Fiscal dominance thesis explains ongoing deficit spending and soft landings, as Fed’s tightening is overshadowed by Congress’s trillion-dollar deficits and war-time levels of spending.
Despite industrial recession and autofinancing crisis, the service sector remains strong, with financial services being a significant export, accounting for 25% of the US economy.
Lobo’s IndependentSpeculator provides independent due diligence and evaluations for investors, offering a fully transparent, documented, and verifiable track record.
Pre-production Sweet Spot (PPSS) plays offer the best combination of risk and reward, with an average success rate of highly successful plays that double, despite risks like nationalization or undercapitalization.
Copper is Lobo’s top pick for 2025 due to bullish economic context and favorable supply-demand fundamentals, with potential price increases of 50-100%.
Copper grades are decreasing while depth is increasing, leading to higher mining costs and prices going forward, regardless of the global economy.
The combination of fiscal dominance and monetary policy is leading to stagflation or reflationary economies, with copper being a key economic indicator.
Gold miners can provide leverage to gold prices, but due diligence is crucial for selecting the best operating companies that outperform the GDX index.
Menger’s subjective theory of value revolutionized economics by placing individuals at the center, asserting that value is determined by personal assessment rather than objective measures like labor costs.
The marginal revolution, introduced by Menger, explains how the price of a tool increases with a new use, while prices of machines for less popular goods decrease, fundamentally changing economic thought.
Menger’s approach to understanding human action emphasizes trying to understand first before judging, without assuming others are stupid or immoral.
Menger’s “Principles of Economics” (1871) was a secularized textbook derived solely from human behavior, making it one of the first to remove moral and religious axioms from economics.
Carl Menger arrived in Vienna in 1859, during an economic boom, with the city characterized by optimism, hospitality, and a thriving stock exchange.
At age 21, Menger critiqued communism not for its educational quality, but for the impossibility of central planning in society and economy.
Menger’s library of over 20,000 books and his extensive annotations provide insight into his thought process and evolution as a scholar.
The Austrian School of Economics, founded by Menger, differentiated itself from the German Historical School, creating a distinct intellectual tradition.
US housing affordability crisis: 38% of median take-home pay goes to housing costs, significantly above the traditional 30% threshold set by the National Association of Home Builders.
Government dominance in mortgages: 85% of outstanding mortgages are sponsored by agencies like Fannie Mae, Freddie Mac, and Ginnie Mae, despite post-GFC legislation aimed at preventing risky lending.
Short-term rental speculation: Massive vacancy and speculation in short-term rentals, particularly in areas like San Diego, according to a January 2022 Philadelphia Fed paper.
Commercial real estate bubble: Class A buildings often vacant due to lack of right industry, while Class B multifamily properties were aggressively marketed to investors in 2020, leading to overbuilding and unsustainable prices.
Blackstone’s property valuation strategy: Carrying overvalued properties at 2018 prices, avoiding price discovery despite recent auctions showing buildings selling at 30-50% of 2015 prices.
Retail sector impact: Big Lots filing bankruptcy and closing 900 stores will trigger rent drops for remaining tenants at strip malls, causing financial distress for building owners and debt holders.
Canadian housing bubble: Cities like Toronto and Vancouver face unaffordable house prices due to unsustainable debt costs, despite immigration policies aimed at reducing population growth.
Warren Buffett’s market stance: Sitting on $325 billion cash, selling tech and banks, buying nothing, and parking cash in short-term Treasuries at 4-5% yield, preparing for a potential 40-year cycle of steadily higher rates.
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