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Happy St George’s Day to you. My apologies for the late arrival of this week’s missive but I found myself without electricity this morning due to, and I quote, “a fault with the electricity”Never mind. Here we are.Everything seems so headline driven and yet contradictory at the moment. With every change in circumstance, especially at the Strait of Hormuz, a different narrative seems to emerge only for it to peter away almost as quickly. You’ve got to be long oil and gas. Buy. There’s no point. The strait is open. Sell. With so much geopolitical tension you have to be long gold and silver. Debt, deficits, debasement, de-dollarisation, conflict, central bank buying. But gold and silver aren’t moving. They had their move last year. Equities make even less sense. You don’t want to be long equities. You need to reduce risk. World War Three is coming. And the S&P 500 has just broken out to record highs. So you end up with this strange situation where the stories are compelling, but the price action is inconsistent. Narrative is not confirming price. Price is not confirming narrative. That’s usually where mistakes get made. You feel like you should be doing something. You look for reasons to act. You react to headlines. You convince yourself you’ve spotted an opportunity. And then the move reverses, or fades or never quite follows through. These are the environments that chop people up. False breakouts. False breakdowns. Strong opinions built on weak signals. That’s why I am such a big advocate of the Dolce Far Niente portfolio. Sometimes doing nothing is the best policy. In fact, often. We had a position in oil and gas so we didn’t need to panic when the bombing of Iran began. We had a position in equities, so even though I was arguing this would be a typical second year of a presidential term, with no meaningful movement until the final quarter, we had exposure to this latest (probably stimulus driven)rally in the S&P 500 to new highs. You can also be wrong, as is often the case when you are a commentator - and it doesn’t matter. 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 use and recommend is The Pure Gold Company. They deliver to the UK, the US, Canada and Europe. More here. What am I doing with my own money? Not that much to be honest. I’m looking around and I can’t see any obvious mispricings. There are areas that look interesting. Software looks attractive. Bitcoin, which has increasingly behaved like a proxy for that part of the market, is quietly ticking higher again. Chemicals look cheap. Copper too is looking attractive. The long-term story is obvious: electrification, underinvestment, constrained supply. What is notable is that the miners are starting to behave better than the underlying metal. That is often where these moves begin. Our new copper play is already up 20% in barely a fortnight. There is a Namibian copper story I am looking at too. More on that soon. Nor am I trimming anything. There is no euphoria to sell into. No obvious excess. And equally no panic to buy. So positions are left alone. There is one area where I do have a clear opinion, and that is oil and gas. But my decision is to hold existing positions rather than add new ones. The market seems to be treating the Middle East situation as temporary. I’m not convinced that’s right - at least not the effects on oil and gas, and I’m staying long, despite the temptation to take profits. I think we are in a new bull market. Positioning in the sector still doesn’t look extreme. Sentiment is not euphoric. Oil could drift lower if tensions ease and the market continues to treat events as passing rather than structural. But this feels more like the beginning of a bull market rather than the end. The same goes for gold and silver - mid-cycle pause is my prognosis there. I think bitcoin probably outperforms them over the next 12 months, but If I’m wrong, it doesn’t matter because I own both. Doing nothing feels like inaction. It isn’t. It is a decision not to play a game where the signals are unclear and the odds are not obviously in your favour. Right now, that is where I am. If you’re interested in my three largest oil positions, you can find them here.Until next time,Dominic The latest edition of Atlas Pulse is out now. In my view it’s the best gold newsletter out there and it’s free. Read it here. This is a public episode. If you'd like to discuss this with other subscribers or get access to bonus episodes, visit www.theflyingfrisby.com/subscribe

Good Sunday to youI’m still finding my feet having just got back from Namibia. I’ve got a full country report coming, as well as a portfolio piece. But I’ve been thinking further about the country’s potential since Wednesday’s note. Namibia has almost everything. Resources. Location. Roads. A small population. On paper, it should work. And yet. Driving through Windhoek, the capital, my guide pointed out a hospital: the Katutura State Hospital. “You don’t want to get sick here,” he said. It didn’t look too bad from the outside. A bit craggy. But I’ve seen worse. The place is infamous apparently. Rats. Endless waits. People lying untreated in corridors. People deliberately go at 3 in the morning, because it betters your chances of being seen the next day. My guide described his own time there when he broke his arm last year. Oof. It makes NHS Accident and Emergency waiting times look slick. Across the road, stood a gleaming monstrosity - the SWAPO (ruling party) headquarters. Brand new. Vulgar. Expensive. Impossible to miss. It wasn’t discreetly tucked away. It was right there, bearing down on the hospital. My first reaction was simply how ugly it is. A few years and that will look truly horrible, I explained to my guide, who seemed baffled by my prediction. His point, however, that I hadn’t yet thought of, was simply how the building had attracted controversy: all that money being spent on what is essentially a vanity project, with the hospital over the road. It was built by the Chinese, funded through a grant from the Chinese government, rather than a commercial loan, at a cost of $50–60 million (figures vary). Because it’s a grant, it doesn’t sit as formal public debt. What could the Chinese possibly want in Namibia. (Clue Namibia, among other things, is the world’s 3rd largest uranium producer and the Chinese pretty much control the 3 largest uranium mining companies operating there. Then there are all those other resources too) There, in a single snapshot, lies the problem. A classic of the resource curse genre. Easy money distorts behaviour. In theory, natural resources should make a country rich. In practice, they often do the opposite. Incentives determine the outcome. If a government can fund itself from its natural resources, from its oil or metal, what does it care about tax payers? If it doesn’t rely on its citizens, it doesn’t feel accountable to them. Instead of serving the public, the state begins to serve itself. Money flows in. It gets spent badly, siphoned off, used to entrench power. At the same time, the rest of the economy suffers. Why build a broad industrial base when the ground is already doing the work for you? You end up with a narrow, fragile system built around extraction. Two countries with similar resources can end up in completely different places. Norway built institutions, saved its oil wealth, invested for the long term. Venezuela (which has greater oil resources than even Saudi Arabia), spent it, politicised it and hollowed out everything else. Don’t get me started on what the UK did with its oil. (First thing the government should do Monday morning by the way is renegotiate North Sea division with Norway). Same starting point. Opposite outcomes. One has one of the lowest GDP per capitas in the world, the other has one of the highest. The difference is governance. Incentives. Culture. Namibia now has some choices to make. It is somewhere near the beginning of that path. It has oil discoveries offshore. It is already a major uranium producer. It has copper, gold, rare earths, diamonds, zinc, lithium and tin. Fish. The opportunity is obvious. But so is the risk. The easy choice is to follow the same path as most of the rest of Africa. The harder choice now, but one that will result in better outcomes, is one of good governance. The debate around that SWAPO headquarters touches on exactly this point. Despite what I’ve said, there is no single scandal you can point to and say “there it is”. It’s all a bit more murky. But the criticism you hear, quietly and repeatedly, is about priorities. Why spend heavily on political infrastructure when basic services are under strain? Why is the party so well housed while public systems struggle? There are major questions too, as with much infrastructure in Africa, about foreign financing and influence, especially from China. You don’t need a formal corruption charge to expose everything. You can see it in how capital is allocated. Oddly, the countries that often do best are those with very little as far as natural resources are concerned. Hong Kong, Singapore, even Venice a millennium earlier. There was no safety net. They were forced to trade, to manufacture, to compete. They had to create value because there was none sitting in the ground. Namibia doesn’t have that pressure. So it has to choose discipline, and that is the hard part. When you see a failing hospital on one side of the road and a gleaming party headquarters on the other, it tells you something about priorities. Never mind what politicians say, look at what they do. I’ll be back with more later this week. Thank you for being a subscriber to the Flying Frisby. 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 pound will be further devalued, as will the euro and dollar. The bullion dealer I use and recommend is The Pure Gold Company. They deliver to the UK, the US, Canada and Europe. More here. PS Here is this week’s piece. This is a public episode. If you'd like to discuss this with other subscribers or get access to bonus episodes, visit www.theflyingfrisby.com/subscribe

I’m travelling, so this week’s note will be brief. What a country Namibia is. I don’t think I’ve ever been anywhere with so much potential. But also what a mess. Official unemployment is 37%. Real unemployment is likely over 50%. Can you imagine? Per capita GDP is about $4,200. That puts it at 119th the global rankings. The countries that top the list include the likes of Luxembourg, Switzerland, Singapore, Norway, Qatar. Small populations. Either financial centres with low tax, strong rule of law and minimal corruption, or oil-rich. Strip out the statistical quirks like Ireland, where corporate domiciles distort the numbers, and the pattern becomes even clearer. With the exception of the US, they are all small, with populations under 5 million. Namibia has just 3 million people. Oil has just been discovered offshore. It is the world’s third largest uranium producer, and has an abundance of other natural resources. It’s safe. There is rule of law. It ports are good. Its roads are even better. And its location towards the south of Africa means it can easily sell into Asia, the Americas or Europe. It fits the template, in other words. I spoke at a conference here this week. There were senior figures in the room, including the governor of the central bank. I made the case that Namibia could make the top ten within a generation, just as Hong Kong did after World War Two when its per capita GDP was on par with most of Africa. Follow the Hong Kong model - low taxes (they never exceed 14% of GDP), simple taxes and positive non-intervention. (You can read about that story in Daylight Robbery) It is not such a nuts idea. Namibia’s people are entrepreneurial. Everywhere I went, someone was trying to sell me something. Everything is there. So what’s missing? “You need minimal corruption,” I said. That got a laugh. And there it is. I’ll have more on how to invest in this extraordinary country soon. 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 pound will be further devalued, as will the euro and dollar. The bullion dealer I recommend is The Pure Gold Company. They deliver to the UK, the US, Canada and Europe. More here. This is a public episode. If you'd like to discuss this with other subscribers or get access to bonus episodes, visit www.theflyingfrisby.com/subscribe

Good Sunday to you, It seems Iran is planning to turn the Strait of Hormuz into the marine equivalent a toll road, or so at least the Financial Times among others is reporting. Ships wishing to pass through the strait must pay a fee of $1 per barrel of oil. Here’s the clincher: the fee must be paid in bitcoin. Why bitcoin? It’s the best money for the job. As it is “permissionless”, no government can order the funds to be frozen or seized. No bank can block the transaction. There is no intermediary. It is outside geopolitical control. Transactions can be made remotely and digitally. Settlement is within minutes. Ownership is clear. The network is sufficiently liquid. No other widely used currency or payment system in existence has these qualities. Not the dollar, not the euro, not gold or silver, not stablecoins. Suddenly bitcoin has become “a tool to navigate a global conflict’, in the words of bitcoiner Jesse Tevelow. A particular company might not like Iran. Iran might not like the company. Neither might trust the other. The two can still transact. Trade can happen between parties that don’t like or trust each other. Trade can also happen outside of politics. Every bitcoiner has known for some time such a moment was coming. It was just a matter of when. If this is enforced, it would mark the first real-world use of bitcoin as neutral settlement infrastructure in a live geopolitical conflict, where traditional systems cannot operate. Obviously this only works if Iran can enforce it, and the Strait is not only Iran’s. This is currently only a contingency situation and, if this conflict ends, habits may quickly revert. There is the other possibility that it does work. Indeed it works so well other nations start copying. The BRICS nations, for example, might find bitcoin an extremely useful non-US-dollar currency in which to transact. In which case, this sets a precedent. My view: the world just changed. At the other end of the scale, we have my little life And the same problem - fiat inadequacy - presents itself though rather more mundane circumstances. I’ve been travelling through Namibia this past fortnight, on my way to give a speech at the Cirrus Investment Conference. When I arrived at the airport, I couldn’t get my card to work in the ATM machine, but I had £200 in cash which I changed - no doubt at some over-priced rate - for local dollars. This was the only cash I had. I’ve been staying at various lodges across the country, all in the middle of nowhere, and I have had a terrific time, but I’ve needed money to tip my various guides, lodge staff, drivers and so on, but with no access to cash. The banking system didn’t work. The card failed. Cash was finite. The people I wanted to tip couldn’t take card payments. We still wanted to transact. So I’ve been using the opportunity to orange pill the locals. Instead of local dollars (which by the way is pegged to the South African rand), I’ve got every member of staff to download a wallet onto their phone, and I’ve tipped them in bitcoin. Everyone so far has been delighted at the arrangement, and the locals now have some money that might appreciate in purchasing power. I’ve told them to HODL their coins for at least 5 years and then perhaps this little tip might be worth something. In the meantime I’ve told them to read up on bitcoin - watch vids, listen to podcasts and so on. As I argue in the book the first step on the bitcoin journey is to download a wallet and practice sending and receiving small amounts of money. So you have the same function at two extremes: bitcoin works where other forms of money fall short. Once again I urge you to have some exposure to this extraordinary tech. ETFs are the simplest way - but they are far from permissionless, as anyone dealing with the FCA will tell you. Charlie Morris’s BOLD is another option and one I some in my own portfolio. On which note, I heartily endorse Charlie’s various newsletters, which you can read here. But the best way to start with bitcoin is to sign up to an exchange and buy twenty quid’s worth. Here’s a little story for you. About ten years ago, around the time I wrote Bitcoin: the Future of Money?, I was at the Port Eliot festival in Cornwall where the internet signal is bad, or was back then. “Accepting bitcoin” it said on one of the little cafe vans. “What’s bitcoin?” a mate standing next to me in the queue said. I told him, sent him a fiver’s worth and told him to use it to buy us each a coffee. The bloke selling the coffee couldn’t get a proper signal on his phone, other people in the queue were getting impatient and so my mate paid in cash and we both forgot about the bitcoins. Several years later when bitcoin went on one its runs my mate messaged me. “Hey, you remember those bitcoins? Well I got out my old phone, retrieved the wallet, sold them and bought myself a car.” It wasn’t a Ferrari or anything like that. Just some second-hand family motor, but even so quite the gain. I doubt those tips will get the Namibian locals a car, but you never know. Why Adam Back is not Satoshi Nakamoto Finally, there was a big story in the New York Times this week arguing that cypherpunk coder Adam Back is Satoshi Nakamoto. Author John Carreyrou spent over a year on the story, but I’m afraid - and I’ve been there - he suffers from a terrible case of Prosecutor’s Bias. He has decided who he thinks Satoshi is and then found coincidence after to fits the story. If you’ve read the book, you’ll know Adam Back was a prime candidate, but one that was easy to discount, because he wrote in a different coding language - C - to Satoshi, who wrote in C++. Indeed, Satoshi came to Back for advice on the White Paper, which Back gave him (you can read the email correspondence). Meanwhile, Back then only came to bitcoin relatively late, in 2013 - and set up Blockstream almost as a catch-up play, which he wouldn’t have bothered doing if he was Satoshi who at this point was worth a 9-figure sum. I wrote a thread on X about it, retweeted by Adam Back himself - so it may be of some interest. Here is this week’s commentary: Thanks for being a subscriber to the Flying Frisby. Until next time, Dominic PS Bitcoin: the Future of Money? is available at Amazon and all good bookshops. This is a public episode. If you'd like to discuss this with other subscribers or get access to bonus episodes, visit www.theflyingfrisby.com/subscribe

Good Sunday to you, And Happy Easter. Today’s missive comes to you from Namibia, where I am giving a talk on gold at the Cirrus Investor Conference next week. I’m right out in the Styx at the minute and internet is patchy so I’m keeping this brief. Here’s the view from my window, if you don’t believe me. Coming to America Meanwhile, just as I was setting off, the US copies of the Secret History of Gold arrived. So watch the unboxing. What do you think of the cover? I’ve been delighted at the response to the book in the UK. The reviews on Amazon have been excellent, averaging 4.8 stars, which is good. The audiobook has done just as well. In fact, I get 4.9 for performance. How about that? People have bought multiple copies whether as gifts or to gold-pill difficult relatives. Both my agent and my publisher are pleased with sales. So everything tickety boo. But the US is the Big Test and next month the book comes out there, published by Pegasus. Which means American readers can finally get your copy. I'‘m obviously super excited, and come May you’ll probably find me on multiple podcasts promoting the merchandise. Here are some links. Get your copy of The Secret History of Gold * in the US * in the UK * and everywhere else. Until next time, Dominic As always, 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. They deliver to the UK, the US, Canada and Europe. More here. PS Finally, here is this week’s commentary, in case you missed it. It includes my thoughts on top pick, Metals Exploration (MTL.L) , following its construction update. This is a public episode. If you'd like to discuss this with other subscribers or get access to bonus episodes, visit www.theflyingfrisby.com/subscribe

This is a free preview of a paid episode. To hear more, visit www.theflyingfrisby.com You’ve probably heard: gold has just had the worst month in its history. Given that gold is older than the earth itself, that’s quite a long history. What headline writers actually mean, even if they don’t know it, is that: in US dollar terms, gold just had its worst month since 1971, at a stretch 1789. But the US dollar is a bogus, fiat measure, and the sooner we start using constant money as our unit of account, the more truthful the world will become. Gold hasn’t changed. It doesn’t. What has swung, violently as ever, is the price of fiat. The move looks more extreme than it is because of where the month started. Gold began March near a high, around $5,400, and then sold off hard. A thousand-dollar swing sounds a lot, but after the run we’ve just had it’s not especially surprising. Indeed I would go as far as to say it’s normal. Here is a 3 year chart of gold to put the March move in some perspective. I’ve also added a very useful indicator - the 233-day exponential moving average - in red. 233 is a Fibonacci number, and with roughly 250 trading days in a year, the 233 EMA works out as roughly the one-year average, but with the added magical quality that Fibonacci numbers often seem to have. In this case, it caught the exact bottom, as you can see. What effectively has happened is that after a long run-up gold has pulled back to the one-year average and bounced off it. What we’re seeing is normal behaviour in a secular bull market. Corrections feel violent at the time. They always do. But this is what bull markets do. My view remains unchanged. We are somewhere in the middle of a multi-year move that ultimately takes gold into the $7,000 to $10,000 range. By the way, if you’re interested in learning more about gold, the latest edition of Charlie Morris’s Atlas Pulse is out now. It remains in my view the most level-headed gold letter out there. And, best of all, it’s free. Read it here. The bigger point is not the chart, it’s the backdrop. I keep saying it, but you absolutely must own some gold in your portfolio, particularly if you are in the UK, indeed anywhere in Western Europe. We have big, big problems coming down the tracks and they are going to result in the further debasement of the national currency. Debt levels are rising, not falling. Governments are spending more, not less. The cost of servicing that debt is going up. The political incentives all point one way: more issuance, more intervention, more currency debasement. The UK is a particularly clear example. You can already see the strain in the gilt market, the pressure on public finances and the complete lack of both political will and ability to address it in any meaningful way. No party is going to fix this. The system itself is broken. There is only one way fiat money is going and it’s the same way it’s always gone. 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. They deliver to the UK, the US, Canada and Europe. More here. Treat pullbacks like this for what they are: opportunities. If you don’t own gold, you are relying entirely on a monetary system that is under visible strain. That in itself is a bet, whether you realise it or not. Onto more positive news - or is it? Squeaky bum time in Nicaragua My largest position, and a core holding for many readers, is Metals Exploration (MTL.L). Broker Hannam has just put a 37p price target on this 13p stock, implying roughly 3x upside. The current market cap is about £400 million. The share price has pulled back sharply after its recent run to 19p to around 12–13p, largely tracking the ups and downs of gold. The company has just issued a construction update, following a recent site visit to the main project in Nicaragua, La India, attended by major shareholders including Nick Candy. Execution is everything now, and it’s squeaky bum time.

This is a free preview of a paid episode. To hear more, visit www.theflyingfrisby.com Never mind the dodgy mortgages, oil spiking to $150/barrel in July, 2008, just before the panic set in, was as big a cause of the Global Financial Crisis. The price rise was like a sudden, unexpected liquidity drain on the economy. The US economy is built on oil. Costs suddenly rose across every supply chain. Disposable income was sucked out of households. Corporate margins got squeezed and inflation expectations rose effectively tightening financial conditions, just as the system needed liquidity. Funding costs then rose and collateral quality deteriorated. In a system already stretched with cheap credit and thin margins, highly leveraged institutions and ordinary borrowers were simultaneously pushed over the edge. The structure was fragile and it only worked in a low energy, low rate world. Subprime may have been the trigger, but the energy shock had already destabilised the foundations. The oil price tightened financial conditions before central banks did This is not a one-off As Charlie Morris points out in his piece What Happened in 1974, there have been three major oil shocks - in 1973/4, 1980 and 2008. In 1973 the US was dependent on Arab nations for most of its oil, and shortly after the Egypt-Syria alliance suddenly declared war on Israel, oil-producing Arab nations imposed an embargo on any nation that supported Israel. “You can support Israel or have cheap oil, but you can’t have both,” the Saudi Arabian king had said on US TV. The oil price went from $3.50 to $10. It would eventually peak at $39.50 in 1980. I was only a little boy in the 1970s but we lived in South Kensington and I remember how many Arabs suddenly moved to the area, many of them with a great deal of money. My step-father ran a business in Belgravia selling modern Italian furniture and his clientele changed almost overnight. Hundreds of billions of dollars, previously in Western bank accounts, now made their way to the Gulf in a transfer of wealth like no other. Next came the Rolls Royces, the racehorses, the Harrods shopping sprees (indeed Harrods itself), the mansions, the public school educations, the City petro-dollar recycling trade and yes the over-priced, glitzy, Valentino furniture. London would never be the same. And what impact did those years have on bond and equity markets more generally? The 1970s were horrible, unless you were long commodities. The low reached in 1982 was so extreme that it marked one of the greatest long-term buying opportunities ever known, perhaps the greatest. While 2008 had its own consequences, not least the end of the City as a leading player in the global financial system (thanks to the regulation which followed), followed by the general decline of London. Each of these episodes follows a similar pattern: an energy shock tightens conditions, exposes leverage and forces a reset. It might not feel that way today with oil at $100, but we are still a long way from the extremes of 1974, 1980 or 2008. A lot of commentary is saying the investment world is too complacent and has not factored in what is coming. What is 2008’s $150 oil in today’s money? I’m not going to give you the CPI numbers because I consider CPI a bogus measure. Using money supply instead (M2), the equivalents look like this * 1974: $10 oil ≈ $120-150 * 1980: $40 oil ≈ $360-440 * 2008: $150 oil ≈ $375-450 In the context of those extremes $100 oil does not look unreasonable The sub-$60 prices with which we began this year now look extraordinarily cheap. I don’t think we are going back to them any time soon. I’m also not saying we are going to those comparable numbers above. I merely show them for context. In terms of where we are going, I think Charlie has it right when he says, “We should assume that $100 oil implies a slowdown, $150 a recession, and $200 a depression”. $200 is not impossible if this was carries on. What to do? Let’s take a quick look at how to position ourselves, and at what’s in store for gold, silver, miners and the equities markets. It was the right call to move into energy at the beginning of the year, I’m pleased to say. With such quick profits the temptation is to sell. I’m maintaining my positions. The US, especially after the Venezuala episode, is self-sufficient in hydrocarbons. Europe is not. Whose oil and gas will it be buying now that Gulf supplies are in doubt, and Russian supply is off-limits? Meanwhile, high energy prices make shale extraction profitable again. North American oil and gas comes out of this strong.

Bull markets don’t last forever. When you’re in the throes of one, it can feel like they do. But they don’t, and at a certain point you have to sell. Gold bull markets can feel even more eternal. Not just because the metal itself is eternal, but because the story comes along that we are going back to a gold standard, or that the Great Purge, which many economists of the Austrian school say is inevitable after fifty years of fiat decadence, is finally upon us. I get that argument. But it is too neat, too deterministic. Real life is much more mucky. So today I want to consider a very important question, and I want to try and answer it honestly: Where are we in this bull market? Has gold already peaked? It’s possible. The spike to $5,600/oz at the end of January had many of the hallmarks of a blow-off top. Or perhaps $5,600 was just a mid-cycle peak, such as we saw in 2006 or 1975-76 during previous bull markets. Or is this bull market still in its infancy? I’m going to study this bull market through every lens I can think of: price, time, valuation, participation, market structure, macro context and sentiment. My bias going in is that we are mid-cycle, as I argued in my Great Forecast last week. Let’s see where I end up. 1. Duration There have been two great gold bull markets since the end of the gold standard: 1971-1980 and 2001-2011. Both lasted nine to ten years. When did this one begin? It depends how you define it. You could take the bear-market low of $1,045 in late 2015. You could take the $1,160 retest in 2018. You could take 2019, when gold broke out of its multi-year base. Technical analysis is often in the eye of the beholder. Just like bull markets. You could even argue late 2022, when the current acceleration began. If you start in 2015, this bull market has already lasted ten years. That would put it right in line with the duration of previous cycles, and you could argue it is close to exhaustion. If you start in 2018 or 2019, there may be several years left to run. I favour 2018. Just as gold hit $250 in 1999, rallied, and then returned to roughly the same level in 2001 before the real bull market began, the 2018 low feels like the equivalent retest. Of course this is debatable. And there is always the possibility that this bull market lasts longer than previous ones. Verdict: mid- to late-cycle. 2. Relative valuation vs other assets Oil With gold at $5,200 and WTI crude around $87, it takes roughly 60 barrels of oil to buy one ounce of gold. Historically this ratio ranges between 6 and 30. The only time oil has been this cheap relative to gold was in the 2020 pandemic collapse, when oil went negative. My view: it’s not so much that gold is expensive as that oil is cheap. Plus commodities inevitably get cheaper as we get better at producing them. (As long as you don’t measure the price in fiat). Gold vs the S&P 500 With the S&P around 6,765, it takes about 1.3 ounces of gold to buy one unit of the index. This ratio has been as high as 5 - at the peak of Dotcom in 2000, and the nadir of gold - and as low as 0.2 (during the depths of the 1930s and at the 1980 gold peak). Gold is therefore on the expensive side relative to equities, but not at historic extremes. This ratio could fall further if equities fall or gold rises. Gold vs US housing The US housing market varies enormously by region - Beverely Hills is not Detroit, Miami Beach is not McDowell County - so national averages should be treated cautiously. But they still give a rough guide. We are now below the 2011 level and approaching 1980 territory in terms of how many ounces of gold buy a typical home. Pretty extreme. Overall verdict: late-cycle. Warning signal 3. Institutional ownership Gold is still under-owned in institutional portfolios. Even after the recent rally, gold represents only a tiny fraction of global portfolio allocation compared with equities and bonds. Gold mining equities are even more neglected. Verdict: mid-cycle 4. Central banks Central bank buying slowed to 863 tonnes in 2025, down from record levels in 2024, but still well above the 2010-2021 average. However, the World Gold Council reported that central banks purchased only 5 tonnes in January, below the monthly average of 27 tonnes. I would not read too much into that. Much buying is reported with delays, and China in particular reveals little about its activity. The usual assumption is that central bank buying is an early or mid-cycle phenomenon. I am not entirely convinced. If the real driver of this bull market is de-dollarisation and reserve diversification amidst a wider geopolitical shift, then official buying could persist for years. Gold currently represents just under 30% of central bank reserves. The US dollar still accounts for roughly 56%. I don’t think this bull market ends until gold sits north of 50% having overtaken the dollar itself. Question: is the war in Iran going to arrest of accelerate de-dollarisation? You know the answer. Verdict: mid-cycle 5. Retail participation Retail demand is growing. 2025 saw record bar and coin demand. ETF inflows are rising, but they are not exploding. Mining companies are finally attracting interest again. Silver went briefly manic last month, which is not a healthy sign, but the episode is already unwinding. Verdict: mid-cycle By the way, due to its senior currency status, the US dollar is going to preserve its purchasing power better than the pound, which is a car crash waiting to happen. I keep getting asked, “is it too late to buy gold?”. If you are in the UK, . We are turning into South Africa and the currency will go the same way. The 40% loss of purchasing power that the pound has seen since 2020 is not going to reverse. If anything it accelerates. Thus … 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. They deliver to the UK, the US, Canada and Europe. More here. 6. Leverage Leverage is difficult to measure precisely. You can look at: futures positioning on Comex, options activity, speculative flows into junior miners, retail spread betting and more. The short answer is this: gold is a crowded trade, but it is not a mania. If it were a mania, the geopolitical shock in Iran last week would have triggered violent liquidations. Instead gold held up remarkably well. Verdict: mid-cycle 7. Mining equities Mining stocks had an excellent 2025. Word is that PDAC last week (the world’s largest mining conference), was the like of which had not been felt since 2011 and the last top. That is a warning sign. This chart shows the ratio of the XAU (large mining companies) to gold since 1988. On a relative basis the miners are still phenomenally under-owned, and we now have a text-book base, formed over 9-years, in place. If this ratio goes back to levels of the early 0 0s , miners will multiply many times over. But these declines began with the emergence of the ETFs and the many alternative ways to own gold without taking on individual company risk. The ratio does not have to go back 00s levels. Maybe. But that base is a thing of beauty. Typically the end of a gold bull market would coincide with massive rallies in junior miners, an exploration IPO boom and a merger-and-acquisition frenzy. We are seeing healthy signs of activity, but nothing like that yet. Verdict: mid-cycle I’m delighted to report that The Secret History of Gold - Myth, Money, Politics and Power, published by Penguin Life, comes out in the US next month. (The US version is published by Pegasus). Order yours now - via Barnes and Noble or Amazon 8. The narrative - gold to $150,000? Gold got some coverage in publications like The Economist and the Financial Times last month, but the story is far from mainstream. Ask most people about de-dollarisation, Triffin’s dilemma or central bank reserve diversification and you will get blank looks. However, some familiar late-cycle narratives are beginning to appear. One is that silver is being remonetised. It isn’t. Silver may well be an important strategic metal, but its monetary role was as medium of exchange. That role is not coming back because we no longer use physical money. That function has been digitised. Gold, by contrast, retains its role as as store of value - a function that silver never had to anything like the same extent. Silver may have use as a speculative asset. It may well rise in price. It may even overshoot spectacularly. But it is not being remonetised. That will not happen, unless Eastenders turns into Mad Max. Another narrative that sometimes appears near major peaks is the US national debt relative to gold reserves. In 1980, headlines declared the US was “solvent again” because it could have used its gold to fully settled its debt. Today US debt is roughly $39 trillion. To settle that debt using America’s 262 million ounces of gold, the gold price would need to be roughly $150,000 per ounce. When arguments like that start circulating, it means the narrative can’t go much further and the cycle is close to exhaustion. We are not there yet. Verdict: mid-cycle 9. Real yields Last but not least: real interest rates. This would be the 10-year Treasury yield minus inflation, or the 10-year TIPS yield. Gold bull markets tend to end when real yields rise sharply. In 1980, Paul Volcker pushed interest rates toward 20% and real yields surged. Gold then entered a twenty-year bear market. At the 2011 peak, real yields rose from deeply negative to positive and gold topped within months. From 2020–2022 real yields went negative again and gold surged, until they rose in 2022 and gold stalled. Today nominal yields are relatively high, but inflation remains elevated, the Fed is under pressure to ease (as are most central banks) and fiscal deficits are enormous. Real yields therefore sit around ze

Good Sunday to you, You’ve no doubt seen the videos of Iran’s largest oil facilities burning. How much destruction does war cause? To the environment, to wealth, to people’s lives. And governments lecture us about the environment. 15% of China’s oil comes from Iran. Not any more. I bet they’re delighted. No surprise, oil futures have spiked again. WTIC has gone to $94 in weekend markets, Brent to $97. I’m glad we own oil and I’m glad we own gold. Iran meanwhile has started targeting desalination plants across the Middle East - how most neighbouring Arab nations get their water - and the probability of an early end to this conflict, despite Donald Trump already claiming the win, seems to be receding by the day. According to Polymarket, the probability of a US-Iran ceasefire by March 31 is just 24%. Even by the end of April it is just 48%. The odds are 67% that the Iranian regime will still be in power by June 30. Meanwhile, in the UK, the strategic stupidity of being dependent on overseas sources for oil, gas and coal when we have perfectly abundant supplies of our own is about to hit home in the form of yet higher energy costs. The government will no doubt blame everyone and everything but itself. UK borrowing costs are now rising faster and higher than any other European nation, which spells trouble for the housing market, business and the economy, and government finances. Ten year gilt yields are now above 4.5% and it costs more for the UK government to borrow than it does any other G7 nation, and indeed any PIIGS nation, which became such laughing stocks after the GFC. Happy days. 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. They deliver to the UK, the US, Canada and Europe. More here. Here’s a five-year chart of gold priced in pounds, in case you were wondering what a trend looks like. There’s only one way this is going. You can look at a 10- or 20-year chart. It’s the same story. Here also for your reference is a long-term chart (since 1983) of the gold-oil ratio. You can see how cheap, historically, oil is. And that’s even after the rally of the last fortnight. What if it goes back to the top of that range? I’m glad we bought oil when we did, before this all kicked off. As always when a market moves in your direction, I now wish we’d bought more. Here is this week’s commentary, in case you missed it. Lots of forecasts for the year ahead. Take a look if you haven’t already seen it. Thank you for being a subscriber to the Flying Frisby. Until next time, Dominic This is a public episode. If you'd like to discuss this with other subscribers or get access to bonus episodes, visit www.theflyingfrisby.com/subscribe

This is a free preview of a paid episode. To hear more, visit www.theflyingfrisby.com War creates uncertainty. Lots of it. And how we all hate uncertainty. Markets don’t like it either. What’s going to happen? How long does it go on for? Where do things go from here? Iran will be an in-and-out job like Maduro. Actually the regime is more entrenched than that. It’s only going to last four weeks. America’s preparing for a 100-day war. Britain is getting dragged into World War Three. It’s Cuba next. Aaaagh. Help. At times like this it pays to zoom out and take stock of the bigger picture. So today I’m going to do that. With a BIG Forecast. I’ve studied the charts, applied some simple technical analysis, all with a striaghtforward question in mind: where is all this going? We are going to look at: * Gold * Silver * Bitcoin * Crude oil * Copper * The S&P 500 * The pound * The US dollar And I am going to give you my forecast. Before we begin, though, take a moment. Where do you think these markets will be by the end of the year? * Will gold be higher or lower? What about silver? * Will Bitcoin break $150,000 or fall back below $60,000? * Will oil go to $100 a barrel? * What about the stock market? * And the pound? Make a note of your answers. Now let’s see how they compare with mine. Gold $4,400 low / $5,600 high by 31 Dec 2026 Gold bull markets don’t last forever, but they do tend to last a decade, if the last 60 years are anything to go by, and we are midway through this one. Chinese accumulation is not over, de-dollarisation is not over, central bank re-allocation is not over. Institutions, governments and private investors are still underweight. About the only group that isn’t underweight is readers of the Flying Frisby. We are currently experiencing a mid-cycle consolidation, much as we experienced in 2006: gold went vertical from $540 to $720 then fell back and traded sideways, with an upwards bias for the next 18 months. Five years later it was $1,920. My forecast: gold range trades. $5,150 is the current price. Gold will flirt with its old highs at $5,600. It will test $4,500 as well. Buy the dips. It’s going higher. Just not quite yet. 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. For the mining companies to work, gold only needs to stay around these levels. The GDXJ-gold ratio - small mining companies v gold - is in an uptrend, though it’s butted up against resistance and the 2020 highs. It can go a lot higher, though maybe it needs a breather. Silver It’s the one everyone wants to know about. Silver is basically a leveraged bet on gold plus industrial cyclicality. It can underperform brutally and it can overshoot like crazy too.

This is a free preview of a paid episode. To hear more, visit www.theflyingfrisby.com 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.

Good Sunday to you, 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: This is a public episode. If you'd like to discuss this with other subscribers or get access to bonus episodes, visit www.theflyingfrisby.com/subscribe

This is a free preview of a paid episode. To hear more, visit www.theflyingfrisby.com 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.

This is a free preview of a paid episode. To hear more, visit www.theflyingfrisby.com 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?

An extra piece for you this week. I had planned to follow up on Dr John’s timely piece on oil and gas today, but it will have to wait. 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. This is a public episode. If you'd like to discuss this with other subscribers or get access to bonus episodes, visit www.theflyingfrisby.com/subscribe