Renaissancemen.org

I was born in 1975, and with that….

Just 4 years before me, the microprocessor was invented. As a small child, I grew up with the Intellivision, Atari, Sega, and then Nintendo. I also remember around the age of 13 or 14 seeing Anna Paquin in commercial talking about the “information superhighway” that was coming, and everyone seeing it like, “what the hell is that”. This was, the internet, of course. We then of course get Lithium Ion batteries, electric cars that can run on these batteries. More recently, we got the advent of quantum computing and just this past week, we had a first with fusion – being able to get more energy out of the reaction than put into it, by a good margin. We also have artificial intelligence coming of age. The mega advances in my lifetime are tremendous. One could possibly add the blockchain to this list – but its long-term utility has yet to be seen – and one can question its usefulness with bloat over time.

A few years ago, you could look at Amazon’s stock and remember 20 years ago, it started as a book seller. Now, the stock price had recently soared, and you kick yourself for not being an investor early and holding. Or perhaps Tesla. Or Apple. The list of these things goes on. I didn’t even really look at any kind of investing in equities until 2019. My primary investment has been rental homes, but I really fell in love with PMs and miners as my primary investment interest. I had learned about the history of 2011 and 1980, and could see we are primed for stupid high movements to come over the next few years.

In this form of doom and gloom scenario, I expect equities and real estate to take a bath. At some point, I’m going to take my gold and silver miner poker chips off of the table, and with this, I’m going to look to put it into something interesting. I have a 13 year old and a 2 year old, and with that – I’m wanting to know where to perhaps have them hunt for future careers as well. I wish I had someone advising me when I was 13 about how the hell to make money.

Can you imagine a scenario 40 years from now where you have lights on in your home, powered by fusion. Your home and workspace has its own personalized AI responding to you, and quantum computing has solved a lot of the world’s issues – including battery chemistry. Your EV charges in no time and gets you about 1,000 miles per charge. It is perhaps a utopia, but how is this wrong to believe in?

If I’m 13 right now, and decent with math, I’m looking at one of the below careers:

1. nuclear fusion
2. artificial intelligence
3. quantum computing
4. chemistry (batteries)

Chaos in the world right now – explosive upside to U? maybe not?

You don’t have to look far in just about any given year to find war or strife, usually over some form of natural resources like oil. You have Russia fighting Ukraine today, and Russia is one of the leading energy providers in the world, with Ukraine having access to vast gas fields Russia just sort of seemed to seize with their occupation. You had the US fight over oil countries for the past 30 years or so. What if energy with fusion could be provided with abundance? This is not a zero-cost substance, but it is “green”. Unlike nuclear FISSION, which has all kinds of nasties with nuclear radiation, nuclear FUSION has none of those side effects.

2023 was going to be the year I jumped into nuclear. I had the Gold Newsletter for a time, and when you signed up, you got a 30 page or so Uranium guide. It said in there that probably 2022-2023 is going to be a good time when the contracts are up for the next contract cycle. The US seems to produce U at $50, and with spot being $40 (or $25 when I read it), it was not likely anyone in the US is mining U. We now have complications with Kazataprom and Russia, and it seems Cigar Lake might be the only real game in the West. Still, lots of Japanese restarts as well as new Chinese reactors coming online seems to have a lot of excitement. I think what happened was everyone knew this was coming now, and piled into the trade to front run it.

It seems the peak happened in 2021, 2 years prior to when the cycle was to happen? It almost seems everyone tried to pull a Rick Rule and get in way early.

I drew that triangle perhaps 8 months ago and just now pulled that chart up. Damn. In the absence of macro events, THIS is where TA can shine. URA us well under the 200dma and if we have a market crash of sorts the next 1-2 months, I could see this having a capitulation sell off. I’m putting a pin in this one to watch. To me, this is the barometer of how the market is going, although I’d probably like to play URNM instead.

I bring up U because Tuesday (12/20) I tried to ask a legitimate question and got lots of snark, flippant answers, and snark when I asked about fusion. I asked a legit question about how controlled fusion MIGHT affect your long-term view of U, and well….it didn’t go well. I can understand that with the next 1-3 years, with contracts needing to get re-done, with lots of demand ahead – that one could see U miners going into a form of lift off. But all of these things are cyclical. You can clearly see Germans shutting down nuke plants in favor of coal. The US can’t get a paper bag designed in under 15 years due to permitting, banks, zoning boards, and pay offs. So how could we build a lot more nuke plants to help this energy cliff thing?

It is obvious to anyone with a brain that “green” cannot solve the problems with baseload energy requirements. Nuclear can help with that, substantially. But what about this fusion thing?

One of the responses was that “we get a new break through every year or two, and it’s always 10 years away”. This one might be a bit different, and I’d urge you to look again. In THIS experiment, they got more energy out than put in with the lasers. This is the big one, which will have a date associated with it for the next 1,000 years. One of the videos I watched explaining this said there were two forms of fusion research – one is with magnets, and the other is with lasers. The TOTAL budget allocated to fusion over the years has been $5 billion, but only about $180m of that has been with lasers.

Now, I want you to step back and think about that number for a second. $180 million. Please, for the love of God, realize what they just did with a shoestring budget. Then, realize if they had perhaps $50b thrown into that over 5 years with tons of researchers and new equipment, what they could do? I work in project management, and I realize “more money” isn’t the end all be all, but IF this has now been proven to work, many, MANY more grants can be funded in this direction. This then has the promise if using more well-funded and efficient lasers (the one used was really old), attracting the best and brightest minds of the world to look in this direction and get funded by these grants, as well as attracting engineers and physicists to start thinking about how you can build this out to work, then shrink it over time.

The scoffs I get when I talk about futurism is something else. I work in tech, and with this, you get virtually all new tech every few years or so you need to re-learn. I manage change, for a living, so to listen to everyone throw up their hands, reminds me of people at work over the years who are resistant to change. They just get replaced over time. But when I asked the U people about fusion, wow – I was summarily dismissed.

I grew up watching the likes of Carl Sagan, Michio Kaku – and am fascinated with the future. No one can PREDICT it, but if you understand the irons in the fire, and have a decent background with science, it’s fun to see what is to come. I am not a “star trek whack job”, but I really got into it. I remember as a kid watching Gil Gerard in Buck Rogers and they were talking to each other on big TVs. It was 400 years in the future, and we do that now as part of work with each other from our homes and think nothing of it.

I am under no illusions that we will be getting power from fusion power plants inside of 5 years, but if anyone ever heard of the Manhattan Project, they kinda sorta did the impossible inside of 5 years. They understood fission on a chalkboard, and then turned that into a nuclear weapon in about 5 years.

If we are in the Global Warming panic they say we are, it is fair to imagine that this type of project could be deemed to “save the world from extinction” and get funding like you have never seen with anything in your lifetime. We just sent $100B to Ukraine to proxy fight the Russians, and you think we cannot cough up $100B to save the planet with fusion?

Let this sink in, in 9 years, we had a goal of putting a man on the moon – and we sent three men up in a giant trash can 240,000 miles from earth using nothing but rockets and a slide rule. I don’t want to hear that we are 30-40 years away. THIS PAST WEEK was the breakthrough that now changes everything.

Remember, this announcement was not from some hack firm in Silicon Valley. This was made by the Department of Energy.

I don’t see U PRODUCERS affected by this short term, but consider risks with early stage exploration at the moment. These things could take 10-15 years before a mine is built. But if the WORLD starts funding fusion now as part of a Green Agenda, how does fusion look like in 10 years? If you are the US, and it takes you 10-15 years and billions of dollars to build a nuclear plant, do you now take a look at this and think twice? Remember, once you build the damn thing, you may have 10 years of collecting revenues to pay the sonofabitch off. What happens if you build it, and no one buys energy from it? This is now an investment risk where you now have to think about ROI for CAPEX projects that now have an asterisk with them. Given we are about to hit a nasty recession, with much higher rates of borrowing – my thinking here is U might be risky past this cycle to invest in. We’ll still need U for perhaps another 10-25 years, but the needs for U over time would diminish, rather than grow, which is why I think HOLDING any U past this cycle could be risky.

Meaning, I at least now have concerns with early stage exploration to the point where I have to really pause and digest this to get into it, at all. It might be the safest way to play U in 2023 would just be putting a chunk of your reserves into URA or URNM for 1-2 years, and get out. I don’t know, people smarter than me with U would know, but I at least have to do my due diligence to ask the questions.

Think about the news cycles. Every 2-3 months then we could start talking about fusion ENGINEERING feats. We just cracked the physics. Now, it’s about building the damn thing out. These are VERY exciting times to be in!

Quantum everything

I learned about IONQ a year or so ago and didn’t do anything about it. I just took a look again a few months ago and the price was in the gutter. I took a leap and bought a small tranche at $6. Went down to $5. Bought a tranche there. At $4.50, sold my $6 tranche. Price went down to $3.50. I LOVE THIS. Others in at $30? Not so much.

Why? I like what Rick Rule talks about with the wife going shopping for tuna fish. If you like tuna at $1, if it goes on sale for $.50 you would be greedy and buy two. But as investors, we really get skittish when price drops. Someone must know something we don’t, and it’s going to go to ZERO!

Right now, the chart sucks.

It’s now at $3.37. I think the stock market is about to have an accident in the next few weeks, and I might even see this hit $2 or $2.50. Maybe by March it’s at $1.50. I like what they are doing. And, they have $500m cash, with a burn rate of about $9m per month. They are starting to get contracts now, and the one thing they need to do is to try and first break even, then be profitable. I don’t have any inside track on them, but feel very comfortable buying them at $1 or whatever the hell it drops to. Is it risky? Hell yeah.

But let’s assume for a minute gold hits where I think it’s going to, in the ballpark of $2500. I can see my FSM doing a 7-8x from where I bought it, with silver perhaps hitting over $50 and banging its head at $60. Both of these targets are absolutely doable when you look at ratios and valuations. Could the DJIA, S&P, and NDQ all take a shit in the coming months? Yup. 4th quarter numbers are abysmal, and we have now seen reports from the Philly Fed that perhaps the BLS misled us all to inflate the job numbers 1m higher than they were.

If you woke up tomorrow, and were a stock trader, and you heard the jobs numbers were 1m lower than reported, AND the Biden admin decided to re-define “recession” AND you can see the Fed made all of these policies based on these job numbers, wouldn’t it be prudent to think we over tightened, too much, and the economy is a real fuck show right now more than they told us, and with that, wouldn’t you expect 4Q numbers to be bad? Yeah.

So I’m hitting the sell button and led God sort it all out.

That doesn’t bode well for the stock prices of things like this. Which is why I’m now watching this closely for markets taking a dump and I want to be greedy here for the next Amazon or Tesla.

But hope? Wow. Yeah – love the idea. Will they be the leaders in 10 years? No one knows.

Artificial Intelligence

Look, I work in IT and barely passed 5 programming classes and did scripting as part of my job for 15 years. I took a college class in BASIC programming at 11 years old in 1987, so I have been around tech my whole life, and understand the limits of programming languages. I understand the 1s and 0s. I understand how flawed a “random” function is with computers. I know a bit about the Turing test. I also played in the World Open of Chess in 1990 as a 14 year old and was amazed at Deep Blue beating Kasparov in 1999. But…AI is different than being able to map out every possible move from there and then just being able to do one move ahead more than a human.

But AI might be a little different than you think, and how programmers think. As if Jordan Peterson is not impressive enough as a human, apparently his brother-in-law is also the top chip designer in the world and works with AI. In programming – we have to literally code lines to make things happen. However, there’s a layer here most don’t see with the whole Assembler language to convert your code into 1s and 0s. But what if this stuff then goes into a chip that can understand MEANING of the action, and not just the action?

I’m not saying AI is 100% either, but if they have BASE UNDERSTANDING, rather than lines of code, this is a different way of thinking of AI. Recently, I’ve seen some videos about ChatGPT that I need to look at closer. AI can now be used for a lot of purposes with design.

AI can be more or less like a helper to humans. While many see AI enslaving the planet, you can think of it as a way of being more efficient. This is perhaps the next step in technology. Think about it 50 years ago where you went into a records office, and you had 40 people and filing cabinets and it might take time for someone to pull the records and give them to you. Now, all of that is not needed and we Google everything. But what if that NEXT level is where the AI understands the purpose of the records and can infer where you are going with that? “Siri – can you identify a potential suspect in the robbery”? the AI might then be able to pull camera video, get gender, approximate height/weight, ethnicity. It can pull phone records, GPS records and triangulate. It can use facial recognition SW of nearby banks or street cams to get a pool of people in the vicinity. It can then identify the items stolen and cross reference it with recent pawn shop transactions and run that facial recognition. Before you know it, you have a pool of 5 suspects with 80% confidence to look at. These 5 suspects all have records for B&E. So you might need less police?

Yes, AI can be disruptive to the workforce, but maybe you don’t need less police. Maybe you just simply reduce the amount of unsolved crimes by 90%? Let that also sink in. You may just have a more productive workforce, not really REPLACE them. In some cases, like the filing clerks above, you may have job loss. But perhaps those 40 filing clerks instead of putting paper in files were then 5 clerks scanning and putting them into databases? This then had 35 clerks out of work, but with tech being what it is, you can potentially find new and exciting uses for this labor.

Batteries

I wrote a ton about them here, so not going crazy here, but every month it seems, there’s more breakthroughs with battery tech. I think just as we think we can’t do more, we get another break through. But with AI and quantum computing above, I would put money that within 5-10 years we have some AMAZING results. A battery in a car with 1,000 mile range? Why not. Apparently that shitty looking cyber truck that Tesla has, has over 500 mile range. In 10 years, you are telling me we can’t double that?

So then you have to worry about charging the damn things. Let’s put this all together.

The future is full of promise…mostly

If there is fusion power available to the world, my guess is you would have power plants like nuclear plants now, where your deuterium/tritium fuel comes in, and then is blasted into power with no emissions. I could not see fusion for a car – just due to the fact that it’s probably not good driving around with a potential hydrogen bomb. However, this path of commercial fusion could be decades out. Maybe as early as 15, but probably more likely 30-40. I’m 47 now, and one of my goals of life now is to live to see fusion power go commercial. Maybe I won’t live to see it, but it’s a goal.

I am always the kind of guy who likes to try and skate to where the puck is going. I got into IT security (now called cyber security) when I ran into an issue at work on my servers in 2004, and wanted to learn all I could, as I saw the industry going in that direction. I went back and got a master’s in that field, then got a CISSP. I went back for my MBA over the course of many years, because I wanted to not only manage technology, but I wanted to understand how to run my desired side business of property rentals. I needed to understand economics, finance, and accounting much better. Over 17 years, I acquired some properties in a weird way, but I wanted to also protect against market downsides. I lost my job at the end of the dotcom bust, and was out of work for 15 months. My grandparents all grew up during the Great Depression, and with this, I’m hard coded a lot differently than some of you with my personal experiences to try and VERY MUCH protect against market downturns. I can even see a near term future where my entire field of IT services is wiped out – which is why I also like the idea of someday transitioning out of it into the world of finance, investing, and continue to add to my portfolio of investments each year.

I can see this recession is going to be….bad. But I’m filled with hope at the same time. One of the things you learn about in economics, is that recessions are quite healthy. They are painful for a time, but it’s a Darwinism time for business. The strongest survive, and then get stronger from it. Today, you can see companies still trading at stupid high values, zombie companies, and cryptos still exist. My thinking is in 12 months, all three of those items will be corrected by a sustained market downturn.

But I then imagine capital that was chasing stocks at 22x earnings heading into a recession may get re-deployed to things like fusion companies. Perhaps quantum computing catches a bid. Perhaps resources are now explored more and we are able to get copper, lithium, and nickel in sufficient quantities to make a lot of batteries. Perhaps the Quantum Computing helps AI solve major problems and leads to things like Chat GPT on steroids.

One of the most impressive things I’ve seen in my life was a show on the Science Channel 20 years ago that talked about a paralyzed man moving a cursor with his mind to then communicate with his caregivers – like he needed water, etc. Elon Musk’s company Neuralink is doing that same research. If you can move a cursor with your brain only, it then stands to reason that you can move artificial limbs or machines that can help control your limbs. If they are able to move a pig’s leg’s remotely, it then stands to reason they might be able to apply this type of technology in 10-20 years for people who are paralyzed.

To me, it’s a great time to be a speculator as well. One thing my MBA did NOT cover was entrepreneurship, so I had to kind of learn a lot by trial and error with how to invest in different types of companies. For example, a company that produces something, you can value them based off of current and future cash flows, earnings, assets, etc. But with a company that has a FUTURE PROMISE of something, it is HIGH RISK. With this, these types of companies may fail a lot more than they succeed. They are using capital investment to try and prove the physics of something – or perhaps to engineer something to make a better mouse trap. Pretty much anything you can think of, can go wrong.

For every Amazon.com, there were 1,000 pets.com sites. Mark Cuban made his fortune selling a website that was more or less absorbed by another company and went away. Where was the value? It was speculative. Cuban did right and got out at the right time and rotated his money into the Dallas Mavericks.

But for all of the chaos that can ensue over the next 12 months, I believe the companies that emerge from this will be very strong. I saw it first hand how when I got involved with the gold and silver miners, that the previous decade they wildly expanded and burned through cash, and when the dark times hit – many changed their business models and became much better businesses. Those that were careless, closed their doors.

For all of the talk I have about BRICS and the dollar going south, the US has just obscene amounts of resources. Meaning, we can go through pain, but we will be fine (perhaps more resilient) on the other side of this. Our greatest resources may of course be oil and natural gas, but many don’t realize how much gold and silver we have. We have massive copper resources we can’t explore. But more than all of that, is our knowledge and university system. Our population is wildly educated, and even if you have other countries gaining on us and the dollar taking a shit, we still have knowledge workers – and given all of the above I’m talking about, is our greatest resource for the next 100 years.

I just saw how a McDonald’s is now automated as a test. I warned about this 10 years ago with talk of the $15 minimum wage. People are clueless, mostly, when it comes to money, value, earnings, and profit. I actually worked at a Burger King for 4 years, and to this day, 28 years later, I still talk to perhaps 12 of the people I worked with then. It was a great opportunity for a high school kid to get some work experience, get a work ethic, make some side cash, and learn how hard some work can be for $4.30 per hour. There were a handful of people who were the glue there as full time employees, and us part timers came and went. But behind it was our franchise owner, John Acuff. I had heard years before he was a running back at the University of Miami, and with this, I guess over the years he had scrimped, saved, and partnered with others to buy a few Burger Kings in our region. Our pay was abysmal, and those damn drag racing weekends at Maple Grove would bring in thousands of people that weekend. Margins on these things were tight, as volume of sales helped make the man some money. My point is that many just feel that “big business” is screwing people over all the time. No, in this case, it was a business decision to buy a restaurant and make profits. This is return on capital employed, and with this, you do not invest without the returns. For all of you who didn’t read between the lines here, if you can’t make a profit, you don’t invest, and with this, you do not have a free market to pick 45 different brands of toothpaste. If you want $15 per hour, you end up with a robot McDonalds.

People are up in arms about that. I would say that the place still needs a full-time person to maintain all of the equipment and perhaps take delivery from the truck. This might essentially move to like the “vendor-owner” models where people buy vending machines and drive around weekly to collect the change and restock the items sold.

Business evolves with the survival of the fittest models. I would say to anyone despondent over the coming bad times ahead, that there’s a very good opportunity above to help mankind advance to the next level of being fit. Our bloat over the past 13 years is about to be trimmed. Rivals are licking their chops at our debt and dollar situation, but have little idea how we can put it in overdrive and leave them in the dust with our tech. Our ability to innovate and thrive is remarkable.

Our ability to learn to help mankind is a passion, and why I would never count the US out of anything. I have a lot of international readers, and I was thinking of writing a blog to you – but thought twice about it given my current career. I think political leaders, greed, corruption, and the merging of big business and governments have had you see the worst 1% of my country’s population the last 70 years or so. Know that most of our people are good, decent, hard working people that wake up each day trying to make a better life not only for their children – but for you as well. These people working in these fields above want to make YOUR lives better too. Politics and politicians get in the way and try and divide us. Our people are wildly diverse, so it’s hard to pin us to a singular culture – but if I had one thing that united our cultures, it’s that we all know that if we give our all to our craft, our work, and are passionate – we can be rewarded handsomely. Those who have made millions and billions then become massive donors to help others out, fund research to help others – and like Elon, try to leave this world a better place than when you started.