Clem Chambers: The End of Democracy, Oil 'Screaming Buy' Right Now & Gold To Continue To Crash

China is not a, you know, big man dictatorship where one guy says that all form a pyramid of power and that's a mighty task and they've got to be number one in AI. If America loses the AI war, yeah, that's the end of democracy.

People need to realize that gold is inflationary. So there's no extra platinum or palladium being added to the stockpile. Investors flying private jets. Traders end up in the penitentiary. I mean, 2 years ago, if you said, "I'm going to build a nuclear power station," they'd hang you by your toenails. You know, this AI battle is is going to be massive.

Clem Chambers, financial analyst, investor, and founder of a new FN. It is a true pleasure to host you on Bellisad's gold radio today.

Well, it's fantastic to be on here. I mean, you are one of the top top tippity top podcast stroke YouTube channels and it's always delightful to come on one of those.

Appreciate it, Clam. Very excited for our chat today. Now, the world is an incredibly volatile place currently. Over the weekend, the war in the Middle East seems to have restarted and subsequently passed. Meanwhile, oil prices are cratering down around 40% from their peak in March and the precious metals complex has been in a downtrend for a bit longer. Gold being down around 30% from its peak in January. So, Clam, I would be very curious to hear where are you currently finding opportunity? Are there any areas currently that are especially catching your eye?

Well, I mean the AI space has been awesome and you know I've made a huge sum of money in that in the over relatively short time and then it's thrown me down the stairs in the last couple of weeks. So you know that is where the action is right now. It was in gold. It was in metals and and that's past that was that's that's in the rear view mirror now. And you know I feel that you'll see gold down at $35,000 before you see any sort of stability coming into it. And it's gone from a play that's all about America versus China over Taiwan to now it's going to come back to it the price where we're really thinking about inflation rather than you know third world war. So that's a better place for gold to be as far as I'm concerned. I don't really want to see the third world war and it really almost would be if China decided to invade Taiwan which I believe was on the cards for next year and is now at least postponed and maybe delayed forever. So that has put gold on the back foot because in a that sort of scale conflict all countries need to build up stocks of gold for that conflict because in a conflict like that there's only one international currency and that is gold. So that is what drove the price because in my model the market sees out about a year. So all those people some of them are thinking about tomorrow some of them are thinking about 3 years but when you average it all out the market prices for about a year out and that sometimes a little bit longer sometimes a little bit shorter depending on the way the world is. But if you take the peak of gold and put a year on it, it's about 8 weeks away from the window that China has to start invasions into Taiwan because of the weather. And then what happened was the um in my in my book, and you can check this up in the news, the People's Liberation Armies, their generals got sacked. Well, why would you sack your generals? Well, because they don't want to do what they're told. And what's what are they were being told? Well, you're going to be invading Taiwan next year. and they were dragging their feet. So, they got fired. And then after they got fired, the PLA pushed back even more against uh President Xi. So, you're not going to go invading Taiwan when the army is saying, "Not so sure. No, no, no. We don't want to do that." So, that put the skids under gold. And now, whether China's delayed it by a year or two years or five years or postponed it, we don't know. But that is what is repricing gold in my model. And everybody thinks about big news but really small issues. Yeah. Iran is a is big news but a small issue. Yeah. And and the Middle East these days is a mediumsiz issue. It's not the big hairy deal it was back in the 70s because there's so much diversification in oil these days. So you know if you imagine just take any country you like and imagine that the aliens stole it the night before. They just picked it up and flew off with it. what would that do to the NASDAQ or what would that do to the S&P 500? And you go, well, it maybe wouldn't do that much. So once you've had that thought and you thought about the scale of things that need to happen to move the market a certain size, you get to understand what needs to happen to repric gold by 100% in a few months. And that was a bit that was the big hairy deal. Now when you go back to Iran, Iran does its business in gold is at war. So it has to sell gold to pay for stuff. Yeah. It is a big creator of Bitcoin because it's one of the big manufacturers of Bitcoin because it turns it its fuel into Bitcoin because that gets around sanctions on many different levels. Well, they're probably having to sell their Bitcoin too, aren't they? In which direction is Bitcoin and gold going? So there's these many downward pressures on the precious metals at the moment. But there's a flaw and where is that floor? And to me that floor is about $35,000 on gold and then I I believe it will settle down. But you're looking at a world that's gone from something based on globalization which you know Americans certain groups of them don't like that. But it means that everybody should be friends. Everybody has economic ties. Everybody should cooperate. And that makes economics much more efficient and makes prices lower and means you get more goods for your dollar or your yen or whatever and that's great. But because of China's ascendancy or America's lack of wanting it to ascend any further or much further or the fact that China's also been increasingly unpleasant about the way it's been going about things, you know, uh basically hacking everybody and spying on everything and stealing IP and and generally doing extremely well. Yeah. That that has meant that America said enough of this globalization. We need to go localization. We need to have local supply chains, not global supply supply chains. And that makes everything more expensive. And that changes the view of everybody cooperating for the good of everybody to people not cooperating and basically building up a a world which is fragmented into different blocks. You know, you've got I mean, America actually printed a document that said this loud last think November, the long-term strategy, which said, "We own everything from Greenwich Meantime to Hawaii. That's ours. That belongs to us. Don't mess with that. We own it." Which is, you know, probably for people in Wales and Ireland, they might not appreciate that so much. But that Western Hemisphere idea that America's put out as its long-term strategy splits the world up. and America gets South America and you know a bit to the left and a bit to the right. Well, you know, China can do what it likes over its end of town. Europe better sort itself out. Yeah. And that is a fragmentation of the of the global order. And and that changes everything. I mean, it makes the world a more dangerous place. Um, it uh makes the world uh economy more fragile. Um, but it does enable America potentially to claw its way back to dominance. Or that's why they're doing it that way round. Because if you look at America, well, it just banned Chinese cars. Why? Well, because it can't make cars that can compete. It just banned Chinese robots. Well, that was meant to be, you know, something that America was going to do better than anybody else. And Elon Musk was going to dominate the world with Tesla robots, and that's why Tesla is such a good investment.

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And America's about to ban Chinese robots cuz they're already there in the stores right now. You can buy them on Amazon. $18,000. And they don't just stagger around an office like the Tesla one which I saw last time. They do kung fu. You go watch the videos of the German chancellor in in China being shown kung fu robots going, "Oh dear. Oh no." And you can see the video of it. So when you see that um America has already been surpassed by China in robots has to has had to ban cars otherwise it's got no industry in cars then you can see that America has got a lot to do to maybe even catch up or certainly pull ahead of China again. China has 250% more electricity than America and this is my new catchphrase. Electricity is destiny. and they've got two and a half times as much.

Electricity is destiny. I would love to talk a bit more about this this thesis that you've had of China invading Taiwan. I know you've said this thesis might be postponed. What would even be the incentives of China trying to invade and conquer Taiwan? And why was it inevitably delayed?

Well, look, if I'm a fantastic ruler and I rule with nothing but peace and everybody does really, really well and then I pass away, nobody writes a book about me. I'm not in any chapter. Clem, the great wise leader, nobody remembers me. They only remember the guy that went and blew something up and took over. How many books are there on Stalin? How many books are there on Napoleon? How many books are there on Hitler? How many books are there on great leaders that didn't cause any mess? None. The reason why you go and take over Taiwan is so you get a chapter in the book of history. Yeah. It it's it's you know you're a leader, you've got everything. You got you got the more power than anybody else in the world, give or take. What next? Well, if you actually go and study what they tell you, you should worry about your legacy and all that toffee. Well, what's the tough what's the legacy of she going to be? Well, it's going to be he's the man that got Taiwan back. That's why That's why they do these things. They don't do them for the good of of everybody else. They do them for their own good. What What's the purpose of invading Ukraine for Russia to get more land? It's already got more than it can deal with. In fact, way more than it can deal with. But it does get you in the history books. Oh, the great Putin reunited Ukraine to the motherland. Yay. Chapter books. You know, 500 books on it. Yeah. If he just sits there making sure his peasants are get a bit more richer. not even they're not even a chapter. So that's why these people do it. They don't get power because they don't love it and they don't get power because they don't want to be remembered. They're they're all they're all Napoleons. They all want to be Napoleon. They always want to be they all want to be the top of the pyramid and they always want the pyramid with their name on it. The man that did X. Yeah. And you know that's why you do those sort of things. Otherwise, you do what I think they're going to do. But it's hard to write books about, which is do nothing and win. All they got to do is do nothing and they've won. And but nobody's going to write a book about that. Hey, this guy did nothing and won. This it's not going to be a bestseller, is it? No one's going to build statues for the guy that did nothing and won. So that's why these leaders go on these horrific abominations and always have always have from the beginning of time. Nothing new.

So if the incentive is to create a legacy, why then well postpone it?

Well, because they won't let you. You're I mean China is not a you know big man dictatorship where one guy says it's it's a whole baantine group of of of committees that all form a pyramid of power on influence is it it's a massive massive antill of interconnections. It always has been the way that China's work. So you can't just go oh we're going to do this. It's not a sort of western dictatorship style. So, you know, once your your army says, "Oh, difficult. Oh, you've got a problem. Got a pro." You know, the way Mao used to do things, he would do it by symbols and then everybody would agree that's the way to go. He didn't go and order um the Great Leap Forward. He jumped in the river and and swam about a bit and everyone went, "Oh, he's still strong. We better do what he wants." And what's that? Oh, we'll work it all out and go off and do it. Yeah. That's the Chinese way. It's not the, "Oh, well, I've I've written a a docu." It's it's not what Trump is doing signing a a document at the bottom that says blue is red or or stop doing that. That's not how it works in China. It works on consensus. And if he hasn't got consensus cuz his army is dragging his feet, well, he can sack his top generals. And if if the army still carries on saying, "Oh, not so sure." He's stuck, isn't he? And if if the people surround him and goes, "Look, look, President Xi, we love you. We love you, but we can just do nothing and win here. just that's what we need to do. He's kind of forced to do it that way. It's not it's not like some temple African dictatorship where all the people he doesn't like get taken out and shot. Well, it is quite like that in China, but that isn't the way that the business is run.

Is it then correct to assume your world, sorry, your worldview is of a rising power, namely China, and a declining power, namely the US. And if that's the case, how do you see the financial really rails or of the system that we have now change over the next few decades?

Okay, America has had a what they call a Sputnik moment. And that is quite an interesting idea because the Sputnik moment was when Russia, which had a bankrupt economy and really couldn't get its its its polity in in shape and really couldn't compete. Yeah. what it could do was launch a rocket with a satellite in it and the big manufacturing and economic power that was dominating the world at the time. America saw that panicked and caught up and but surpassed it. Yeah. Well, if you're a cynic, you'd now say that the country that has a broken economy can't manufacture things anymore and whose um actual governmental system is all messed up. The only thing they can do is launch rockets better than the other side. And the other side which is dominant in manufacturing is is the other side. So the Sputnik moment actually might be a little bit more like a Sputnik moment than you imagine but around the other way. However, what Trump is trying to do is bring everything back home. Bring back manufacturing back home. Bring back the economy back home. Rebuild the base of the pyramid of economic activity which has been hollowed out by China. and you know go hell for leather to surpass China or a cynic would say catch up. Yeah. And go forward and not hollow itself out to the rest of the world. And that's their strategy and everything they're doing is is that is trying to do that trying to be um you know a a more powerful uh military power that doesn't rely on all its materials from abroad. Rare earth for example from China. How you going to fight a war when you can't build your own battleships because you can't build ships anymore because your ship builders are all in Asia these days, etc., etc. And bring back manufacturer so that you can actually manufacture your sneakers in America, your t-shirts in America, your light bulbs in America, your nails in America. And the idea is somewhat hopeful in my opinion, but nonetheless, it's the idea that robots are going to do all this. Yeah. And that's the idea. So re onshore manufacturing into America, pull it all back home, put up defenses and and catch up or rather put the gap between America and everybody else back in. Yeah. And that's a mighty task. That's a gigantic task. That's 10, 20 years worth of effort and going hell for leather and going all in. And they've got to be number one in AI. Yeah. Because if they're not number one in AI, America's finished. So what we're going to see is either a breaking of America's will to take that incredibly difficult harsh path and just go, "Oh, forget it. Let's just go back to the party." Yeah. Or and if they do that, that's that's it. China will be um the well will be even more dominant or as dominant or or you know, China will be the superpower. But if they don't, if they do, if America does get stuck in, then there will be this economic race between the two powers to be the economic dominant country. And that will generate massive economic activity and be fantastic, absolutely fantastic. And I my money is on the latter because, you know, unless unless the American uh system, which is now woken up to the fact that it's about to lose the crown, unless they give up, which I don't think they will. They could I mean Europe kind of did it. Yeah. They could give up and and you hear people say oh you know service centers they make a noise they they use water you know and all that sort of European way of doing things. Well, yeah, don't have any AI bend the knee. Yeah. And Europe probably see well, we bend the knee. Do you really want to? Because basically if America well and or Europe who's got way more catching up to do if America loses the AI war yet yeah that's the end of democracy. There will be no democracy because China ain't no democracy and it will be in charge. So you can forget your democracy. So it's all on it's all it's all on AI and America will go allin and I think even Europe will t start to go all in in couple of three years time. There ain't no second place in in intelligence, you know. It's like saying, "Well, you're you're 12 years old and you're at school and there's these 14 year olds and you've got to um you know, you've got to compete with them." It ain't going to work, is it? If you got a country that's got more intelligence than you, you're toast. And that's what AI is. Now, you could say, "I don't believe in AI. It's a load of old toffee." And no, no, it's not. It's not that good. But it is. It absolutely is. And you know this AI battle is is going to be massive and it's going to involve a huge investment like like as Mr. Trump has seen like we've never seen before and there's a good chance first of all AI will elevate the general level of intelligence in all these countries which is probably going to be a pretty good thing. Yeah. And it's a a battle that can be fought and it's a battle where where the countries can run neck and neck if they have the will to do so. But the big advantage China has is it has 250% more electricity. And AI is electricity there. That's it. AI is electricity. And there's well it's effectively Silicon Valley versus the um Chinese Communist Party. And if America loses it, that's it. That's it for the West. That's it for democracy. Forget it. It the Chinese way of running things is what will take over. And that's I don't think a great thing.

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So I'm rooting for the west and I'm rooting for AI and I'm rooting for reindustrialization and I'm rooting for more energy and you know there are consequences for that and remediation is going to be need a lot of remediation environmental remediation for this uh as you can see in China I mean China pumps out vast amounts of pollution and they work quite hard at remediation there's a lot of lot of electric vehicles in China and people go oh they've sold us all this renewable they've got renewable and they've got nuclear and they got coal. They'll burn anything. Oil, gas. If they can make energy out of it, they will do it, right? They cannot have enough energy. That's their strategy. And by the way, they'll try to convince you you don't want any. Funny that. But anyway, energy is destiny. And that's the zone that we are entering into now. And that's because of AI. AI is electricity. No electricity, no intelligence. You're you're finished.

How important was it for the US losing its industrial base for it to be hollowed out that it had the world reserve currency? And if it was very important, is it then also key to lose that status of the world reserve currency?

I'm not a fan of that. And and do you ever wonder why China doesn't want to be the world reserve currency? Have you ever wondered why they don't want you buying their companies? Yeah. If if you are the world reserve currency, you kind of have to have a trade deficit. Now, if you have a trade deficit, if you're pushing your money out to the world, they can pick it up and come back and buy you. Now, the the the misguided opinion is that if you run a trade deficit, the people that are selling to you, it's not in their interest to bankrupt you. But that's not true because they take your money and they come back and they buy you. They buy your land. They buy your property. They buy you. And that is what mechanalists do. And that's what China's been doing. They they they asset strip all over Europe. And we're asset stripping all over America. Yay. We've got your confetti. Let's have that building. We'll have that. We'll have that company. We'll have that land. Yay. We'll have that forest. Yay. Take your confetti back. Yeah. So, the reserve currency, I mean, I don't even really know what the basis for why it's a good idea. In the old days when money was precious metals, you just got all the precious metals because you were the dominant economic power and everybody bought your stuff, right? So you became the reserve currency because everything had your head on it because you got it all and and you pushed your money back out as reinvestment. Yeah. So the money was gold and silver and it had your king's head on it. And the reason it had your king's head on it is because you sold your wheat or you sold your whatever it was cotton or ceramics and you got gold and silver for it and you remitted it. That's why you were the reserve currency because you were economically dominant. Now confetti it's a different thing altogether. Different thing. And what exactly what is the benefit of that apart from you risk hollowing out your economy for it. Now, it does enable politicians to to manufacture free money and then spend it. And obviously politicians like to do that. And if you want to look at the real Achilles Hill right now of America is is that it's running these massive deficits. And these deficits which are are not going to break the back of America for you know a few years yet but will ultimately if they don't do something about it is caused by the politicians spending like sailors and basically bankrupting the company country you know what I mean so you know that ability to print money and push it out into the world enables them to spend and spend and spend and bankrupt their country. So, beyond that benefit, which is a short-term benefit, what what's the long-term benefit that you can sanction Iran because everything's in dollars and you can cut off that flow. Is that such a big hairy deal? I mean, you know, a lot of people, the right-wing people would say just leave them to to it. Just let them get on with it. Just let them kill each other. It's not our problem. And America, of course, has been become addicted since the Second World War to be the policeman of the world. Has had many economic benefits from it. But you know now the chickens are coming home to roost a little bit and you know they have pushed that currency out into the world and they have made the developing world not poor anymore. And you see there's two sides to this. If you go well there's 8 billion people in the world and there's four billion really poor people. Is it fair that we live high on the hog and force them to be poor and die young and have terrible life conditions? I mean, we could just, you know, do do free trade with them and and they could rise and, you know, become not horribly poor anymore. And that's the globalist point of view. And that's how you get China going from $200 a year in income to 20,000 where they are now. And that's in what, 40 years. Yeah. And, you know, many many millions of people have have not died because of America's um fiscal and trade deficits. And that's fine. On the other side, you go, "Well, we've we've we used to be number one and we had it all great and now we've broken ourselves. We've given it all away to all these people and they're not even thanking us. In fact, they hate us. So, we need to stop doing that. And we need to bring it all back in and live our fabulous lives rather than worrying about these people that are nothing to us. And we need we had it good and we've given it all away like idiots and now we're broke. What are we doing?" So, that's the other end of the argument. And I can see both sides and it's probably somewhere in the middle because China at some stage probably about 10 years ago got cocky as the English would say and started to say, "Hey, we're doing so well. It's all down to us. Yay, we're so great. Oh, maybe those people giving us all the money are not our friends. Maybe we want to hurt them." And and that was a big mistake. But anyway, there you are. Here we are at a a a pivotal point where America is trying to reverse globalization and get back its assets and get back its economy, the base of its e economic pyramid and and focus on its its um hemisphere of influence and all that good stuff and you know not necessarily going to pull it off. If they pull it off that'll be great for everybody. If they don't pull it off, that's going to be very hard, very difficult because you know that China is now an absolute juggernaut. Absolute juggernautal. And everybody pushes out this toffee about them, you know, oh, they got this problem with property. Oh, they got this problem with birth rate and all that nonsense. But, you know, you you you go through JFK and then you go through a Chinese airport and tell me who's ahead.

It sounds like then there will be a significant vacuum if the United States no longer wants to keep the world the world reserve currency like you outlined not really beneficial to the country and China doesn't want it either. Is that place going to be filled up by precious metals like it used to be in the past?

There's not enough of them. Now precious metals are right now part of a parallel economic system. Okay. So gold does act like money, like currency under certain circumstances in war and in special circumstances. So right now a country like um Iran when it sells oil to China, it gets paid in gold and that gold sits in in Beijing in a warehouse or in a vault. And when Iran wants to buy motors for its drones that it wants to throw at the rest of its brethren, it will buy them and it'll be shipped to Iran from China and some gold will be taken out the warehouse and given to the um turn into cash and and they'll pay for it that way around. So gold right now is exactly used as an international currency, but it's a clumsy one. And you know, nobody really I mean put yourself in pick a country. Go on, pick any country you like. Switzerland.

Switzerland. Well, actually Switzerland is about the only example. That's a bad one. Don't they still have coins that are silver?

They might. How about then France?

France. Okay, great. So, your Macron and someone comes along and say, "It's a great idea. We're going to go back on the gold standard. We're going to revalue gold at $25,000 an ounce and we're going to have silver. We're not going to Well, we do the copper anyway, but we're not going to we're not going to mess around with copper coins that are are not tokens. So, we're going to have silver coins that value silver at X and gold coins that value um gold at Y and off we go. He's going to say, well, what about if I want to stimulate the economy? Oh, well, we won't be doing any of that. Oh, so how am I going to win an election then? Oh, well, I mean, you know, but we need hard money. It's good for economics and it's wonderful and everybody loves it and everyone think it's a great idea, but I'm not going to win my election, am I? Well, I mean, you know, it's for the good of the country. Yeah. No, you know, the ability to print fear is it's a fabulous tool. I mean, heaven knows what would have happened in 2008 if if it hadn't been fear system or for that matter in COVID. Yeah. Because remember, there's always fear. There's always been fear. Even the Romans had fear. Everybody's had fear. Gold is what backs things, but before you know it, it only partially backs things. fractional reserve banking always appears. Yeah. So even the goldsmiths of the Middle Ages with their with their safes of gold um you know they were writing lots of IUS on top of that gold at multiples. Yeah. And they learned that they really shouldn't write more than 10 times the IUS over the gold they got in their warehouse. And so you're always going to have credit and you're always going to have a a fear system. It's just that the money that people carry around in their pockets may or may not be um you know precious metal because you go you go to the bank the that's what bank runs are all about and they when there was a gold standard they had bank runs and you show up and ask for your your money and they wouldn't have enough in the in the in the warehouse because there wasn't enough in the warehouse because there was fractional reserve banking always has been always will be. So, you know, it's not a solution to fear. It's just that you get um some nice shiny coins, but the actual economy is running on credit, which is just another form of fear. And if you really nail down I mean this one of the best stories that I heard and it's and I didn't know this until recently actually was in America in Nevada, they found a mountain of silver. I can't remember which mine it was, but it was a dirty great silver mine. And it was one of, I think, one of the mines that was responsible for for the North to win the Civil War cuz that helped fund them. So anyway, they found this mountain of silver home home state mine, was it? Anyway, so they got tons and tons literally of silver. So they show up to the local government and they go, "Right, mint this into dollar coins, please." And the government said, "No, no, we're not going to do that." Well, why not? It's silver. That's money. Mint it. No, no, no. That that would be too much silver and and that will devalue the value of the dollar if you do that. So because there was too much silver, it would have been inflationary. So inflationary silver. And in the same way the Spanish got inflationary gold because they showed up in South America and found piles of it, brought it home and and broke the back of the Spanish empire by making everybody not want to work anymore because they had all this money and they had runaway inflation because there was so much gold, etc., etc. So gold and silver as currency backing is is not a a a wonderful solution that's stable. It's in fact quite unstable. And back in I used to have an office in the city of London in a place called Throgorn Street and there was a battle there in about 1805 190 1905 190 because they discovered gold in South Africa and basically the British Empire had run out of gold to stimulate the economy. So the economy was in a deflationary um tightening crushing economic loop because it didn't have enough gold to to keep the wheels of the economy turning smoothly because the economy was bigger than the gold necessary to keep it going. So any they found some in South Africa and therefore they went nuts because all of a sudden there was enough money to to actually grow the economy and the people that were dealing in the shares in those companies were so excitable and excited they had a riot against the police because the police told them to stop trading after the market closed on the curb. They went on the curb which is you might have heard that phrase the curb and traded these shares and they were so carried away that when the police told them to move on it was you know past their bedtimes. They had a battle. They had three-day riots. So, that gives you a feeling for how stable or otherwise a goldback currency can be. It's not all marvelously smooth and it's just another asset. And, you know, it it it's I don't think we'll ever see a retail backing of of uh currency with precious metals. But right now, if you are Iran or you're Russia, you're doing a lot of business that is goldbacked. So, it doesn't mean that that it can't work. It's just that places like Brazil, it will be their worst nightmare to have a hard currency. I mean, they haven't got hyperinflation in South America by accident. It's because they love it. It's it's how they run their their their governments. So, to take that away from them, that would be like I don't know what it would be like taking away. It's just not going to happen.

Okay. Well understood. So your shorter term thesis is there's a bit more downside ahead for gold. You called 30 $3500 an ounce as an attractive entry point. What is your longer term outlook for the metal? Do you think there's an opportunity to not just keep up with the basement but potentially gain in relative value?

Well, I mean, there's always this gold will go up as a function of what you would call debasement or inflation and or uh global stress. So, if global stress continues to ratchet up as it's been on a constant chart doing so, then gold will go up. But I think people need need to think about how expensive gold can be and how expensive how what is the sort of normal level for gold and and also bear in mind that there's 3,200 tons a year coming out the ground. That's a lot of gold. That's a $30 billion of gold a year and that has to be uh absorbed um to keep the price at least flat. And if you think about gold in terms of that's about 1% of all the gold there is in the world. So there's at least 1% inflation. Now if you take what's called the free float which is gold that's available to people and remember most gold is locked up buried in Fort Knox etc. and is never coming out. Yeah. So if you imagine that say half of the gold that is around is locked up forever like that. Well, that's all of a sudden 2% inflation, maybe 2 and a half% inflation of the gold supply every year. So, that's a drag. And people need to realize there's a a inflationary that gold is inflationary. Small, but it nonetheless is inflationary. Unless you go around and you lose 3,200 tons every year somehow, it's um an inflationary metal. Um, but I think that everybody should have two and a half percent maybe 5% of their assets in gold. That that's like page seven of the book of investing. And most people don't. And the best way to do that is to dollar cost average. So just buy a little every month. Yeah. You know, if it means buying the smallest gold coin every quarter, do that. Yeah. So that it's sensible to have 2 and a half% of of your portfolio exposed to gold. 5% is not crazy either. 50% you're pushing your luck very much. Yeah. But as a part of a diversified portfolio of risk, precious metals is is is a very very good part a very good sprinkle of of things that are um not quite so correlated. And I'm a big fan of platinum and palladium because I think they're really badly priced. I think they're very cheap and I think they're very um mispriced. And I was saying this some time ago before they went through the roof and now they're coming back through the floor again. Um, they make 25,000 tons of silver, which is, you know, not that much when you look at iron or but it's an amount. They make 3,200 tons of gold, platinum 200 tons. Palladium 200 tons. And these metals absolutely key to clean up the environmental mess that all this rush for energy is going to cause. Yeah. So, you know, I I I think that platinum and palladium, if I if I pick up gold, I think I will be slapping myself saying, why why wasn't I buying platinum and palladium? What was I thinking? Platinum and palladium 200 tons a year. And you see, gold, you make 3,200 tons, it goes in a shed somewhere with guns up in front of it. When you make 200 tons of platinum, every year 200 tons of platinum gets destroyed by being blown out the back of cars out of the cat converters. So there's no extra platinum or palladium being added to the stockpile of platinum palladium because about the same as the production of platinum palladium is actually destroyed by your cat converter being worn out as you drive. So there's no more platinum palladium being made. Netn net um the places that make it Russia. Whoa, that's not very stable, is it? South Africa, not the most stable in the world. Canada and America, that's the only places it's made. Not much of it. And if you want to give have an quick idea of how important it really is, is that America has obviously sanctioned Russia, but they carved out platinum and palladium from those sanctions. Platinum and paladium from Russia is not sanctioned by America. So, that's where I would be thinking, where I will be thinking. But at 3,500, I'll just be, you know, picking up a few ounces here and there every sort of week or two and um and just doing that until I kill over dead.

How do you think about the precious metals miners currently, especially like you outlined some North American names that might have some platinum and palladium as a byproduct?

Well, I must say I've I've owned um Still Water, Sabani Still Water. I I got out of them near the top um by good fortune. Um and they I don't know these miners. I mean if if you there's this um piece of software that that I use, it's called priced in gold elite and um you know they that's something that I've come across recently and and they price everything in gold. So you can look up Nvidia in gold, you can look up NASDAQ in gold, and you can look up Newmont Mining in gold. They've just gone down in value versus gold. How does that happen? Beats that beats me completely, right? So I I the miners make me very nervous. The big ones, yeah, okay, nice dividends. Um the tiny little ones, well, you might as well go to Vegas and bet on the numbers. Um, but you know, so I'm not I'm I'm not a big fan. I'm very very tempted to short gold and long um big gold miners because I mean they can't really get too far apart anymore. And you know, it's like how can they go down when gold goes up in in relation doesn't make any sense to me. So to be honest, I don't understand them. I don't understand how they trade because when gold goes up, they don't seem to go up. Then when they go up, gold doesn't seem to go up. It's it's all a mystery to me. And if I don't understand it, I won't touch it. So I understand gold. It's shiny. I like it. I I can put it in my pocket and it's very heavy. And it's been like that since, you know, 500 BC. So I understand gold and therefore I don't mind owning it. But when I get stuff and it doesn't behave in a way that I I go, I don't agree with it doing that. And and gold miners are like that. They do things I don't agree with. and and um so I I don't they're they're low down on my list of things to buy, but you know um I like physical ETFs. I like physicals. I like vaulting it. Um and you know, one thing that investors in in precious metals should, particularly old school people, is that they should have an exit for what they do. So if they've got if they collect gold coins, they need somebody who's going to buy off them, a way to buy it. that's reliable. Yeah. And as the previous peak, people couldn't sell their silver. Nobody wanted to buy it because the channel of of um breaking it down, the channel of liquidating it into the market was full. So, a deal is going to go, "Well, I'm not buying this from 110 because I'm going to wake up tomorrow, it's going to be 90 and and I won't be able to sell it on. I can't hedge this position out." And therefore, the market just stopped. Right? And you don't want to be in an asset that's going to break at the top. You know, it's like a brokerage software that you get when the market's going wild or crashing and you want to sell and you log on and the blooming thing's down because it's been overwhelmed by people wanting to sell. So, you do need if you are going to invest in precious metals and you don't plan to die with them, you need to have a position that you can sell like that. And if you can't sell it like that, you don't want it.

I would love to get your thoughts on the energy complex currently. Like I mentioned during the intro, the war in Iran seems to have restarted and subsequently died down again over the weekend. However, even during these peace deals, peace deal talks, the commodity flow disruption that we're seeing in the straight of seems to continue on. Of course, we see tankers leave the trade. We don't really see tankers flow in. How are you currently thinking about the energy complex? WTI is currently trading around $70 a barrel. Is that potentially an attractive entry? Especially looking at the oil producers.

Well, I I almost entered on Friday and I don't know. I haven't seen the price this morning. I I it probably would have been not the most stupid thing, but I don't like trading and when I was a kid, I was good at it and now I'm old. Um, you know, it's a young man's game. So, and you know,

there's investors flying private jets. Traders end up in the penitentiary. So, I'm not a fan of trading this sort of stuff. It's extremely difficult to trade, and I know a lot of people, that's what they want. They want to trade. They want to know, they want to buy something that's going to go up in the next day or 5 days or 5 weeks. I see energy is a lot longer term. There's just not enough of it. And you know, unless America gives up, period, like Europe nearly did, and maybe you could say has, I mean, I think that's going past the turning point. I think when they blew up those power stations in Germany so they could never reuse them, I think that was the low of that kind of stupid behavior. And they're going to have to build up lots and lots of energy. They're just going to have to. And if they don't, that's it. Forget it. They're gone. Goodbye. You know, energy is life. Yeah. And I've been saying that; for when I started to say energy is life, it was an unpopular thing. And now people are starting to realize it. Yeah. Energy is life. Energy is AI. No second place in AI. You've just got to remember that AI is energy. There's no second place in AI. The demand for AI is non-infinite. Therefore, the demand for energy is going to be non-infinite. If you ain't got it, energy is destiny. So long term, there's only one downside, and it's a pretty big one, actually, and that is governments get involved and muck it up. So you, what you really need is a clean play, you know, a nice exposure to energy that the government's not going to come down and go, you know, "I'm chairman Mau, you got to have it this way," and oh dear, I've messed it all up. And you know, energies have often been nationalized. In fact, it was really annoying. I had a lovely position in EDF. Um, a few years ago, government came in and said, "We're having that. Sorry. Here you go. Here's a nice little premium. Thank you very much. That was nice, but not as nice as if I'd had it now." And they just came in and said, "Goodbye. Go on. Get out. Get out. Get out. It's all ours now. Go away. Stop it. We don't want you. Get out of it." So that is the drawback with energy, because it could become so critical and so vital that you won't be able to get exposure to it. But you know, that's what the investor has to work out. How do I get exposure to energy? Because energy, it's going to be the thing coming up. And the penny hasn't really dropped yet. If you think about what the Americans are doing, and saying it's dropped there. Europe not so much. UK, it maybe they'll catch up. They're trying to catch up, but catching up, you know, you have to really, really try to knock it out of the park. America's going all in. That is my position. That is my—I don't really know whether it's true or not. But if the setup is as such, they got two choices: go all in and compete, because there's no competing without going all in. Yeah. Or to give up and perish. And America's going all in. And to go all in, you have to go all in in energy. And just listen to what they say. I mean, it's almost like one of those um school English essays or school comprehension essays when they say, "Somebody said this. What does it mean?" You know, just listen to them. Energy dominance. What does that mean? It means energy dominance. Doesn't mean a lot of energy. Doesn't mean the right sort of energy. It is the energy dominance. America is going for energy dominance. Well, they got a long way to go, because China's got two and a half times as much of it. So, how? And they're building, I think, 50 nuclear power stations right now. America isn't. So, to catch up with China who have energy dominance. Yeah. What does that mean? Well, that either means they're living in a fantasy world or they're going to go all in. They're building nuclear power stations. I mean, what planet is that? I mean, two years ago, if you said, "I'm going to build a nuclear power station," they'd hang you by your toenails. Yeah. I mean, it's like nuclear power used to be Satan, didn't it? And all of a sudden, they're building them all over the place. Well, what happened? Why? No second place in AI. And AI is energy. That simple. You know, if they don't go all in, it's the end of democracy. What they going to do then? Wave goodbye? They've got to go all in, haven't they? Or what if they don't? So, you know, energy is an absolute super tanker. Literally, it's again another juggernaut, but for many, the penny hasn't dropped. They're still living in the previous epoch, which is globalization and everybody being friends, and we'll take your, you know, $1 t-shirts, and you can come visit our old, um, country and see nice things, and yeah, we'll all be friends and all that good stuff. We don't mind that we—if you cut us off from rare earth, we're going to perish. We're fine with that. You'd never do that, would you? Yeah. That's the world of the past, when AI isn't a weapon. Yeah. When a country wouldn't go, "Wow, we can crush this country. We got more AI than them." No, we're all one big happy family. We're all working for the best of humanity. Yay. But the moment you go competitive, and it's one country v another country. Yeah. AI is a weapon. And AI is a weapon. They just—America just cut one off and said you can't have it. Nobody can have it. Only us. Why do you think they did that? It's too dangerous. Well, you mean it's a weapon? Yes, that could be used against you. Yes. Can I have it? No. Yeah. There's no second place in AI. There's no limit to the demand for intelligence. AI is energy. Energy is destiny. So energy, that's the big trade. And what I'm saying, that most people are going, "What's he talking about? He's on drugs. Oh, he's mad. He's mad." A lot of people be going to be going also, "Oh no. Oh, yeah." Oh, but there's still a huge amount of people that haven't got the memo, but you can hear the memo landing on people's desks in real time right now.

>> If the memo is landing in real time, how can it then be if we're going through the largest commodity flow disruption in history that WTI is still trading at $70 a barrel? Well, it seems with all the disruption that we've seen, all the draw downs in inventory and the structural tailwinds like you've been outlining during this interview with the energy dominance that the US seems to want to get again, also just GDP growing, which of course means higher energy consumption, and an underinvestment for the last few decades in sustaining capital expenditures. How can it possibly be so cheap? I would dare say right now it just seems like a screaming opportunity.

>> Yeah, there you go. Excellent. Well, all right.

>> Look, the point is there's structural issues here. Like if you wanted to, you know, send a load of oil that away. I mean, now that they've unplugged the straits of Hormos, there's going to be massive cues at the other end, isn't there? Yeah. There is all sorts of lags. There are all sorts of slow things. They're going to build these nuclear power stations. Okay, they're starting. Okay, how long before they switched them on? How many um gigawatts of electricity are all these new service centers demanding? A lot. How much is coming? Nowhere near enough. What's going to happen to them then? Well, a lot of them are going to be canned, aren't they? Oh, and then what's going to happen when America runs out of money to um fund this onshoring and all this AI buildout? What's going to happen there? Well, they're going to print money. Well, if you said now in a couple of years' time, America's going to print money like there's no tomorrow. Most people say no, no, no. They've got a new Fed governor and he's a hawk. You know, they're not going to do that. They're going to bring inflation down. No, they're not. Why? 'Cause there's no second place in AI. And then they're going to need the money to fund all that buildout, all that onshoring, and all the other poor buggers that are going to be in the queue for cash. Otherwise, they're all going to go broke. Oh, blah blah blah blah. That's what's going to happen. Do you think they're going to let it go down? Yes. Oh, okay then. You think that America is not going to go all in in AI and it's going to sit back and perish. Happened before. Wouldn't be the first civilization to go that route. Yeah. But I don't think that's the case. They're going to go all in, and they're going to go all in for energy, and there's massive lags there building out energy and infrastructure. That's not like that. They're so used to Silicon Valley. Oh, I've got a new piece of software. Upgrade your PC. It's Wednesday. That doesn't happen with infrastructure. Doesn't happen building factories. You know, you is a good example. You would agree that they're building out infrastructure like um AI infrastructure like no tomorrow in America. You would agree that they're going to build out masses amount of power stations in America tomorrow. Well, you find a company that builds power stations and look at their share price. It's hardly moved. How much money they're going to make because everyone's going to want them to build them a power station? A ton. Yeah. It's just that if you look at all the companies in the AI buildout, they've all been doing this for a year, and suddenly bang, as the penny drops. You can see them in the charts. Go, I did a thing on Substack which breaks out all the value change from AI right the way from the top with the models all the way down to energy, and actually there's a layer below which is money, i.e. Goldman Sachs. And if you go down that chain of causality, you'll see one after the other of shares that dominate each one of those sectors suddenly taking off vertically because people go, "Oh, therefore this. Oh, therefore that. Oh, I better buy some of them. They look cheap. Bang. Up they go. Oh, therefore that. Oh, they look cheap. Bang. Up they go. Oh, what about those guys? Oh, they've gone already. What about those guys? Oh, they've already gone ballistic. What about those guys? Oh, they haven't gone yet." Bang. Off they go. You could literally, you can find my article or make up your own list of causality, you know, um AI companies, Nvidia, people that make sheds, people that make transformers, people that make optic fibers, people that make bulldozers that move the earth around, people that make um things that go make things cold, all the stuff that AI needs. And you'll see time and time again, about four months ago, they all took off. And even to the fact that people like Hewlett Packard and people like um Cisco, who basically just make generic stuff, they've all gone through the roof because they do need hard drives. Western Digital has gone mental. Micron's gone mental. HP hasn't done bad. Intel, which I wrote about when it was at 20 bucks, and I said, you know, this trouble with China in Taiwan, America don't make no chips anymore. They're all in Taiwan. So they're going to have to onshore all the chip-making. And who's got chip fabs in America and Europe? Nobody. But Intel. That was when they were 20 bucks. They're 138 now. So you can see it. You don't have to believe me. Just go follow my logic, and you'll see it there in the prices. Yeah. And it all backs out to two things: money and energy. The only one that hasn't moved yet are people like Goldman Sachs. And when they press that print button, that would be great for gold, of course, because that will be not as inflationary as you might imagine, but it will still be inflationary. We're still looking down the barrel at 5 to 9% inflation for the next 10 years. Yeah. The people that are going to make like bandits that haven't moved yet are people like Goldman Sachs, 'cause they're the guys that are going to be said, "That's for you. That's for you. You can have that. Oh, you can have that. By the way, uh, we want that for that." They're the ones that are going to be distributing all this money, and they're going to be making—there's going to be a huge Wall Street explosion on the back of all this, because either America doesn't go all in and it's all over, or they go all in and it's going to go completely pee tong.

>> Clen Chambers, this has been incredibly interesting. I would love for you to talk about what the best way for anyone watching is to keep up with your work, as well as talk about a new FN.

Well, newfn is an investing platform that I've built recently, and it's mainly for people that are interested in UK stock prices, because we give away real time, which will cost you, I don't know, $300 or $400 a year. We give away level two, which will cost you more than a thousand, and it's all free, free, and we're just rolling in American prices now, and we're planning to put in some crazy tools, but you know, it's all free, so you can go check it out. And um, you know, it's a very good way of following the stocks that you like and the news, and particularly if you're interested in UK stuff, you know, there's no better site, and it's completely free, so you end up saving £1,000 and you've got a great site. So that's what UFN is, and I use that because, you know, if you don't stay absolutely on top of the market, you just miss out on opportunities. I mean, I missed out so many opportunities um recently following all the AI stuff. Things that were so obvious that I just didn't have my eye on them, and it oh dear, oh dear. Oh dear. But anyway, there you go. Um, but nonetheless, you know, the markets are very exciting for the moment. There's an idea that I've been toying with recently. Everybody goes, "Moans in America anyway about this K-shaped economy," which means that rich are getting richer and poor are getting poorer. Well, it isn't. It's certain people are getting richer and certain people are getting poorer, and the people that are getting richer are people that are economically active, and investing is economically active activities. Yeah. And it can be a job, it can be investing, whatever economic activity, and economic passivity. And that leg are basically people who are economically passive. And that's a lot of people. And that's in fact probably the majority, 'cause how many people watch your channel? I'm sure there's 100 times more people watching some cute cat video or whatever. Mr. Beast torturing people. Yeah. Whereas people that watch channels where they can actually improve their economic activity and improve their lives, quite a small group. Yeah. But that's the group on that leg of the K. Yeah. So that's where I'm all about, and I'm building tools for that, and I write about issues that help, hopefully give people an insight in the way to think about things, and because it's all about your thinking at the end of the day. It's if you think properly about investing, you'll be on that leg of the K, the upward leg. And so I write about that in Substack. I've got a YouTube channel where I rave like I've been raving now. And what I like to think, and I'm often told, is that you won't hear the sort of stuff that I say. Right or wrong is different. And there's no point watching 57 videos about somebody saying gold's going to go to 10,000 by Christmas. And what's the point of that? Apart from it makes you feel good, and then it doesn't happen. So if you want a different take, and I've been ridiculously right the last year, and I can't carry on being right. I've got to blunder at some point. But you know, it's all there. I've written for Forbes for 25 years. If you want to read my full stuff, um, but Substack Clem James Alpha, YouTube Clen James Alpha, and on, you know, fantastic podcast like yourself.

>> Clen Chambers, thank you much. Thank you very much for your insights and your time today. Really appreciate it.

>> Pleasure being on.

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