The Flying Frisby - money, markets and more

Good Sunday to you,
We Episode 3 of the New Orleans Series for you today and it is my pleasure to welcome veteran exploration geologist, Brent Cook, to the programme.
Normally both cautious and skeptical (in a sector that requires a lot of skepticism), Brent is buying, I’m delighted to report. Brent is a wise man and his words bear listening to by anyone who feels the need to speculate in the mining sector.
As always you can watch the video above, or listen as a podcast via Spotify, Apple podcasts et al.
Brent tells us why he believes we are still early in this mining cycle, he describes his experiences of previous mining bull and bear markets and gives his outlook for gold, copper and the wider exploration industry. Brent also explains how he evaluates companies, how to distinguish genuine mineral discoveries from expensive projects that may never become viable mines Brent also explains how he evaluates companies and decides when to sell. What are the warning signs Brent looks for?
This podcast is brought to you by the 🥇 The Pure Gold Company.
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.

🌍 BRENT COOK & EXPLORATION INSIGHTS
Learn more about Exploration Insights, the mining research publication founded by Brent Cook and now edited by Joe Mazumdar.
ICYMI, here is this week’s commentary, a good one I thought:
And finally, if you have a minute to spare, I have recently put together a Coat of Arms. Here is the amusing story behind it:
Disclaimer:
I am not regulated by the Financial Conduct Authority (FCA) or any other regulatory body as a financial advisor. Therefore, any information provided in this newsletter does not constitute regulated financial advice. It is solely an expression of opinion. Small-cap stocks are inherently risky. Please conduct your own due diligence and consult with a financial advisor, if you have any doubts. Remember, markets can both rise and fall, especially in the case of small and mid-cap stocks. I am not aware of your individual financial circumstances, so only invest money that you can afford to lose.
The value of gold is variable and can go down as well as up. Past performance is not a reliable indicator of future performance. Physical gold is not regulated by the Financial Conduct Authority, so the protections offered by the Financial Ombudsman and the Financial Services Compensation Scheme are not applicable. Tax treatments can change over time.


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In case you missed them, look out for my interviews with Grant Williams and Peter Schiff from New Orleans. Well worth your time. More to come :)
I heard Porter Stansberry tell this story about Alvin Adams and the US railroads on a panel we shared at the New Orleans Investment Conference last week. It was the best story I heard all conference, and it has been rattling around in my head ever since.
Between 1865 and 1873 the United States built, as Porter put it, “the most consequential physical network in its history”, but in doing so destroyed swathes of capital. Track mileage doubled, from 35,000 miles to 74,000, in a decade. Railroad capital reached $4.5 billion, when the capital of the entire US banking system was $720 million and the federal debt was $2.3 billion. In January 1870, 87% of the shares traded on the New York Stock Exchange were railroad shares.
Every argument you hear about AI today was made about the railroads then, boiling down to: they will transform the country. And they did. The railways changed America. The people who financed their construction lost fortunes.
Indeed, the losses caused the Great Depression, as it was known until the 1940s, when what went on in the 1930s usurped it. In 1873 the New York Stock Exchange closed for ten days because of the failure of Jay Cooke & Co. By 1876, 134 railroads were in default on $500 million of bonds. By 1877 a fifth of American track was in receivership. European investors lost around $600 million.
Then competition meant that revenue per ton-mile fell by around 60% between 1870 and 1900. The traffic came, just as promised, but the users got the benefit, not the shareholders.
Some years earlier, having lost his shirt in the Panic of 1837, a businessman in his late 30s by the name of Alvin Adams began carrying packages - letters, cheques, bearer bonds, valuables - between Boston and New York. His business did so well that in 1854 it was incorporated as Adams Express Company, with $1.2 million of capital. It did not own a single mile of track. It bought space on other men’s trains and transported stuff.
By 1875 its capital was $12 million. Porter told the story of how it paid an $8-a-share annual dividend through the Great Depression of the 1870s and the subsequent downturns. Adams Express was able to build a successful business using the railway network without financing the construction of that network itself. In 1929 Adams Express became an investment fund. It still trades in New York today as Adams Diversified Equity Fund (ADX)
By 1890 the express companies, American Express among them (yes, the one that’ll do nicely) , were moving 115 million packages a year over 175,000 miles of routes without owning a single locomotive. It’s like Trip Advisor being the world’s biggest travel company without owning a hotel, or Uber not owning a taxi.
The business that used the railways, rather than build them, was the one that did best in the railway boom and bust.
Cummings, AI and power
Which brings me to this article, AI and Power, by Dominic Cummings. I should say that I find Cummings difficult to read, and I have little patience for writers who don’t put in the hard work required to make life easy for readers. But Cummings is box office, and few people understand the machinery of power the way he does, so he gets a pass.
His case is that AI will impact not just the economy, but the balance of political power. If machines do an ever-growing share of work currently done by humans, the implications for jobs, wages, tax, the welfare state and the relationship between citizen and state are profound. Disruption will arrive faster than institutions can adapt, and power will sit with barely handful of companies. We may get growth. We will also get upheaval and a political settlement that becomes increasingly difficult to hold together.
Which all makes me want to own gold.
If AI weakens the tax base while increasing demands on government, the pressure on already stretched public finances gets harder. Governments will respond with yet more borrowing, printing and repression. Then gold comes into his own. Plus you can’t prompt it into existence.
Elon Musk, meanwhile, has been making the point that producing computing power is one thing, finding profitable uses for it is another. Trillions are going into data centres, chips, power and cooling. Their value depends on what businesses do with the compute, what they will pay for it, and whether the revenue ever justifies the capital.
If compute gets cheaper, usage could explode and businesses could run at a fraction of their old costs. Great for the users, potentially bad for the sellers, who may end up competing to supply a service/commodity at ever lower prices. Revenue per ton-mile all over again.
The question is where the profit ultimately accrues. It almost certainly won’t be with the companies building the infrastructure, or even those selling the computing power. It will be with the businesses that use it to reduce costs, improve services and increase margins. Again, the railway analogy is useful here: the people who owned the track did not make the most money from the networks. It was the people transporting stuff.
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.

The midterms, mining and oil
The Republicans have taken a hammering in the midterms. Democrats have won control of both the House and Senate, a substantial rebuke to Trump and his administration. That changes the political landscape for the next two years, and it matters for energy, mining, AI regulation and the investment climate generally.
Under Biden, whose administration was pretty green, permitting was an almost insuperable wall for much of the American mining industry. Under Trump, that quickly changed and the US became one of the most attractive mining jurisdictions in the world. But these changes are not permanent. A future Democratic president, if his advisors are sufficiently green, could take policy in a very different direction. Mining projects take years to permit, finance and build, which makes political uncertainty especially consequential.
The Iran conflict has clearly contributed to the Republican defeat, not least through its effect on energy prices and the cost of living. If Trump wants to help his party recover before 2028, he needs to find a way to end the conflict ideally while saving face. Good luck with that. That would take some of the geopolitical premium out of oil, and we saw some of that with the sell-off this week. But Iran was only the trigger for higher prices. The deeper problem is a decade of underinvestment, and I don’t see oil back below $60 on any sustained basis.
The revolution is real. So is the bubble
All of which brings us to Henrik Zeberg’s superb piece, The Revolution Is Real. The Bubble Is Too, from last month. Anyone who uses AI can see how transformative it is. Anyone who studies bubbles can see how precarious the mania around AI is. Both are true, as they were of the railways, of electricity in the 1920s and of the internet in the late 1990s.
Zeberg reckons AI capital expenditure could average 3.6% of US GDP between 2025 and 2032, amounting to some $10.3 trillion over eight years. How much infrastructure can be built, and at what cost, before the revenues generated by its use justify the expenditure? That’s the question.
The railways and the fibre boom at least left something behind. Trains still run on the same lines today, and the fibre that bankrupted its dotcom financiers became the infrastructure of the internet. AI hardware is different. It does not have the same useful life. Track laid in 1870 could still be earning money a century later. A chip bought in 2026 may be economically obsolete by 2030, even if it is still physically functional.
On the other hand, today’s hyperscalers - Google (Alphabet), Microsoft, Amazon, Meta, and Oracle, which together control over two-thirds of global AI compute capacity - are not Northern Pacific. They are cash-generative giants with substantial existing businesses and customers. But if capital expenditure gets too far ahead of demand, financing tightens and returns disappoint. If that spending has been propping up economic growth, AI stops being a stock market problem and becomes a macroeconomic one.
Especially given the concentration of capital in maybe two handfuls of US companies, including those five.
The question, then, is how to position yourself for a technological revolution that may also produce one of the great investment busts. Here’s how I’m approaching it.
Who is today’s Adams Express? And who isn’t?

Good Wednesday to you,
My mid-week commentary may end up a day or two late this week, as I am travelling, but in the meantime here is episode 2 of the New Orleans series.
It features the legend that is Peter Schiff, economist, investor and long-time sound-money advocate. He believes almost every path now facing policymakers ultimately leads back to gold.
The Federal Reserve, says Peter, cannot genuinely defeat inflation without inflicting enormous damage on the housing market, stock market and wider financial system. We discuss the growing losses embedded in the US mortgage market, America’s extraordinary debt burden, why another round of quantitative easing could trigger a sovereign-debt and dollar crisis, and what happens if confidence in the dollar itself finally breaks.
I didn’t know this but as well as gold Peter owns a lot of mining equities.
These episodes of Money, Markets and More are brought to you by 🥇 The Pure Gold Company.
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.

Follow Peter on X or on YouTube. Learn more about Euro Pacific Asset Management.
And, if you missed episode 1 with Grant Williams, a conversation I heartily recommend, it is here:
Until next time,
Dominic
The Secret History of Gold is getting rave reviews and is available around the world at all good bookshops. The audiobook is especially popular.
Disclaimer:
I am not regulated by the Financial Conduct Authority (FCA) or any other regulatory body as a financial advisor. Therefore, any information provided in this newsletter does not constitute regulated financial advice. It is solely an expression of opinion. Small-cap stocks are inherently risky. Please conduct your own due diligence and consult with a financial advisor, if you have any doubts. Remember, markets can both rise and fall, especially in the case of small and mid-cap stocks. I am not aware of your individual financial circumstances, so only invest money that you can afford to lose.



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

As promised, here is my conversation with investor and author Grant Williams, the first of eight conversations recorded at the 2026 New Orleans Investment Conference. It’s a belter. I hope you enjoy it.
As always you can watch the video above, or listen as a podcast via Spotify, Apple podcasts et al.
Grant argues that politicians will never go for the discipline of a gold standard voluntarily, but the breakdown of the existing system - excessive debt, financial instability, currency debasement and ultimately a loss of trust in money itself - will force it on them.
We discuss why he sees gold as the financial system’s “apex predator”, why the investment conditions of the last 40 years have reversed, and how a future revaluation of gold could form part of the process of rebuilding confidence in the monetary system.
Here is Grant’s website and here is his X
This programme was brought to you by 🥇 The Pure Gold Company
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.

And, as we discussed it, here is a link to The Secret History of Gold on Amazon.
Until next time,
Dominic
ICYMI: my commentary on last week’s budget.



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 believe most people start out in politics because they want to make the world a better place. Better might mean more socialist, more Conservative, more Liberal, doesn’t matter. They want to make the world better, whatever their idea of better happens to be. Maybe I’m just naive thinking that.
In any case, very few ever get any real chance. I once heard a jaded MP describe the House of Commons as, “the crucible of broken dreams”. Hundreds of people arrive to change the world and leave years later barely even having affected parking in their own constituency.
But what if you’re one of the lucky few? You keep your head down, stay out of trouble, the winds blow in your favour and suddenly you’re in government, Chancellor maybe, or even PM. Now’s your chance. What would you do? What if you were Prime Minister for a day?
How many times have you heard someone once in a position of power, shortly out of office, pontificating about what the government should be doing? You had the gig! Why didn’t you do it when you had the chance?
Today’s candidate for that future memoir is John Healey. An MP since 1997, former housing minister (mind you anyone can be a housing minister) and Defence Secretary, nearly 30 years working his way up the greasy pole. Now he’s got the Chancellor gig. Here was his chance to make the world a better place - as he sees it.
And what did he do? He decided to not rock the boat. He kicked the can. He did not make a single hard choice. In a crowded field of toothless budgets this was surely the most gummy.
All this budget does is reinforce what was already there, a system that pretty much every end of the political spectrum agrees isn’t working.
He could have begun the job of undoing the 40 years of neoliberalism Andy Burnham came to power promising to undo. Instead, as our Kemi put it, we got 4p off gherkins.
I’m travelling, fortunately, so I was able to avoid the speech. But I’ve had my minions look through the deets. 98 separate measures, a record, and every single one of them tinkering around the edges, adding yet more complexity to what is already bloated. A few points here, a frozen threshold there, even a “modernisation” somewhere else. It all adds up to very little, and almost none of it lands before 2029-30. By then the forecasts will have be proven wrong and the world will have moved on.
The number that matters most
That would be the interest on the national debt. Next year the government will spend £130-150 billion servicing its debts. We’re talking the education budget or more. It has eaten up the “headroom”, the Treasury’s much vaunted cushion against the fiscal rules. It is going to eat a lot more.
We now owe more than £3 trillion. Remember if you spent a million pounds every day since the year Zero, you would still not have spent a trillion pounds. We owe three. Thank goodness we don’t have to pay it back in sterling silver. Thank goodness for currency debasement.
We will borrow another £133 billion this year, plus there’s the refinancing cost of debt being rolled over, and student loans, so in fact that number is more like £260 billion. Borrowing over the next five years is £65 billion higher than the OBR said in March. Seven months, £65 billion. Indeed why does the OBR even exist when we have AI? That’s one budget that could have been slashed.
Debt stays above 95% of GDP in every single year of the forecast. But the debt doesn’t just sit there, it compounds. Healey’s plan? More spending now, more taxes later. Another £7.6 billion in giveaways this year. The tax rises that pay for them don’t arrive until after the next election. Funny that.
A £100 payment lands in your bank account in January. The VAT cut on electricity runs until July. Both straddle next May, which is when Burnham probably calls an election, even if it means contradicting himself, which would be nothing new. The direct debits, the instalments, HMRC in your bank account: all 2029 or later. Sweets before the vote, bills long after.
Who pays for the £100? Banks, supposedly. The bank surcharge doubles from 3% to 6% for 15 months. But as the IEA’s Dan Hannan points out, banks can only collect taxes, not pay them. It comes back to you through dearer mortgages and worse savings rates. They put £100 into your account with one hand and take it out with the other. And come 2029, HMRC will be able to do that literally. More on that in a moment.
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.

Punish the productive
The tax rises fall almost entirely on the people who might create some growth. Again.
The allowance for business investment is cut. The relief for people who build a business and sell it is halved. Owner-managers are pushed onto higher dividend rates. The minimum wage rises 4%. The result will be less hiring and more unemployed.
Landlords, meanwhile, pay another 2 points on rental income, on top of last year’s 2 points. This will push up the cost of renting, a cost which is already rising due to Labour’s attack on landlords.
More landlords will exit the game, as a result, meaning fewer homes to rent and higher rents. The ones who remain will pass the costs on either through higher rents or a boiler that doesn’t get fixed. Either way, the tenant pays. They always do.
Healey kept Rachel from Accounts’ freeze on income tax thresholds all the way to 2031, thereby raising more than £55 billion by 2030-31 according to the always wrong OBR. That’s several times everything in this Budget put together. Fiscal drag is a stealth tax extraordinaire, as bad as inflation, if not worse.
The tax take is heading for 43% of GDP. Badenoch says it will be the highest in British history. It might also be the least productive.
Hands in your account
Then there’s the bit that should worry everyone, except the unbanked.
HMRC has had the power to take money straight out of your bank account since 2015, another legacy of that awful Conservative government, which was everything but conservative. That precedent came with safeguards: only for debts over £1,000, a face-to-face visit first and at least £5,000 left in your accounts. It barely got used. This budget changes the game. From July 2029 HMRC will be able to take “lower value” debts directly from your account, in instalments, from anyone it judges “can afford to pay” but misses payments. Who decides? HMRC. What are the safeguards? We don’t know yet. They’ll be written up later in a “Code of Practice”. The power comes first. The protections come afterwards, if at all.
From April 2029 every business filing VAT or PAYE returns will have to give HMRC a direct debit, which HMRC will use to collect “any unpaid balances”. Every business. HMRC decides what you owe, then takes it.
What happens when HMRC cocks up, as it will? You’ll have to contact them. Good luck with that.
PAYE removed the ability of the tax payer to withhold payment of taxes. This is as bad. It is an enormous power shift.
Put together with debanking, already a very real problem, and the picture is grim. Money in the bank is not yours as much as you thought it was, and it certainly isn’t your private property.
Yes, it raises revenue for HMRC. The instalments grab alone raises £1.35bn in 2029, and every pound that goes to HMRC early is a pound that could have been re-invested. In other words it acts as a leash on growth. They are so dim.
And the other side of the ledger?
Not much as far as I can see. The benefits bill keeps rising. So does unemployment. Household disposable income per person falls this year. I can’t see any serious attempt to get the millions of working-age people on out-of-work benefits working again. The ticking PIP timebomb is unaddressed. This Budget taxes the productive and subsidises the unproductive, so as a result we will get less productivity an…


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