The global economy faces a period of functional devaluation as US federal debt and entitlement liabilities approach $160 trillion, far exceeding total private net worth. To manage this intractable debt, the US dollar will likely lose 75% of its purchasing power over the next decade, mirroring the inflationary environment of the 1970s. Natural resources, particularly precious metals and copper, serve as essential hedges against this erosion of value. Structural underinvestment in these sectors over the past two to three decades has created supply deficits that will inevitably necessitate higher prices. Investors must adopt a long-term, contrarian mindset, focusing on value rather than price, and recognize that commodity bull markets require patience to navigate volatility. Successful resource investing involves identifying high-quality assets during periods of market hatred and maintaining the discipline to sell when valuations become parabolic.
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