845 richard karn

“...I’m as mad as Hell and I’m not going to take it anymore.”

Richard Karn Managing Editor

The Emerging Trends

Report

Anchorage, Alaska

www.emergingtrendsreport.com

“Great Britain’s wholesale price index, expressed as 100 in 1717 was also 100 in 1930 when Great Britain took the pound off the gold standard”; by 1977 when Jastrow published The Gold Constant, the index had increased by more than 2000% in less than 50 years..


Population Growth: 2.2% GDP Growth: 6.46% CAGR M2/M3 Growth: 7.04% CAGR Public Debt: 9.03% CAGR

Purchasing Power: -3.16% or -4.17 CADR

>30 changes to the way CPI is calculated, each lowering CPI < COLA + < money paid Social Security benefits, gov’t pensions = > GDP


If Past is Prologue...

Putin: “...the parasitic nature of the US dollar...” Wen: “...irresponsible money printing ...”

Roessef: “...perverse effects of (US dollar) policy...”


Totalitarian regimes tend to

attribute their motives to their enemies as a way to justify both their actions and pre-emptive strikes.

(paraphrased from Arendt, H.: Totalitarianism)


If you want to ‘save money’: gold & silver bullion

If you want to grow your wealth in a negative real

interest rate environment, you cannot NOT speculate; but where?

Gold and Silver stocks

Hard Assets: Energy, Resources & Agriculture

Specialty Metal stocks


gold will continue to as act like a leveraged inverse short ETF against confidence in central banking and interventionist policies (Grice/Hoye);

whether a broad decline in input costs outpacing the decline in the gold price or the price of gold outpacing the increase in input costs, we believe gold mining profits will outperform most if not all other sectors; and,

shareholder dividends will attract significant interest because the companies are backed by gold and motivated by profit rather than being paper promises backed by the full faith and credit of a leftist governments and corrupt central banks administering fiat currency regimes.


fiat currency abuse/corruption long overdue infrastructure restoration and /or

expansion in both the USA and EU a) water & wastewater treatment

b) Oil & Gas pipelines (400,000 & 270,000 miles respectively), pumping stations, and refineries + shale build-out

c) North American Electrical Grid

d) 103 nuclear power plants, some dating from the ’60s

nature of bureaucracies


Endless pursuit of higher quality, ever more efficient devices at ever lower prices

Technology-enabled explosion in material science R&D

Unique performance characteristics in tech alloys

Limited substitution + trace amounts used = price inelastic

Scarcity or byproduct sourcing = supply inelastic Many have dissipative uses but no recycling protocols

Specialty metal demand trajectory is discovery-driven and

largely independent of GDP (unlike oil, base metals, lumber etc)

…cycle back to top and repeat—faster.


Note that the vertical axis is logarithmic, so the ‘fit’ to reflect growth in HDD capacity reflects exponential growth.

The Great Stabilizer: - 3G and 4G super alloys (Ni, Co, V, W, Mo + Re) - perpendicular bit stacking HDDs - artificial photosynthesis - nano-lattice for targeted drug delivery

HDD Capacity Growth

http://upload.wikimedia.org/wikipedia/commons/8/8a/Perpendicular_Recording_Diagram.svg

Not easy to invest in: mis- & disinformation Murky pricing: few are traded on an exchange Off-exchange traded metals are unhedgeable Many are by-products and sold forward Pricing is discovery-driven, not GDP-correlated

Free Marketeers in denial about Neomercantilist

intentions


26

antimony (5) beryllium (3) bismuth (3) cobalt (3)

fluorspar (2) gallium (3) germanium (3) graphite (3)

hafnium (2) indium (3) lithium (2) magnesia (3)

manganese (2) molybdenum (2) niobium (4) 6 PGMs (5)

15 REEs (4) rhenium (3) scandium (3) selenium (4)

silicon (2) silver (3) tantalum (2) tellurium (4)

tin (3) titanium (2) tungsten (3) vanadium (2)

zirconium (3)

Sovereign Risk Scarcity No Substitute By-product Dissipative Use

Hageluken, Christian:”Sustainable metals recycling from waste electronics”; South Pacific Regional E-waste Workshop; Brisbane, QLD, 21.07.2010.


321m computers sold globally in 2010, 98m in US alone 1.3b cell phones sold globally in 2010; number in use

surpasses 5.0b (Gartner)

123,000 computers are discarded every day in the US--19% are recycled

402,000 cell phones are discarded every day in the US--13%

are recycled (EPA)

200 g/t Au in PC motherboard scrap; mobile phone scrap: 340 g/t Au, 3500 g/t Ag, 140 g/t Pd,

130 kg Cu (EPA)


Fiat Currency Abuse + discovery-driven trend + resource nationalism/corruption + increasingly intrusive bureaucracies + politically-motivated export restrictions + deeper mines, more accidents + declining # of qualified personnel + ever more environmental restrictions + civil conflicts + power supply disruptions + national/corporate/private stockpiling + low hanging fruit (deposits) long gone + exploration venturing farther afield + lack of recycling protocols + relentless demand

HIGHER RESOURCE PRICES www.emergingtrendsreport.com

History + Free Marketeers vs Neo-mercantilists + increasing resource nationalism + EM demand + China fears + WTO + trade wars + relentless demand + inexpensive valuations + few threats under investor control + project finance improving + uniquely varied & stable geology

AUSTRALIA

gold & Spec Met miners mid-cap producers (M&A) proven micro-cap deposits micro-cap historic mines


http://1.bp.blogspot.com/-bRt5AdJvP10/TcApZEkupeI/AAAAAAAAAzI/QGcD52kIoyw/s1600/Lemmings+2.jpg

845 richard karn

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