The Invisible Metal

Event Driven Optionality in "Paid to Wait" Expressions

To start with some housekeeping:

I appreciate everyone’s patience with the lack of published notes over the past few weeks. My trip to Asia was highly successful and educational, but I returned quite ill and recovery has involved two steps forward, one step back. I don’t know why Covid always hits me this way…you think you’re better for a day or two, and then a few days later — bang, lousy again and back to bed. Thank you for the good wishes. Starting to feel much better now!

I have several other notes, charts, and ideas coming, but in the meantime the gents at Money of Mine podcast had me back for my second discussion with them on commodities (it had been a year since my last one). After a long patient wait on their part, we managed to get it done Tuesday evening. You can find the conversation here, with detailed discussions on copper, uranium, oil, and more… I hope you enjoy it!

There is one particular commodity I have thus far not discussed publicly and am ready to share with readers now. Most of the work on this idea was done in preparation for my trip to Hong Kong where I presented the thesis in front of several friends. We were graciously hosted in an informal gathering by our friend Louis Vincent Gave of GaveKal to whom I am eternally grateful for his hospitality, coordination, and friendship. Today’s note lays out the thesis, and I look forward to any and all insights, feedback, thoughts, reactions, and pushbacks you might have! With that, let’s get into it…

“No one is paying attention.” — Jared Vennett in The Big Short, played by actor Ryan Gosling; character based on Deutsche Bank’s Greg Lippmann, structured products salesman during the 2000s housing bubble