It's probably about 80% former and 20% latter. That may well change - but we are not there yet.

While nations might not be so much abandoning the dollar as they are simply increasing their gold holdings, they, are, however, reducing their holdings of US Treasuries. De-dollarisation and diversification.

At the moment, the whole process is covert and benign, but it may become a lot more significant a few years from now.

I urge you too to be diversified and own plenty of gold. It may well be that you are going to need it, and you're better off booking your seat on the lifeboat now while they are still available. This is especially the case if you are in the UK: there has never been a Labour government that didn't devalue, and this particular lot are flip-flopping and clueless. My guide to buying gold is here, in case of use:

I don't see any reason for this central bank buying to abate, by the way. My prognosis is that it continues.

What about the new President?

I want to, briefly, consider gold and President Donald Trump.

Here is what gold did last time he was in power.

Thousands of years ago aliens landed on earth. They came in great space ships, which the ancients took to be chariots of the gods, and they came for gold.

They were the Anunnaki from the planet Nibiru, according to ancient astronaut theory, which derives from author Zecharia Sitchin's interpretations of Sumerian texts. Tall and imposing, with features both human and otherworldly, they were seen as deities.

They needed gold dust to suspend in their planet’s atmosphere to protect it from the solar radiation that was slowly destroying it.

But the primitive hominids they found here, such as homo erectus, were useless, so they combined their alien DNA with them to create a worker race capable of mining the gold they had come for: Homo sapiens. They established mining colonies in Africa and in the Fertile Crescent, which became the cradle of civilisation.

The Anunnaki taught humans many things – agriculture, astronomy, mathematics, writing and record keeping - to ensure their mining operations ran smoothly.

Eventually, they departed, taking vast quantities of gold with them, but they left behind some of what they had created. Evidence of their existence can be found in myths, ancient mines, ancient texts and, of course, in the Megalithic structures they created such as the Pyramids and Stonehenge.

There is actually some evidence that the capstones on top of the pyramids – the pyramidia – were gilded with a layer of gold or electrum (gold-silver alloy), which, of course, would add to the many celestial and religious connotations of these structures. It’s also thought we could not build them today.

This is one of the reasons we associate gold with the gods.

That’s my story and I’m sticking to it.

Tell your friends about this ancient alien race.

If you haven’t already, take a look at my buddy Charlie Morris’s monthly gold report, Atlas Pulse. It is, in my view, the best gold newsletter out there, and, best of all, it’s free. Sign up here.

And, of course, if you are buying gold to protect yourself in these uncertain times, as always I recommend The Pure Gold Company. Pricing is competitive, quality of service is high. They deliver to the UK, the US, Canada and Europe or you can store your gold with them. More here.

You really should subscribe.

I mucked up the title of my mid-week piece, so in case you missed it here it is:

I regard the crimes committed by the Pakistani Rape Gangs as some of the most barbaric, if not the most barbaric, given the scale of them, ever to have been perpetrated on British soil.

Yet, while I knew they were bad, I don’t think I realized quite how bad they are.

I’ve just finished playing a judge - Judge Peter Rook - in a new "verbatim film," which recreates the sentencing word for word of one of the most notorious grooming cases in Oxford. What went on is horrifying.

It’s called "The Grooming Gangs Cover-Up." It is produced by Phelim McAleer and Ann McElhinney, founders of the Unreported Story Society, which specializes in verbatim dramas, plays, and podcasts, and it comes out this Tuesday, January 21. Here’s the trailer:

At times, I could not believe the words that were coming out of my mouth.

I remember telling my elder son and daughter about these rape gangs back in the mid-2010s. Neither believed such a thing was possible. My son started googling. Even on the internet, there was little evidence of what was going on. Rapists are predominantly white, he concluded, and that was that in their minds.

The internet had smothered the story.

In 2020, when everybody was squabbling over Brexit, there was this campaign to get the Remainer anthem - Beethoven’s "Ode To Joy" conducted by André Rieu - to the top of the charts in time for the day we left. Fighting a rearguard action, Leavers then tried to get my song about Brexit, "17 Million F*ck Offs," to Number One. The result is that quite a few singles got sold. The media loved the story, and it was all over the papers. But there is one thing they left out: that I donated the proceeds to the Maggie Oliver Foundation, a charity set up to help the victims of rape gangs. Even that got covered up. (I don’t know what Rieu did with his royalties).

Midjourney, an AI art app which I use to illustrate these articles, refuses to design me a picture to illustrate the title of today’s piece.

Cover up, like the crimes themselves, is still happening.

A couple of years ago, my daughter-in-law was drugged by a Pakistani Bolt driver who had offered her a drink of water. This was in London - not Rotherham or Telford. Fortunately, the drug only kicked in after she had arrived at her destination and her friends looked after her. But what would have happened if that man had "helped out" by offering to take her home? How many other young girls have not been so lucky?

I put a picture of the guy online along with a warning. There were a lot of comments underneath. Many of them were deemed racist. Such is the extent of the brainwashing in the name of multiculturalism, a comment is now deemed of greater concern than actual deeds.

What is racism, anyway?

I define it as the wilful persecution of someone on the grounds of their race.

These white girls were the victims of racism. And sexism. And paedophilia. And rape. And GBH. And, in some cases, murder.

They were targeted because of their race. They were called "white w****s," "white c*nts," and "white slags," and no amount of contempt was enough for them. Yet, of course, they were white, and apparently, whites cannot be the victims of racism. Whites are privileged, you know that.

When is this two-tiered insanity going to stop? Is it not clear how much damage these false, progressive narratives, which we have let thrive, are doing?

We need a clear discussion followed by a definition - not the definition of a race grifter - of what racism is. And the rules need to be the same for everyone. No more multi-tiered nonsense.

These were racist crimes. And they went on for so long because those who should have put a stop to them were scared of being labelled racist. Rather than risk that slur, they threw children under the bus. Woke is, truly, cancerous.

If you live in a remote rural village, and somebody of unusual appearance comes along, and you stare at them, that does not make you racist. Staring at what is unusual to you is normal. If you use a word that is now considered out-of-date, perhaps as a result of not mixing in sophisticated urban circles, with zero harmful intent that does not make you racist. However, if you target a little girl because she is white, then groom her, inject her with drugs, rape her, and then sell her body to people you know so they can rape her - well, that is racist. And a whole lot more besides.

Let the truth be told

At lunch the other day, I started to read out to my family some of the judge’s sentencing remarks, which detail what happened. We got about two sentences in before it all got to be too much, and they didn’t want to hear it. No surprise. What happened is beyond awful.

Read the below if you can stomach it.

How can one human being do something like this to another?

The beauty of these verbatim dramas is that the creators cannot be accused of sensationalism or exaggeration. It is the truth. That is what needs to come out. We have to learn about what has happened if only to motivate ourselves and our leaders into doing something about this.

It has been going on since the 1990s. It is still going on today. No more brushing it under the carpet in the name of multi-culturalism.

The Jay Report claims that 1,400 children (that’s just the under-age ones) were sexually exploited in Rotherham over 16 years. If you extrapolate that number over 50 other towns and cities, you arrive at roughly 70,000 victims. That is a conservative estimate. You can do similar extrapolations and come to a figure of a million. The likelihood is 250,000-500,000, given that we are talking about a period longer than 16 years and it has been happening in more than 50 locations. Kids!

For sure, the cover-ups - the unwillingness to police, prosecute, publicize, or punish - meant the rape gangs went much further than they otherwise would. They thought they could get away with it.

We need truth, even if it is unpalatable, if we are to stop things like this ever happening again.

Most of these girls have never had anything like justice. How is a few years in prison anything like justice anyway?

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The system does not work - smash it

Prison is no longer sufficient punishment. It does not work as a deterrent. With almost 20% of inmates now Muslim and, according to a solicitor friend, with prisons now largely controlled on the inside by Muslim gangs, prison has become a place of indoctrination, radicalization, and Islamism. Thus, not only does imprisonment not work, it is actually counter-productive: it is creating offenders. Who’d’ve thought something run by government doesn’t work as intended?

Then prisoners get let out too early, especially to make room for people uttering wrong think on social media.

Prison is also expensive - annual imprisonment now costs more than £50,000-100,000 per year per inmate, plus the costs of processing it all (police, courts, legal aid, etc) also amount to more than £50,000. As if what the rapist has done is not already bad enough, now we have to pay for him too. The courts are overwhelmed. The justice system is exploited. We need something different and better. It’s long overdue. Horror stories like this one can at least motivate the required reform.

There are other factors motivating the cover-up in my view. Policing your own community, where everybody knows who's who, everybody speaks the same language, and comes from the same culture is one thing. But policing another culture, where the language is different, the values are different - even the names are difficult - is much harder.

It gets even harder when the majority of that culture feel a greater loyalty to their own people and culture than they do to what is right in the eyes of the host culture, or indeed the people of the host culture. If the alien culture does not integrate, it gets even harder.

It was probably easier for the police to let stuff go, and focus on other things.

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Here’s a thought

In the largely secular UK, where the state now takes on responsibilities which were once borne by the church - education, care and so on - the state has also replaced religion. From Nigel Lawson to Polly Toynbee, it is now recognized that the NHS has become a religion.

But the Pakistani communities that have taken over so many towns in the north and elsewhere do not feel the same sense of loyalty, protection, or worship to Britain’s welfare state. It is something to take from rather than contribute to. They worship the Prophet Mohammed, not the NHS.

I will wager a large bet that - especially in these communities where cash plays such a big role - they are paying much lower levels of tax than their earnings dictate. They will pay their Zakat long before they pay their VAT, Income or other taxes. Is HMRC policing these economies to the same extent? You know it isn’t.

Will a thorough investigation be commissioned? Of course it won’t. That would be racist.

More tiers, more iniquity, more injustice.

But that’s is another story, and it’ll be years before that one comes out.

Please tell your friends about this article.

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Heads up: there is now a video version of last week’s predictions piece, if you fancy:

Onwards …

I am bullish on America.

For all its failings, I think it’s still, as comedian Lewis Schaffer is forever telling me, “the greatest country in the world.”

The new administration has huge hurdles ahead of it - not least sorting out the excess spending on its military-industrial complex and atrocious healthcare system, though perhaps "system" is not the word I should be using. The administration also faces considerable resistance from its ideological opponents who prevail in the deep state.

But if Donald Trump, Elon Musk, Vivek Ramaswamy, RFK, et al. get just a third of the stuff they have planned over the line, then the economy is going to boom like hell. There is a lot of money in that country, a lot of entrepreneurial spirit, and a lot of opportunity. Just the size of the US alone means it is, in itself, an enormous market.

However, while the economy and the stock market are bedfellows, they do not always march forward hand in hand. How often this century have we seen stock markets boom while life for the ordinary working person becomes ever harder? Inflation, for example, eats away at his effective earnings, and he struggles to keep up, while the same inflationary dynamic actually pushes up stock markets.

The reverse can also apply. There might be an economic boom "on the street," but stock markets, on the other hand, might be flat. Perhaps they already advanced a year ahead of the boom in anticipation. Perhaps life made better for the American worker by, say, tariffs does not suit global companies like Apple, and so stock prices retreat.

So, while I am bullish on America, am I bullish on US stocks?

I must confess to being rather more ambivalent, as there are a number of headwinds and warning signs.

Let’s look at some of them.

First, there is the small (by that I mean large) matter of the US dollar.

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Here’s the original article if you prefer to read or listen”

If you are buying gold to protect yourself in these uncertain times, I recommend The Pure Gold Company. Pricing is competitive, quality of service is high. They deliver to the UK, the US, Canada and Europe or you can store your gold with them. More here.

And

If you haven’t already, take a look at my buddy Charlie Morris’s monthly gold report, Atlas Pulse. It is, in my view, the best gold newsletter out there, and, best of all, it’s free. Sign up here.

He has invented an entirely new digital system of money with the potential to change the world as we know it. He has watched it grow to a market cap of over two trillion dollars, with as many as 100 million users worldwide, including actual nations, and the US President promising a strategic bitcoin reserve in his 2024 election campaign.

He has half the internet nosing about and trying to figure out who he is. His own coins are worth about $100 billion, making him one of the richest people on earth.

Yet he has managed to stay completely unknown and anonymous. It is almost unbelievable.

Never mind Big Foot, the Mary Rose or the Loch Ness Monster, the mystery of ‘Who is Satoshi Nakamoto?’ is perhaps the greatest mystery the world has ever known - or not known.

There have been thousands of investigative attempts, articles, blog posts and discussion groups involving probably millions of man hours dedicated to pinning down this man, with names bandied about from Elon Musk to little known computer scientists. They have all failed. Satoshi’s identity is as bulletproof as his code.

For my 2014 book, Bitcoin: the Future of Money?, from which today’s piece is taken, I ventured on the same doomed journey. I spent many months poring over the 80,000 words Satoshi wrote in the three years he was active online, looking for clues. What unusual words did he use? Does he make any spelling mistakes? Does he have any quirky grammatical habits? I analysed it in such detail I can tell you where he places brackets, how he uses hyphens, even how many spaces he uses after a full stop and how that changed – all in the hope of finding idiosyncrasies that appear in the writing of other Cypherpunks - clues which might lead me to him.

Profiling a genius – some broad brushstrokes

‘I’ve had the good fortune to know many brilliant people over the course of my life, so I recognize the signs.’ Hal Finney

Satoshi reached such high levels of expertise in so many different fields that many believe he can’t possibly be one person. He is a polymath. It is not just the breadth and depth of his knowledge, but, more importantly, its specificity that makes him unique.

In order to first conceive a new system of electronic cash, one would have to have thought extensively about the nature of money and its history. Money is a subject that has found more interest in the last few years with the emergence of bitcoin, the 2000s bull market in gold, the financial crisis and the growth of libertarianism, but, in 2007–8, when bitcoin was conceived and first introduced, books and academic papers on the subject were few and far between. The subject did not have broad appeal.

How many of those who cared actually had the ability to design a system like this? It is one thing declaring what needs to be done; it is another putting it into practice.

Satoshi must have had expertise in computer coding, mathematics, databases, accounting, peer-to-peer systems, digital ownership, law, smart contracts, cryptography and monetary history.

He had to have had experience in academia. The act of submitting a white paper, its presentation, the impeccable referencing – it all denotes academia, even government.

It’s also easy to infer from the way bitcoin was launched that Satoshi had experience in open-source tech start-ups.

The resilience of the code suggests he had computer hacking experience. Moreover, his ability to keep his identity hidden, despite the fact that half the internet is trying to figure out who he is, suggests significant practical experience in staying anonymous. It also means he has the trust of those who know him, if anyone did, to keep his secret.

Then there’s the matter of his prose. It is consistent and of such a high standard it seems he must have had experience as a writer – perhaps he was a blogger, an academic or an author. He was also quite humble and dismissive of his ability in this regard. ‘I’m better with code than with words’, he said.

It’s clear from his posts that he had the awareness to see shortcomings in his system, and the patience not to try to do too much too quickly. He had the foresight to perceive problems before they arose and the meticulousness to prepare for them. He appears to have remained calm and measured in the face of difficulty, but also of his own success. He treated those two imposters just the same. Signs of arrogance are hard to find.

Then there’s the way that bitcoin was introduced to the world.

PR, like economics, is not an exact science. Sometimes something gains traction, sometimes it doesn’t – and there’s no explaining why. Bitcoin has been a PR masterstroke. The coverage it has received has been enormous. It gets more publicity than gold, which is the oldest form of money there is. Satoshi cannot take all of the credit for this, but he has to take some of it. He understood when to make his ideas known, at what point to release his creation into the open-source world and he had the self-efacement to let go of it for others to develop. He promoted his idea with huge under-statement – but the scheduled creation of bitcoins meant there would be no shortage of bitcoin-holders to do the promoting for him.

So we can add an understanding of both PR and psychology to his list of qualities. His knowledge of how people on the internet, in the open source world and in large institutions work, allowed him to progress his creation.

Finally, he has a certain honesty. Despite Bitcoin’s similarities to a pyramid or Ponzi scheme, he never pumped-and- dumped his creation. Tempting though it must have been, he never sold the bitcoins he mined. That also suggests he already had money.

There are not many people like this.

From mathematics to computer programming to economics and monetary history to politics to PR and psychology to cryptography to business acumen and vision to plain old written English – in all of these fields he excelled. To cap it all, he’s probably good-looking too.

It’s early in history to be drawing this sort of comparison, I know, but there are many parallels between Satoshi and Isaac Newton. Newton was a brilliant scientist and mathematician, of course, and an alchemist. But he was also Master of the Royal Mint. He redesigned England’s monetary system, putting us onto the gold standard on which Britain’s colossal progress during the next 200 years was built.

If you haven’t already, take a look at my buddy Charlie Morris’s monthly gold report, Atlas Pulse. It is, in my view, the best gold newsletter out there, and, best of all, it’s free. Sign up here.

First instinct

Many believe that Satoshi was Hal Finney, the veteran programmer, who invented reusable proof of works, one of the models on which bitcoin was based. This was my first instinct. Often such “first instincts”, for reasons I cannot begin to explain, prove correct.

When Satoshi first announced bitcoin on the cryptography mailing list, nobody replied. The message was ignored for two days. In the short-attention-span land of the web, two days is a long time to wait for some feedback on something you’ve spent 18 months working on. Two days is a long time to wait when you might have nailed something Cypherpunks had been dreaming about for 20 years.

The first reply came from Finney. Was he replying to himself in order to generate some interest and discussion – to bump his thread? Replying to your own posts, known as ‘sock-puppeting’, is not uncommon.

Let us pursue this line of thinking a little further.

Finney was born in 1956 – in that same two-year golden window as so many computer-scientist geniuses that would change the world (from Bill Gates to Tim Berners-Lee to Steve Jobs) were born – and spent his life working on cryptographic systems. He was number two to Phil Zimmerman, the pioneer in the field, for many years at the Pretty Good Privacy (PGP) Corporation, where they developed the most widely used email encryption software in the world.

Such were his beliefs in privacy, freedom, and Cypherpunk, Finney was known to spend many nights writing and developing code for free, just because he believed in the work.

In 1993, he published the paper, ‘Detecting Double-Spending’. Solving the double-spending problem (ensuring the same money cannot be used twice) was, of course, the key problem with digital cash. It was what Satoshi was so excited about when he proposed Bitcoin. In 2004, Finney developed the ‘reusable proof-of-work’ (RPOW) system, which coders regarded as a brilliant step forward – but his system never saw any economic use until b itcoin.

Finney is one of the few people to have the background and expertise to have developed bitcoin – but he is also an obvious person to take an immediate interest.

In his very first reply to Satoshi’s announcement, he wrote:

“As an amusing thought experiment, imagine that Bitcoin is successful and becomes the dominant payment system in use throughout the world. Then the total value of the currency should be equal to the total value of all the wealth in the world. Current estimates of total worldwide household wealth that I have found range from $100 trillion to $300 trillion. With 20 million coins, that gives each coin a value of about $10 million.”

The comment shows extraordinary insight. Many now see this “amusing thought experiment” as inevitable. But could it also be somebody trying to get others excited? Very possibly.

(By the way, ‘thought experiment’ is an expression Satoshi himself uses – though it is not uncommon in coding circles).

Of the many names touted as Satoshi, Finney’s writing style is one of the few that match. The major difference is Satoshi used British spelling and Finney does not. There is a similar calm, understated tone, similar use of language, similar punctuation habits: two spaces after a full stop. In stylometrics tests carried out by John Noecker Jr., chief scientific officer at text analysis experts Juola & Associates, Finney consistently scored high. (However, veteran cypherpunk blogger, Nick Szabo, scored higher).

Then I noticed both Finney and Satoshi had ‘@gmx.com’ email addresses. (GMX is a free email provider based in Germany. Many Germans use GMX, while Americans and British tend to gravitate towards Gmail, Hotmail, or Yahoo. Today they would probably gravitate towards P rotonmail). Was this just coincidence – or was it a clue?

Why did Satoshi disappear?

In December 2010, Satoshi made his final post and then disappeared from the internet.

Why?

Perhaps to protect his anonymity in the face of rising interest from the media and, more significantly, the authorities: to protect his own safety as the WikiLeaks panic began to erupt. (After Wikileaks was shut out of the financial system, many began sending it bitcoin. The effect, ironically, was thus to make it an extraordinarily wealthy organisation).

But there is also the possibility that he disappeared because he was ill.

In 2009, Finney was diagnosed with Lou Gehrig’s disease – amyotrophic lateral sclerosis – the same disease from which Stephen Hawking suffered. It is, for the most part, fatal and claims its victims within two to five years. ‘My symptoms were mild at first,’ he says, ‘and I continued to work, but fatigue and voice problems forced me to retire in early 2011. Since then the disease has continued its inexorable progression.’ Finney, eventually died in August 2014.

In March 2013 he said, ‘Today, I am essentially paralyzed. I am fed through a tube, and my breathing is assisted through another tube. I operate the computer using a commercial eye-tracker system. It also has a speech synthesizer, so this is my voice now. I spend all day in my power wheelchair. I worked up an interface using an Arduino so that I can adjust my wheelchair’s position using my eyes. It has been an adjustment, but my life is not too bad. I can still read, listen to music, and watch TV and movies. I recently discovered that I can even write code. It’s very slow, probably 50 times slower than I was before. But I still love programming and it gives me goals.’

Could a terrible illness be the reason Satoshi withdrew?

Finney was one of the first to mine bitcoins. What did he do with them?

I mined several blocks over the next days. But I turned it off because it made my computer run hot, and the fan noise bothered me. In retrospect, I wish I had kept it up longer, but on the other hand, I was extraordinarily lucky to be there at the beginning. It’s one of those glass half full, half empty things.

The next I heard of Bitcoin was late 2010, when I was surprised to find that it was not only still going, bitcoins actually had monetary value. I dusted off my old wallet, and was relieved to discover that my bitcoins were still there. As the price climbed up to real money, I transferred the coins into an offline wallet, where hopefully they’ll be worth something to my heirs. Those discussions about inheriting your bitcoins are of more than academic interest. My bitcoins are stored in our safe deposit box, and my son and daughter are tech-savvy. I think they’re safe enough. I’m comfortable with my legacy.

Finney sold many of his bitcoins in order to pay for medical care, many at around $100. Satoshi never moved his.

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We are all Satoshi

Finney was a key player in the development of Bitcoin, no doubt. He was one of the first to ask real questions. He managed to understand from the start the inner workings of the Bitcoin protocol and its potential. He explored the weaknesses in the Bitcoin code – one of them is even named 'the Finney Attack'. He had many exchanges with Satoshi on the Bitcoin forums as they progressed the code and developed new versions. He asked question after question. But these very exchanges show there were two people talking. On January 10th, 2009, for example, Finney publicly complained to Satoshi that Bitcoin had crashed when he tried to receive a transaction. If it was his own code, and he was transacting with himself, he would surely have quietly fixed it himself.

Moreover, coders all agree that Finney's coding style – and the style of the comments written in the code – is different from Satoshi’s. Also, Finney preferred to code in the language C, whereas Bitcoin is coded in C++. This is something Finney himself confirms: 'I’ve done some changes to the Bitcoin code, and my style is completely different from Satoshi’s. I program in C, which is compatible with C++, but I don’t understand the tricks that Satoshi used.'

Shortly before the publication of this book, the Forbes journalist Andy Greenberg published an interview with Hal Finney. Finney was now too ill to even speak – he could only raise his eyebrows to say yes. His son showed Greenberg fifteen email exchanges between Satoshi and Finney from January 2009. They mainly focused on bugs Finney had found in the code, to which Satoshi replied with fixes - and notes of thanks.

Greenberg was also shown Finney's bitcoin wallet – with the transfers between Satoshi and Finney made back in 2009. As Greenberg notes, the wallet evidence and the Gmail timestamps in the emails would have been hard to forge.

To cap it all, there is the fact that in 2009, at precisely the same moment Satoshi sent time-stamped e-mails, Finney, a keen runner, was photographed in the middle of a ten-mile race. Nobody, not even Satoshi Nakamoto, can be in two places at once.

Bitcoin could not have happened without the work of Finney.

If Satoshi Nakamoto was several people, Finney might have been one of them. But if Satoshi is an individual, Hal Finney was not him.

This is an extract from my 2014 book, Bitcoin: the Future of Money?

If you missed them (there were problems with the site midweek), check out my forecasts for 2025.

OK, folks. It’s predictions time.

As ever, the eternal conflict applies: the more outlandish the prediction, the more entertaining it is to read about - but the less likely it is to actually happen.

On these pages, we attempt to strike a balance.

Here are 15 things to look out for in 2025.

Here is a video version of this article, if you prefer:

1. The long overdue correction in the UK housing market finally begins.

“Record Boxing Day bounce,” says Rightmove. Read beyond the headline and you get this: “Our data shows a 26% increase in the number of new properties listed for sale compared to Boxing Day 2023, which previously held the record.” They’re trying to spin more sellers.

More sellers means more supply.

Meanwhile… houses are overpriced. The economy is not booming, so people have less money. Labour’s higher taxes also mean buyers have less capital to spend. Higher mortgage rates mean there is less money to borrow, and, thus, less newly created money to come into the market and prop up prices.

The rich are not coming to Britain - they are leaving, if they haven’t already left.

More supply of houses, but less money to buy them with.

Meanwhile, stamp duty is a massive deterrent to buyers. Never mind people choosing not to move because of it, anyone buying a second or third home - they’re as good as gone: who is going to pay 5% stamp duty for a second or third home? Not many people, I wouldn’t have thought.

More supply, less money, fewer buyers.

Then there is the general perception of the economy. Psychologically, people are not feeling rich, nor are they bullish about the economy, meaning fewer people will take the plunge.

What about investment from overseas?

See my earlier comment about stamp duty. The cost of buying drives away investment.

Moreover, the UK is not currently well looked upon. Rich Americans, for example (normally a good source of buyers), are not going to pile in given, one, the costs of buying and, two, how the UK is currently perceived over there.

Then Labour are going to loosen planning laws and build a whole load more houses - well, they say they are - meaning even more supply.

As if that wasn’t enough, 2026 is the year the 18-year-cycle in property turns down.

If houses don’t turn down this year, I’ll declare this market permanently immune.

2. Keir Starmer survives

His premiership is already looking dicey. It’s one crisis after another, and it’s difficult to see how he survives, especially with all the rape gang stuff.

However, I think short-term PMs became a bit normalised in the Cameron-May-Johnson-Truss-Sunak era. Cameron went because of Brexit. May went for the same reason. Johnson got his landslide, handed to him by Farage, but then Covid came along, and Johnson, under a lot of pressure from the Left, got the shove from Tory MPs with whom he was never particularly popular anyway, worried about their seats. Not having been elected, Truss and Sunak were toast before they even started.

None of that applies to Starmer. I admit he is looking shaky, particularly under this extraordinary pressure from Elon Musk. But I still think it’s too early for Labour MPs, worrying about their seats, to give him the shove, and it’s normal for a PM to last the full term - what happened under the Idiots Tories was not normal - so somehow Starmer survives the year.

3. Gold hits $3,000.

I’m not wildly bullish about gold at the moment, at least in US dollar terms, though I still think it is absolutely essential you own some. One, because at some point the China gold story is going to hit the mainstream, and suddenly there will be a scramble for gold. It probably won’t be this year, but you never know, and gold is one particular lifeboat you want to have ready in advance.

Second, if you are in the UK, I think sterling has problems - more on this in a moment - and your wealth is much better stored in shiny yellow metal than it is in British government digital stuff. (You would normally say British government paper, but it isn’t paper anymore).

On which note, if you are buying gold to protect yourself in these uncertain times, I recommend The Pure Gold Company. Pricing is competitive, quality of service is high. They deliver to the UK, the US, Canada and Europe or you can store your gold with them. More here.

And

If you haven’t already, take a look at my buddy Charlie Morris’s monthly gold report, Atlas Pulse. It is, in my view, the best gold newsletter out there, and, best of all, it’s free. Sign up here.

$3,000 - landmark number though it is - is only 12.5% higher than where we are. We could easily see that by June.

4. Microstrategy (NASDAQ:MSTR) becomes a top 100 company by market cap.

Currently, Deutsche Telecom (market cap US$145 bn) is 100th. Microstrategy is $85 billion at time of writing. It joins the elite. What a pick this has been for readers.

5. Bitcoin …

I was in Miami on New Year’s Eve at Michael Saylor’s - strictly on reconnaissance, of course - and one thing I learned there was that roughly half of corporate donations during the 2024 Presidential Election - $245m according to the Federal Election Commission - came from the crypto industry. Coinbase alone contributed $75 million.

I’m a beneficiary, so I’m not complaining, but, really, you have to say, buying such favour is more than a little dodgy, even if that is how the world works and has almost always worked.

But it means the likelihood of the Republicans delivering on their pledge for a strategic bitcoin reserve is likely.

The US isn’t going to buy a million coins straight away, but it may well buy 3-400,000 in year one. That sends bitcoin a lot higher.

The prediction?

It goes to $200,000 then crashes.But then it crashes. Cos that’s always what happens.

6. Sterling has big problems.

We spend too much. We make too little. We have an incompetent Chancellor, who is something of a stranger to the truth. We have too much unpayable debt. We are on the wrong side of the Atlantic.

My eight-year cycle has turned down. This is the year it hits the skids.

A sterling crisis will hurt house prices too.

7. X thrives, Blue Sky dies, Blogging Blue Skies

Blue Sky is just a left-wing tantrum, same as Parler and Gettr, a few years back, were right-wing tantrums. It won’t last. People gravitate to where speech is freest - with a little bit of large network thrown in. I am a huge, huge Elon Musk fan. I think he is a force for immense good (finally, the rape gang story is getting the attention it deserves), though perhaps the algorithms have made Twitter/X a little too much the Elon show. Nevertheless, Twitter/X is highly addictive, it is where the narrative is set, and those who have stomped off will mostly return.

Elsewhere, people don’t watch films like they used to - I went to the cinema the other day and it was pants. They don’t read books like they used to - they tend to pick their phone up first. But when they grab their phones, in amongst the doom scrolling, they do read articles and essays. So blogging - and platforms like Substack, where speech is also free - thrive too.

8. The S&P500 Rises 10%

Year one of the electoral cycle is traditionally the weakest (year 3 is best), but the S&P has a decent year nonetheless.

9. Oil ranges.

Oil does not crater, as many predict, with the Trump-inspired increased US production. But nor does it moonshot. A $60 to $90 range - something like that.

10. Small Caps Thrive

Small is beautiful and small caps make a welcome return. I know I’m a broken record on this one, but one day it will happen. Probably when my back is turned.

11. The US Dollar Index breaks out to 20-year highs.

Somewhere near 117-8 is the high.

12. The BRICS don’t come out with a proper US dollar alternative … yet

13. Silver disappoints … as always

$33 is the high, $22 the low.

14. Despite all the crap, the world becomes a better place to live.

We live longer, we eat better, tech keeps improving things. We advance. AI makes us more productive and betters living standards.

15. Your Bruce-y bonus sports prediction.

Liverpool win the league and the three promoted teams Ipswich, Southampton, and Leicester all go back down. I’ve stopped following football, but that’s what my son told me would happen.

Happy New Year everyone. I hope the Universe grants you everything you are hoping for and more.

I’ll come back and mark these at the end of the year. 2 points for a hit, 1 point for an ok, 0 for a miss, and -1 for an epic fail.

Until next time,

Dominic

One of the takeaways was that one should publicly declare one’s goals and aspirations. In doing so, several things happen.

You make yourself more accountable. Knowing that others now know your goals pushes you to take stronger action to achieve them. You thus become more committed to them. The act of public statement also solidifies goals both in your mind and in the public perception, thereby moving them beyond an abstract idea to something more concrete. The act of articulating goals also clarifies what it is you are actually looking for and may even give you new insights.

Support networks can also emerge: friends, family, peers, contacts are more likely to help in some way, if they know what you are trying to achieve. They might introduce you to helpful people. Those who have been down similar paths might be able to offer advice, assistance or collaboration.

You will have something to keep referring back to, better enabling you to track progress, which will further reinforce the whole thing.

Finally, making such a declaration makes you vulnerable, but that is actually empowering and liberating. It reduces internal conflict; while others might empathise and want to help you for your honesty.

With all this in mind, I thought I would share my New Year resolutions with you. I hope you find some interest, amusement or even motivation in them.

Some are quite personal, but for reasons stated above, I’ve decided to post them anyway. I hope it is not TMI.

I always tend to overdo it with my resolutions - reach for the sky and then, even if you fall short, you still end up pretty high.

So here they are:

Health, Body & Mind

* Stay fit and strong. Weights two or three times a week. Something aerobic two or three times a week. Plenty of stretching. Daily deadhangs, pelvic floors, breathing and neck exercises.

* Keep drinking less.

* Fast once a week.

* Eat more protein.

* Get good at lucid dreaming. (Lucid dreams are when you are aware you are in a dream, while you dream - dreaming is something I have got very interested in of late).

* Read at least 15 books. I read a fair bit, but most of it is online. I hardly seem to read actual books any more - my phone always takes priority. Put this right.

* Try and do some mindfulness meditation stuff once per week.

Money

* Invest well and grow my net worth - and the net worth of Flying Frisby readers - by at least 20%.

On which note, if you are buying gold to protect yourself in these uncertain times, I recommend The Pure Gold Company. Pricing is competitive, quality of service is high. They deliver to the UK, the US, Canada and Europe or you can store your gold with them. More here.

Work & Career - Laughter, Acclaim, Opportunity

* Continue producing consistent, interesting content for this Substack and grow it - both subscribers and revenue - by 25%.

Apropos of which, why not subscribe?

* Get better at PR and marketing, significantly grow my online presence - both as comic and commentator - and build a bigger following. ( I have a plan here).

* Finish my musical about the Peasants’ Revolt.

* Write my Gilbert and Sullivan musical.

* Write stage and screen adaptations of Kisses on a Postcard.

* Make something significant happen with Kisses on a Postcard. I’ve put that in bold because it is perhaps the most important of all to me. We are talking about something that could be as big as Oliver! or The Sound of Music, if there are any producers reading this.

* Try and get some comedy gigs in the US and grow a presence there

* Get more gigs and better gigs in the UK, working towards a full-scale tour.

* Keep writing the songs, making people laugh and produce another album by year end (I try and produce one a year).

* Get my new book, The Secret History of Gold, as good as possible; and market it as well as possible, especially in China and the US. (It’s due out in August).

* Practice my uke and singing most days and get better at both.

A lot of asks: I think I might be going against everything I said here on Wednesday.

Enjoying this article? Then why not subscribe …

Love and Family

* Be the best father I can be to Samuel, Eliza, Lola and Ferdie. Set a good example. Love them unreservedly. Help them fulfil their potential. Spend more time doing memorable things with all of them, but especially Eliza and Ferdie, as they lost out a bit this year.

* Find a nice place to live and settle down happily with Miss Downing in a lasting, fulfilling relationship.

* Be a good son to my mother, and justify the unreserved love she has shown in me.

Not a lot then.

I realise I am asking a lot of both myself and the universe, but the whole point of these resolutions is to be bold.

I’m not going to say I won’t achieve all these goals, as that defeats the purpose (I never manage all of them but I’M NOT GOING TO SAY THAT). If nothing else, at least I’ll have something interesting to write about this time next year.

This isn’t all about me. What about you? What are your goals? What are they? Let’s discuss them in the comments.

I wish you a 2025 packed with happiness, growth, fulfilment, success and—fingers crossed—lucid dreams.

Dominic

Tell someone about these resolutions.

PS A few final bits and pieces:

* If you haven’t already, take a look at my buddy Charlie Morris’s monthly gold report, Atlas Pulse. It is, in my view, the best gold newsletter out there, and, best of all, it’s free. Sign up here.

* If you missed my New Year piece, it’s a good one. Here it is:

* I recorded this interview with Rob Moore the other day, which you might enjoy:

David Haye is his name. Way back when, his sister and I were married, and he is uncle to my two oldest children. I don’t know if that makes him former brother-in-law. Whatever.

I still maintain that the world doesn’t quite know what an exceptional boxer David was. His speed and power were second to none. The wins in France against Jean-Marc Mormeck to win the cruiserweight World Title, after being knocked down in the fifth, and then in Germany against the unbeaten Russian Nikolai Valuev, who at 23.4 stone and 7 feet, was the largest heavyweight in history, were two of the greatest British overseas wins ever.

In winning both cruiserweight and heavyweight world titles, he achieved something only two other boxers, Evander Holyfield before him and Oleksandr Usyk after, have managed. That tells you how good he was. Yet, he is not quite seen in the same light as those other two, largely because of injuries and losses later in his career.

I’ve known David since he was 16, and he was going to be the heavyweight champion even then. It was almost all anyone in the family talked about.

What I always most admired about him is his singularity and clarity of purpose; that and his breathtaking, fearless honesty. He hides nothing. He tells it like he sees it and then lives with the consequences. Jordan Peterson would be proud.

It’s that singularity of purpose - that winning mentality - I want to talk about today.

As a youngster, David used to spar with a fighter who was naturally more gifted but never made it through the amateur ranks. “He would rather be the guy who could have made it,” David used to say. “The guy sat in the pub 10 years from now telling everyone he could have made it. He would rather be that than take the necessary risks and make the necessary sacrifices to actually make it.”

I was always incredibly struck by that attitude.

Burn the ships: have no plan B

We all met up at David’s mum and dad’s, my old in-laws, on Christmas Eve. All our kids were there, and it was a lovely family do. David’s son, Cassius, who is 16, is turning out to be quite the tennis player. I reminded them of a story from when Cassius was seven or eight.

We were having lunch, and I said that tennis was a great sport to get good at because, unlike, say, football, if it doesn’t work out, you can always get a job as a tennis coach. You can go anywhere in the world and have a pretty nice life.

I looked to my right and saw David fuming, “What are you telling him that sh*t for? Why are you putting those kinds of doubts in his head?”

I was thinking like a risk-manager, I guess. The sports stars of old always used to get a trade first. Not so David.

His mentality reminded me of a story about Spanish conquistador Hernán Cortés, which I tell in my new book on gold to be published later this year. Cortés landed in Mexico in 1519. His purpose was to find gold and to conquer. He had 508 soldiers and 11 ships. On landing, he scuttled 10 of them. It meant there was no escape. His men now had to win - or die.

Speaking of gold, have you signed up for Charlie Morris’s monthly gold report, Atlas Pulse? It is, in my view, the best gold newsletter out there, and, best of all, it’s free. More here.

Later that night, David and I back-and-forthed on texts a bit, and I told him the Cortés story. And so we come to the point of today’s missive - and it’s an appropriate one, given we are in the season of New Year's resolutions.

David sent this message back in reply, which I think is one of the most brilliant texts - about winning, clarity, singularity of purpose - I have ever received. So I publish it in full here:

Yes, I’ve heard the same story, and it’s a lesson that resonates deeply with me—not just in the abstract, but in how I’ve lived my life and shaped the mindset of my children. When Cortés sank his ships, he left his men with no option but to succeed. That’s not just a story of conquest; it’s a metaphor for the winning mindset. When there’s no retreat, no Plan B, the path becomes clear. The mind and body focus completely on achieving the one goal that matters.

That same principle was drilled into me from an early age. My dad told me I could box aged 10, but only if I was the best. There was no room for half-hearted effort or second thoughts. From the moment I said I wanted to be the heavyweight champion of the world—the pinnacle of the sport—every decision I made aligned with that goal. There was no ambiguity, no backdoor exit. Winning wasn’t just a possibility; it was the only outcome.

That’s the mindset I’ve passed on to Cassius and Kingston. He wants to be the best tennis player in the world, and he knows what that means: living full-time in Spain, training in the blazing heat on clay courts, and pushing his body and mind to the limit every single day. He understands, like I did, that greatness demands clarity and sacrifice. It’s about burning the ships—eliminating all distractions and doubts—so there’s only one way forward.

Winning isn’t an accident or a stroke of luck. It’s the result of relentless dedication and a mindset hardwired from the very start. It’s about creating an environment where success is the only option, so the journey becomes as clear as the destination. That’s how champions are made—whether in the ring, on the court, or in life.

Share this message with a friend.

We don’t all want to be number one. Many of us are content with what we have. But if you are serious about becoming top dog, then that text message - from someone who has been there and done it - should be put to memory.

I look at my own life, and I’m the very opposite: jack of all trades, master of none. Comedian and financial blogger. What - how does that work? I've also been: prolific voiceover artist, podcast host, TV presenter, actor, author of three books, boxing ring announcer (for Hayemaker Boxing - who says nepotism doesn’t exist?), and a million other things I can’t remember. Even within comedy, my career is disparate: comic songs, stand-up, MC, witty raconteur, lectures with funny bits. Gold or bitcoin - which is it? Why not both...

I’m occasionally asked why I am not more well known than I am. There’s your answer. I do too many things quite well instead of excelling at one.

I think it’s partly because I get interested in stuff. But it’s also a defensive thing, I’m sure. If one doesn’t work out, I’ve always got the other to fall back on.

Here is one of my resolutions for 2025: do fewer things better.

What do you think? Please post your thoughts in the comments below.

Happy new year, everyone. Let’s hope it’s a belter.

Buying gold to protect yourself in these uncertain times? I recommend The Pure Gold Company. Pricing is competitive, quality of service is high. They deliver to the UK, the US, Canada and Europe or you can store your gold with them. More here.

A pleasant chat about the state of bitcoin, and, in particular, how far advanced bitcoin adoption is in the Czech Republic.

Before I begin, just a couple of things:

* In case you missed it, check out Friday’s piece on North American tax loss selling. It has 9 ideas for short-term trades, which could come good by February.

* And there is now a video version of "The Chainsaw and the Swamp: A Tale of Two Economies" for your Sunday morning viewing pleasure.

Right. Here we go …

Predictions are funny things. The more outlandish the prediction, the more entertaining the copy, but the less likely it is to actually happen. What is more important: getting lots of eyeballs or being right?

I like this exercise because it demonstrates just how much perspective can change over time. While we can change strategy as events develop, what I wrote a year ago does not, so when you look back at stuff you got wrong, you can look foolish, even if you changed tack in real time. On the other hand, if you got stuff right, people go - well that was obvious.

So the rules of my little game are this: I score two points for a direct hit, one for a good call, zero for a miss, and minus one for a "David Lammy on Mastermind" fail.

I made 15 predictions. Here they are:

1. The Great Decline goes on.

I was pleased with this one, even if it was rather negative.

“Everywhere the state’s tentacles reach remains a drain on productivity. Our once-great institutions continue to fall apart, like zombie meth addicts, stumbling towards dysfunction... The ordinary worker desperately trying to improve his lot is bled dry by taxes, inflation, housing costs, and the voracious state monster. Fiat loses yet more of its purchasing power. The South Africanisation of everything continues.”

Gosh, it’s depressing and negative. Things may be changing on the other side of the pond, but they are not in Europe. Two points.

2. Gold breaks out to new highs and goes to $2,400.

And some. $2,790 was the high. We’re now at $2,620. Two points.

3. Bitcoin goes to new highs as well.

Yup. We are at $98,000 as I write. $108,000 was the high. Two points.

4. For reasons I don’t understand, ethereum outperforms bitcoin.

Ethereum always seems to move later in the cycle and by more, hence the prediction. But in 2024 bitcoin outperformed. Zero points.

5. The US dollar trends sideways.

It didn’t. The US Dollar Index began the year at 100 and ended about 8% higher around 108. Another big fat zero.

6. Sterling has problems.

Cable began the year at around $1.27 and it’s now at $1.25, having been as high as $1.34. So it’s down a bit. But the eight-year cycle low that I am looking for has not materialized. I’m sure it’s coming, but zero points.

7. The Tories are eviscerated.

Pleased with this one.

They had their chance and they blew it. Come the General Election this year, the voters are unforgiving. … The SNP is similarly annihilated. The shortcomings of our political system are there for all to see. But nothing that needs to change does.

Roughly 80% of the country did not vote Labour, yet they got 63% of the seats. Incredible. And they call it democracy. Two points.

8. Uranium to hit $125/lb.

Nope. The highest it got was $105/lb, and that was in January. It spent the rest of the year declining; it's now at $73. Minus one. Totally wrong.

9. Fast and processed food companies have problems.

I think I am early to this. Let’s see what RFK does. But, by way of proxy, McDonald's is flat on the year; Burger King (Restaurant Brands International) is down 14%; KFC is off about 10%.

Good call. Two points.

Seed oils are losing.

10. Good year for the Japanese yen.

It has to go up sometime right? It’s so cheap.

Nope. It went down. Minus one.

11. The S&P500 has a good year.

I’ll say. It’s up 25%. Way above expectation. Two points.

12. Small caps outperform.

Apart from a brief spell in summer, they didn’t. It feels like they are starting to, but nope. Zero points.

13. UK house prices. Atrophy and stagnation, but no meltdown

That feels about right. About 50% of stuff on the market isn’t selling, apparently. I’m not surprised; the cost of moving is so high. Two points.

14. Silver. Can it stage a meaningful rally above $30?

Nope, I said. It went to $34 in October. Now it’s $29. Was that rally meaningful? Well, it did better than I thought it would. Zero points.

15. Liverpool win the league; Sheffield United, Burnley, and Luton are relegated.

Got the losers right but not the winners. 1 point.

All in all, not a great showing. 13 points.

Oddly enough, whenever I score low on the predictions, I have a much better year in the portfolio. That was the case this year, where we have had some real winners in the Flying Frisby: bitcoin and MicroStrategy, obviously, but also Lightbridge and Novavax too. Meanwhile, the low-risk Dolce Far Niente portfolio is rocking it.

Happy Christmas everyone. Thank you for being a subscriber.

And why not gift someone a subscription this Christmas?

I’ll have some predictions for 2025 early in the new year.

Until next time.

Dominic

PS Don’t forget:

* In case you missed it, Friday’s piece on North American tax loss selling has 9 ideas for short-term trades, which could come good by February.

* Plus the video version of "The Chainsaw and the Swamp: A Tale of Two Economies" for your Sunday morning viewing pleasure.

Become enlightened.

It was the best of times, it was the worst of times, it was the age of wisdom, it was the age of foolishness, it was the epoch of belief, it was the epoch of incredulity, it was the season of Light, it was the season of Darkness, it was the spring of hope, it was the winter of despair, we had everything before us, we had nothing before us …

Charles Dickens, A Tale of Two Cities, 1859

There is a video version of this article here, if you prefer.

Here is the world I think we are heading into over the next couple of years.

On one side of the Atlantic, we have Argentina and its new president, Javier Milei, taking a chainsaw to the state in every conceivable way. I was there last month and I fell head over heels in love with the place. Every day it seems another state body is having its budget cut.

It’s like everything I argued for all those years ago in Life After the State - Why We Don’t Need Government is suddenly happening in the real world, and it is wonderful.

The result of all this is an economic boom that is starting to take everyone’s breath away – even free market acolytes are surprised.

You must invest in Argentina. You must have a position. What is happening there is equivalent to Eastern Europe after the fall of Communism, China at the turn of the 21st century, or the UK and US at the beginning of the Reagan-Thatcher era.

With libertarianism being the dominant belief system of the Internet, and Milei, the poster boy for anarcho-capitalism, an internet sensation, you can rest assured that Argentina’s success story is not going to be kept a secret. The Internet is going to let everyone know about it.

Then to the north, we have the USA. Who was the first foreign leader to be invited to meet President-elect Donald Trump? You betcha. It was Javier Milei. That tells us where things are going.

We have passionate libertarians Elon Musk and Vivek Ramaswamy taking the knife to government and the deep state – I cannot emphasise enough how gripping a belief system libertarianism is once it takes hold - look what it’s done to me - and it has clearly taken hold of these two.

We also have a Trump administration that is much more organised and wiser than the previous incarnation, as well as more state shrinking. It knows who its enemies are and it seems ready for them.

The US may be “minarchist-light” compared to Argentina, but even so, an economic boom is coming to this most entrepreneurial of countries. A lot of people are going make a lot of money.

So you must also have a position in the US. It is already the world’s biggest economy. How much is it going to grow with so many bureaucratic barriers of state removed?

The Stagnant Side of the Street

Then we turn to the other side of the Atlantic. “The stagnant side of the street” to misquote the song.

Here in the UK, we have gone the other way. We are increasing taxes. We are increasing state spending. We are growing government, and, in doing so, creating more barriers to innovation, invention, and entrepreneurship. Most of Western Europe is the same. These are countries run by blobs, by regulators and planners for regulators and planners, by technocrats who know better than you.

Here’s an example of the government helping. On 6 October 2020, when the FCA announced it was clamping down, bitcoin was $10,000. Today it's $97,500. I make that $87,500 per coin of gain that the UK citizen has been protected from. Great job guys. The UK was once at the vanguard of this breakthrough technology. Satoshi used English spelling, he quoted the Times. He may well have been British. Now we are bringing up the rear.

It is just so much harder and more expensive to do anything entrepreneurial in the UK, whether it’s setting up a business in the first place, hiring, the taxes you have to pay, the cost of regulation and compliance, or the exorbitant cost of housing and property, which drains capital that could be better invested elsewhere.

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Prime Minister Keir Starmer is currently in the Gulf trying, as he says, to secure investment for the UK. “This government will build on partnerships that drive our mission to kickstart economic growth and put money back in working people's pockets,” he said yesterday. It’s obvious that he thinks economic growth comes from government rather than the private sector. He actually thinks government spending is going to help. He does not realize because spending inevitably leads to higher taxes, and taxes stifle growth.

I bet if you listed ten businesses and said which of these are wealth-creating and which are just wealth-extracting, he would not know the difference: it is not a thought process his mind would ever entertain. Yet the difference between the two is everything. Subsidised green energy is wealth extracting, compliance is wealth extracting, manufacturing (as long as it’s not wind farms) and tech are mostly wealth creating. One builds wealth that did not previously exist - everybody wins - making stuff, growing stuff - the other is zero sum: it extracts wealth that already exists and sends it somewhere else - only the extractor and the recipient win. The guy who built the wealth in the first place loses.

The most basic rule of taxation – you really should read Daylight Robbery – is that higher taxes and higher tax rates do not lead to greater government revenue. This administration does not get that most basic concept, which has existed for as long as there have been taxes (ie all of civilization). How can they be so stupid I’ve no idea, but they lead us.

To invest in the UK is to invest in stagnation and regulation. That is not proper investment or wealth creation.

The rest of Western Europe is no better.

In addition, we are experiencing colossal levels of discontent, unprecedented migration, two-tiered justice, two-tiered welfare, rising crime, the disappearance of previously high-trust societies, and rising social tension.

But thanks to the Internet, the stupidities of UK and European policies will continue to be laid bare to all. No amount of censorship is going to hide it. In any case, X has already killed censorship. Other platforms must now stop censoring, if they want to stay relevant. On the Internet people gravitate where speech is free-est.

Meanwhile, such is the nature of memes, people are going to relentlessly take the piss, especially from the other side of the pond. Comedy is a powerful tool. Day after day, the meme-makers, led by Elon Musk himself, are going to expose Keir Starmer and his deluded team, never mind the EU and other technocrats, for the fools they are.

The exposure the Internet brings will cause this technocratic left to backpedal a little – Starmer, as we saw from his 19th relaunch speech last week, has already started – though it will not be anywhere near enough. We need our own Javier Milei.

But it is all is only going to exacerbate the current trend: long America, short the UK and Europe.

So What To Do Now?

I ran into one of the UK’s most successful investors at a party last week. He told me he has moved everything he can out of sterling and out of the UK.

If you are looking for some entertaining Christmas presents, we have some celebratory “One of the 17 Million” Brexit mugs, my new album and other goodies for sale in the Dominic Frisby Shop. Take a look.

Something positive for you this Sunday morning - and why we should be grateful for government incompetence

The idea of Central Bank Digital Currencies (CBDCs), money that governments and their planners will be able to programme, rightly fills many of us with an Orwellian sense of dread.

“Did you not have the vaccine? Oh, well then you don’t qualify for the next payment.”

“Have you been saying wrong things on social media? Then you don’t get the good loan rates.”

“We suspect that you might not have paid the right rate of tax, therefore we are deducting what we think you owe and it’s up to you to prove otherwise. You want the money back? Please hold …. Your call is important to us.”

CBDCs allow for almost unimaginable interference in our lives, intrusions on our privacy and liberty, never mind meddling in the economy. Chinese social credit scores would be just the start of it.

When you combine the instincts of, say, the current Labour administration to intervene, together with its incompetence, the ramifications are truly horrifying.

Some say CBDCs are inevitable. Technology is destiny and all that. I’m a bit more optimistic.

Hete’s why.

CBDCs have been piloted in numerous countries and fully implemented in:

* The Bahamas - the "Sand Dollar"

* Nigeria - the "eNaira"

* Jamaica - "JAM-DEX"

* The Eastern Caribbean Currency Union

Nowhere has got them to work. The Bahamas is generally touted as the CBDC success story. My buddy, Dave Skarica, who lives there says, “LOL. I have never seen one person use it.”

Why have they failed? People don’t use them. When they do use them, they don’t work. People prefer the legacy systems they know.

CBDCs are yet another government IT project that is doomed to fail.

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You might say the internet was a government IT project. It was . The U.S. government - via ARPA and later DARPA - provided crucial funding that led to the development of key protocols like TCP/IP. But the Internet succeeded because of the immense infrastructure that millions of people, mostly working in their own self-interest, since built over many decades on top of it.

Our modern system of debt-based fiat money should long since have imploded under the weight of all the abuse and debasement successive governments have heaped upon it. But it has survived, indeed thrived as a medium of exchange, albeit a terrible store of wealth, because of the incredible fintech architecture that has been built on top of it, again by millions of people over many decades mostly acting in their own self-interest. That architecture is probably what has saved the system.

Fiat money is just promissory - worse than that it is a promise of something that isn’t even there - but the incredible advances in communication technology that we have seen in the last 150 years - telecommunications, digital technology and all the rest of it - have all enabled the sending and recording of those promises. The fortunes that have been invested have all helped the system evolve and indeed preserved it.

Fiat money worked as countries gradually abandoned gold standards over the course of the 20th century because they were the only currencies citizens knew. The payment and saving infrastructure was already built and normalised. The coins and notes and cheques and bank accounts all functioned perfectly well, and there were no alternatives. The removal of the gold backing did not really impact the overall architecture.

Government currencies worked in the first place because they were based on gold and silver, which everybody already used and instinctively knew had value. When they weren’t debasing their money, rulers, or those working for them, often actually improved the system: coinage, for example, certified the amount of precious metal in a coin and the ruler’s stamp legitimised it. Money was based on something people already knew and used and understood.

Not so CBDCs. They have no existing infrastructure around them, nor is their use normal.

Governments will not be able to design anything decent. They will need the private sector to do that, and this will take many years, perhaps decades before it gets as good as the infrastructure around existing payment systems. It would also take many years and lots of nudges for people to change habits

The private sector is not going to invest the required amount of money in payment systems if people are not going to use it, so you will end up with a situation, a bit like green energy, where governments will have to spend billions subsidising it in order to make it work, but the actual energy you get is not as good as that provided by fossil fuels: unreliable, more expensive and more damaging to the environment. There will not be the same green arguments - 10 years to save the planet and all that - to justify the spending. The scope for corruption and crony capitalism will be enormous. Again.

You really should subscribe.

None of this will stop governments trying it, of course. Citizens might slowly start to use the system, particularly if they get free handouts, but it will be a long time before CBDCs reach a level where they compete with existing payment systems. At this point fiat money as we now know it probably won’t exist anyway. We tend to forget, but most nations as we currently know them are only about 200 years old. Many won’t exist in 50 or 100 years time. They’ll go bankrupt and break apart. What will happen to their money?

There is the possibility of demanding that taxes are paid in CBDCs, I suppose, but again this opens up so much scope for outcry, waste and inefficiency, I just can’t see it working.

People within the blob look at bitcoin and admire it and think they can copy it, but even bitcoin is what it is, not so much because of Satoshi Nakamoto’s genius invention, but because of the way hundreds of thousands of people in the free market embraced it and built on top of it. The reason they did was, again, self-interest: the value of bitcoin kept going up. Every bit of bitcoin fintech, every podcast, every tweet - every transaction. They all help the bitcoin price. It’s a colossal open-source contribution and movement. There is not the same incentive with CBDCs. Their value is never going to go up. Quite the opposite. Their value will fall as governments issue more and more of them. There is not the same incentive.

To have any chance of working, CBDCs will require billions and billions of subsidy. Most governments do not have the resources. They are already bankrupt. They will struggle to justify the expense. Health or welfare or pensions or something will be deemed more important.

Plus they will meet with huge resistance from the freedom-fighters and possibly even the media .

None of this will stop them trying of course. But on this issue at least you can sleep soundly. CBDCs are one Orwellian nightmare that is not going to work.

They will end up yet another failed government IT project.

All ye from the future look back on this ‘ere prescient article and marvel at my foresight.

If you are interested in this subject, take a look at my song, Programmable Money.

Tell your friends about this amazing article.

A reminder about those mugs, my album and other fun Christmas presents - all for sale in the Dominic Frisby Shop. Take a look.

“If once you have paid him the Dane-geld, You never get rid of the Dane.”Rudyard Kipling

The winter of 406-407 was bitterly cold across Europe. The Rhine froze over, enabling hordes of Vandals, Alans - I love the fact that there was a tribe of Alans - and Suebi to make their way across the river, and into the Roman empire. They were violent with hunger, from the cold and greedy for what they had admired for so long on the other side.

The response from Rome was slow, weak and inadequate.

In Britain, Rome had already lost the north and west to warlords. The Roman armies in Britain, who, at best, had been paid with debased money, feared these Germanic tribes would cross into Britain next, so, led by Constantine III, who declared himself “Western Roman Emperor”, they made their way across the Channel and into Gaul, leaving ‘Britannia’ to fend for itself. We do not really know if it was Rome that gave up Britain, or Britain that gave up Rome, but, either way, the Dark Ages had well and truly begun.

Gold , silver and bronze coins had been widespread under the Romans. They were used to pay taxes, and often re-minted to pay the army and the civil service. But after Constantine III’s departure, few coins were either minted or imported. Judging by the numerous hoards found from the period, many people buried their money - presumably to keep it safe in this unruly new environment of no military protection and merciless invasion from Angles, Saxons and other tribes from the continent. With the lack of new supply, existing coins were re-used. Clipping - cutting off the edges to steal metal - became widespread. The previously vigorous late Roman monetary system crumbled. It was not for another 200 years that minting properly started up again.

The Anglo-Saxon invaders initially used gold more for adornment rather than as currency. Though there are examples of earlier Anglo-Saxon coins, King Eadbald of Kent was the first Anglo-Saxon whose name we actually know to mint coins. This was around 625AD - small, gold coins called scillingas (shillings), modelled on coins from France. Numismatists now call them thrymsas.

As the century progressed, these coins grew increasingly pale, until there was very little gold in them at all. From about 675, small, thick, silver coins known as sceattas came into use in all the countries around the North Sea, and the gold shilling was superseded by the silver penning, or penny. As money, gold fell out of use almost altogether, though silver had something of a boom.

It is thought the word ‘penny’, like the German ‘pfennig’ derives from the pans into which the molten metal for making them was poured. ‘Pfanne’ is the German for ‘pan’. Another theory is that it derives somehow from the denarius, as the symbol for the penny used to be the d. Likely a bit of both.

The Mercian King Offa, he of dyke fame, who reigned for almost 40 years from 757 to 796, must be one of the greatest Anglo-Saxon kings, certainly the greatest of the 8th century. As well as his dyke, which protected his kingdom from Welsh invaders, and provided a barrier by which he could collect duties, he is credited for the widespread adoption of the silver penny and pound as a unit of account (though the pound was in use before his reign, he still gets the credit). His coins, with portraits and intricate designs, were as accomplished as anywhere in Europe at the time. His system, though probably imported from Charlemagne and the Franks, for reasons which will become clear, almost certainly dates back to the Romans. 12 silver pence equalled a scilling. 20 scillingas, or 240 pennies (12 x 20), equalled a pound weight of silver. Thus did the pound we still use today get its name - it was, simply, a pound weight of sterling silver.

The Latin word for a "pound" is libra and the pound sign, £, is a stylized writing of the letter L. The d meanwhile used for pence comes from the Latin denarius. The roots of the British system of money are Roman.

Offa’s system remained standard until at least the 16th century and, in many ways, until decimalization in 1971. You had to add up each unit of currency separately in this format: £3.9.4, which would be spoken "three pounds, nine shillings and four pence," or "three-pounds, nine and four." To add, you would calculate each unit separately, then convert pence to shillings, leaving leftover pence in the right column. Then convert the shillings to pounds (with leftover shillings in the middle column). And then add up the total pounds. It sounds complicated when you explain it, especially to those oriented in metric, but, like all traditional measures, it is quite intuitive in practice.

On this note, have you seen my lecture about weights and measures? It’s superb!

Offa’s systems were gradually consolidated over the subsequent centuries, especially as the kingdoms of Anglo-Saxon Britain began to merge. In the 860s, for example, the kingdoms of Mercia and Wessex formed an alliance by which coinage of a common design could circulate through both of their lands.

The Viking invaders found coinage systems far more sophisticated than their own, and the Danegeld, the protection money with which they were bought off, was paid in silver pennies. I had always thought the “geld” in Danegeld meant “gold” but in fact it means yield, and the Viking invaders demanded this tribute wherever in Europe they ravaged.

Buying gold to protect yourself in these uncertain times? I recommend The Pure Gold Company. Pricing is competitive, quality of service is high. They deliver to the UK, US, Canada and Europe or you can store your gold with them. More here.

The Danegeld system was quite efficient - on both sides. For the invaders, they were often paid more than they could raise by looting, without having to fight. For the locals, the ravaging was avoided, although, as Rudyard Kipling noted in his poem on the subject, “if once you have paid him the Dane-geld, You never get rid of the Dane.”

The Danegeld probably also motivated improvements to Anglo-Saxon coinage. To pay his own soldiers, to build forts and ships, and to pay Danegeld, Alfred the Great increased the number of mints in his realm to at least 8. His successor Athelstan had 30 and, to keep order, passed a law in 928 stating that England should have just one currency. Ever since, there has been just one. This was many centuries before standardisation in France, Germany, or Italy.

When William, Duke of Normandy, invaded England in 1066, he succeeded where his Viking ancestors had failed for over 270 years, in that he managed to conquer all of England. It meant he took control of English coinage, which was far superior to that of his homeland. William’s coins, struck back in Normandy, are remarkable for how poor they are, compared to their English counterparts.

He had at least seven types of English pennies struck with his name on, enabling him to achieve the rebrand that was so important to him. No longer was he William the B*****d, as he was then known. Now he was William the Conqueror. He let the world know through his coins. It worked: that is how we still know him today.

It is a little ironic that the pound should be so named for its silver. Because, from the time of Isaac Newton and the founding of the Bank of England, silver had very little to do with the pound. Only gold.

That story is told here:

It’s difficult to look beyond bitcoin and MicroStrategy (NASDAQ:MSTR) at the moment, the later in particular. Nobody expected this, not even Chairman Michael Saylor. The returns have been astonishing. A couple of readers have reported to me that the gains have been life-changing. Wow! What an email to receive.

It’s easy to get hubristic when you have a big win. Instead, let us express gratitude for the good fortune that has smiled upon us.

But look beyond we must, and so today I want to look at what I can only describe as a stealth bull market - natural gas. The price is creeping up, and few are talking about it.

Natural gas is a bit like silver: if it can disappoint, it will. So we begin this piece with that reminder. Natural gas has broken the soul of many a wiser man than me.

On the other hand, the next five years look pretty positive.

It’s obvious that the world is going to go nuclear now, and that Small Modular Reactors (SMRs) are going to provide the power AI so badly needs. However, it will be a good five years before they on stream, so what is going to provide the power in the interim?

The answer is natural gas.

There is a problem, however: Supply.

America's Gas Wells Are Drying Up

The North American Shale Gas Revolution dramatically changed the outlook for fossil fuels. Peak Oil was a huge theme leading up to the Global Financial Crisis, and then it disappeared, almost overnight.

Between 2005 and 2020, US natural gas production grew by 90%, with shale accounting for the bulk of it. In 2005, shale gas made up about 5% of US natural gas production; by 2020, it was over 75%. By 2017, the US had become a net exporter, especially of more transportable liquefied natural gas (LNG).

The price, meanwhile, plummeted. Good for consumers!

Here’s the long-term chart so you can see those price declines since 2005. From almost $16 to $3.50 today (as low as $1.50 earlier this year, where it has formed an attractive double bottom - you know how I like those).

Obviously, we in the UK and Europe pay way more for our natural gas than they do in North America. It’s so dumb; we have enough to supply ourselves in the UK. But we don’t because fracking is deemed environmentally damaging. So we import gas from abroad, which is produced by, you guessed it, fracking. I guess if it is fracked somewhere else, it’s less harmful. Not

Then there are the transport costs and the environmental costs that come with that.

Anyway …

Spanning Ohio, New York, West Virginia, and Pennsylvania, Marcellus is the largest natural gas-producing field in the United States, contributing over 25% of production. In 2010, output was 2 billion cubic feet per day (bcf/d). By 2023, it exceeded 35 bcf/d, but production has been falling for almost a year now. We are currently at 26.7 bcf/d

The next largest is Haynesville, in Louisiana, Texas, and parts of Arkansas. Extraction costs here are higher, and production stands at 16 bcf/d, but it is slowing here too, according to analysts Goehring & Rozencwajg.

One of the few areas of growth is the Permian Basin, in Texas and New Mexico, currently around 23 bcf/d, but even there, growth is modest.

Now, it might be that the reason for stagnating growth is low prices - they often are - and higher prices will result in increased production. They usually do. That is the way with commodities.

But natural gas prices have already doubled this year, and they keep on creeping up.

The other interpretation is that the North American Shale Gas Revolution has passed its peak.

With America’s new president, you can expect plenty more investment in production than under the Democrats, and that should bring the price down, but the gas price has actually risen - from $2.70 to $3.50 - since the election.

It might also be that Russian gas taps come back online to the EU sometime next year, which means America will lose its new market.

But all of this conjecture is factored into the price. And that is rising.

How to invest all this

* The number of migrants to Britain has doubled since Covid.

* 747,000 “permanent-type” migrants moved to the UK last year, the OECD said, up from 488,400 in 2022.

* This marks a 53% year-on-year rise.

* The four countries seeing the biggest surge in migration are the UK, South Korea, Australia, and the United States.

* Note: Three of those four countries are English-speaking. This is something I have long argued: the UK will inevitably see higher than average migration levels because people prefer to go where they can speak the language, and more people have some English than other languages.

Meanwhile, our birth rate has dropped to 1.4 children per woman, the lowest on record.

The net result is that the demographics of this country are changing dramatically and rapidly. Different people means a different culture.

The demographics of primary schools

Migration measures, particularly illegal migration, are not entirely accurate. If someone has entered the country covertly, for example, there's often no record. Nor are censuses entirely accurate. Some don’t fill the census in, many don’t fill it in accurately, especially if here illegally, if they don't understand what it is, or if someone is claiming the single person council tax discount. There is a lot of scope for double counting for people with multiple addresses - students and so on.

However, pretty much everyone who has kids sends them to school. There is no hiding, no double counting and so on, so the numbers you get from the schools’ census are pretty accurate.

White British now make up 61% of UK primary school kids. 37% are of minority ethnic background. The remaining 2% are unclassified. (In secondary schools, minority ethnic accounts for 36.6%).

Minority ethnic includes Asian (13.4% of primary school kids), White non-British (8%), Black (6.5%), and Mixed (7.8%).

Bear in mind that these figures are for the whole UK. This includes primary school kids in remote rural areas, where British ethnicity will likely comprise over 90%.

White British was at 64.9% in 2020-21 and minority ethnic at 33.7%. The numbers are changing fast. From 65 to 61% in three years.

Ten years ago it was 70%.

This 61/37 ratio compares with 85/15 in 2002.

Previously, I extrapolated that White British would be a minority in primary schools by 2035. But with the current trends, especially considering that migrants tend to have larger families than locals, white British could become a minority in primary schools as soon as 2030, or just after.

The demography of primary schools will, within a generation, reflect the demography of the country.

I doubt this is what the majority of British people want.

But it's not a topic that's being discussed, let alone addressed, in the echelons of power. Instead, it's being brushed under the carpet.

Well, it will soon be too late. This is an urgent and pressing issue. Without wishing to sensationalise, the future of the British people and their homeland really is at stake.

Demography is destiny after all.

You really should subscribe to the Flying Frisby.

If you are thinking of buying gold to protect yourself in these uncertain times, I recommend The Pure Gold Company. Pricing is competitive, quality of service is high. They deliver to the UK, US, Canada and Europe or you can store your gold with them. More here.

More on this:

Today, we are going to look at gold, bitcoin, and our way of playing it, MicroStrategy (NASDAQ:MSTR), which has now 10xd (!) since we first covered it last year. Amazing.

Finally, there'll be a short update on gold miners. Remember them?

Let’s start with gold.

Gold - and most other metals - has been hit since the U.S. election last week. It’s down $200, or about 7%, with U.S. dollar strength being a big factor (the dollar has been storming higher since October).

While I think this bull market might be punctured, as I put it last week, and that gold probably has a bit further to fall, I am not unduly worried. 2024 has hitherto been a great year for gold, and it remains an essential long-term core holding.

It is an even more essential holding for UK investors. I think sterling has big problems ahead of it, and gold serves as your hedge against crap governments.

If you are thinking of buying gold to protect yourself in these uncertain times, I recommend The Pure Gold Company. Pricing is competitive, quality of service is high. They deliver to the UK, US, Canada and Europe or you can store your gold with them. More here.

Labour or Tory - I’m no fan of either.

They’re both as bad as each other, in my view. The less government there is, the better things run. But that's irrelevant idealism. Of greater concern here is reality: there has never been a Labour Government that did not devalue sterling.

* Blair and Brown crashed sterling in 2007-8 (though until then their record was okay);

* Under Wilson, Callaghan, and Healey, we ended up going to the IMF in 1976. Callaghan and Wilson also devalued in 1967.

* Cripps and Attlee devalued in 1949.

* Ramsay MacDonald’s National Government, which followed Labour from 1929-31, took us off the gold standard in 1931.

Why should this Labour Government be any different? If anything, it is even less competent. Sterling devaluation is coming. How exactly might not yet be clear. I rather suspect it’ll be an attempt to make us competitive against an ultra-streamlined US, but that’s just a guess. You must own some gold (and some bitcoin) in such an environment: non-government money.

Gold under Trump - What Gives? What’s coming?

I’m sending out today’s missive a day later than usual because I wanted to see the market reaction to the US election results and leave a little time to digest it all.

Broadly speaking, I am happy with the result, and I believe the world will be a better place for it than the alternative. We’ll see less technocracy, less deep state , and less overseas intervention; more pro-energy, pro-Bitcoin, and pro-business policy; and a stance that’s anti-seed oil (go RFK!), anti-subsidised, environmentally harmful green quackery, and anti two-tiered, inequitable woke ideology.

Any administration that puts perhaps the most competent person alive, Elon Musk, in a prominent role, has got to be net positive.

But be careful what you wish for and of that. Donald Trump is not, as his most ardent supporters seem to think, going to save the world, nor any such. You need to fix money and tax to do that, and while he might tweak the latter, there will not be wholesale reform. And he is going to print lots of the former. Trump will run deficits, US debt will grow as a result and the nefarious consequences of fiat will take other forms.

If there are financial problems looming for the US, I suspect their roots lie in the bond markets, where yields are rising.

In short, the better alternative won. There will be more opportunity in the US than there otherwise might have been, but Trump is no Javier Milei. America isn’t yet ready for that.

The initial market reaction give us some insight into where things are headed in the next few months.

If you are thinking of buying gold to protect yourself in these uncertain times, I recommend The Pure Gold Company. Pricing is competitive, quality of service is high. They deliver to the UK, US, Canada and Europe or you can store your gold with them. More here.

How did markets react?

First up, and something I’m particularly pleased about: bitcoin has broken to new highs, hitting $75,000 yesterday. I’m particularly pleased because new highs in bitcoin usually bring a lot of noise. This time, the noise got drowned in the election frenzy, which means there’s plenty more hype in the tank.

Our chosen vehicle for bitcoin exposure, MicroStrategy (NASDAQ: MSTR), is now north of $250. This has been an incredible win for readers, as we first covered it last year at an adjusted $35. It’s risen 8x, compared to bitcoin’s 150%—that’s some outperformance.

I wrote back in September that Q4 is usually bitcoin’s best season, and that is bearing out.

Stock markets also rose, as you would expect with someone as pro-business as Trump. The Dow rose 3.5%, the S&P 500 climbed 2.5%, and the Nasdaq about 2.6%.

During Trump’s last presidency, stock markets more than doubled, though with two major wobbles along the way, one due to Covid. Something similar this time around is not an unreasonable expectation—unless you subscribe to this view. If so, that would take the S&P 500 to around 12,000. Quite the number.

What I found especially encouraging was the outperformance of small caps. The Russell 2000 was up 6%. Small caps have underperformed for years and are due for a run. Trumponomics clearly suits them.

An interesting tidbit: Trilogy Metals (TSX: TMQ), a mining company I follow with two promising copper assets in Alaska, the development of which were blocked by the Biden administration on environmental grounds, saw its price rise 108% yesterday . Investors seem confident it will now get the green light.

I expect similar stories across the mining, oil, and gas sectors. This is a time to be investing in the USA.

On the other hand, commodities, especially metals, sold off. Copper fell 3%, with zinc and iron ore dropping by similar amounts. Crude couldn’t make up its mind: it came down a bit, then rallied, then ended the day flat. Natural gas was similarly indecisive

Gold, silver and platinum all sold off, as the US dollar itself rallied quite sharply, rising 1%. Gold was off almost 3%, silver by almost 5%. Not good, though mostly a reaction to the dollar. Looks like those particular bull markets are, for the time being, punctured. That’s not me telling you to sell your gold by the way. Don’t. You are going to need it. Particularly if you are British.

Which brings me to the UK and last week’s budget.

I promised you my thoughts on it.

It’s heavyweight goldbug stuff. I hope you enjoy it.

You can watch it below, but I have also ripped the audio so you have the option to listen to that if you prefer to escape the clutch of your screens.

If you are thinking of buying gold to protect yourself in these uncertain times, I recommend The Pure Gold Company. Pricing is competitive, quality of service is high. They deliver to the UK, US, Canada and Europe or you can store your gold with them. More here.

I’ll be MCing this year’s Moneyweek Summit this coming Friday November 8th. Readers of the Flying Frisby can get a 20% discount by entering the code FRISBY20

And if you are interested in hearing more from Alasdair, he has a Substack too.

Shortly before Covid hit, I became CEO of a Canadian company by the name of Cypherpunk Holdings (HODL.CN). I was very pleased with that ticker symbol—HODL. My idea. But I did not have a clue what would happen as a result …

I’m writing about the company today because, even though I stood down four years ago, I know a number of readers bought shares because I was the CEO. It’s quite a story.

Mining entrepreneur Marc Henderson controlled a shell company that had just received a large payout from the Mongolian government for some uranium assets it had seized illegally, as you do, and he wanted to use the opportunity to start a crypto business. We knew each other from way back, and he approached me because of my book.

He also brought in Canadian bitcoin entrepreneur Moe Adham, and Moe and I put together a proposal to become a privacy tech investment company.

We were both quite ideological about it. We had grave concerns about the increasing imposition on our privacy from both Big Brother and Big Tech. We felt it was only going to increase, and that therefore there would a need for privacy tech—anything from VPNs to private messaging apps such as Signal, to bitcoin and privacy coins. How right we were. Look at some of the stuff that went on during Covid.

Perhaps where we misjudged was that we thought there would be a large appetite for privacy tech amongst the general public as a result. It turns out most of the general public care more about convenience than they do about their privacy, at least online. In many cases, they don’t even realise what they are sacrificing.

Buying gold to protect yourself in these uncertain times? I recommend The Pure Gold Company. Pricing is competitive, quality of service is high. They deliver to the UK, US, Canada and Europe or you can store your gold with them. More here.

Once we were up and running—and, believe me, there was a lot of compliance—I brought in my mate, bitcoin OG Jon Matonis, and we began the process of acquiring bitcoin. We would hold large amounts of bitcoin. (This was before Michael Saylor’s Microstrategy, which has been a big winner for the portfolio since we tipped it last summer it around $30 - now $220 - especially as bitcoin closes in on all-time highs).

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One of our key investors was poker champion Tony Guoga, who bought an enormous stake in the company and eventually joined the board to become Chairman.

I stood down shortly after my dad died in April 2020. (From a financial point of view, that was a mistake, as I would have several million options now with the stock itrading at two bucks).

But, despite the good work that the company was doing on the ground, the great investments it was making, and the phenomenal board, it just kept trundling along sideways, largely ignored by the investment community and trading at around half its NAV. Like a champ, Tony Guoga kept on buying stock, especially on dips, building up an enormous position. He owns about 35% of the company. Talk about management being aligned with the interests of the shareholders.

Recently, however, the company had a rebrand. With all the bitcoin ETFs, it was pointless holding bitcoin, they thought, and the company decided to focus instead on SOL, which lacks a mainstream investment vehicle. Sol Strategies Ltd became the new name, and, a few months earlier, they brought in a new CEO, Leah Wald, as well.

In the last fortnight, the shares have gone absolutely nuts—going from around twelve cents to above C$2. There have been several catalysts. First, Leah has made a number of well-received appearances in the media that have generated some interest in the stock. Second, it has become the easiest way to get exposure to SOL. Third, "HODL" is also the US ticker symbol for one of the bitcoin ETFs, and many Canadians, typing in HODL, accidentally bought this company instead. LOL.

Veteran traders will know the chart pattern the stock has played out. I believe it’s known as the hockey stick.

Just incredible. And look at the volumes that have come in.

The market cap of the company went from about C$17m to C$335 at the top of the market yesterday. Guoga’s stake alone went from about C$6m to north of C$115m.

For years, the company was trading at half its NAV of C$30. Suddenly it’s trading at ten times.

From a technical point of view, it shows just what can happen to a company after it builds all that cause trading sideways for many years. When it spikes, it can really spike.

I gather that it’s become something of a meme stock, so who knows when this will end? The algorithms have taken charge, especially on the US OTC markets where it also has a listing (CYFRF) and it is having daily swings of something like 30%.

It even makes Lightbridge (LTBR) look calm. Have you seen that, by the way? $14 yesterday. It was $3 a fortnight ago, when I wrote it up.

Another hockey stick:

My broker commented that it’s good to see some animal spirit has returned to the markets.

I’m just amazed at what algos can do to small-cap North American stocks. Talk about speculation.

Casino!

Let’s hope one day they discover AIM.

I don’t know if this kind of speculation signals a top. It’s pretty obvious to me Trump is going to win next week, so maybe that’s all priced in and markets pull back after the election.

Crash ahead?

On which note, I leave you with this crazy interview. It was recorded in March of this year, several months before the Trump assassination attempt in July, and yet predicts it with incredibly accuracy. He also predicts the weird weather, a Trump win, followed by a 1929 stock market crash. Watch a minute or two from around the 11-minute mark (it should start there). Nuts.

I bet there are a gazillion things he’s predicted which haven’t happened. But I still thought it was pretty amazing.

I probably shouldn’t even be sharing this stuff, but I remembered it last night it from a few months back and, with the election coming next week, I went back and re-watched it.

What do you make of it?

Let me know in the comments.

(NB: At the end of this piece there is a short note on Lightbridge Corp (NASDAQ:LTBR), which has tripled since I covered it a fortnight ago).

I have suffered from asthma for as long as I can remember.

Others have it worse than me. I had always been able to manage it with drugs – salbutamol mostly – but, all the same, there was always that lurking thought that if I forget my inhaler and have an attack, I could be in trouble.

Then, suddenly, in my early 50s, it disappeared.

It is not uncommon to grow out of your asthma. It happens to a lot of people. But my asthma was not getting better; it was getting worse as I grew older. I can’t prove it, but I think I got rid of it. Here is what I did.

How Bad Was My Asthma?

As is quite common for people my age, I was not breastfed as a baby – science thought it knew better than Mother Nature – and the allergies I suffer from – the main ones being to animal hair and pollen, which result in hay fever and asthma – are a result of that, I’m sure. It’s part genetic too: my dad had asthma but grew out of it in his adolescence. None of my four kids, who I’m delighted to say were all breastfed, have it.

There were two main triggers: animal hair, cats especially, and exercise. Sometimes going from warm to cold (e.g., going outside in winter) would bring it on, and it was worse during the hay fever season.

As a child, we had cats – Persian ones too – and we didn’t get rid of them until I was nine. I can’t believe it took that long to figure out I was allergic to them; whenever I left the house, my asthma noticeably improved. But I took drug after drug every day, morning, noon, and night – Intal and Ventolin.

We moved and got rid of the cats, fortunately. As a teenager, I got quite strong and fit: I played a lot of rugby and football. I found I could get through matches without needing the inhaler at all. But cats would always destroy me. Within ten minutes of being in a house with cats, I would be wheezing. I was just so sensitive to them. Prolonged exposure would take a day or two to recover from.

It was so frustrating going to people’s houses and having to leave because of my asthma, or having to sit there and wheeze, while the owners scrabbled about putting the cat outside or hoovering. Made no difference. Every year on Christmas Eve, I would have the annual asthma attack when visiting my uncle and aunt.

As I got into my late 20s and 30s and the fitness of my youth waned – not helped by smoking too much weed at university – I found myself needing my blue inhaler (salbutamol) more frequently again to play sport.

By the time I got to my 40s, I often found myself getting wheezy for no apparent reason, and I was using the blue inhaler almost every day.

Doctors advised me to use the brown inhaler – QVAR (beclomethasone) – every day, rather than salbutamol, and the brown did indeed clear it up so that I didn’t have to use the blue. But I don’t like taking drugs every day, and every time I tried to wean myself off the brown, I found my asthma had got even worse. I was too dependent.

By my late 40s, I was quite overweight, and even though I did a lot of aerobic sport – running and football – I was heavily dependent on puffers.

We had a dog too, and even though it was a hypoallergenic poodle, I was still sensitive to its hair.

Alcohol made my asthma worse, especially red wine. Also, if I drank, there was always the risk I would then smoke, which of course made it bad the next day.

Here I am today, and I have not used a puffer in maybe two years. I play football most weeks, tennis sometimes, I run, and do sprint training and cycling, including hill training.

But this week came the acid test. I went for a drink at a some friends house, and they have a cat. I spent a very long evening there and did not leave until 3 AM. No puffer required. I went back the following day and spent several hours there. No puffer. Then again two days later (I really like these friends!). Still no puffer. My nose didn’t even run.

I could still feel the allergy. But I was not remotely wheezy.

For me, this is quite extraordinary. Fifty years of asthma have gone.

How Did I Do It? (Plus a Note on Lightbridge)

I’m going to spell out all the things I did. It might be that it was a combination of all of them.

NB If you missed Sunday’s piece about what next to do with Lightbridge after its incredible rally - 3x in a week - it is here.

This week has the potential to be one of the most significant weeks in the history of money.

36 world leaders, including China’s Xi Jinping, India’s Narendra Modi, and UN Secretary-General António Guterres, are meeting in Kazan, Russia for the BRICS summit. The main agenda of the summit is de-dollarization.

Even The Guardian has noticed. “One of the main aims of the summit,” it says, “will be to speed up ways to reduce the number of dollar transactions, and so mitigate the US ability to use the threat of sanctions to seek to impose its political will.”

I’m not convinced the 36 nations in attendance are quite ready to abandon the dollar, or even make overt declarations of war against it, but for sure we will gain insights as to where we are in the grand scheme of this inevitable move away. We will learn where we are with the alternative payment systems being developed, be it BRICS Pay or mBridge.

The most powerful weapon these nations have against the dollar is gold—far stronger than China’s yuan, or Russia’s rouble, or any other currency basket or crypto amalgam they come up with. Gold is universal money, and its value is understood by all. There has never been a global reserve currency that did not start out backed by gold. How ready these nations are to re-adopt it, we shall soon discover.

In any case, gold has been rallying relentlessly into the de-dollarisation story. We are at $2,740/oz now. Amazing. Perhaps this is a case of ‘buy the rumour, sell the news.’ Whatever. Could be in the short or even medium term. But that’s not the attitude. Owning physical gold is an urgent necessity at the moment. Things are just too precarious. You don’t want to be letting go of long-term core holdings on the basis of potential short-term movements.

I am watching developments closely.

If you are buying gold to protect yourself in these uncertain times, I recommend The Pure Gold Company. Pricing is competitive, quality of service is high. They deliver to the UK, US, Canada and Europe or you can store your gold with them. More here.

The Silver Surge: Is $50 the Next Stop?

In the meantime, ever unreliable silver has been playing catch-up. It’s gone through all that resistance around $30-33 and has, having done a near-perfect inverted head and shoulders, now broken up to $35. I think it’s going back to $50.

There is some resistance at $35, $37.50, and $44.

You know my views on silver. It’s the metal with the most potential yet, if it can find a way, it will always let you down.

Its natural price is 1/15th of the gold price, because there is only 15 times as much silver in the earth’s crust as there is gold. With gold at $2,700, silver “should” therefore be $180.

In fact, there is a case for silver to be higher than that because, while all the gold that has ever been mined remains, the silver does not—it has been consumed. So above-ground silver stocks do not reflect gold stocks.

The problem is that silver has long since been demonetised. It lost its monetary status when the world adopted gold standards after the various gold rushes in the second half of the 19th century. Without this official backing, silver is only going to be an industrial metal, albeit a precious one.

Gold may no longer be an official medium of exchange, but central banks still buy and hoard it, as do corporations and private investors. The Bank of International Settlements recognises it as a Tier 1 Capital Asset. The same does not apply to silver.

Silver, as we know, also has a multitude of industrial uses, which are only going to increase as the world gets more computerised and electric.

There is also some evidence of silver shortages—over 200 million ounces this year, a similar amount to annual jewellery demand.

Total annual silver demand is around 1.2 billion ounces—the second highest on record. 836 million ounces of that come from new mine supply, 180 million ounces from recycling, and the rest from sales of existing supply.

Demand looks something like this:

* 61% industrial (electrical, electronics, photovoltaics, photography & other)

* 17% Jewellery

* 5% Silverware

* 17% Investment

When silver moves, it moves fast, and it can turn on a sixpence, so it’s important not to get wedded to the silver story. The thing to remember about silver is, like errant girlfriends with personality disorders, if it can let you down, it will. The lovemaking will be unforgettable, you will have the time of your life, but, as sure as eggs are eggs, it will break your heart. Manage your risk.

As I say, there is not a lot standing in the way of silver and $50. In that scenario, the miners will go to the moon.

If it goes to $50, that will only be the third time in silver’s history it made it here—1980 and 2011 being the other two occasions. Third time lucky and all that. If it breaks above $50, there is nothing but blue sky above. Maybe it’ll go to $100 or even $180. It’s a maniacal metal.

Here’s that amazing long-term chart.

How am I playing it?

I may be cynical, but I also think you should always have a position in silver. Its potential is too huge.

I own a silver miner that is just coming into commercial production and therefore due a re-rating. It will make a fortune at $50 silver, but it doesn’t need $50 silver to work.

That company is …

It lasts 50 minutes, so next time you fancy a bit of “edutainment” give it watch.

The first part is available to all, and you can unlock the full experience by becoming a paid subscriber.

I was super-pleased with this one, as I think I might have mentioned ;)

Meanwhile, I wanted to share my thoughts about the amazing share price action we have seen in Lightbridge Corp (NASDAQ:LTBR). The stock really has exploded, more than doubling since I wrote about it last week. What was a $3 stock is now trading at $7.

Here’s the original piece, in case of interest - I covered it in in last Sunday’s thought piece on SMRs too.

The volumes are insane.

What to make of it all? And what to do next?

Let’s start with a chart showing the recent price action.

Some volume came into the stock on Monday, as I said it would, with my write up in Moneyweek, but what really ignited things were, first, Google announcing it has signed a deal to secure energy from Kairos Power, which will build seven small modular reactors (SMRs); then Amazon announcing that SMRs are part of its plan to transition to clean power. The entire sector went bananas, making last week’s pieces extremely timely. Lightbridge Corp in particular went nuts.

Average trading volumes are normally less than 350,000. But look at the volumes that followed those announcements.

Wednesday 3.4 millionThursday 1.1 millionFriday 7.5 million

Over the course of the week almost 13 million shares changed hands. The company has just 14 million shares outstanding!

What to read into this?

I looked at the outstanding interest in the options market and there is quite high interest at the $5 strike price with November and February expiry, but not enough to account for this kind of volume.

When you see trading volumes of that sign, it can sometimes be a bullish indicator - a change in ownership - but it can also be a bearish indicator - lots of people looking to get out.

I have to say, when a market is the kind to you this quickly, it is best to take at least a little profit.

There’s no doubt uranium is hot again, and that SMRs are the future, but there is also some excess. It‘s obviously up to you what you choose to do. This stock was once trading above $800, so there is plenty of room for it to move back up. But I’m thinking to take some money off the table this week.

Buy yourself a treat. And enjoy the lecture.

I am speaking at the Battle of Ideas this weekend on three rather different matters:

* Immigration and Demographics

* Who Is the World’s Greatest Comic?

* Why Cash Keeps Us Free

Do come. You can get tickets here.

With this years Battle in mind, the Academy of Ideas asked me to write one of its Letters on Liberty. Here it is for your reading or listening pleasure. (There is a PDF version here).

It begins with this note from the Academy.

What are Letters on Liberty?

It’s not always easy to defend freedom. Public life may have been locked down recently, but it has been in bad health for some time.

Open debate has been suffocated by today’s censorious climate and there is little cultural support for freedom as a foundational value. What we need is rowdy, good-natured disagreement and people prepared to experiment with what freedom might mean today.

We stand on the shoulders of giants, but we shouldn’t be complacent. We can’t simply rely on the thinkers of the past to work out what liberty means today, and how to argue for it.

Drawing on the tradition of radical pamphlets from the seventeenth century onwards - designed to be argued over in the pub as much as parliament - Letters on Liberty promises to make you think twice. Each letter stakes a claim for how to forge a freer society in the here and now.

We hope that, armed with these Letters, you take on the challenge of fighting for liberty.

Academy of Ideas team

Why Cash Keeps Us Free by Dominic Frisby

Give most people the choice of living and working anywhere in the world, I bet the large majority would choose the US. For all its many shortcomings, it’s still the land of opportunity. It’s exciting, it’s dynamic. Wonderful things can happen there. In terms of tech, with Silicon Valley and all the ensuing social media and ecommerce, it is very much the world leader. And yet, Americans still use cheques.

When was the last time you used a cheque in Europe? Donkey’s years ago. As much as 5 per cent of all financial transactions in the US last year were by cheque. For all its modernity, the US is - in terms of fintech - a good 10 years behind Europe or Australia. Not only do they use cheques, but people in the US still go out with cash in their pockets. Bunch of luddites.

However, things are slowly changing, and the US is following the rest of the developed word to cashlessness. It is inevitable, I’m afraid. Technology is destiny.

It’s also a great shame.

Cash empowers its users

When I pay you in cash, nobody else gets in on the transaction - it’s a direct transfer from me to you. No grubby middlemen can cream off their percentage. No prying eyes of the state can monitor what we do. Big Tech can’t glean information from the exchange, to be used at some later stage to sell you stuff or, worse, report back to Big Brother, Big Insurance or whichever Big wants in on your data. Nobody can stop you making the transaction.

With cash, you can buy and sell and store your wealth outside of the financial system, if you so choose. There are plenty of reasons, both practical and moral, to do this.

Cash means control. Just take the recent de-banking scandals from Canada to the UK, where truckers had their fundraised money withheld because of their views on lockdown, and a UK politician was kicked out of Coutts for holding the wrong opinions. Both the Canadian truckers and their families, and Nigel Farage, had one thing in common – they held views outside of the liberal mainstream. And because their money wasn’t under their mattresses but in banks and websites, they lost control of their own cash.

Indeed, instability is nothing new. We are repeatedly told how, in 2008, we were ‘on the brink’, how close the system was to imploding. Surely, then, it makes practical sense to keep money outside of the system? When Cyprus’ banks teetered on the cliff of financial disaster in 2011, there were bail-ins. Ordinary people’s money, sitting in deposit accounts, was sequestered to save the system. If your life savings were threatened with confiscation to bail out an organisation you considered profligate, I imagine you too would want little part of it.

What you do with your money says more about you than what you say  - no wonder so many want access to this information.

Indeed, the former governor of the Bank of England, Mervyn King, has admitted that banking is not fixed - and we will see financial panic again. It makes sense to hoard some cash, if only as emergency money.

In 2016, the Japanese central bank imposed negative rates to try to goad people into spending rather than saving, as the ageing Japanese are prone to do. The spectre of being charged a fee to keep your money in the bank loomed, and so much cash was then withdrawn that the country sold out of safes. Who can blame the Japanese? In Germany, Denmark and Switzerland, some high-net-worth individuals with more than 100,000 euros were charged for being wealthy. There was plenty of talk of confiscation and bail-ins during the financial panic that came with Covid, though fortunately it proved to only be talk. Nevertheless, when in the bank, your money can become a tool of government. How often do you support what your government is doing? Not that often, I imagine.

People don’t seem to realise this, but when you deposit money in the bank, you are actually lending it to the bank. The bank, under government orders, can then decide who you can and can’t send money to (anyone tried sending money from a UK bank to a bitcoin exchange recently? Most banks won’t allow you to). The bank can certainly monitor and then disclose what you do with your money. In times of financial panic, it is within the bank’s power to confiscate money, again, on government orders. Cash protects you against all of this. It enables you not to play the game - if you don’t want to.

What you do with your money says so much about you - no wonder so many want access to this information. From the apparently benign (we can see what books you have bought, and so can suggest other books you might like) to the sinister (we can see what books you have bought, and therefore now have you marked down as a problem). When I was at university, a rumour circulated that various organisations monitored who took which books out of the library. Anyone who borrowed Mein Kampf went on a list as potential spy material - I’m not sure on who’s side.

These are all, in my view, quite legitimate reasons to want to keep money outside of the system. I’m not saying we should take all of our money out of the bank, but that we should all have the option to do so. It’s our money, not the banks’. We need cash because it is private.

Privacy - and why it matters

‘Who are you? Why do you hide in the darkness and listen to my private thoughts?’ - William Shakespeare

It’s so obvious why we all need some privacy in the real world that it almost doesn’t need explaining. Yet, in the digital world, so many of us don’t realise just how much of our privacy we are giving away. On a daily basis, we sacrifice privacy for convenience.

Different people know different things about you. You might supply your doctor with information you wouldn’t give your taxi driver, but your taxi driver knows where you are going - and your doctor might not. You might supply your lover with information you wouldn’t give your lawyer. Then again, you might tell your lawyer something you wouldn’t tell your lover. The difference is, information you supply online - what you say, read, watch, share, buy or sell - can be used for purposes beyond those for which it was supplied.

Information is taken, without you realising that you are granting permission, and is used to shape your behaviour.

How often has this happened to you? I was talking to my daughter on the landing outside my bedroom about a trip I was planning. I said, ‘should I bring my Timberlands or my hiking boots?’ She said ‘your Timberlands’. I said that they were a bit old. I got into bed, looked at my phone, and Amazon was flogging me Timberlands. Your phone is listening - accumulating information with which you did not deliberately supply it.

It’s not all bad - often that information might be used advantageously. I’m a huge Game of Thrones fan but I only discovered the books all those years ago because Amazon recommended them. YouTube frequently suggests videos to me that I’m interested in, which I might not otherwise have found. Nevertheless, information is taken, without you realising that you are granting permission, and is used to shape your behaviour and influence the decisions you make. The same data mining is taking place every time you use your credit card, or Apple Pay. It is used to determine the content you receive, to sell things to you, to make decisions about you - the loan, insurance, job or the opportunities you are offered. It is used to influence the political decisions you make. And all this information could be stolen. In the wrong hands, it could be used against you in some way. It can and is being used to spy on you.

With financial transactions in the online world, you have little idea what information about you is being used, how it is being used or by whom. You have little say in its use - no ability to object nor power to amend that information. You have no control.

There are no such concerns when using cash.

You have nothing to hide

‘If you’ve done nothing wrong, you’ve got nothing to hide’ is the common argument against worrying about privacy. But if you are exploring new ideas - dangerous ideas, ideas that go against the orthodoxy, perhaps investigating the concept that the world might not be flat and is in fact round - do you really want some hidden power knowing what you are up to? The effect of this threat of intrusion is to censor free thought - to censor your inquisitiveness.

One solution is to become a drone, to not do anything experimental or anything wrong. Perhaps that’s what they - whoever they are - want. Gmail reads the emails you draft but decide not to send. Effectively it knows what you thought, but decided not to say. How dark is that?

A better solution is to protect privacy - to limit the scope that others have to use our information beyond the purpose for which it was supplied. It allows us to have greater control over our online reputation and enables us to grow and mature without being shackled by foolish things we might have said or done in the past. It enables us to explore new ideas outside the mainstream, without fear of being watched. Those that know about us have power over us. Protecting privacy limits that power. Cash is key to this.

But, of course, protecting privacy costs money. The internet is, mostly, free. Protecting your privacy takes effort. If you protect your privacy, you lose all the benefits that your phone and computer knowing a bit about you brings, from saved passwords to helpful book recommendations.

This is the dilemma we all face, and most choose convenience without even realising it. This, above all, is why the world is going cashless. It’s more convenient to pay with your phone, or with a card, than it is to carry cash. In the marketplace, convenience always wins.

Mobile phones and the naysayers

Here’s a little story for you. By 2023, some 85 per cent of the global population - 6.8 billion people - had a smart phone. That’s more people than have a toilet. Yet, at its peak in 2008, there were 1.3 billion landlines for a global population near 7 billion. Why did the mobile, and then the smartphone, succeed where the landline failed?

Yes, superior wireless technology made widespread coverage more possible. But there is another, simpler reason: to get a landline, you need a bank account. When more than half of the world’s population is ‘unbanked’, as it was in 2008, without access to basic financial services, telecoms companies saw no potential custom. Those companies would have built lines in the Arctic circle if there was profit to be made by it, but there wasn’t. Too many people were financially excluded. The infrastructure was never built, and people were left with fewer possibilities to communicate.

A mobile, on the other hand, you can buy with cash. You don’t need to be banked. The financial system was a barrier to progress for the world’s poor. Cash is a facilitator for them - it means total financial inclusion, a luxury the better off take for granted. Without financial inclusion - and there will always be some that, for whatever reason, often some bureaucratic quirk, won’t have it - you are trapped in poverty. Beware the war on cash.

The irony is that the smartphone now facilitates financial inclusion, whether via traditional finance (banking etc) or modern alternatives - the likes of the African mPesa (a widely used currency based on airtime) or bitcoin and other crypto currencies.

Handy cash

Cash still has its uses for small transactions - a chocolate bar, a newspaper or a pint of milk. It will always be the fastest form of payment there is - think of the change you might put in a busker’s hat or the bucket of someone collecting money for charity. It is also the most direct payment there is.

For many people not at the top end of the economic scale, cash is still king. For example, I like to tip waiters in cash, knowing they will receive that money without it being syphoned off by some unscrupulous employer. I like to shop in markets, where new businesses often start out. Cash is widespread - it’s fast, it’s cheap. I can buy directly from the producer knowing they will receive all the money, without middlemen shaving off their percentages. Goodness knows it’s hard enough for new, small businesses as it is.

A quick look at a recent British Retail Consortium report shows that, surprisingly, cash remains the least costly payment method to process. I want to maximise new businesses profits where I can. Many new businesses starting out need the cash economy. Small businesses need it. The financially excluded need the cash economy. The war on cash is a war on them. Cash also has its uses for private transactions, for which there are many - and by no means are all of them illegal. But if you listen to the scaremongering, you’d start to think that all cash users are either criminals, tax-evaders or terrorists. Sure, some use cash to evade tax, but it’s paltry compared to the tax avoidance schemes multi-national corporations employ. Starbucks doesn’t use cash to avoid tax, it’s all done via legislative means.

I have a confession to make - even I, with my highfalutin principles, no longer carry cash, guilty though it may make me feel.

A quick poll of my Twitter followers showed that 36 per cent no longer carry any cash when they go out. This is also a generational thing. The number of no-cash-users is much higher among the under-30s. I have four kids between the ages of 18 and 23, none of them carry cash. Nor do their friends. It’s the older (wiser?) generation who still carry cash, even if only as emergency money. The problem is, cash is like playing records, when the rest of the world is on Spotify.

Use of cash fell quite dramatically with Covid, but it still accounts for 14% of all retail payments in the UK, according to a 2023 House of Commons paper. Projections are that, by 2031, this number will fall to 6%. (Obviously, if you include other payments the proportion is much lower.)

In mainland Europe, the use of cash is higher at around 20% of all retail transactions. Germany, Italy and Spain are still at 35-50% cash, while the Nordic countries are below 10 per cent. In the US, the number is in the 20-25% region. But the trend is very much down.

But here I have a confession to make - even I, with my highfalutin principles, no longer carry cash, guilty though it may make me feel. The truth is, cash is dying. The convenience of fintech is killing it. Money is now almost entirely digital.

Bitcoin and digital cash

Tech might have doomed cash, but it is also coming to the rescue in the form of bitcoin and other crypto currencies. Bitcoin itself was invented to be a digital replication of the cash process. A can send money directly to B without there having to be any middleman to process the transaction. Bitcoin is cash for the internet.

Among the many breakthroughs which got people so excited about this new technology was that Satoshi Nakamoto’s blockchain solved the problem of ‘double spending’ - making sure you can’t spend the same money twice - without having to use third parties such as banks to process the transaction. There is now a plethora of copycat currencies, with many of them focused on privacy in order to make their usage anonymous.

At the other end of the scale, we have central bank digital currencies - CBDCs. These have been piloted in various countries around the world and, fortunately, nowhere has really got them to work. They have been met with neither trust nor understanding, and in many cases the tech has fallen short. In Nigeria and the Eastern Caribbean, they went beyond the pilot phase and have been out and out failures. Even in the Bahamas, the one place where a CBDC is said to have worked, adoption has been much lower than hoped. I asked my friend who lives there how successful it had been. He gave me this reply: ‘LOL. I have never seen one person use it.’

Fortunately, government incompetence is on our side.

Money has always been a bottom-up technology. Users prefer what is convenient. The fiat currency we use in the West today has evolved over many hundreds of years, especially as communication technology has developed. All you are doing when you make a payment is, effectively, sending a promise - the money itself does not exist. There is no gold or anything tangible backing it.

Cash is slightly different, because you are handing over something physical. But read what’s on that piece of paper - it’s just another promise. Once upon a time, you might have been able to swap a 10-pound note for 10 pounds of sterling silver (not quite true as silver was abandoned before paper money became widespread) or 10 gold sovereigns (true). But today, all it says is ‘I promise to pay the bearer the sum of 10 pounds’ - it is a promise of nothing. How the whole house of cards doesn’t come tumbling down is beyond me, but there you go.

Many central banks want to make the transition to CBDCs, despite zero democratic mandate. The planners want it because it then allows for money to become even more of a tool of government policy: whether it be monetary policy, taxation, welfare, surveillance or control. Fortunately, government incompetence is on our side. The history of government IT is so bad, it’s unlikely any will succeed, thank goodness, especially not in countries with large populations. Heck, they can’t even fix the potholes! But that’s not to say they won’t try.

Always end on a song

That’s an old show-business maxim. Why don’t we do just that?

‘Programmable Money’, a song I wrote last year about CBDCs, summarises everything there is to be worried about. Enjoy!

If you liked this song, you should sign up for my comedy newsletter.

Lyrics

C - B - D - C. C - B - D - CProgrammable money. Programmable money.

We’ll monitor every purchase you make,Every transaction or decision you take.If you’re not doing wrong, what is there to hide?How you spend money is for us to decide.

Your social-credit rating, how do you score?If you’re compliant you will get your reward.You may only own what we deem you can own.If you don’t register, we’ll block your phone.

Wait! You’ll be late for the expiry date.The state has mandated your money terminatesSo spend, speculate before it’s confiscatedThis is what we’re going to orchestrate

No more saving

Programmable money. Programmable money.C - B - D - CC - B - D - C

Your money’s now a tool of policy.You will be living in a smart city.You may only travel in a limited range.Energy and meat rations cos, climate change.

We’ll take your dough if we think it’s owed.No matter if you do not think it’s so.Taxes and fines, fares, fees of all kinds.All embedded in the lines of code.Hail Big Brother

Programmable money. Programmable money.C - B - D - CC - B - D - C

Tears of the sun, fallen from heaven.Empires fall. Radiant droplets everlasting.

We will implant you with a microchip,AI and other forms of censorship.We will decide what is good for you.Total control there’s nothing you can do.

Bitcoin fixes this!

From here.

Here’s a PDF of today’s piece.

Finally, here are some videos I made of recent articles, for your viewing pleasure.

I don’t know about you, but I use artificial intelligence (AI) all the time. ChatGPT has become my right-hand man. It gives me advice (really – and good advice too), it helps me make decisions, it gives me exercise workouts, recipes, it proofreads what I write, it helps me write titles, it even helps me write song lyrics. Midjourney does all the imaging for this newsletter. Even a simple Google search now involves lots of AI.

I know I’m not alone. Almost everyone is using AI, consciously or not.

Guess what? AI requires bucket loads of power. That’s why Microsoft recently agreed to pay Constellation Energy, the new owner of America’s infamous nuclear power station, Three Mile Island, a sizeable premium for its energy. There is cheaper wind and solar power to be had in Pennsylvania, but it isn’t as reliable as nuclear, 24 hours a day.

It’s not just AI. The widespread political desire to rid ourselves of fossil fuels means the world needs electricity, and fast.

Nuclear is the solution, of course. But nuclear takes a lot of time, even with AI now “re-routing” the anti-nuclear narrative. It takes especially long in the UK where any kind of infrastructure project requires billions to be spent on planners, lawyers and consultants before a brick is even lifted.

It’s so stupid of course. Nuclear power stations have been operating commercially for 70 years, providing reliable, affordable, and almost infinitely renewable “clean” electricity. Nuclear has the best safety record of any energy technology. Almost all environmental concerns, such as waste disposal, have been solved. But if you want to know the name of the point at which stupidity, hypocrisy, waste and weakness meet, it’s called British Energy Policy.

Layer upon layer of safety is demanded in nuclear plant design. The regulatory process is slow, cumbersome, and complex. There is a long lead time between planning, building, and operation, which adds to expense. Political uncertainty meant many proposals for nuclear power stations in the UK were shelved. It all drives away investment.

But governments around the world are waking up to the fact that the silver bullet is nuclear-powered. Thus, the narrative is changing. The dawn of the new age of nuclear power is upon us, and it can’t come quickly enough.

That’s why the focus has shifted to small modular reactors (SMRs). These have been operational for almost 70 years now in submarines, aircraft carriers, and ice-breakers, but in the last few years, land-based SMRs have been developed to generate electricity.

They use simple, proven technology, and are safer than current nuclear power stations. They can be manufactured in factories and then rapidly erected on-site. Modular refers to the design principle of breaking down a system into small, independent, and interchangeable components, or “modules”, that can easily be combined, modified, or replaced without affecting the rest of the system. This flexibility means they are scalable. It aids manufacture, transportation, and installation while reducing construction time and costs.

SMRs don’t occupy much land, so they have little impact on the landscape. Some can even be constructed underground – surely preferable to wind turbines and solar farms. In the UK, they could be erected on the redundant sites of closed nuclear and coal-fired power stations, where grid connections are readily available.

A 440 megawatt (MW) SMR would produce about 3.5 terawatt hours (TWh) of electricity per year, enough for 1.2 million homes – or to provide power to Wales, the Northeast of England, or two Devons. It would require about 25 acres of land. A solar farm would need 13,000 acres for the same output; a wind farm, 32,000 acres. Three 440MW SMRs would be enough for London, which has around 3.6 million homes.

What’s more, their output is not dependent on the weather. Reliability is why Microsoft paid a premium of more than 85% for Three Mile Island’s power. SMRs produce electricity that can easily be adjusted to meet the constant, everyday needs of the grid (baseload), and they can also ramp up or down to follow changes in demand throughout the day. They spin in sync with the grid, so they help keep everything stable. When they’re running, they act like a steady hand, providing momentum that makes it easier to manage sudden changes in electricity supply or demand.

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How To Invest

There are all sorts of ways to invest in nuclear power. The simplest and least risky is to buy the metal itself. Current demand for uranium stands at around 200 million pounds per year, while mining output totals only 140 million pounds. Another 25 million pounds comes from secondary sources, such as scrap and recycling. So there is a uranium supply deficit. I’m surprised the price isn’t higher. London-listed Yellowcake (LSE:YCA) has been set up with this purpose in mind. It is, essentially, a uranium holding company. You buy the shares, and thus own a share of the uranium it holds. It makes up part of the Dolce Far Niente portfolio.

You could also buy uranium miners, though I have to say I do not like the miners at all. There are the large producers, such as Cameco (Toronto: CCO) and Paladin Energy (Sydney: PDN). You can also gain exposure via large caps, such as Rio Tinto (LSE: RIO), but they are not pure plays. There are mine developers too, such as NexGen Energy (Toronto: NXE), whose Rook 1 project should be producing a whopping 30 million pounds a year by 2030, almost enough to solve the uranium supply deficit single-handedly.

If you don’t fancy your stock-picking skills, go for a fund instead. The London-listed Sprott Uranium Miners ETF (LSE: URNP) is an exchange-traded fund that gives you exposure to a basket of mining companies, as does closed-end fund Geiger Counter (LSE: GCL). Another popular ETF is the Global X Uranium UCITS ETF (LSE: URNU).

Why don’t I like uranium miners? About 90% of those listed in the funds do not have any production coming in the near future and are, therefore, huge vortexes into which capital will disappear. At present, they are fully valued. That’s not saying they won’t go up. But when the time comes for them to fall, they will bomb.

When I last looked at SMRs in 2021, the companies I tipped were Rolls-Royce (LSE: RR) and Fluor Corp (NYSE: FLR). Both have been real winners. Rolls-Royce has built seven generations of SMRs for use in nuclear submarines and, with its modern designs for SMRs, has been winning contracts all over. Rolls-Royce is not a pure SMR play. But it has put its SMR business into a separate entity (Rolls-Royce SMR) and I presume this will be spun out and listed at some later stage.

The stock has been going great guns under its new CEO, Tufan Erginbilgiç. I tipped it around the 100p mark and it’s now at 530p and there’s no stopping it. It was 1,350p in 2013, so there’s plenty of upside left, and that was before there was any urgency about SMRs. I’ve taken my original stake off the table, and the rest I’m holding.

I also mentioned NuScale, a US outfit, which in 2021 was unfortunately still private. There was a way to get exposure to NuScale, however: via majority shareholder and engineering company Fluor Corp. It has been a real winner too. We tipped it at $18. It’s now $50. The stock remains a hold, although it is not a pure play. Worth $8.6bn, Fluor has $200m of free cash flow and trades at 42 times earnings.

But the company we were looking at, NuScale Power Corporation (NYSE: SMR), has now listed – good ticker – and you can buy the stock at not far off the flotation price. Be warned, however: this is a volatile company. Since its initial public offering (IPO) at $10, the stock has been as high as $15 and as low as $2. It is now at $13.

NuScale designs, develops, and commercialises SMR reactors for nuclear-power generation, aiming to provide a “safe, flexible, and scalable nuclear-energy solution”. Its flagship product is the NuScale Power Module, a self-contained pressurised water reactor (PWR) that is far smaller than traditional nuclear reactors. Each module has an electric capacity of about 60 megawatts, but they can combine to scale up.

NuScale has partnered with various organisations, including the US Department of Energy (DOE) and global energy firms, but it does not yet have a solid sales pipeline, so it is hard to value. Instead, it’s a bit of a meme stock that rises and falls when it gets tipped. NuScale has a market capitalisation of $1.2bn and revenues of $23m; it lost $273m last year. It now has $180m in negative free cash flow, $130m in cash and a burn rate of about $35m per quarter. (So it’s got enough money for another year.) Caveat emptor.

Another option is BWX Technologies (NYSE: BWXT), but again it’s not a pure SMR play, more of a picks-and-shovels play. The company manufactures nuclear-reactor components, systems fuel, and other critical parts for the nuclear-power industry. It really is wide-ranging (think anything from naval nuclear propulsion to nuclear defence) and its history goes all the way back to the Manhattan Project.

SMR developers will often rely on BWX’s expertise and manufacturing capabilities to ensure the safety and functionality of their designs. As demand for SMRs grows, so will the appetite for BWX’s products and services. BWX has a market value of $10bn and $1.2bn in debt. Earnings per share are just shy of $3, and the price/earnings (p/e) ratio is close to 40. But it is profitable and pays a yield just below 1%.

If you want to go really small and speculative, there is always the mining exploration option (not recommended), or uranium enrichment firms. If this technology of enriching uranium to make it more powerful comes good, then the efficiencies of the industry will improve even further, and the problem of uranium supply deficits will quickly vanish, along with the high prices of many uranium miners. Silex Systems (Sydney: SLX) – market cap A$1.1bn (£565m), 50% owned by Cameco – is the market leader here, although Centrus Energy (NYSE: LEU), worth $1bn, is not far behind.

We are still some years from successful enrichment, but it is coming. I doubt we will see it before the uranium price itself breaks to new highs above $140/lb, which it hit in 2006, and probably not until $200 uranium. High prices have a habit of accelerating everything. Uranium is now at $70/lb.

That’s when tiny-cap nuclear-fuel tech firms such as Lightbridge (Nasdaq: LTBR), worth $46m, could rocket. Lightbridge, looking to improve the safety, economics, and proliferation resistance of nuclear power, is developing a fuel that operates about 1,000 degrees cooler than standard fuel. It’s got $27m in the bank, is losing $10m a year and, like NuScale, seems to rely on memes and tipsters. The stock costs $3 so there is plenty of upside. But be warned: this is an illiquid Nasdaq stock. Don’t chase it.

Amazing chart. From $4,000 - to $2. Talk about wealth destruction. It’s like an NHS IT project. Looks like it might, finally, have bottomed though.

This article first appeared in Moneyweek Magazine.

I’ll be MCing this year’s Moneyweek Summit on Friday November 8th. Readers of the Flying Frisby can get a 20% discount by entering the code FRISBY20

If you’re interested in nuclear, Wednesday’s piece might be of interest:

I had an email from Nick Lawson, CEO of investment house, Ocean Finance, which has put together some research on Lightbridge. I share it here, in case of interest.

And here once again are those vids:

Final call for my “lecture with funny bits” about mining this Thursday. Hope to see you there.

But here it is, finally, the follow-up to How to Sleep Well, in which we address the bane of many who would sleep well: peeing in the night.

Did you know one in three adults over 30 and more that half of adults over 50 wake up to pee at least once a night? The interruption damages the precious rhythm of sleep, especially later in the night when getting back to sleep again is harder.

The problem plagued my dad for decades, and it was bladder issues that eventually took him. His peeing was a major source of misery, especially in his later years, and my eyes still well up now when I think how much pain and discomfort he was in.

Unfortunately, like father like son and all that, I have my father’s bladder.

I’m only 55. I’ve been having to get up in the night for at least 25 years now. It is not uncommon for me to have to get up as many as five times. On a really bad night, it can get to ten.

For years, I accepted this as my genetic destiny. But with this sudden turnaround in my health and fitness—in which I have rid myself of many things I thought I was stuck with—and not wanting to follow in Dad’s footsteps, I’ve put some considerable effort to this issue in the last few months.

I’m delighted to report that I have made real progress.

Twice this week, I have got through the night without having to pee at all. It’s been 25 years since that happened for me, and the exhilaration I felt the following morning was quite something. I even got 100% sleep scores on my Whoop.

If buying gold to protect yourself in these uncertain times, let me recommend The Pure Gold Company. Pricing is competitive, quality of service is high. They deliver to the UK, US, Canada and Europe or you can store your gold with them.

Five things I did which made a difference

The condition of having to pee in the night is called nocturia.

I started by going to the doctor, where I had all sorts of tests: blood tests, urine tests, and the infamous finger up the bum. Everything came back fine. No prostate or bladder issues. The only thing they found was that my kidney function was sub-optimal.

There are five stages of kidney function, with stage 1 being optimal and stage 5 being failure. I’m stage 2, “mildly reduced function,” which is not ideal, but it’s also not abnormal for someone my age. In any case, it’s often asymptomatic.

So if everything is mostly working down there, why all the peeing?

I have a theory which I’ll come back to in a moment.

By the way, while I remember: fasting does not help. When fasting, if you’re like me, you will consume loads of liquid—soup, herbal tea—to fool your body into thinking you’re full. All that liquid means a lot of peeing.

Also, fasting puts your body into a state of ketosis, which makes your kidneys work harder. Ergo more peeing.

However, the health benefits of fasting, especially weight loss, are so great that, in my view, they outweigh the increased peeing.

1. Supplements

I tried a million different supplements:

* Pumpkin seeds

* Linseed / Flaxseed

* Walnuts (also good for Omega 3)

* Zinc

* Selenium

* Pygeum Africanum

* Magnesium

* Vitamin D (though I also read that it makes you pee more—you can’t win)

* Quercetin

I’m not convinced any of them made a significant difference, but I mention them because they were part of the process.

2. Booze

Sorry, but it’s a killer. Especially, beer. Lots of liquid plus the diuretic effects of alcohol. Try not drink as much, try and drink your booze earlier in the day, away from bedtime. Best of all, don’t drink at all.

If you need help cutting down on booze, get a Whoop. I explain how they help here.

3. Fluid Management

Consume your fluids earlier in the day. Avoid drinking anything for at least three hours before bed, even if it means going to bed a bit thirsty (though that might not be great for your kidneys).

This makes a huge difference - it will reduce your peeing by as much as 40% I’d say.

At the same time as making sure I didn’t drink three hours before bed, I started doing two other things. I think it these three things in tandem that made the difference.

4. Getting your body out of the habit

Often I’d wake up in the night with the feeling that I needed to pee, when I didn’t even need to.

I began to suspect that my body had simply got into the habit of waking up. I needed to break the cycle. How to do that?

You can watch a video of this article here:

For the first time in history, gold went above £2,000/oz yesterday.

This is a huge landmark in the decline of sterling.

Of course, nobody in the UK echelons of power is talking about it.

We are, however, because it matters. Who is buying so much gold that price keeps going up? Why are they buying? There are hugely significant developments taking place in Asia that have the potential to reshape the global financial order.

This bull market is not like previous bull markets. It’s not driven by retail buying. What’s driving it is far more significant than that.

Clowns to the left, cretins to the right

Here is gold in pounds since Gordon Brown sold ours in 1999. It’s quite something—over ten times higher! What a clown.

Meanwhile, in other currencies, gold continues its march. Here it is in dollars, the preferred benchmark, over the past three years. This is proper bull market stuff.

I know I have said this a million times, but I really urge you, if you haven’t already, to diversify out of sterling—indeed any form of fiat money—and use gold as your savings vehicle.

The gold price action is telling us something.

The way this government is going—it’s proving almost as rudderless as the Tories were, and in record time—sterling could have real problems, and soon.

To my knowledge, not one influencer in the Labour Party, over the course of its conference this week, mentioned stewarding the currency, protecting its value, or any of that stuff. Just as every government before it has, they will use sterling devaluation to compensate for their deficit spending.

The pound is only holding up in the forex markets because the Bank of England did not cut rates last week, when the Federal Reserve and the ECB have gone into a rate-cutting cycle.

Perhaps, more significantly, no one in the Labour Party is discussing what is happening in Asia. Central banks are buying gold in huge quantities. They are no longer waiting for the price to pull back before making their purchases.

Perhaps most significantly of all—they are not reporting all their gold purchases. It is happening on the quiet.

If you want to buy gold to protect yourself in these uncertain times, let me recommend The Pure Gold Company. Pricing is competitive, quality of service is high. They deliver to the UK, US, Canada and Europe or you can store your gold with them.

De-dollarisation is happening in front of our very eyes

The implications for the West are huge. But, despite the geopolitical significance, this issue is nowhere close to the Labour radar.

This goes back to early 2022 and the Russian invasion of Ukraine when the US confiscated Russia’s US$300 billion. Most of the rest of Asia looked at that and thought, “we need to de-dollarize.”

China, as we know, has quietly been reducing its holdings of US Treasuries. It now holds $777 billion in US Treasuries, which is about 10% of the US national debt held by foreign entities. This compares to 22% in November 2013. That is quite the reduction.

China has also, as we know, been accumulating vast amounts of gold.

Analyst Jan Nieuwenhuijs calculates that China has bought 1,600 tonnes of gold since Covid. I think the number is higher. That is on top of the 370 tonnes it mines annually—and most of that mining is state-owned.

I was having dinner with a VIP Chinese investment banker last night. I asked him about the Chinese mentality and de-dollarisation. “It is a matter of pride,” he said. China does not want to be beholden to the US. Global reserve currency status is a goal. There has never been a global reserve currency that did not start out backed by gold.

For now, it continues operating by its doctrine, “we must not shine too brightly,” but all the while it is accumulating gold and reducing its dollar dependency.

But it is by no means the only country doing this.

Saudi Arabia was “caught” a fortnight ago secretly buying 160 tonnes of gold in Switzerland—kudos to Jan Nieuwenhuijs for the scoop.

“One thing is for certain,” says Jan. “Saudi Arabia owns much more gold than it wants the world to believe.”

This is significant because Saudi Arabia was such a key player in establishing the petrodollar in the early 1970s after the US came off the gold standard, enabling the dollar to retain its status as the global reserve currency.

Saudi Arabia could be quietly repositioning itself as an ally of the next global superpower. It could also, as we shall see, be at the heart of a new global payments system.

The new international payments system which bypasses the US dollar

And a reminder there are just a handful of tickets left for my “lecture with funny bits” at the Museum of Comedy on October 10th - October 9th was cancelled - sorry. This is a super interesting show, even though I say so myself. If you are free, I really recommend it.

In 1914, a young German named Heinz Kurschildgen started his first job as an apprentice in a dye factory in his hometown of Hilden. He became fascinated by the chemicals he was working with, and built a small laboratory at home to conduct experiments.

Before long, he thought he had found a way to make gold, and even persuaded several investors to give him money. However, it soon became clear that he couldn’t make gold and found himself prosecuted for fraud. The courts let him off on the grounds that mentally he was not all there, but only on condition that he solicited no further investments with schemes to make gold. 

He was soon claiming he could make other transmutations, and became something of a joke figure in his hometown, where a bust was even erected in his honour, albeit ironically, inscribed with the words: “For the genius gold-maker, from his grateful hometown.”

But in 1929, he returned to his first calling, which was kidding people he could make gold. He approached German President Paul von Hindenburg and Head of the Reichsbank, Hjalmar Schacht, with a proposal to make the gold they needed to pay off Germany’s WWI reparations.

These had been set at 132 billion gold marks, which translates to 47,300 tonnes. To give you an idea how unrealistic a figure this was: it was an amount not far off all the gold that had ever been mined in history by that time. That would take quite some alchemy.

But Kurschildgen was not a man to be deterred. He raised a load more money, defrauded his clients, and ended up with another 18 months in jail.

You really should subscribe to this wonderful publication.

After his release, he was soon at it again. This time, he approached the newly elected Nazi government with a plan to make petrol from water.

Chief Scientific Advisor, Wilhelm Keppler, paid him a visit and Kurschildgen agreed to reveal his methods and surrender the rights to the government. Meanwhile, his claims about being able to make gold piqued the interest of SS leader Heinrich Himmler, who had a notoriously superstitious streak and a fascination with alchemy. Himmler started generously funding Kurschildgen to conduct his experiments. 

But Reichsanstalt physicists soon declared his contraptions useless, and Kurschildgen ended up in a concentration camp.

“Himmler has fallen for a gold and petrol maker,” said Joseph Goebbels in his dairy. “He wanted to defraud me, too. I knew what he was about straight away”.

After two years Kurschildgen was released for good behaviour. Himmler had him put straight back in the camp. On no account did he want this embarrassing story becoming public.

After the war, Kurschildgen tried to get recognized as a victim of Nazi persecution, so he could claim compensation. “The Gestapo would stop at nothing to get my invention," he told the courts.

As with most of his ventures, his petition was unsuccessful.

Even so, you can’t fault the man’s ambition.

Until next time,

PS Don’t forget Shaping the Earth on October 10th.

If you are interested in buying actual gold in these uncertain times, then look no further than my recommended bullion dealer, the Pure Gold Company. Premiums are low, quality of service is high, and you get to deal with a human being who does not moonlight as an alchemist!

There are just a handful of tickets left for my “lecture with funny bits” at the Museum of Comedy on October 10th - October 9th got cancelled - events beyond our control, sorry. This is a super interesting show, even though I say so myself. If you are free, I really recommend it.

Some charts have been doing the rounds this week, and I wanted to take a look at them today, as a couple of you have been asking about them.

The first is this one, which shows that, relative to stocks, commodities are as cheap as they have ever been.

I have little doubt that there will be another bull market in commodities, that it will come when people are least expecting it, and that, when it does come, it will blow everyone’s minds, just as previous commodity supercycles have done.

But here’s the thing: we have got better at producing commodities. Modern farming methods mean we can produce more grains and softs at cheaper prices than ever before. Yes, sometimes there are events beyond human control that get in the way—bad weather being the most obvious example—but the broader trend will always be towards lower prices (especially if you use ratios and thereby strip out the fiat factor).

But these are the commodities that we grow. What about fossil fuels and metals, which are finite resources? We’ve long since taken the easy stuff.

Well, yes. But the same logic still applies. Modern mining means we can now explore far-flung corners of the earth and economically produce from much lower-grade rock. The same applies to fossil fuels. Fracking is an example. This new technology meant that previously uneconomic deposits became economic. The result was a glut of supply and lower prices.

So, while I do not doubt that commodities will have their day, I also look at the chart above and see no reason why they can’t get cheaper still. The trend of the last two or three years is lower. That ratio could quite easily go back and retest its 2020 lows. It could go even lower.

There is a lot of value to be had from ratio charts, but you also have to factor in basic stuff like improved productivity. However, there are other factors too. Many think we are heading towards some huge international conflict. If so, international trade will suffer, countries will start stockpiling, and commodity prices will quickly revert to 1973-4/1999/2008 levels.

Are you buying gold to protect yourself in these uncertain times? Let me recommend The Pure Gold Company. Premiums are low, quality of service is high and you deal with a human being who knows their stuff.

Here’s another ratio that is doing the rounds: gold miners versus gold

Now this one is pretty compelling. Time to pile in to gold miners? Let’s see. and let’s also check in on the miners we own.

Innocent sleep … sore labor’s bath,Balm of hurt minds, great nature’s second course,Chief nourisher in life’s feast.William Shakespeare

Sleep is so important to your well-being. Your mind works better when you sleep well. Your moods improve. Your outlook improves. Your physical condition improves. Your health improves.

Life is better when you sleep well.

We spend—get this—a full third of our lives asleep. Yet how much do we treasure sleep? How much do we guard our sleep time? How much effort do we put toward improving our sleep?

Like so many things in this modern, fiat world of declining standards, the value of sleep has been overlooked.

Science may only just be starting to acknowledge the benefits of good sleep, but it’s something we’ve intuitively known since forever. From time immemorial, art and literature have been filled with references to the value of a good night’s sleep. The Ancient Greeks, Hippocrates among them, knew it was a prerequisite for good health. Many cultures considered dreams to be a form of contact with the divine.

I used to think I had mastered the art of sleeping. In the last couple of years, I’ve learned this is far from the case.

However, I’ve put in a lot of work and now, in my newfound role as health guru, I feel I’m in a position to dish out some advice on how to improve your sleep.

England cycling coach David Brailsford used to talk about the incremental effects of marginal gains. Sleep improvement is very much the same. There are lots of little things you can do, and, with the accumulation of these, you will see vast improvements.

Here are ten ways to improve your sleep, including how to deal with waking up in the night, bedtime habits, alcohol’s impact, melatonin, peeing in the night and more …

1. How to get to sleep

I always struggled to get to sleep, even as a youngster. I can remember lying in bed for endless hours, really trying to get to sleep and not being able to. 

When you’re lying in bed trying to sleep, and you can’t, that is when the demons come: unwelcome thoughts creep into your mind and then start looping over and over. It’s good to be able to fall asleep quickly.

I now realise one of the reasons I got into the habit of drinking too much was that, after a few drinks, whenever I lay down, I would go straight to sleep. Drinking was a way of avoiding that difficult period of trying to get to sleep.

My other method was doing loads and loads of physical activity and then going to bed absolutely shattered. Not always possible.

So, here’s the first lesson I’ve learned, and this is the best hack ever.

First thing in the morning, go outside and get 15 or 20 minutes of sunshine. Do this as soon as you wake up. Make your morning cup of tea or coffee, then take it outside and get some sun. Even if it’s cloudy and cold in the middle of winter, go outside and stand where the sun would be. Open your eyes towards it. You’ll still get some rays.

This has been shown to regulate your circadian rhythms. In my view, it’s the single best thing you can do to help you fall asleep at night.

You’ll find, like magic - or is it clockwork? - that as soon as the sun goes down that evening, you’ll start feeling tired.

2. Darkness.

Darkness aids sleep. Blackout curtains in the bedroom are a good idea, but if that’s too much hassle, there’s a simpler, cheaper solution: sleep masks.

I’ve only lately taken to wearing sleep masks in bed (I’ve always used them when travelling) and I’ve come to love them. Go for a silk one—they’re very comforting. I use this silk one by Alaska Bear.

3. Breathe Better

There is a simple product for this too. Mouth tape.

Stick a little bit of this tape across your mouth and it forces you to breathe through your nose. You’ll be amazed. You sleep so much better if you only breathe though your nose.

I’m currently using this light weight one and I like it. My son prefers this heavy duty stuff, which might be better as a stating point to change your breathing habits.

If you sleep on your back and then snore, mouth tape can really help out.

4. Get a sleep tracker

I use the Whoop fitness tracker, which you wear on your wrist.

When I compare my data with friends using other devices like Garmin, Apple, Fitbit, Whoop, and Aura, there’s quite a bit of divergence between the brands, particularly on calories burnt. I don’t think it really matters: it’s the act of monitoring and tracking that leads to improvements.

Whoop seems to generally regarded as the best for tracking sleep though.

An unintended but incredibly beneficial side effect of getting a Whoop is that it will massively cut down your drinking. More on this in a moment.

5. Room temperature

Don’t forget Shaping The Earth, “my lecture with funny bits” in London this October 9th and 10th at the Museum of Comedy. Please come if you fancy a bit of “learning and laughter”.

Three subjects I want to briefly look at today, starting with everyone’s favourite non-government money.

There were rich promises of huge gains in bitcoin with the launch of the bitcoin ETFs and the halving cycle. Neither has quite materialised.

Bitcoin is “only” up by 30% this year, though to read some of the commentary, you’d think this is another Bitcoin winter.

The problem is that most of those gains came in February. For the other eight months of 2024, we’ve been generally stagnant. In fact, since March, we’ve been making a series of lower lows and lower highs and are clearly in a downtrend—hence the despondency.

However, despondency is often the ally of the contrarian investor, and with that in mind, I want to share a table with you (borrowed from Coinglass).

It shows Bitcoin’s quarterly performance. I’m sharing this now because we’re heading into Q4, which has historically been Bitcoin’s best quarter, with average returns close to 90%.

Seasonal patterns aren’t always the most reliable indicator, but the odds are favourable: seven positive Q4s against just four negative ones.

Better than Q1, which is 50:50; Q2 with seven positive and five negative; and Q3, which shows five positive and seven negative years (including this one, which isn’t over yet).

Let’s hope those averages hold.

I argue that Bitcoin should be a core holding. Many don’t like bitcoin, but the potential is so huge that, in my view, the greater risk is not owning it rather than owning it.

My guide to buying Bitcoin is here. And here, I detail the easiest way for UK investors to gain exposure via a traditional broker.

How Japan finances the world - and why we should be worried

About a month ago we explained the summer turmoil and the unwinding of the yen carry trade. The big question we all want to know the answer to is: was that it? Are we done now, or is there more to come?

You can watch a video of this article:

When I was 19, I started getting these weird heat rashes.

Every day, whenever I got hot, these debilitating, paralysing heat rashes would envelop me. Burning, bumpy, red weals suddenly covered my body. So itchy—you wanted to scratch everywhere, though scratching brought no relief. Once the rash started, there was nothing I could do. I just had to wait for it to pass, which would take about half an hour.

I didn’t even have to get so hot that I broke sweat for the rash to come on. Just walking briskly would do it, getting flustered, wearing a layer too many, even having a shower.

And it came every day, usually mid-morning.

I thought it might be stress that was causing it, but it was the other way around: these rashes were causing the stress.

I found a way of coping with it: do intense exercise every morning and actually induce the rash. Then it seemed to burn itself out for the rest of the day.

But the next morning, it would be back again.

I went to see doctors about it. None of them knew what it was. As GPs often do when they don’t know the answer, they brushed it aside, “Oh, it’s probably stress.” I wasn’t making this up! But unless I actually had an attack in front of the GP, there was no way of showing them what it was.

I saw a dermatologist, who gave me anti-depressants. I saw Chinese herbalist after Chinese herbalist, who all concocted these disgusting teas for me to drink. Lord knows what damage I did to my liver drinking that stuff. I saw an acupuncturist who declared brightly that he could cure it. But he couldn’t.

It made my life a nightmare, because you never quite knew when the rash was going to hit. What if it came on when I was on stage? During that all-important meeting? When I was with a girl I liked? It was a source of acute embarrassment.

The condition disappeared, bizarrely, if I went to the tropics. Why, Lord knows. But as soon as I got home, back it came.

Then I noticed the condition also disappeared in the summer. What was that about? I realised the antihistamine I was taking for hay fever also prevented these rash attacks.

But I didn’t want to take antihistamine every day—that couldn’t be healthy—so, once the hay fever season was over, I would go back to keeping it at bay by trying to do intense exercise every morning and burning it off.

When I got married and had kids, aged 30, this became impossible, so I resigned myself to daily antihistamine. This started with Clarityn (Loratadine), moved onto Zirtek (which I hated because if I drank alcohol, I used to get incredibly drunk and that led to a lot of bad decisions and mistakes) and, eventually, Xyzal, which I found I only needed to take every other day. The potential long-term damage of sustained anti-histamine use was a gamble I was prepared to make to avoid the daily nightmare of this condition.

If you are buying gold to protect yourself in these uncertain times, then let me recommend The Pure Gold Company. Premiums are low, quality of service is high and you deal with a human being who knows their stuff.

Eventually, I discovered that the problem I had was a condition called heat-induced cholinergic urticaria. I went to see a specialist at St Thomas' Hospital. “There is no cure,” she told me. “Sometimes it clears up by itself,” she told me, “sometimes not. You’re lucky antihistamine stops it. For many that doesn’t work.”

I volunteered to be a guinea pig so she could experiment on me as part of her research into the condition. I would go to the hospital, have a hot bath, my skin would erupt, and then she’d prod me and prick me and nod and mutter, but it got me no nearer to a cure.

Here I am at 54, and it has not cleared up.

What is the cause?

I’m still not quite sure if something I did caused it. Urticaria is from the same allergic school of illnesses as asthma, eczema, and hay fever, from which I suffer a little (asthma especially if I run or am near cats), so it might be hereditary or genetic. It affects young men more than any other group, which is what I was.

I’ve been on numerous forums where fellow sufferers discuss the condition, and a lot of us took the antibiotic tetracycline. I took it for years as a teenager to help with my acne. God, it makes me cross that I was allowed—even encouraged—to take it for so long. Bloody doctors, or one in particular (no longer with us so I won’t name him and speak ill of the dead), and my mother’s blind trust in them. I thought it might be tetracycline.

I had spent two months in Egypt just before I got my first outbreaks, and I got very ill with Giardia, a form of dysentary. Maybe I lost some essential bacteria in my stomach or something, or got leaky gut. (I’ve taken a million probiotics and all the rest of it—didn’t work).

Also just before the first outbreaks, I got the sh*t kicked out of me in a park in Milan by a group of young Italians - I mean properly beaten up, 7 v 1 and I made the mistake of fighting back - so maybe it was somehow related to that.

Maybe it was the accumulation of everything.

Nature’s magic superfood comes to the rescue

One of the unintended benefits of my health drive in recent years is that my asthma, which I’ve had since I was born, appears to have, for no apparent reason, gone. I haven’t been near cats to test it there, but I no longer need my puffer to play football. (Don’t know why. It might be an age thing; a health thing, most likely a seed oil thing).

Then I forgot to take my antihistamine for a few days, and I noticed that I wasn’t getting urticaria attacks either. Praise the Lord! I thought my urticaria might’ve cleared up too.

No such luck, as it turned out. It hadn’t. I went abroad and, after a few days, it came back.

Then I realised there was something I’d been taking at home, and I hadn’t taken it away with me.

It made all the difference.

That mysterious ailment you’ve had for ages and can’t rid of. this might sort that out too.

You can watch a video of this article here:

Robert F. Kennedy has been grabbing headlines this week, not just for his alliance with Donald Trump, but for his criticisms of the American food industry, which he holds responsible for the epidemic of obesity and poor health.

I can’t believe what he has to say is even considered controversial, when it’s so obvious it’s true. Yet Time, The Guardian, The New York Times, and all the usual suspects have all come out to smear him.

Surely it’s clear? Processed food is bad for your health. Processed food causes obesity. Processed food is the cause of many modern illnesses. Don’t eat processed food. It is bad for you.

I’m not a doctor. Then again, I’m not an economist either. I’m just a guy who gets interested in stuff, especially systems—how they work and what their effects are.

In the noughties, I became very interested in our systems of money, largely because I couldn’t understand why houses cost so much relative to what people earn. Before long, I felt I had a good grasp of how money works. I ended up writing a film that became an internet sensation (and got horribly plagiarised in the process), several books, and umpteen articles, all making the case that if the West is to save itself and create a level playing field, we need sound money. Whether that’s based on gold or bitcoin doesn’t really matter. Money needs to be independent, rather than a tool  of government.

Recently, I’ve become very interested in health - on particular, improving mine. For years, I have been unable to understand why I—and millions like me—could never keep weight off.

I have become convinced that seed oils are to health what fiat money is to the economy. It is that fundamental, in my mind. Thanks to bitcoin and gold, the fiat money narrative genie is out of the bottle. Fiat is not going to die tomorrow—it will probably take decades —but more and more people are realizing how bad it is and are taking steps to escape the system via alternative money.

The same thing needs to happen with seed oils. I find myself becoming as passionate about this as I was about money 15 years ago. Why are so many people obese? Why are so many people, who work on their health, diet, and fitness still 10 or 20 pounds heavier than they’d like to be? Why were so many people skinny in the 60s and 70s, but not now? Are people greedier now than they were then? They can’t be. We are the same human beings. Indeed, we exercise more.

What’s changed is processed food. It barely used to exist. Now it’s almost impossible to avoid. The main enabler of processed food, the thing that gives it such a long shelf life, is seed oil.

What are seed oils?

"Seed oils" is a catch-all term for the various vegetable oils that have replaced animal fats to become a mainstay of the Western diet: sunflower oil, rapeseed oil, canola oil, soybean oil, corn oil, palm oil, margarine, and so on. Anything hydrogenated is bad.

Seed oils were mostly invented for industrial purposes, but because of their price and properties, “entrepreneurial” companies, assisted by regulators, quack research, and lots of PR, gradually added them to their food products, so that seed oils have now, mostly, replaced animal fats

Just look at how they’re made. You gather seeds from plants such as soy, corn, cotton, safflower, or rapeseed; heat the seeds to extremely high temperatures, so the fatty acids oxidize; process the seeds with petroleum-based solvents such as hexane to extract the maximum amount of oil; add chemicals to remove the foul smell (this deodorization process produces harmful fatty acids); and then add more chemicals to change the colour and appearance of the oil. Not healthy.

One of their properties is that they don’t break down easily (they can thus help lengthen food’s shelf life). The problem, it seems, is that the human body can’t properly break them down either.

Okinawa in Japan became famous for its longevity, with many people living well into their 90s and 100s. Then along came Western processed food, and suddenly there is an increase in obesity, diabetes, and other modern illnesses. The once famously long-lived population is now seeing both a decline in life expectancy and an increase in health problems that were previously unknown.

When correlation equals causation

This chart shows the consumption of vegetable oil in the US since the late 19th century. We didn’t used to eat seed oils; we ate animal fats. You can see they change in diet.

Sugar often gets the blame for the rise in obesity, but if you look at current US sugar consumption, it’s not that different from what it was in the 1930s or 40s. Obesity has grown, while sugar consumption has remained broadly flat.

Now, let’s look at vegetable oil consumption and obesity rates. They correlate. And in this case, correlation is causation.

A cock-up at HQ some of you didn’t see Sunday’s piece about a scam in the gold bullion markets. Here it is ICYMI:

Also in video format if you prefer.

Now we look at what must be the most important price in the world: that is the price of the global reserve currency, the US dollar.

Does it go up or down from here?

There is probably no more important question in global finance to know the answer to.

If the dollar is falling, it usually signals boom times for assets: equities and commodities especially. The US prints and spends, and then exports the inflation. Money gets loose and the party rocks.

But when the dollar is strong, everyone gets the jitters.

Today the US dollar is seriously oversold.

Conversely, the inverse trade—gold—is at all-time highs. US equity markets are flirting with all-time highs, while the euro and the yen, even the pound, have been soaring.

What’s more: the US General Election is coming.

On which note, how about this for a chart?

Since 1985, the dollar has declined with the Republicans - Reagan, Bush x2 and Trump - and rallied with the Democrats - Clinton, Obama, and Biden.

Who wins in November has a big impact on the price

But there’re several months to go till November, and a lot can change in just a few weeks.

Let’s start with US dollar index, which tracks the dollar against the currencies of the US’s main trading partners', over the past year.

Look at the RSI.

The RSI has gone beneath 30 for the first time in over a year. You would typically expect a reversal from these levels.

Look at the 3-month rally the dollar had starting in July 2023, the last time it was this oversold, it was quite something.

In fact, based on this, I have taken a small short position in cable, betting that the dollar will rise against the pound.

Last week, Fed Chief Jerome Powell indicated that the Federal Reserve is now ready to start cutting rates, which should be bearish for the dollar. However, oversold is oversold.

"The time has come for policy to adjust." he said. "My confidence has grown that inflation is on a sustainable path back to 2%."

The market is somewhat divided as to whether that cut will be 0.25% or 0.5%, but lower rates go. The inflation—by their definition—monster has been tamed.

“The 2-year yield has fallen to 3.9% compared to base rates at 5.5%, which is the bond market’s way of pricing in future rate cuts,” says Charlie Morris at Bytree. (Have you subscribed to his letter? You should.) "The difference, at -1.6%, means that a full rate-cutting cycle lies ahead. Indeed, this reading is more pronounced than seen in 2001 and 2008, implying the cuts could come thick and fast."

2001 and 2008 were major turning points in the US dollar.

What about sentiment?

To gauge this, I ran some polls on various WhatsApp chats and Twitter/X. What did they show?

There are some unscrupulous bullion dealers out there who are taking advantage of rookie buyers who don’t entirely know what they are doing when buying gold.

I am not going to name names. But don’t fall the scam

If a dealer tries to flog you graded coins, in almost all cases they are trying to rip you off. Don’t pay a premium for graded coins.

You are not buying gold to try and be clever and hope that your coin gets some kind of rarity value. In most cases, that will not happen. There are clever people who know this market better than you already playing this game. Don’t get involved. Your priority is to get as much gold for your money as possible. You are buying gold to preserve purchasing power, not to lose it.

If a dealer tells you that some recent sovereign, for example, is extremely rare, that it was one of the last coins minted under Queen Elizabeth or some such, and that it has been graded and has a special certificate and blah blah, and it therefore carries a huge premium, they are trying to pull a sly one. The reality is that the extra premium paid is almost impossible to claw back when you come to sell.

It really annoys me that bullion dealers are doing this. When buying gold, trust is everything and they are breaching that. You are buying gold for safety, not to be ripped off.

Eventually, the FCA or the Office For Fair Trading or someone will eventually come after the dealers, but it will be too late. We all know how slow these organisations can be and by this point many more people will have been scammed. 

Why do dealers do it? 

A dealer might buy a large stock of coins from the Mint. Coins are often of a slightly different quality. Dealers then send them off and pay a small fee to get them graded according to their Mint State. The scale ranges from MS-60 to MS-70, with MS-70 being a perfect, flawless coin. They then charge a large premium for coins with high grades, even though they barely paid any premium when they bought the coins 

The margins when dealing in gold are on the slim side - sometimes just a few percent. But if they get an additional premium for the rarity, that margin can rise to 100%. No wonder there are so many unscrupulous salesman trying to flog graded coins. 

Fractional coins—¼ or 1/2 sovs for example—or older coins do trade at a higher (though not enormous) premium. These can trade for 15-20% above the spot value of the gold content. But you are likely to get that back when you sell. (Demand for fractional coins has increased this last year while it has fallen for 1oz coins).

But for graded coins you can end up paying 100% premium to the spot value of the gold, yet when you come to sell you get little more than the spot value. So when you come to sell, you can lose over 70% even if the spot price of gold has increased.

It’s like buying a painting by a modern artist and being told by the vendor he’s more famous than he is, only to find out later on that he isn’t.

Don’t fall for it. And spread the word. The more people that know about this the better.

If you are interested in buying gold in these uncertain times, then check out my recent report, and look no further than my recommended bullion dealer, the Pure Gold Company. Premiums are low, quality of service is high, and you get to deal with a human being who knows their stuff and won’t try and flog you graded coins at rip-off premiums.

IMPORTANT: somebody keeps impersonating me on various social media, including on here asking readers to message them on WhatsApp. It is not me. Don’t engage. Please report and DON’T send any money.

Finally, my Edinburgh Fringe show Shaping the Earth, a “lecture with funny bits” about the history of mining, is coming to London October 9th and 10th to the Museum of Comedy. Please come if you fancy a bit of “learning and laughter”. It’s a really interesting show, even though I say so myself.

IMPORTANT: somebody has been impersonating me on Substack, on Instagram and on YouTube. Please don’t engage. Report and block. And please DON’T send any money.

Thanks to all who came to see Shaping The Earth up in Edinburgh. The show got incredible feedback. I am doing it in London October 9th and 10th at the Museum of Comedy. Please come if you fancy a bit of “learning and laughter”.

House prices have to come down some time. But when exactly? That’s what we all want to know. 

So here’s your answer.

The declines start in the US and Canada in 2025, followed by the UK, Europe and Australia in 2026.

That’s what the 18-year property cycle says, at least.

Today we explore that cycle and what it says about house prices.

18 Years of Boom and Bust

Economist Fred Harrison, who first covered the theory in his 1983 book, The Power in the Land, is very much the Godfather of the idea that real estate follows a predictable pattern over an 18-year period.

I first stumbled across Harrison in 2005, when so many were sure house prices had to come down (needless to say they didn’t), on reading his brilliantly prophetic article for MoneyWeek, arguing that we were two or three years from the top. Wasn’t he right. 

Today, by most accounts, property should have already crashed. Real estate prices bear little resemblance to earnings. With the rise in interest rates that followed Covid, mortgage-holders found themselves with higher costs. Some were forced to sell, while prospective buyers could no longer afford to borrow as much as before. Increased taxes - I’m looking at you, Stamp Duty in the UK -  have only added to the unaffordability.

And yet, while the market may be slow and stagnant in many parts of the country and indeed the world, it is not exactly crashing.

There was one school of thought that was steadfast in all the house-price bearishness which followed Covid, saying property’s time to crash had not yet come. They were the acolytes of the 18-year cycle in real estate. Yet again they’ve been proved right. 

Real estate peaks in 2026, they said. After that we get four years of decline.

You know my views on cycles. 

We have the seasons, days and nights, the moons, menstruation, the cycle of life - cycles are turning all around us. There are economic and investment cycles too: bull markets and bear markets, commodities super-cycles, Gordon Brown was always blathering on about the economic cycle, mining is cyclical. New technology goes through a clear cycle as it evolves and is adopted. 

On the other hand, it’s easy to look back at the past, find some random pattern and declare it a cycle. Actually trading them in real time is a very different matter. In fact, the human need for narrative and the fact that cycles make for good copy mean it’s very easy to get wedded to the idea of a cycle, when a very different reality is staring you in the face. After 2008 many got it stuck in their heads that this was Kondratiev Winter and the next Great Depression, and, as a result, missed one of the most rip-roaring bull markets in history. 

With all that said, the 18-year cycle in real estate has proved remarkably reliable, and, says Akhil Patel, author of The Secret Wealth Advantage, and one of Harrison’s great disciples, it goes all the way back to the turn of the 19th century. (I’ll show you that data in just a sec).

Looking to buy gold in these uncertain times? Check out my recent report, and look no further than my recommended bullion dealer, the Pure Gold Company. Premiums are low, quality of service is high, and you get to deal with a human being who knows their stuff.

Broadly speaking, there are four phases to the cycle - and it actually lasts about 18 and a half years.

* Years one to seven. A silent rally followed by …

* A mid-cycle slowdown or dip at around the seven year mark.

* The explosive phase. That’s when house prices really get on the map. Think 1983 to 1989 or 2002 to 2007. In the last couple of years you get a classic blow-off top - the winners’ curse.

* Finally, the correction which lasts around four years. Think 1989 to 1993 or 2008-2011. Then the cycle starts again.

Here it is, illustrated.

This is, says Akhil, “primarily a North American phenomenon, though Britain and Europe follow the US and, increasingly, emerging markets do as well.”

Here, for the historians out there, is a table from Akhil’s book that shows the data in the US going all the way back to 1800.

Recent turns of the cycle

There is no doubt the cycle has played out in the UK over my lifetime. (The US is typically 6 months to a year ahead of the UK ). From the mid-1970s through to 1989 there was an extraordinary boom in the UK, followed by that infamous crash from 1989 to 1993 and negative equity so bad that thousands simply posted their keys in the letter box and walked away from their homes. Prices peaked in the third quarter of 1989 at £63,000, before falling to £51,000.

But in 1993 things got going again. By the turn of the 20th century property erotica was all over the television, houses had become financial assets and today’s intergenerational wealth divide was just beginning to show its face. 

The market peaked in Q3 2007, and declines followed, though it wasn’t such an out and out crash as 1989-93, largely because there were few forced sellers with the slashing of interest rates. The average house price then fell from £183,000 in Q3 2007 to £149,000 in Q1 2009. They fell by a lot more than 18% if you were a foreigner, however, as the pound lost a good 30% in the foreign exchange markets

It would be 2012 before the market properly got going again. We saw the mid-cycle dip around about Covid time, and now we are in the explosive phase, though in many parts of the country this is one helluva limp explosive phase. While prices are rising in some areas, the market is stagnant in many others.

It’s clear from all the leaks that Labour are looking at ways to extract some of the wealth tied up in housing. Whether that’s going to come from increased council taxes (0.5% levy of the value of the property - a number that will only go one way), capital gains tax on the sale of your main residence, increased attacks on buy-to-let landlords, increased Stamp Duty or by some other means, we do not yet know. (Labour are doing what the Tories used to do: leaking and then seeing what the reaction is). 

None of that bodes well for house prices. Nor do their plans to increase housing supply via new builds, or indeed the mass exodus of people with money.

On the other hand, lower interest rates, which are coming, should give the market a boost.

Overall, my advice to any prospective buyers is to wait. I think this market is primed for big falls, but, like the 18-year guys, I don’t think these falls come for another couple of years. That said, often not buying a home means putting the rest of your life on hold, which is not a good thing to do. 

If there’s a place you’ll be happy in, and you can afford it now, then do it. Cost is not always the main priority. And, of course, there’s always the possibility the 18-year-cycle guys have got it wrong.

After the unexpected popularity of my post about weight loss (still can’t believe it had 11 million views), I am trying something a little bit different this Sunday morning with this short video about dead hangs, while doing a dead hang. I am planning to cover alternative health a bit more frequently on here in the Sunday morning thought pieces.

(NB If you want to try dead hangs, but aren’t yet ready to hang fully, try resistance bands or standing on a step and still putting as much weight as possible through your shoulders).

Enjoy!

In case you missed them, last Sunday’s post on immigration was extremely popular

And we also had an update this week on the Dolce Far Niente portfolio

TRANSCRIPT:

Hey Siri. Timer in 2 minutes.

Today, I’m going to talk to you about dead hangs.

I’m going to try and do a 2-minute dead hang while recording this video. Not sure if I can last two minutes while talking.

I had a motorcycle crash when I was 27, and I've had problems with my neck ever since.

Then, last year, I got a trapped nerve in my shoulder and I was in agony. My osteopath helped a lot. I did about 3 or 4 minutes of neck stretches most days. However, the problem continued.

And it was only after I started doing dead hangs a few months ago, that my neck issues, shoulder issues and trapped nerve mostly cleared up.

Dead hangs are great. Everything we do, whether exercising or just sitting, compresses the spine. Dead hangs stretch it all out.

As well as decompressing the spine, they have all sorts of beneficial side-effects.

* They improve your posture.

* They re-aligning the spine.

* They stretch out all the evils of sitting at a desk in front of a screen all day.

* They increase neck and shoulder strength, flexibility and mobility.

* They stretch through your torso, particularly if you swing from side to side, improving your stomach and core strength.

* They are great for your grip strength, your fingers and forearms.