Joe Weisenthal: Hello and welcome to another episode of the OddLots podcast. I'm Joe Weisenthal.

Tracy Alloway: And I'm Tracy Aloway.

Joe Weisenthal: Tracy metals. Metals.

Tracy Alloway: That's it. That's the episode.

Joe Weisenthal: That's it. It's the title.

Tracy Alloway: No, you're right. There is a lot happening in the metals space. So, we have gold above 5,500 an ounce, which is a record. We have silver above $120 an ounce, also a record. And now we have copper at over $14,400 a ton.

Joe Weisenthal: Yeah. So, this is something that's super interesting to me and I think it's a very important dimension, which is that copper is the ultimate industrial metal, right? And for Dr. Copper tells us about the economy. Probably a little overstated, its reputation, but it's the ultimate industrial metal.

Tracy Alloway: Gold is the ultimate metal with no industrial uses, right? It's primarily a store of value, a form of money that's existed for thousands of years.

Joe Weisenthal: And then silver is a little bit in the middle. It's more of a safe haven, but we know it has it's used in solar, it's used in photography. Not that that really exists anymore, but you know what I was saying. So, it's like it's interesting to see like why are they all flying at the exact same time? Yeah, I was going to say the exact same thing. So each of these metals historically would tell you something very specific about the state of the economy and copper certainly would be screaming people are bullish on economic growth. Silver, you know, something kind of in the middle and gold, gold soaring is something that you traditionally associate with stress points either in the financial system or the broader global economy and yet here we are. Yeah, it's all happening in once and like you could say, dollar debasement, right? And we know the dollar has been weak against other currencies. It's not like inflation as measured is raging hot. So, it's not just a simple story of the dollar becoming worthless. There's something going on with metals. Maybe they're just the new meme stocks. But we have to dig in.

Tracy Alloway: Yeah, let's do it.

Joe Weisenthal: All right. Well, I have to say we really do have the perfect guest on the perfect day. Again, we're recording this the morning of January 29th. We're going to try and get it out ASAP. But this headline, copper surging 10%. Unbelievable headlines. We've had him on multiple times in the past, a believer in super cycles, a vindicated man in many respects with many of his calls. He was a Goldman a long time. We're going to be speaking with the one and only Jeff Curry who is now a partner at Carile knows commodities as well as anyone else we talked to. So Jeff, thank you so much for coming back on the Outlaws podcast.

Jeff Currie: Great. Well, thank you for having me. You know, commodities are up and back in favor. It was a rough last couple of years to say the least.

Joe Weisenthal: What do uh what do we We should just ask is this going to be the peak?

Tracy Alloway: Yeah. Is this the peak? Did we Is uh Yeah, that's the question. Is this the peak? Because

Joe Weisenthal: they're back on. Everyone's going to ask is this the peak? Oh, did online get the peak? Cuz they called they ring Jeff Curry. So, let's just get this out of the way.

Jeff Currie: By the way, I love that we're in the foothills of the Himalayas right now. So, we're not even close to the the real mountain peaks yet.

Tracy Alloway: Really?

Jeff Currie: Yes.

Tracy Alloway: Okay. So, I'm going to ask the obvious question, which we alluded to in the intro, but why are all three of these things moving in the same direction all at once? When you look at the commodity complex, you take anything that has an atomic number to it that's in the periodic table, it's going up right now.

Jeff Currie: Even nickel and zinc have joined the party.

Jeff Currie: If it is a molecule and it has a carbon in it, a carbon hydrogen, a CH in it, it's been struggling. So that includes hydrocarbons as well as carbohydrates like corn, wheat, and so forth. So that space the molecules have been struggling yet you have the things that are primarily critical minerals things that are in the periodic table the atomic number have all done well and the fundamentals in copper are not that much tighter than what you have in oil. that what's going on in the metal space is hoarding given the concerns over having availability of these critical minerals and you you threw out the idea of debasement and I want to throw in three other D's dd dollararization and diversity to your debasement so debasement ddollarization and diversity is what's driving all of these different metals and when we think about the ddollarization and that goes back to 2022 when the US and Europeans froze the central bank assets of Russia. Every emerging market goes, uhoh, I don't want to be owning any dollar denominated assets because look what happened to the Russians.

Jeff Currie: And as a result, they're moving as fast as they can out of dollar assets and into assets that cannot be seized. And precious metals and metals are part of that. And then when you have the geopolitical risk as high as they are right now on a global basis, whether it was US cutting off Venezuelan oil supply to China, India and Europe, or it was the Chinese cutting off critical mineral supply to the US and its allies, or it's Russia cutting off supplies of natural gas, it's a dangerous time to be dependent upon foreign commodity supply. And as a result, we have stockpiling. And we everybody talks about the squeeze in silver running it up to $120 an ounce. The reality is this is a squeeze by the population of the people in China. You know, they're hoarding the silver over concerns around, you know, export controls and things of that nature. So you mentioned China just then and this is exactly what we wanted to ask you about which is if you stripped out what's going on in China. How much of the rally would disappear in something like gold?

Jeff Currie: I I mean the vast majority of it is not just China but emerging market central bank buying basically reduce their holdings of western bonds that can be frozen similar to what happened with the Russians. So, you know, do not underestimate the impact that China's had. In fact, if anything, China and the other emerging markets have squeezed other participants in the gold market out

Jeff Currie: and you still have a long ways to go. I like to point out that in 1970 when Nixon took the US off the gold standard, central bank reserves of gold stood at around 40%. Last time I calculated late day in the last year was in that 27 to 28%. But the run up in the last couple of days could be as high as 30 by now. But I think the key message is there's still a lot more buying by central banks who diversify themselves out of dollars.

Tracy Alloway: I I'm still a little bit confused. What is it about silver particularly that's so desirable right now from the population in China? Because just let's talk about hoarding and some of these issues. It's totally understandable why China wants to hold certain strategic assets, right? It wants to accumulate a lot of oil in part because of defense purposes because in the event of a war for whatever reason, they may get shot out of oil. So, they need a lot. What is it about silver in the population context that makes it so desirable? And by the way, I'm looking at a chart. This is from two days ago, but the Shanghai silver premium buyers in China paying more than $5 an ounce versus everyone else in the rest of the world. But explain what is it that's driving this purchase from the public in China.

Jeff Currie: Okay, first let's talk about its role as a critical mineral. It goes into the production solar PV and that makes it as you pointed out at the beginning 50% an industrial metal and then 50% of a store value like gold. So the fact that it has these dual uses, it's a critical mineral and important to the electrification process on a global basis. Remember, it's a superconductor. Actually, let me go back to answer your question, Tracy. We said, what do gold, silver, and copper all have in common? They're superconductors.

Jeff Currie: I know people say, "Well, Jeeoff, copper isn't exactly a definition of a superconductor. It's not as strong as silver and gold, but it sits up there in that electrification process." And so when we think about silver, it's critical for the industrial base of China, given the importance of solar panels as a part of the industrial manufacturing process in China. So you know whether if you're the PBOC or something like that, you we're going to be very focused on making sure there's adequate silver supplies inside of China. Um, so the fact that it also then has the store of value like gold and accessible by many parts of the population because even at you know hundred $100 an ounce, $120 an ounce as where we're this morning, it still makes it a much more affordable u you store of value. So I think the two key points for China and why silver is so important is its role as a critical mineral and as a superconductor. And given the importance of solar panels and other types of renewable investments to the Chinese industrial base, having a secure supply of silver is absolutely critical to the Chinese economy. Second of all is when we look at the price of silver, even at $120 an ounce, it is still very affordable to many of the population as a store of value similar to gold. And also given the recent price trends, people feel comfortable in holding it. So it has those two components that make it critical to the Chinese economy.

Joe Weisenthal: Some people would say that like all right, you can look at all these things surging and tell a story about debasement and electrification and what the future world is going to look like. Some other people would say, well, you could tell an even simpler story, which is that one of these markets is wrong, right? So maybe copper sees economic growth going to the moon, although it seems kind of unlikely to me. Maybe silver is somewhere in between. Maybe gold is wrong about the debasement thesis, whatever. How do we know that we're just not seeing investors get this one wrong? People are just going for the meme coinification of precious met of metals. Well, I I do think when we talk about a commodity super cycle,

Jeff Currie: the sword, which by the way is nothing other than a commodity capex cycle or a big global capback cycle. And we're seeing that, you know, whe it's an investment in defense, investment into AI, data centers, the list goes on. This is a worldcale capex boom we're now entering.

Jeff Currie: which by the way is nothing other than a commodity capex cycle or a big global capback cycle. And we're seeing that, you know, whe it's an investment in defense, investment into AI, data centers, the list goes on. This is a worldcale capex boom we're now entering. And that typically is when you see the big commodity super cycles, one in the 70s, one in the 2000s. And we're I mean just take the defense spending in Europe alone. It's likely to be 9 trillion euros over the next decade. To put that in perspective, the Chinese boom in the 2000s was 10 trillion US. Today it's about 15. So even just Europe on alone, we haven't even factored in data centers and AI. So when that occurs typically what we see is a rericing a rerating towards asset heavy industries in commodities or another way to think about it is short duration is strangely is when interest rates are low everybody thinks oh you would be doing capex cycles no you do them when the interest rates are high because the interest rates are high they're telling you you need to put money into the ground and so we're moving into one of these repricing towards assets heavy industries which is why it'll ultimately be sustainable across the entire commodity complex.

Jeff Currie: And I just want to take a step back and talk about these repricings because in my career I've lived through two. The first one was in that call it O2 through like 04 time period and that's when we coined the term revenge of the old economy. Old economy is asset heavy new economy is asset light. And that asset light in the late 90s 2000s was really about the scalability of software. You don't need to have put a lot of money into the ground to be able to create growth. And that was the whole asset light model. But eventually we ran out of all of these heavy industries that you need to make the investments in. And then China came on the scene and became clear we need to make those investments. And that happened over that decade. But that repricing rerating was a violent process as you moved out of new economy or into the old economy. The next time we saw that was in 1415 where we moved out of the old economy and into the new economy.

Jeff Currie: Why? Because it was clear China was at the end of the track. And if you remember that time period we go through there the euro went from like 1.4 to parody in the course of like 18 months. I remember the period oil was coming down $7 a barrel like every other day. Everybody, what's going on? What's going on? But I want to make a point here to get to your point about why is this sustainable across all these commodities? And when we look at I'm going to take a like a private equity pitch book in 2012 of a Canadian oil asset. They valued the asset at $110 a barrel. The irr of that asset that this oil field was 25% at 110. Now fast forward to 2016 after the macro repricing. Oil was sitting around $40 a barrel. Now let's go repric the irr of that asset. What do you think it is? Immediate response was people go, "Oh, it was negative IRR." No, it was around 181 19%. It didn't come down much. Why is because the Canadian dollar repric so wages went down. You had a repricing of the cost of capital. You had a repricing of copper, iron ore. they all came down and so your cost basis came down such that the irr was far more stable over that repricing and that's ultimately what we're starting to see happen across this space right now and I believe we're in one of these repricings where we're going to move back into the asset heavy space I want to make one last point before moving on this during this it's going to make this one really different from ones in the past

Jeff Currie: is I want to go back to the 1960s because it's similar to to today and that was at the at least in the modern data the the first big commodity super cycle the asset light space back in the 60s was companies like Coca-Cola in fact all the nifty50 were brands what do brands have similar to let's say Microsoft infinitely scalable at zero marginal cost and so Coca-Cola was the world's darling right now and all of the big commodity producers the miners the oil companies were at the bottom and then you had the Arab oil embargo create that catalyst to repric. Now what happened here is that that's different today. So you think about that asset light space was Coca-Cola then and then in then in in 2000 it was Microsoft and today it's Google and the hyperscalers. Now here's where it gets really different in the power. What's going to happen now is the asset light space is getting into the asset heavy space i.e. These hyperscalers are putting steel into the ground. And by the way, you're no longer a asset light infinitely scalable software company. You're a minor. You're a oil company. You are a commodity producer. Your multiple is going to get rerated. And so what we have is the asset light space this time is moving into the asset heavy space in putting steel in the ground. So this is going to be a real violent transition.

Jeff Currie: So you ask about copper and silver and the rest of these things. What are the restrictions on their big capex budgets? Is the availability of transformers. What are transformers? Big chunks of copper. And so we have a difference in this cycle than ones in the past is the asset light space is colliding in the physical space at the exact same time. Which is what I tend to think that this repricing is going to be more violent, more sustainable. And what you're going to see, and it goes to a simple point that I observed in the 2000s, was when oil first went up because oh, it's a bunch of investors buying oil, it sits at $60 a barrel. That's supernatural returns. No, you actually had capital rotate out of the asset light space and into the oil space during 0405 such that the cost basis actually rose and there was no supernatural return. So go Tracy, back to your point, how sustainable is this? Well, what we're seeing is all the capital flowing into this asset heavy space and it's going to fill the ground underneath these prices and support them from a relative cost basis. And so when we think about $14,000 a ton copper, doesn't mean these guys are earning supernatural returns because we see so much capital moving into the space.

Tracy Alloway: I absolutely love that comparison of the software companies to the Coca-Cas. and this idea that like there are certain business models that can scale incredibly with very little physical needs and I the way you frame that I thought was uh very helpful to understand and we've certainly talked a lot on the podcast about the hyperscalers getting into the real business of things and you know going up the chain and in some cases getting you know getting into the power production investing in their own nuclear plants and hiring power traders. So all of this feels very real. Let's just like you say we're in a super cycle. You say we're at the foothills of the Himalayas. What does history or your work say about how big and how far this can go?

Jeff Currie: Well, I mean historically these cycles last somewhere around 12 years. The one in the 70s did. The one in the 2000s did. The one in the '7s from ' 68 to 1980. The one in the 2000s from essentially 2002 to 2014. A lot of people say, "Oh, the world's different today than any of those other points time." Putting steel in the ground still takes about the same amount of time. Technology or no technology. I like to point out where do you get the the 12 years? You the first three years are getting people to believe it

Jeff Currie: before they they start to really invest earnestly. And I would say this one started in 2020. And so the fact that we lost two years in 23 and 25 whether it was copper or oil and part of the reason for that was the rally in prices was so steep after that Russian Ukrainian invasion that the policy response globally was incredibly swift. I want to point out that policy response in 22 and 23 was not so much the rise in interest rates but the creation of supply. And I say that is because you had inflation come down everywhere in the world in a synchronous manner. And it did it against record commodity demand and really strong GDP growth in the United States. What does that tell you? It simply could not have been interest rates and the demand side. It had to come from a supply side. Where did they get new supply? Russia, Iran, Venezuela. you know, some of the issues that are facing a state, they got it through increased immigration on on the labor side. There was a lot of ways they created supply all over the world to be able to deal with that. Now, the point this time around, and everybody's bought into this oil supply gut, we don't have a problem, is that those easy fixes are not going to be available next time around. So, this one's going to take longer than normal.

Jeff Currie: But I also want to go why I'm comfortable with this being a super cycle is all of these things are all policydriven. The one in the 70s was due to the LBJ's war on poverty, the big defense spending. Sound familiar? And then you had the Arab oil embargo. If you look at what happened in the 2000s, it was the decision to admit China and the WTO, a policy decision. um here the policy decisions is the war on free trade and it's not just the US doing it everybody's doing it you know curtailing commodity supply around the world in fact the three points we laid out in 2020 in fact it was on this show we laid them out they're still very much valid today and they were all policy decisions.

Jeff Currie: one was del globalization the war on free trade I mean if anything it's been turbocharged now from 5 years ago and when we think about it it's all policy decisions and it's not just inside the United States where we're seeing this, you know, the Chinese cutting critical mineral supply, you know, Europeans focused on, you know, protecting themselves, defense spending, the list goes on. Let's go to the second one at the time, decarbonization or electrification. And I know a lot of people are going to look at, oh, well, didn't the US backtrack on that with, you know, the recent political shifts? The answer is absolutely not. the rest of the world is doubling down on electrification for both when we think about the electrification of the world where it wasn't decarbonization was not the motivator today it wasn't then and then going back in time why do I say that why did China build cutting edge technologies and nuclear power solar wind batteries and the rest of it they did it for energy security kind of goes into the deglobalization point they want their own secure energy supply in fact Carter coined the term energy transition and wanted to transition out of oil into renewables in 1977 not because they wanted to save the world but because of energy security. One last point on this is France lowest carbon footprint in the world. It didn't get there because it wanted to save the planet. It got there because it wanted nuclear power so it could it was Charles de Gaul decision to rid itself of the oil trade. So this story regardless of what's going on in the political push back and I don't think green was ever probably the right way to phrase this. You know it's renewable. It's a secure source. Nuclear power is a secure source. Throw data centers AI all on top of it. It's turbocharged from the last time we talked about. And then finally the third point was redistribution or the war on income inequality.

Joe Weisenthal: Yeah K with the K economy. This is alive and kicking.

Tracy Alloway: Wait, say more about that last point.

Jeff Currie: Well, when we think about commodities, and actually Tracy, you I've seen you even make this point that I made back five years ago was that

Jeff Currie: when you see inflation and you see commodity demand, it has to be coming from the low income groups. This is a point I think people get backwards, right?

Jeff Currie: Inflation is bad for the high income groups. And the reason why is because the low

Joe Weisenthal: This was a great call that you made, by the way. Yeah.

Jeff Currie: And the lowincome groups are the ones that actually think about this corn. A highinccome person will consume the same amount of corn at any point in time. The marginal demand has to come from the low income groups. And so when you give them money like fiscal transfers and you know to keep the masses happy in certain situations, what are they going to do? They're going to spend it. They're going to spend it on commodities and physical goods and that ends up creating that inflation. And then the high income people suffer because the visit the response by policy makers to the higher rates is wealth comes down. And another way to think about all inflation is is a wealth transfer between the high income groups and the low income groups and then they go out and spend it. And so when we think about the demand here is that third one which is this war on income inequality. is just going to demand more and more types of transfers to the lower income groups to be able to deal with the civil unrest and and it's alive and kicking everywhere in the world right now. And so I I would assume you know the you know if you liked any of these three stories back in 2020 you got to love them today.

Tracy Alloway: Just going back to the super cycle thesis and the role of policy, how do we know that the importance of a lot of these metals, the strategic importance, how do we know that that won't end up increasing supply faster than we expect? You know, part of the story, especially in copper, is that it's not that many people are pulling it out of the ground anymore. It takes forever to get a new mine started. How do we know that governments aren't just going to make it easier to get this stuff and so you'll see a supply response faster than perhaps you saw previously?

Jeff Currie: Let's go back to my point. You know, these are 12 year cycles. It's just putting steel in the ground takes a long time. Even if you got rid of all the bureaucracy and red tape, it's going to take time. But let's go to the critical minerals. Why does China dominate these? They did it because the Soviets and the Americans didn't want to touch the downstream processes because of not in my backyard for nimi reasons. I mean, even the Soviets, let me remind I say the Soviets because this decision was made in the 70s. Remember when the EPA, the super fun sites and all of that, the Americans and the Soviets used to do this. They quit doing it and farmed it out to the Chinese because they didn't like doing it in their backyards. This these are really highly toxic processes. And so if you're going to onshore them and bring them back, you've got to figure out technologies to do this in a way that's going to deal with those nimi problems that people didn't want to deal with 50 years ago. Um so it's going to be very expensive, time consuming. There's ways to get around it, but it, you know, whether I heard, you know, you can build these facilities on army land in the United States, you don't get any of the bureaucracy around environmental problems. But even so, and the last thing you this stuff you do, you you know, if you didn't like it in the 70s, you're still not going to like it today. Um, so I it's not something that can be resolved overnight. It's going to take a long time. It's going to take an enormous amount of capital, new technologies, created, rerouting supply chains around the world. That's why I say that we're at just the tip of the iceberg on what needs to be done here, which is why I think it's going to go on, you know, for at least another decade.

Jeff Currie: And I mean one last point about the super cycle the 70s and the one in the in the 2000s. They were sequences of price spikes. They weren't a steady upward trend. You had one in 73, another one in 7778 and another one in 80. In the 2000s you had one in ' 0405, another one in ' 08, and then the final finale in 11 late 10 and 11. It was with Libya and then copper topped 11,000. So everybody thinks they're like this steady upward trend in prices and assets. The reality is their sequence of price spikes and this one will be more bubbly in nature.

Tracy Alloway: Right?

Jeff Currie: I like to say it's a bubbling cauldron of supply and demand imbalances. And in part of this is because of what happened with the surge in investment around let's call it the green investment around net zero 2050. I like to say that that investment occurred from around 2015 through about 2122. It created an environment where you have lots of let's say renewable wind in places like Germany or Spain, but you don't have the batteries, the grid and the rest of it. So what that creates is these pockets where you can see big shifts where you have negative prices of power at some point, explosive prices on the other side. So the one thing about this time around, it's going to create much higher levels of volatility across the commodity space. I think silver, you can see you're getting through these pockets where it'll go up and down. And you know, whether if it was California Power in the 2000s and that that commodity cycle, which sure reminds me what silver is doing today, is you end up with an environment in which the volatility gets higher.

Jeff Currie: The volatility then scares investors away. The lack of investment then reinforces the higher volatility. And I think that that dynamic in this bubbling cauldron of supply and demand imbalances is just going to be that much more vicious this time around than in the past.

Joe Weisenthal: Jeff, you're my favorite person to talk to about commodities. But my second favorite person to talk to about commodities is the Uber driver that I had in 2022 who when he was dropping me off at Bloomberg, and I mentioned this on a previous episode, he's like, "Oh, I have a thesis. some really long silver because it has all these industrial uses, but silver is frequently mined as a byproduct of copper production and there isn't a lot of new copper production happening at this current state and therefore we're not going to see a big supply response be elicited on the silver side and so you're going to get this mega squeeze. So he's my second favorite one. That was 2022. now in January 2026. I mean clearly the price was right but this phenomenon as he described it does that sound uh pretty accurate to you?

Jeff Currie: Absolutely. I mean with all of these it's by the way you you can get the supply. It's not a scarcity of the commodities whether if it's critical, metal, even copper. It's like it's the access. It's it is the political access to where the resources, but more importantly, it's the willingness of capital to provide the money. I like to say it's not about the supply and demand of the molecules or of the metric tons or the bushels. It's about the supply and demand of the capital used to create the production. Therein lies the core problem. And the capital has not moved in. So Tracy, back to your point, how long does it go? We haven't even moved the capital in yet. The capital is still sitting in the new economy or asset light world. And the returns, you know, by the way, I've asked people, I go, like this was in like 23, 24. I go, hey, why don't you want to put money into these these this space? The answer was, Jeff, I agree with your story. The problem is the tech space is providing such very good returns that if I am underweight the space I got a problem and I rather be putting the money into what's out before me. That was the case in 23 24 25.

Joe Weisenthal: Just to be clear since the last time we talked to you there has not been a ton of activity in terms of let's actually start digging.

Jeff Currie: No, because the pullback in late 22 and early 23 was so vicious across this entire space.

Joe Weisenthal: Yeah.

Jeff Currie: That the money they looked at it go, I got beaten up. You know, Curry, you told me to go in back in 20 and 21, worked for about a year and a half, I got absolutely cremated on the backside. I'm not going to do that again. And so, they got beaten up over that time period. Their willingness to go back in and believe the story is not that high. They're going to have to see it. And now that's moves so quick, so fast like it did in 22 that they're going to look at it and go, "Oh, I've missed it." And I think, you know, it's like Tracy's point is how how much further this go? How sustainable is it? And I think the key point there is it's got it's that volatility is discouraging them. Yeah. And that's why I tend to think what is going to force the money into this space is you're going to have to have the returns in the asset light tech or whatever you want to call it world get to a point that they're go looking at the old economy going I'm willing to take that risk and go in it because that's the only place that has returns. And when they do that that's when you're going to end up seeing the rotation.

Jeff Currie: And I also want to go back to a point here is the market is so severely underweight all of this stuff cuz it's been so hated for so long that when the money rotates anti- gold bug but when the money rotates it it's going to be playing catchup. Whether if it's, you know, the two and a half percent waiting of energy in the S&P 500 versus what a seven or eight percent waiting on revenues, the market cap is too small and whether if it's in metals and mining critical, these things are just so tiny. It's like we I was talking the other day, you take FCX and let's see Ivanho Mines and some of the other smaller copper producers and what is their market cap is is altogether 200 billion versus Nvidia at 4 a.5 trillion. Now all a sudden you take that money out there and it has to go chase this space. And so you're asking how high can it go? you can go really high because you're talking about moving trillions of dollars out of asset light into asset heavy when nothing's been here for over a decade.

Joe Weisenthal: Jeeoff, very very quickly, are there any risks to the structural super cycle thesis? Is there any indicator that you're watching to suggest that okay maybe it's not going to happen or maybe it's not going to happen at the moment that you're currently predicting?

Jeff Currie: I I first I want to talk about the difference between equities and commodities. Commodities are driven by the real physical supply and demand and equities in financial markets are driven by expectations. Expectations can or cannot happen. I trying to figure out what the next person's going to do and what they're going to buy actually can be modeled and thought through, but it's less predictable. Long-term supply and demand balances of commodities, you know, when you have a problem. By the way, people don't push back. I mean, when I think I said on the last time here, copper is the best trade I've seen in terms of fundamentals. Stan Duck Miller recently, he made the same comment that, hey, it's tight. Yeah, it's really tight, but it may not work today, tomorrow, the next day. I know if I sit on the position and hold it long enough, eventually you'll get to that point where it does pay out because, you know, the physical supply and demand, the rubber meets the road, and you see the the rise in prices. Now the question is can you stay liquid long enough before that event occurs.

Jeff Currie: So first of all the reason why I'm so confident into these stories is the forward on these markets are incredibly unbalanced whether if it is in copper you know the industrial metals you know the critical minerals oil all of them are really imbalanced because so that's the thesis why my confidence now what is the near-term risk it's not that you know that you're going to because we're going to electrify the world you don't have enough copper to electrify the world the risk is like the demand for in housing demand in China collapses, but that happened in 23 and 24. So, you've already paid the price on that one. So, when I think about these risks that you're talking about, they might come from the demand side because you cannot create supply from thin air. So, it has to be demand coming down. But that demand coming down just ultimately delays how long it'll take before you run into problems. The main reason why copper didn't perform in that 23 24 time frame is we underestimated the severity of the property contraction in China. And part of that was the high interest rates west forced the Chinese to keep interest rates too high because they had to prevent capital outflow and as a result it really hurt that property sector. So that would be, you know, the it's it's different than the the the financial markets because the expectations can change on a moment and they're hard to forecast. Bottom line, you need this investment.

Joe Weisenthal: Jeff Curry, perfect guest, perfect day. Thank you so much for coming back on OddLocks.

Jeff Currie: Great. Thank you for having me. It's quite enjoyable.

Tracy Alloway: Truly the perfect guest and congrats on uh all your structural thesis that seem to be playing out.

Jeff Currie: Great. Thanks. Take care y'all.

Joe Weisenthal: I love that. I mean, Jeff's just the best.

Tracy Alloway: He's so good.

Joe Weisenthal: I'm so glad we could get him on today in particular. I should just mention we're recording on January 29th. The price of metals is going up so quickly. Who knows what it's going to be tomorrow. I think the most po I mean there are so many powerful ideas and compelling notions. To my mind one of the strongest ideas that I think is sort of under discussed in the debate is the intersection of the commodity rally and the war on free trade right and you know we look at things they're getting a little bit more expensive here people sort of look like oh is the tariffs being passed through etc. But this deeper dynamic that if you don't have a world of sort of relatively open trade, then that forces everyone to stockpile and that forces everyone to build their own version. And that all I'm going to build a chip plant here and I'm going to build a chip plant there and I'm going to build a chip plant there because we're also worried you have that duplication that it's the war on free trade that whether it's public or private forces all of this commodity intensive spending.

Tracy Alloway: Yeah. All I'm going to say is it's good to hold gold and silver coins.

Joe Weisenthal: Stop rubbing it in. Stop rubbing. Stop rubbing.

Tracy Alloway: Well, the problem is it feels good.

Joe Weisenthal: It feels good. But well, that's the thing. I don't even know how to sell. Like I would have to carry a bunch of gold coins through New York and find a dealer or something.

Tracy Alloway: You know what? We need to take another trip through the uh Diamond District where there are plenty of signs on their windows. We buy gold and so forth.

Joe Weisenthal: Well, I would actually do an episode on buying physical gold. Let's do an episode on selling physical gold. Yeah.

Tracy Alloway: Like, how do you actually do that? Are there certain ways to do it that are better than others and all of that?

Joe Weisenthal: I totally do that.

Tracy Alloway: Let's do it. That sounds like a great episode.

Joe Weisenthal: I have a silver bar somewhere, too. I need to find that.

Tracy Alloway: I like uh I

Joe Weisenthal: I'm going to bring it in and use it as a paper weight just to annoy you.

Tracy Alloway: Well, I have my uh I have my uh what's it called? The not the um what's that metal that I have my tungsten cube

Joe Weisenthal: that metal that you were obsessed with and now you've forgotten. I should have asked if that's my one that's my main exposure to hard assets is that tungsten cube that I use paper weight I think so I mean he said every element in the he said the the story is that if it's an element in the periodic table it's gone up in price and I actually think tungsten has gone up quite a bit in uh price but I didn't exactly buy in size I think my cube cost about $300 or something like that but

Tracy Alloway: okay um shall we leave it there

Joe Weisenthal: let's leave it there

Tracy Alloway: this has been another episode of the Odd Thoughts podcast I'm Tracy Aloway. You can follow me at Tracy Aloway.

Joe Weisenthal: And I'm Joe Weisenthal. You can follow me at the stalwart. Follow our producers, Kerman Rodriguez, at Kerman Arman, Dashel Bennett at Dashbot, and Kellbrooks at Kalebrooks. For more OddLots content, go to bloomberg.com/odlotss. We have a daily newsletter and all of our episodes. And you can chat about all of these topics 24/7 in our Discord, discord.gg/odlotss. And if you enjoy Odd Thoughts, if you like it when we talk about commodities, then please leave us a positive review on your favorite podcast platform. And remember, if you are a Bloomberg subscriber, you can listen to all of our episodes absolutely adree. All you need to do is find the Bloomberg channel on Apple Podcast and follow the instructions there. Thanks for listening.