The Strategic Metals Awakening (Craig Tindale)

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Eventually what happens is we've
just become a complete vassal

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state.
We have to take what they tell

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us to do because they have
complete economic power over us.

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If we decide that we're going to
become a vassal state because

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it's all too hard, then become
part of the Chinese state.

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JD For the best part of of 40
years, the the West has lived

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under a comfortable delusion
that we've finally liberated

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ourselves from the physical, the
mining, the smelting, the

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refining and and that The Dirty
business of matter has actually

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been happy to export it
overseas.

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It's gone to China and the
likes.

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And that predicament has left
the West incredibly fragile.

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This is a a worldview that our
guest today, Craig Tindale has

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has spoken about its
implications, the the the

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enormous consequences of it,
extrapolating it out, what it

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means and ties it all into to
the mining world that we care

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about.
Yeah, it's one of those

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conversations where you're
you're left thinking about where

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does the world kind of go from
here.

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The the topics that Craig talks
about as you outlined there are

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enormous.
And I feel like they're the,

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they're the undercurrent or
they're the what's behind the

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curtain to every kind of
conversation.

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When we talk about the
importance of of mining over the

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past few years, it's China
first, the West, it's our

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separation finance from the
material world and these sorts

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of things.
It's our inability to refine and

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manufacture things here in
Australia or in any other

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western nation.
And the the ramifications just

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enormous.
And Craig's writing has really

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just captured the imagination.
I think heaps of people have

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been drawn to it because he kind
of put into words what a lot of

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us were thinking or maybe in
different pieces and he paced

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them all kind of together in a
digestible way that the the

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penny just dropped for a lot of
people.

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So I'm excited to share this
conversation with Craig Tindell.

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Multidisciplinary thinker.
We'll put some links to Craig's

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work in the in the show
actually, if you're not

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familiar.
But yeah, it was a delight to

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speak with him.
I've watched a fair amount of

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your shows.
Normally I get interviewed by

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people that don't, I have never
seen before.

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So it's it's quite odd because I
go on all these podcasts.

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I've done about 12 in the last
four weeks, and I don't know who

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they are.
Yeah, I know who you guys are.

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I watch you regularly.
Oh, that's great to hear.

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You put on a good, you put on a
good show.

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We're.
We're we're flooded.

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We we've got mutual appreciation
for each other's content then.

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Yeah, yeah.
Well, you had a lot of good

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content on recently.
So it's it's it's and it's very

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interesting.
You know the the guy who was the

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China guy, the guy that.
Hugh McKay.

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Hugh Makai, Was it Hugh Makai?
He was in China and he talked

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about traveling around China.
And I did this.

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Who was the guy who's traveling
around China?

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He kind of grew up in China,
maybe.

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Oh.
Willow was a who who studied.

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Yeah, yeah, yeah.
Who's the investment?

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Yeah, the investment bank and
you talked about cost of

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capital.
Yeah.

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Yeah, yeah, because I, I
traveled around China in in like

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I barely was 20 and I remember
all that kind of stuff.

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It's amazing.
It's interesting.

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So is that was like 1981 and
it's probably earlier than he

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was around.
But it's, it's interesting you

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bring you bring Willow up.
I mean, there's a lot of

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parallels with your worldviews,
which I imagine are both

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informed by your experiences,
you know, growing up in, in, in

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a, in a formidable part of your
life in, in China.

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Both have like a very multi
polar perspective of the world,

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both astutely aware to the about
the differences in in how you

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know the the the cost of capital
has has impeded the the the

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West's ability to to to compete.
The the state model versus the

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capitalist model that that we
have here has been the the

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defining feature of the last 50
years.

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And it could be in, in you know,
to kind of paraphrase your

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writing in a sense what what
breaks the system as well.

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So how big a role is that that
cost of capital component and

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what does that kind of look like
in 1020 years time?

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I reckon it's everything.
It's, it's what we've grown up

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in.
I think it was 1977, the Fed

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changed its mandate and it's and
the mandate changed to basically

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measure consumer inflation.
And you've had a number, number

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of manifestations of that over
time.

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OK, So what we started measuring
was the cost of bread and milk.

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You know, if that went up, that
was evil, you know, and we, we,

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we need to put up interest rates
to stop that bread and milk

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going up.
But if the cost of your shelter,

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which is, you know, more
Germano, I guess went up, we

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didn't even notice, you know,
they could go, your cost of

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shelter could go up 3 * 4 * 5
times.

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Now I think it's 10 times your
wages and we don't even notice.

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And that's because the, the, the
Reserve Bank and the Federal

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Reserve and all the central
banks were set up under a system

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called neoclassical economics or
monetary theory, which basically

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said that they were going to
manage the economy from the

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consumption side.
So it's basically central,

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central centralized management.
But from the consumption side,

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the, the, the communists or the
Chinese do it from the

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production side and we do it
from the consumption side.

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So what we did, we introduced,
we introduced basically a model

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that was pretexted on the idea
of efficient, efficient capital

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or efficient pricing.
So you know, if something an

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iPhone could be made by Foxconn
in a building with Nets around

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it and it could be done more
cheaply, then so be it.

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It shouldn't be done in
Australia or America, it should

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be done over there.
And what happened is that

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efficient pricing model, which
is stateless by the way, it

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doesn't look after sovereignty,
it doesn't look after the, the,

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the country involved.
It basically looks after price

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and, and posits that prices the
defining model of efficiency or

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the OR the indicator of
efficiency.

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So it, it, what it does is
eventually hollows out your

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economy.
So because you're efficiently

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pricing things that come out of,
you know, countries that are

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charging $10 a day or $500 a
year in income, they can always

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wage aggregation means they can
always produce more stuff over

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there than we can produce over
here.

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And, and so it defaults away
gradually.

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So what we end up, you know, we
got rid of our car business, we

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got rid of all of our
manufacturing.

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We got all of that based on this
efficient capital hypothesis,

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the, the price, the price of, of
goods were the defining factor.

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And they, they, it sent us off,
I guess on a wild goose chase

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because eventually, you know,
we're just serving coffee to

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each other and, you know,
providing services internally,

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domestically, but we're not
earning any, any income from

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overseas, you know, and that's
include value added things like

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mining.
You know, we don't refine our

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own products.
We send them all to China.

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We, we don't, we don't build our
own cars.

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We don't build anything really.
And you know that, that that

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changed the sovereignty on the
security of, of, of not only our

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country, but every country.
Because what happens is you

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can't produce the things you
need to defend yourself.

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You can't produce the things you
need to create energy.

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You can't produce the things
that you need to even if you

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want to go net zero, which seems
a silly idea if that covers 20%

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of your carbon.
Even even if you do that, like

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you, you can't produce it in in
country.

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And and so you know, it's it, it
can never be efficient.

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And over time.
This is meant that the hurdle

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rate for a state capitalist
based mining venture or refining

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venture is you know 2 to 4% WACC
where the cost of capital for

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you know BHP or Rio or or some
or even you know one of the

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small developments is is
14141516, sometimes 20%

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depending on risk.
As the overseas countries.

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You know, this applies even more
than Australia.

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You know, there's, there's
projects going up at the moment

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that you know, the iron ore
project similar was it Simon

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Simon du?
Simon Du is a classic case in

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point, $20 billion worth of
capital for Rio Tinto and and

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the Chinese to put up a mine.
And you know that's if we if we

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priced it in Rio Tinto terms and
and didn't have the the the

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Chinese involved, it would be a
loss make it wouldn't turn in

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the ROI in in 6-7 ten years.
But because you have to build a

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railway, you have to do all
kinds of things to get the

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project up.
But if China can lower the price

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of iron ore by 10% right across
the board by produce bringing on

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so much production, well then
you know, they get their return

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of on investment in, in, in, in
two years.

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You know, they may, they may
lower the price to get a net

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saving in, in price of say $10
billion that that goes to them

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and, and that that pays back,
you know, half the investment

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cost for that iron ore mine and
gives them pricing power.

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So state capitalism has a way of
lowering the price of things so

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that it lowers the overall.
So the price signalling I guess

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is false.
You know that they invest in

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copper and iron ore like it's,
it's energy or, or, or water.

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So they, you know, they see it
as a, as an input into what

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they're manufacturing.
And since there are only people

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manufacturing anything, you know
that that really matters.

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So they, they, they price these
things in ways that we can't

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price them.
And so eventually everything

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defaults to them.
Now it's not just mining, which

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we're interested in today, but
it's pharmaceuticals.

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It's, it's just about every
sector that we're you can think

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of.
I've had a lot of people copy my

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framework with my collaboration
into other sectors like textiles

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in Europe and textiles in India
and and pharmaceuticals in the

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US.
And so it's the same applies

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what the do what the Chinese do
is price things so that we can't

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compete.
You know, we've got a classic

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example of copper refining at
the moment where the Chinese

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refiners are, are, are paying a
$50 bounty to the Chilean and,

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and Peruvian copper, copper
miners to, to, to, to refine

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their copper.
And the poor Koreans are nearly

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broke because or what was the
Koreans or Japanese are nearly

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broke because they have to
charge $100 a tonne to break

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even.
So copper refining defaults to

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them.
And so it's economic war.

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I don't know if either of you've
read unrestricted warfare by the

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two Chinese generals.
I can never pronounce their

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names.
So unrestricted warfare is a

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concept that was developed by
the Chinese.

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And you know, you've heard the
old term, we always fight the

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old wars.
You know, old generals fight the

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old wars, not the war that's
coming.

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And so that concept kind of
applies to us because we

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conceptualize war as, as
something that happens, you

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know, with Tom Cruise and, and,
and, and storming machine gun

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nests and, and, and things like
that, where war conceptualized

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by the Chinese is economic
warfare.

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It's, it's just, you know, it's
just about anything you can

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think of.
So what they're doing at the

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moment is prioritizing the
state's position through,

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through economic warfare, you
know, so that nobody can refine

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copper in, in the West according
to our values because they can't

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make a profit because they're,
they're being price targeted by,

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by Chinese refiners.
So we, we end up with all of the

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critical metals being, being,
being I guess monopolized in the

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refining stage by, by, by
Chinese refiners.

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And you know, it multiplies out
because it has massive

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consequences.
You know, the consequence, the

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consequences.
You know, we know how the the

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West wants to build out
electrification, that wants to

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build out solar plant, solar
panels, It wants to build out

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wind farms, it wants to build
out AI and robots and just about

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everything else we've heard in
the last 12 months.

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Now that requires a huge amount
of metals, that requires a huge

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amount of materials because
there's, there's gases and

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chemicals in this too.
And they now have, you know, the

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supply line for those projects
runs right through China.

225
00:13:55,720 --> 00:13:59,560
So they've put a licensing
system in it that basically

226
00:13:59,560 --> 00:14:03,440
says, you know, no copper for
you.

227
00:14:04,080 --> 00:14:05,560
It's like the old Seinfeld
thing.

228
00:14:05,960 --> 00:14:10,720
It's, it's, you know, they're
not going to serve copper to a

229
00:14:10,720 --> 00:14:14,960
defence manufacturer.
They're not going to serve rare

230
00:14:15,560 --> 00:14:19,040
earths to a, a defence
manufacturer.

231
00:14:19,040 --> 00:14:22,720
And that's what they, they did
in Japan and they've already

232
00:14:22,720 --> 00:14:24,240
done it.
So they've exercised these

233
00:14:24,240 --> 00:14:27,120
powers and, you know, they,
they're licensing, they're

234
00:14:27,120 --> 00:14:28,920
bureaucratic.
They could just slow it down.

235
00:14:28,920 --> 00:14:32,200
They don't have to turn it off.
It doesn't have to be explicit.

236
00:14:32,880 --> 00:14:36,160
They can just go, well, why
we're going to take six months

237
00:14:36,160 --> 00:14:39,560
to to, to approve these sales
and they can just slow it down

238
00:14:39,560 --> 00:14:41,400
with the friction of
bureaucracy.

239
00:14:42,680 --> 00:14:46,120
And So what happens is, you
know, this undermines the

240
00:14:46,120 --> 00:14:49,000
valuations that we've got
across.

241
00:14:49,160 --> 00:14:52,720
You know, the, the, I always
call them the Fab 7, but they're

242
00:14:52,720 --> 00:14:57,320
the Mag 7, you know.
Yeah, we've got valuations that

243
00:14:57,320 --> 00:15:02,880
assume that, you know, for
instance, the Reuben trip chip,

244
00:15:03,000 --> 00:15:07,880
the the ultra Reuben chip, which
is I think the 2007 and 2008

245
00:15:08,440 --> 00:15:11,280
releases of NVIDIA, We assume
that they're going to have a

246
00:15:11,400 --> 00:15:15,880
place to to, to be lodged
inside, you know, frames

247
00:15:15,880 --> 00:15:18,040
etcetera, inside large data
centers.

248
00:15:18,040 --> 00:15:20,280
But those data centers might not
be able to be built.

249
00:15:20,280 --> 00:15:22,920
The the built the ones that
we're building at the moment

250
00:15:22,920 --> 00:15:26,920
might be the last ones until we,
we we we fix these check

251
00:15:26,960 --> 00:15:29,200
checkpoints.
And and that's because we're,

252
00:15:29,960 --> 00:15:32,360
we're, we're up against a
material constraint, right?

253
00:15:33,240 --> 00:15:35,480
Well, it's two, it's two
constraints.

254
00:15:35,480 --> 00:15:39,000
It's a material constraint.
And my friend Robert Friedland,

255
00:15:40,760 --> 00:15:42,480
you know, would say, well, we
can't get that.

256
00:15:42,480 --> 00:15:45,840
We can't mine the copper quick
enough anyway, right?

257
00:15:46,120 --> 00:15:49,960
It takes, you know, for an
Ivanhoe mine that that latest 1

258
00:15:49,960 --> 00:15:53,960
is about 500,000 ton a year.
It's taking him like something

259
00:15:53,960 --> 00:15:55,920
like 20 years to get it, get it
going.

260
00:15:57,280 --> 00:16:02,760
You know, it's, it's the average
discovery to mine production I

261
00:16:02,760 --> 00:16:05,440
think is 17 to 19 years or
something like that.

262
00:16:05,640 --> 00:16:11,960
In the US, it's 30 years.
So it's, you know, we can't just

263
00:16:11,960 --> 00:16:14,440
bring more copper online.
And all of a sudden we've got

264
00:16:14,440 --> 00:16:20,280
this triumvant of new demand
from, you know, different

265
00:16:20,280 --> 00:16:25,760
sources, you know, AI, the new
AI data centers of 50,000 tons

266
00:16:25,760 --> 00:16:29,880
of copper each.
The, the, and, and you know,

267
00:16:29,920 --> 00:16:33,160
this is the hyperscale ones that
sit on campuses.

268
00:16:33,760 --> 00:16:38,560
The, you know, each, each, even
the normal data center takes

269
00:16:38,560 --> 00:16:44,880
about 2000 tons of copper.
All of the all of the, the grid

270
00:16:44,880 --> 00:16:51,000
stuff in in order to power them,
you know, there's 80 million

271
00:16:51,320 --> 00:16:58,920
kilometres of power lines
projected forward by by 2430.

272
00:16:58,920 --> 00:17:06,920
Five, 74 million of them is, is,
is one to three ton a kilometer,

273
00:17:07,319 --> 00:17:12,200
but the other 6,000,000 is, is
something like 50 ton per

274
00:17:12,200 --> 00:17:15,760
kilometer of copper.
And, and all the others too,

275
00:17:15,760 --> 00:17:21,400
like an average grid power line
has, has, has got like 8 or 10

276
00:17:21,400 --> 00:17:25,160
metals in it.
So yeah, and, and, and a lot of

277
00:17:25,160 --> 00:17:30,360
the people say, well, that we,
you know, they'll replace it

278
00:17:30,360 --> 00:17:32,880
with other stuff, they'll
replace aluminium with copper.

279
00:17:33,680 --> 00:17:36,400
But how are they going to do
that when the aluminium is

280
00:17:36,400 --> 00:17:39,920
controlled as well?
And, and things like silver,

281
00:17:40,200 --> 00:17:43,320
silver, you know, 70% of our
silver comes from copper

282
00:17:43,320 --> 00:17:47,760
smelting and zinc smelting and
lead smelting in the, in China.

283
00:17:47,920 --> 00:17:53,560
If they want to cut the, the,
the silver off, they can do it.

284
00:17:53,800 --> 00:17:57,280
They can do it in 5 minutes.
They have 70% of production,

285
00:17:57,280 --> 00:18:00,760
5000 tons.
We are in deficit per year in

286
00:18:00,760 --> 00:18:04,320
silver production versus
consumption.

287
00:18:04,760 --> 00:18:08,640
That would push, push the West
out to 1314 thousand tons of

288
00:18:09,080 --> 00:18:14,440
copper in deficit, probably more
because I'm still convinced that

289
00:18:14,600 --> 00:18:18,480
nobody's really done the, the
bottom up numbers on this.

290
00:18:20,160 --> 00:18:22,600
And that has to come out of
people's cutlery drawers and,

291
00:18:22,800 --> 00:18:25,600
you know, out of their vaults
and wherever else the silver's

292
00:18:25,600 --> 00:18:30,440
kept, it's above ground.
And, and nobody can prove to me

293
00:18:30,440 --> 00:18:32,560
that they can get at it.
You know, there's people saying

294
00:18:32,560 --> 00:18:38,920
there's 2 or 300,000 tons
inside, inside, you know,

295
00:18:39,080 --> 00:18:42,800
people's cutlery drawers.
But there's, there's, there's

296
00:18:42,800 --> 00:18:45,200
not, we can't prove that they
can get that kind of thing.

297
00:18:46,040 --> 00:18:49,960
So we end up with a kind of, I
call the state of denial.

298
00:18:49,960 --> 00:18:54,120
You know, we're in a state of
denial where we, when we, you

299
00:18:54,120 --> 00:18:57,880
know, when we all look back on
mining, I don't know, you know,

300
00:18:57,920 --> 00:19:02,000
10 years ago, we just looked at
the, you know, the resource and

301
00:19:02,000 --> 00:19:06,280
the grade and the, and the, and
the cost of extraction and all

302
00:19:06,280 --> 00:19:08,440
that kind of stuff.
And we, our valuation models

303
00:19:08,960 --> 00:19:13,440
never contemplated the idea that
we might not, we had to include

304
00:19:13,440 --> 00:19:15,760
the refineries.
And if we didn't have the

305
00:19:15,760 --> 00:19:18,960
refineries, if you've got a
miner that hasn't got a customer

306
00:19:18,960 --> 00:19:21,080
at the moment, how do you raise
money?

307
00:19:22,080 --> 00:19:25,640
Like it's, it goes back to that
capital thing, doesn't it?

308
00:19:26,120 --> 00:19:30,920
The the if, if, if, if you're a
miner with a Chinese partner,

309
00:19:32,240 --> 00:19:34,760
you know, you, you probably can
raise money and can probably

310
00:19:34,760 --> 00:19:38,080
rise at a low cost, but you
probably have to promise your

311
00:19:38,080 --> 00:19:41,720
off take to a Chinese refinery
because that's the, that's part

312
00:19:41,720 --> 00:19:46,560
of the conditions precedent.
You know, you look at companies

313
00:19:46,560 --> 00:19:51,040
like metals X, you know, with
Renaissance, I think it's called

314
00:19:51,040 --> 00:19:56,240
in Tasmania.
The entire off take is, is, you

315
00:19:56,240 --> 00:19:58,720
know, the heart, the half the
mines owned by the Chinese.

316
00:19:58,720 --> 00:20:03,200
Anyway, Yan and I think of this
and you know, the entire off

317
00:20:03,200 --> 00:20:07,560
take goes to China, you know, so
that's I guess identified it as

318
00:20:07,560 --> 00:20:11,120
an Australian resource.
But it's really a Chinese

319
00:20:11,120 --> 00:20:13,680
resource by by contract and
ownership.

320
00:20:13,960 --> 00:20:16,920
And then even Metals X, if you
look into their shareholding,

321
00:20:16,920 --> 00:20:19,600
their biggest shareholders are,
are Chinese funds.

322
00:20:21,080 --> 00:20:24,720
So, you know, what we think of
as a is, you know, and it's very

323
00:20:24,720 --> 00:20:27,760
profitable for Metals X because,
you know, all they have to do is

324
00:20:27,920 --> 00:20:29,840
is reap the royalties or the
benefits.

325
00:20:30,400 --> 00:20:32,200
But, and there's nothing wrong
with that.

326
00:20:32,200 --> 00:20:35,360
You know, one of the things I
would would highlight is I don't

327
00:20:35,360 --> 00:20:37,760
blame anyone for this.
This is just common sense.

328
00:20:38,360 --> 00:20:40,840
If, if, if you're in the Chinese
position, why would you do

329
00:20:40,840 --> 00:20:42,640
anything different?
You just go, God, they're a

330
00:20:42,640 --> 00:20:44,440
bunch of dummies.
I'm going to take advantage of

331
00:20:44,440 --> 00:20:47,760
this.
To that end, Craig, was it

332
00:20:47,760 --> 00:20:49,520
inevitable that that we got
here?

333
00:20:50,440 --> 00:20:54,760
Yeah, absolutely inevitable.
What happens is we create

334
00:20:55,400 --> 00:20:59,400
incentives for the, for the
rivals to take advantage of.

335
00:20:59,920 --> 00:21:03,320
And if those rivals don't take
advantage of, it doesn't, it's

336
00:21:03,320 --> 00:21:05,920
not rational.
So they, they go, well, we might

337
00:21:05,920 --> 00:21:07,800
as well take advantage.
We want control of

338
00:21:07,800 --> 00:21:09,640
manufacturing.
We want to be the number one

339
00:21:09,640 --> 00:21:15,480
manufacturer of say EVs or PVS.
And so we better control our,

340
00:21:16,040 --> 00:21:18,520
our, you know, the, the
downstream and the upstream and

341
00:21:18,520 --> 00:21:23,240
the, and, and in order to do
that, you know, we've created an

342
00:21:23,240 --> 00:21:28,600
atmosphere or I guess an
environment that allows that to

343
00:21:28,600 --> 00:21:30,800
happen.
And so, yeah, I think it's

344
00:21:30,800 --> 00:21:33,600
completely rational act on the
Chinese part.

345
00:21:33,640 --> 00:21:39,160
I don't blame them for a second.
I just think it's dangerous for

346
00:21:39,320 --> 00:21:43,000
either party to be weak.
What I'm interested in is, is

347
00:21:43,240 --> 00:21:46,880
equilibrium between the parties,
because if you push those

348
00:21:46,880 --> 00:21:52,160
incentives too far, you know, we
end up as vassal states of, of

349
00:21:52,160 --> 00:21:55,440
China.
And, you know, we have, we've

350
00:21:55,440 --> 00:21:58,200
got very few ways back to
normality.

351
00:21:58,720 --> 00:22:01,320
And so, you know, I would say,
you know, good luck to the

352
00:22:01,320 --> 00:22:02,720
Chinese.
I I think they've done a

353
00:22:02,720 --> 00:22:04,960
wonderful job.
I spent a lot of time over in

354
00:22:04,960 --> 00:22:08,160
China.
You know, I have tremendous

355
00:22:08,160 --> 00:22:10,360
respect for their country and
their people.

356
00:22:10,800 --> 00:22:13,920
But I don't think it's good for
anybody to take it this far

357
00:22:13,920 --> 00:22:18,200
because all you end up is in
conflict because nobody wants to

358
00:22:18,200 --> 00:22:20,600
become a vassal state you
either, you know, that that's

359
00:22:20,600 --> 00:22:23,600
what they're trying to push on
Europe and, and Australia to a

360
00:22:23,600 --> 00:22:27,680
certain extent as well.
So yeah, mine is just a rational

361
00:22:27,680 --> 00:22:32,120
point of view.
This is, it's an interesting

362
00:22:32,200 --> 00:22:36,800
predicament for the West to, to
be in and it's a, it's dire

363
00:22:36,800 --> 00:22:41,800
because the fragility of of, you
know, our own defence is, is

364
00:22:41,800 --> 00:22:45,320
kind of striking.
I'm curious to to hear you speak

365
00:22:45,320 --> 00:22:48,840
about your concept, the
simultaneity trap, Craig.

366
00:22:50,680 --> 00:22:54,160
Well, the, the trap is we didn't
expect, you know, the, the

367
00:22:54,160 --> 00:22:58,400
design of the copper production,
if you can call that a design.

368
00:23:00,440 --> 00:23:04,080
We were planning copper
production for the world of 10

369
00:23:04,080 --> 00:23:06,400
years ago.
And in the world of 10 years

370
00:23:06,400 --> 00:23:09,120
ago, we didn't have the great
electrification, we didn't have

371
00:23:09,120 --> 00:23:12,360
the great, great alternative
advantage and we didn't have

372
00:23:13,000 --> 00:23:15,400
the, the art.
We certainly didn't have the AI

373
00:23:15,400 --> 00:23:17,120
and all the things that go with
it.

374
00:23:17,440 --> 00:23:24,440
Nor do we have half these new
fancy armaments, let's call it

375
00:23:24,440 --> 00:23:28,120
the military capabilities.
Everything's exploded.

376
00:23:28,480 --> 00:23:33,440
So what's what we have now is,
is mines that was designed on 10

377
00:23:33,440 --> 00:23:36,840
or 15 years ago, demand.
And all of a sudden, you know,

378
00:23:36,960 --> 00:23:42,400
similar simultaneously, we've
got demand from sectors we were

379
00:23:42,400 --> 00:23:44,720
never expecting.
And So what happens, there has

380
00:23:44,720 --> 00:23:51,560
to be an element of denial.
Yeah, the PVIIII doubt 2027 that

381
00:23:52,480 --> 00:23:58,720
PV can be implemented because it
will be cannibalized, you know,

382
00:23:58,760 --> 00:24:03,080
by defence and and AI.
And I don't even think the AI

383
00:24:03,080 --> 00:24:09,360
data center they're building
maybe the winning combination

384
00:24:09,440 --> 00:24:12,680
anyway.
You know, everyone's assumed,

385
00:24:12,680 --> 00:24:16,960
everyone's assuming that AI is
the big thing, but what if I,

386
00:24:16,960 --> 00:24:21,160
what if AI actually comes to us
at the edge computing?

387
00:24:21,160 --> 00:24:24,040
What if we can have AI in the
box in five years and it's

388
00:24:24,040 --> 00:24:28,440
sitting beside us?
You know what, why do we need

389
00:24:28,440 --> 00:24:31,680
these ridiculously configured
data centers?

390
00:24:32,360 --> 00:24:36,120
And So what will happen is
what's happened in history and

391
00:24:36,120 --> 00:24:38,240
every time this kind of thing is
happening is they'll be

392
00:24:38,240 --> 00:24:46,920
rationing and, and you know, the
highest, the, the, the, the unit

393
00:24:46,920 --> 00:24:50,400
that has the highest ability to
pay will pay the highest price.

394
00:24:51,960 --> 00:24:57,200
But it, it means that, you know,
because we're constricted,

395
00:24:57,440 --> 00:25:03,520
because we have limits put on
what we can do in the West, it

396
00:25:03,520 --> 00:25:09,240
means that the Chinese can, you
know, obviously go forward and,

397
00:25:09,360 --> 00:25:12,280
and dominate these sectors.
You know what one of the amusing

398
00:25:12,280 --> 00:25:16,680
things I see is this, you know,
debate in the eye, eye gurus

399
00:25:16,680 --> 00:25:20,920
that the, the, the Chinese are
only 6 months ahead and sorry

400
00:25:21,200 --> 00:25:23,600
behind and, and we have to stay
ahead.

401
00:25:24,280 --> 00:25:27,960
And it's like, well, if you, if
you really build out the

402
00:25:27,960 --> 00:25:32,040
architectures you're telling me
you can build out, you're not

403
00:25:32,040 --> 00:25:33,240
going to be able to do it
anyway.

404
00:25:33,480 --> 00:25:36,440
You know, you're going to, it's
like that classic thing that

405
00:25:36,520 --> 00:25:38,520
we've all probably done at the
high school.

406
00:25:38,720 --> 00:25:41,600
You know, when you're, you're in
the 800 meter race and you run

407
00:25:41,600 --> 00:25:44,200
out front and all of a sudden
you get into the straight and

408
00:25:44,200 --> 00:25:47,520
everyone runs past you.
You know, the West is that

409
00:25:47,640 --> 00:25:52,520
we're, we're, we're, we're
getting ahead of ourselves.

410
00:25:52,520 --> 00:25:56,800
We're building things.
People, people are looking at

411
00:25:56,800 --> 00:26:03,560
these AI data says as you know,
as, as in the, as in the cloud,

412
00:26:03,560 --> 00:26:07,080
like physically people think
they're in the cloud and there's

413
00:26:07,080 --> 00:26:13,000
these massive metal and carbon
and energy chewing metabolic

414
00:26:13,000 --> 00:26:16,640
systems that have to be fed.
Yeah, they're, they're massive

415
00:26:16,640 --> 00:26:21,400
engines and we're building them
like we, we, we, we, we have an

416
00:26:21,480 --> 00:26:26,200
unlimited supply, which is
probably understandable.

417
00:26:26,200 --> 00:26:29,320
You know, from the tech
perspective, you know, they've,

418
00:26:29,400 --> 00:26:31,560
they've always done that.
They've never reached a

419
00:26:31,560 --> 00:26:36,640
constraint situation.
But you know what, they, they

420
00:26:36,640 --> 00:26:40,960
can't continue to do it.
So you just said we just end up

421
00:26:40,960 --> 00:26:45,040
in conflict.
And you know what, what it means

422
00:26:45,040 --> 00:26:49,200
to us as investors is we're
going to be damn careful because

423
00:26:49,800 --> 00:26:55,520
you know, the valuation of a, of
a, an FMG for instance, changes

424
00:26:55,720 --> 00:27:01,240
significantly if if they've got
56% grade iron ore.

425
00:27:01,240 --> 00:27:03,600
And I think that was roughly
what they are thinking in the

426
00:27:03,800 --> 00:27:09,200
new mine the Rio is promoting is
it's got 65%.

427
00:27:09,200 --> 00:27:13,280
That means you've got to
process, you know, hundreds of

428
00:27:13,280 --> 00:27:17,760
millions of tons more to get the
same amount out of the mine per

429
00:27:17,760 --> 00:27:20,960
year, whatever that mine
production is.

430
00:27:21,200 --> 00:27:24,080
It means that you've got to just
process more or you've got to

431
00:27:24,080 --> 00:27:27,200
refine more or you've got to do,
do everything more.

432
00:27:27,680 --> 00:27:31,040
And if they have all the
steelworks and they have all

433
00:27:31,040 --> 00:27:37,280
the, you know, the, the, the,
the furnaces, etcetera, we can't

434
00:27:37,280 --> 00:27:41,200
do it ourselves anyway.
So a company like FMG becomes

435
00:27:41,200 --> 00:27:44,760
captive price captive.
You know, they either provide

436
00:27:44,840 --> 00:27:47,840
and you know, they're taking
Chinese machinery, they're

437
00:27:47,840 --> 00:27:51,560
doing, taking on Chinese debt.
You know that they all of a

438
00:27:51,560 --> 00:27:56,320
sudden become a managed entity.
And then BHP and Rio are the

439
00:27:56,320 --> 00:27:59,440
same types of things.
You know, the Rio was taking

440
00:28:00,560 --> 00:28:04,480
like a Guild mentality to this
new mine where they provide all

441
00:28:04,480 --> 00:28:09,520
the expertise and, and the
Chinese provide all the, the,

442
00:28:09,640 --> 00:28:13,880
the, the money and, and they buy
all the, they buy all the, the

443
00:28:13,880 --> 00:28:18,040
product.
And that you, you can, you can

444
00:28:18,040 --> 00:28:20,440
extrapolate that out right
across the market.

445
00:28:20,480 --> 00:28:24,440
You know, how many, how many do
we, how many miners do we know

446
00:28:24,720 --> 00:28:27,200
that are having trouble raising
money?

447
00:28:27,200 --> 00:28:34,600
And, and, and because they can't
show profitability where others

448
00:28:34,600 --> 00:28:37,920
if they're, if they're, if
they're financed by, by China,

449
00:28:37,920 --> 00:28:40,200
they can, they can show
profitability fairly quickly and

450
00:28:40,200 --> 00:28:43,080
they don't even have to show
profitability in, in some

451
00:28:43,080 --> 00:28:45,520
respects.
It's interesting JD, when we

452
00:28:45,520 --> 00:28:48,240
think about the stuff Craig is
talking about, the West has

453
00:28:48,240 --> 00:28:52,360
found themselves not resilient
at all, not at all resilient

454
00:28:52,360 --> 00:28:55,960
because we don't have the
capability and capacity to

455
00:28:55,960 --> 00:28:59,480
manufacture, to refine, to build
things like we used to.

456
00:29:00,280 --> 00:29:02,840
Some businesses however are
bucking that trend.

457
00:29:02,960 --> 00:29:06,720
Sandvik made Sandvik ground
support still manufacturers in

458
00:29:06,720 --> 00:29:09,960
the countries in cities close to
mines all around the globe,

459
00:29:09,960 --> 00:29:12,560
particularly in Australia still
manufacturers it's own bolts

460
00:29:12,560 --> 00:29:14,320
here.
We saw it with our own eyes.

461
00:29:14,360 --> 00:29:16,960
I always thought the ground
support in Sandvik, ground

462
00:29:16,960 --> 00:29:19,480
support stood for, you know,
supporting the ground in

463
00:29:19,480 --> 00:29:21,960
underground mines.
But it's supporting the Western

464
00:29:21,960 --> 00:29:23,360
world essentially.
It's what they're doing.

465
00:29:23,360 --> 00:29:25,320
That's what Craig has explained
to us today.

466
00:29:25,400 --> 00:29:28,920
I think it would be, it would be
UN Australian not to put an

467
00:29:28,920 --> 00:29:31,520
order in, not to download the
Sandvik Ground Support app or

468
00:29:31,520 --> 00:29:34,880
give Derek Hurd a call today.
We've outlined it 100 million

469
00:29:34,880 --> 00:29:38,240
times before, but these guys are
proudly manufacturing in

470
00:29:38,280 --> 00:29:41,080
Australia and many other
countries and they are, they're

471
00:29:41,080 --> 00:29:42,880
doing R&D as well.
They're making sure we stay

472
00:29:42,880 --> 00:29:46,640
competitive on a manufacturing
fund and I'm tremendously proud

473
00:29:46,640 --> 00:29:48,560
of that man.
Keep as resilient as Sandvik

474
00:29:48,560 --> 00:29:51,120
Ground support is.
Just like Craig tells you about

475
00:29:51,720 --> 00:29:53,160
and Chuck in an order for
Sandvik ground support.

476
00:29:53,160 --> 00:29:55,320
Go Sandvik.
So what what you've articulated

477
00:29:55,640 --> 00:29:59,360
Craig is essentially the, the,
the age of capitalism as we kind

478
00:29:59,360 --> 00:30:04,600
of know it is, is dead and the
age of state capitalism is upon

479
00:30:04,640 --> 00:30:07,120
us.
And we've seen, we've seen clear

480
00:30:07,120 --> 00:30:09,920
signs of this.
The MPA materials deal last year

481
00:30:09,920 --> 00:30:13,320
with the US government taking
10% and and setting a price

482
00:30:13,320 --> 00:30:17,960
floor is a clear sign that the
West is on its way to a more

483
00:30:17,960 --> 00:30:21,480
state capitalism type approach.
I'm curious to hear though, what

484
00:30:21,480 --> 00:30:26,360
are the, what are the signs that
you're looking out for that are

485
00:30:26,360 --> 00:30:29,600
a clear indication that the West
and perhaps other parts of the

486
00:30:29,600 --> 00:30:33,080
West, perhaps Australia, Europe
is well on its way to doing the

487
00:30:33,080 --> 00:30:34,480
same.
Because, you know, we're never

488
00:30:34,480 --> 00:30:37,240
going to see a massive headline
saying this is the new approach,

489
00:30:37,240 --> 00:30:41,400
but there's going to be signs.
Yeah, I, I think, I think what

490
00:30:41,400 --> 00:30:44,960
we had before was stateless
capitalism and stateless

491
00:30:44,960 --> 00:30:48,440
capitalism didn't look after the
sovereignty of our, of our

492
00:30:48,440 --> 00:30:50,360
state.
And when we say state

493
00:30:50,360 --> 00:30:53,640
capitalism, we, we do through in
the lens of, you know, the

494
00:30:53,640 --> 00:30:57,800
communist perspective.
And if you go back to a kind of

495
00:30:57,800 --> 00:31:02,680
Hamilton, Alexander Hamilton's
logic, he, he articulated a a

496
00:31:02,680 --> 00:31:08,480
fairly solid piece of philosophy
that said that if you couldn't

497
00:31:09,920 --> 00:31:13,240
manufacture for yourself, if you
couldn't provide your own needs,

498
00:31:13,720 --> 00:31:16,800
you became vessels of, of
another foreign power.

499
00:31:17,160 --> 00:31:18,720
And they learnt this the hard
way.

500
00:31:18,720 --> 00:31:23,480
You know, Hamilton set beside
Washington in, in the

501
00:31:23,480 --> 00:31:25,720
revolutionary wars.
And, you know, he was the guy

502
00:31:25,720 --> 00:31:29,120
that was worried about getting
all the, the logistics right.

503
00:31:29,280 --> 00:31:32,760
And so, you know, if if you read
Eisenhower's books, another

504
00:31:32,760 --> 00:31:36,080
logistics guy, you know, they
call him a general, but he was

505
00:31:36,080 --> 00:31:39,280
basically the logistics guy that
that made sure all these

506
00:31:39,280 --> 00:31:44,080
fighting generals had the, the
type of, you know, supply lines

507
00:31:44,080 --> 00:31:46,920
that they needed.
He said the same things in his

508
00:31:46,920 --> 00:31:49,680
books.
He's he's famous for that quote

509
00:31:49,680 --> 00:31:52,840
about the military industrial
complex, but everyone should

510
00:31:52,840 --> 00:31:56,640
read these other stuff because
these other stuff outline very,

511
00:31:56,640 --> 00:32:00,880
very particularly how we had to
maintain a level of

512
00:32:00,880 --> 00:32:02,920
independence.
And he did that as a president

513
00:32:02,920 --> 00:32:06,760
as well.
So I think what we're doing is

514
00:32:06,760 --> 00:32:10,240
not so much evolving to a new
type of capitalism.

515
00:32:10,240 --> 00:32:13,080
I think we're evolving back to
where we should, but back to the

516
00:32:13,080 --> 00:32:18,880
future that, you know, if we go
back and look at any of the

517
00:32:18,880 --> 00:32:22,880
theories of economics, they're
all proposed by economists that

518
00:32:22,880 --> 00:32:25,520
were sitting inside dominant
states.

519
00:32:25,840 --> 00:32:31,040
They weren't proposed as as a
way of, of ensuring sovereignty.

520
00:32:31,040 --> 00:32:35,080
Even if you go, you know, von
Misers or Hayek or you know, any

521
00:32:35,080 --> 00:32:38,240
of the Austrian economists,
they're always proposing the

522
00:32:38,240 --> 00:32:42,560
price efficiency was, was, you
know, one of the most important

523
00:32:42,560 --> 00:32:44,600
things.
And they, they all push global

524
00:32:44,600 --> 00:32:47,080
trade.
Well, sure, global trade within

525
00:32:47,080 --> 00:32:52,480
your own allied, you know,
within the allies is, is, is a

526
00:32:52,480 --> 00:32:54,880
great idea.
But global trade with your rival

527
00:32:54,880 --> 00:32:58,800
is, is crazy.
And so I think what we're doing

528
00:32:58,800 --> 00:33:02,360
is coming back.
And, you know, what are the

529
00:33:02,360 --> 00:33:04,320
signs?
I'm, I'm saying of it is, you

530
00:33:04,320 --> 00:33:06,840
know, you mentioned MP
materials, but there's a hundred

531
00:33:06,840 --> 00:33:09,160
of them.
You know, Iperion X, we've got

532
00:33:09,400 --> 00:33:13,840
$115 million to, to look at that
Titanite.

533
00:33:15,040 --> 00:33:17,360
You know, we've got MTM got
money as well.

534
00:33:17,360 --> 00:33:23,440
We've got UCU got, got a whole
bunch of money to develop a, a,

535
00:33:23,440 --> 00:33:30,560
a rare earth processing plant.
And I think what you'll see is

536
00:33:30,560 --> 00:33:35,840
a, is a fairly quick evolution
to a new type of capitalism,

537
00:33:35,840 --> 00:33:40,120
which will be state capitalism.
You know, I'm doing one, I'm

538
00:33:40,120 --> 00:33:43,840
doing a, a return of matter
version for, of India at the

539
00:33:43,840 --> 00:33:45,920
moment.
And that'll be out probably by

540
00:33:45,920 --> 00:33:48,640
the end of the week.
And it's, it's, it's

541
00:33:48,640 --> 00:33:50,840
consequential.
Like they can't even defend

542
00:33:50,840 --> 00:33:52,520
themselves.
They've got 14 days worth of

543
00:33:52,520 --> 00:33:57,040
artillery munitions for their
artillery.

544
00:33:57,640 --> 00:34:02,520
But they, they, they import out
of the 10 rare earths to the

545
00:34:02,520 --> 00:34:05,840
defence aligned, they import
100% of every one of them.

546
00:34:07,240 --> 00:34:09,880
And so if they want to make more
shells, they've got to go to

547
00:34:09,880 --> 00:34:11,920
China.
So if they have a war with China

548
00:34:11,920 --> 00:34:16,159
that, you know, all China has to
do is go, well, we, we just have

549
00:34:16,159 --> 00:34:22,280
to impose our will, you know,
for say 14 days or 30 days or

550
00:34:22,280 --> 00:34:25,320
something like that.
And, and, and their opposition

551
00:34:25,320 --> 00:34:27,800
has to fall.
And that's, This is why I think

552
00:34:27,960 --> 00:34:33,440
the Russians are so confident
because you know, they're,

553
00:34:33,840 --> 00:34:36,360
they're, they're doing 4 million
shells a year.

554
00:34:36,360 --> 00:34:39,679
And we're, we're, we're
struggling to do 400,000 shells.

555
00:34:41,360 --> 00:34:44,480
And so you're going.
The the fragility is like

556
00:34:44,480 --> 00:34:46,520
startling that you, you
underline there.

557
00:34:46,960 --> 00:34:50,600
Just to your point on the, on
the US funding, do do you not

558
00:34:50,600 --> 00:34:53,880
think it's relatively small
scale still?

559
00:34:53,880 --> 00:34:57,440
I mean, the, the US spends a
trillion bucks on, on interest

560
00:34:57,440 --> 00:35:00,160
payments on, on defense, on, on
these types of things.

561
00:35:00,680 --> 00:35:04,200
And that Project Vault, for
instance, where they're talking

562
00:35:04,200 --> 00:35:07,800
about stockpiling stuff is 12
billion bucks at most about, you

563
00:35:07,800 --> 00:35:09,880
know, a portion of that coming
from the private markets as

564
00:35:09,880 --> 00:35:12,680
well.
Do you think this is very early

565
00:35:12,680 --> 00:35:16,080
stages and and like startlingly
small check sizes still?

566
00:35:16,920 --> 00:35:18,720
Yeah, I think that's the big
opportunity.

567
00:35:19,880 --> 00:35:22,520
You know, I've been talking to
fund managers for the last two

568
00:35:22,520 --> 00:35:24,880
weeks, the very large fund
managers.

569
00:35:25,240 --> 00:35:28,600
So it's an interesting insight
into the, the capital

570
00:35:29,520 --> 00:35:33,760
perspective of, of, you know,
organizations and individuals

571
00:35:33,760 --> 00:35:36,720
that have trillions of dollars
under their, under their

572
00:35:36,720 --> 00:35:40,600
investment watch.
You know, I'll give you 1

573
00:35:40,600 --> 00:35:45,440
number, $400 trillion in
invested capital at the moment

574
00:35:45,480 --> 00:35:51,040
in the US system. 1% is allied
to mining or refining or any of

575
00:35:51,040 --> 00:35:52,400
the things that we're talking
about.

576
00:35:53,000 --> 00:35:57,360
So you know, that clearly starts
that that things are going to

577
00:35:57,360 --> 00:36:00,640
get it's going to be a rotation.
There has to be a rotation

578
00:36:00,640 --> 00:36:04,000
between to refining and mining
and manufacturing.

579
00:36:05,040 --> 00:36:07,680
And that rotation is probably
going to be very significant

580
00:36:07,680 --> 00:36:11,280
because like if the video is
overvalued because they can't

581
00:36:11,280 --> 00:36:15,400
deliver Reuben and Ultra Reuben
and, and all the other chips

582
00:36:15,680 --> 00:36:19,960
they've got lined up, you know,
their valuations are probably a

583
00:36:19,960 --> 00:36:25,880
little too high.
And the valuations of a of, you

584
00:36:25,880 --> 00:36:28,480
know, some of the miners is
probably too low, especially the

585
00:36:28,480 --> 00:36:35,760
miners that are associated with,
you know, refiners, etcetera,

586
00:36:35,760 --> 00:36:38,200
like that.
You know, there's, there's,

587
00:36:39,680 --> 00:36:42,200
there's, there's big moves with
the miners.

588
00:36:42,200 --> 00:36:48,560
You know, we saw this, this
recent merger with was it, was

589
00:36:48,560 --> 00:36:52,520
it Rio Tinto and, and I've gone
blank.

590
00:36:52,520 --> 00:36:56,960
The talks with Glencore.
Yeah, Glencore, you know,

591
00:36:56,960 --> 00:37:01,320
they're looking to consolidate.
They, you know, there's going to

592
00:37:01,320 --> 00:37:05,520
be a massive reorganization of
the mining world so that they

593
00:37:05,520 --> 00:37:12,680
can produce the finished
product, not just just just mine

594
00:37:12,680 --> 00:37:14,400
the finished product.
And you've got, you've got all

595
00:37:14,400 --> 00:37:16,720
kinds of projects that you guys
would probably know better than

596
00:37:16,720 --> 00:37:19,760
me.
We're refining it, you know,

597
00:37:19,760 --> 00:37:23,960
over in Port Pierre in WA,
they're going to start refining

598
00:37:23,960 --> 00:37:27,760
things.
But you know, you're also, I

599
00:37:27,760 --> 00:37:30,800
wouldn't be surprised to see
that there'd be some breakage of

600
00:37:30,800 --> 00:37:32,840
some of these off take
agreements as well.

601
00:37:33,480 --> 00:37:37,160
So if we if we hamiltonize the
economy by directing capital to

602
00:37:37,160 --> 00:37:39,720
strategic sectors or the OR the,
you know, this move from

603
00:37:39,720 --> 00:37:44,840
stateless to state LED capital,
don't don't we risk creating

604
00:37:44,960 --> 00:37:48,840
kind of like zombie industries
like a Boeing or a Lockheed that

605
00:37:48,840 --> 00:37:51,600
lose the very efficiency that
that made that made them

606
00:37:51,600 --> 00:37:55,000
competitive.
Well, I would argue that did

607
00:37:55,000 --> 00:37:59,000
that efficiency angle on, on the
old capitalism really work?

608
00:37:59,760 --> 00:38:02,520
You know, like all we got is
monopoly.

609
00:38:02,520 --> 00:38:05,920
There's a book, I forget who
wrote it, the Myth of

610
00:38:05,920 --> 00:38:11,160
Capitalism, you know, where they
look very carefully at whether

611
00:38:11,160 --> 00:38:16,000
capitalism is, is actually on
foot or, or it's just a dream.

612
00:38:16,000 --> 00:38:18,760
And you know that most of the
sectors are duopolies,

613
00:38:18,760 --> 00:38:22,040
monopolies or Triopolis or
something similar.

614
00:38:22,520 --> 00:38:25,280
So they've got pricing power,
you know, the, the corporations

615
00:38:25,280 --> 00:38:27,800
have learned how to game the
system anyway.

616
00:38:29,520 --> 00:38:33,440
And so, you know, I, I, I don't
buy this inefficiency thing.

617
00:38:33,480 --> 00:38:39,440
Like I, I, I, I probably
outsourced 4 or $5 billion worth

618
00:38:39,440 --> 00:38:47,400
of stuff to India from, from a
technology perspective for large

619
00:38:47,400 --> 00:38:51,440
Australian organizations.
And, you know, when I did that,

620
00:38:51,880 --> 00:38:55,880
you realize that, OK, I was
going to the board saying that,

621
00:38:56,000 --> 00:38:58,880
you know, this is an NPV of 14%
or something.

622
00:38:58,880 --> 00:39:01,120
And we, we're going to save
this, we're going to save that.

623
00:39:01,760 --> 00:39:05,520
But you realize the contractual
variations reclaim that on

624
00:39:05,520 --> 00:39:08,720
behalf of the vendor anyway.
And there was no real savings.

625
00:39:08,720 --> 00:39:12,080
It was just projected, you know,
was there any real savings in

626
00:39:12,080 --> 00:39:16,400
privatizing imports?
Not to the not to I, I just see

627
00:39:16,400 --> 00:39:19,720
as a tax.
Was there any real savings in,

628
00:39:19,760 --> 00:39:22,720
in tolls?
You know, the tollways that

629
00:39:22,720 --> 00:39:27,520
we've got, you know, running
around all our, all our cities,

630
00:39:28,040 --> 00:39:32,280
you know, they, they basically
just financialized roads so

631
00:39:32,280 --> 00:39:34,960
that, you know, it cost me $40
to get across Sydney from now

632
00:39:34,960 --> 00:39:38,000
at, at the moment.
Those those are privatizing

633
00:39:38,000 --> 00:39:40,360
these these things that have
these very natural monopoly

634
00:39:40,360 --> 00:39:43,040
characteristics about them.
Yeah.

635
00:39:43,160 --> 00:39:45,080
And so we've financialized
everything.

636
00:39:45,080 --> 00:39:49,120
You, you look at, you know, our
mortgages, we're paying two or

637
00:39:49,120 --> 00:39:55,160
three days pay a week to, to
live in a house that, you know,

638
00:39:55,160 --> 00:39:58,760
all the bank did was provide the
financial assistance to get in

639
00:39:58,760 --> 00:40:00,280
there.
And they, they, you know, it's

640
00:40:00,280 --> 00:40:02,600
endogenous money.
They didn't even create the

641
00:40:02,600 --> 00:40:04,320
money.
They created the money out of,

642
00:40:05,520 --> 00:40:09,040
you know, thin air and they
didn't do anything, you know,

643
00:40:09,160 --> 00:40:14,640
17th century Russian serfs.
I worked three days for the man,

644
00:40:14,640 --> 00:40:17,160
the house.
So they can live where they are,

645
00:40:17,160 --> 00:40:21,960
where where debt serves this in
a similar way, you know, they're

646
00:40:21,960 --> 00:40:26,960
financialized shelter.
And we're so dumb that we think

647
00:40:26,960 --> 00:40:29,960
it's investment growth if our
properties inflate.

648
00:40:30,160 --> 00:40:33,240
But we think when bread and milk
goes up, we should be shocked.

649
00:40:33,600 --> 00:40:36,680
You know, like you've, you've
all seen those graphs where they

650
00:40:36,680 --> 00:40:40,840
show the services inflation
going through the roof and the

651
00:40:40,840 --> 00:40:42,920
cost of televisions going
through the floor.

652
00:40:43,520 --> 00:40:47,480
You know, all, all we've done is
managed to fit in the middle

653
00:40:47,480 --> 00:40:51,640
ground.
And, and, you know, inflation

654
00:40:51,640 --> 00:40:55,760
might be 2%, but it's basically
the, the average of, you know,

655
00:40:55,760 --> 00:41:00,720
the massive increase in
education prices in, in, in

656
00:41:00,720 --> 00:41:04,480
health prices in, in, in
various, in various service

657
00:41:04,480 --> 00:41:10,160
sectors versus the cost of, you
know, imported apples and, and

658
00:41:10,160 --> 00:41:14,520
everything else.
So it's I, I, I think it's a con

659
00:41:14,520 --> 00:41:17,800
job, you know, that we've been
convinced that we need an

660
00:41:17,800 --> 00:41:23,480
independent RBI or, or, or
Federal Reserve and that, and,

661
00:41:23,480 --> 00:41:27,240
and actually what they've done
is act like a, a super lobby

662
00:41:27,240 --> 00:41:32,640
group to divert funds to their
industry, you know, for no good

663
00:41:32,640 --> 00:41:34,280
reason.
They're not creating wealth,

664
00:41:34,280 --> 00:41:35,720
they're not creating
productivity.

665
00:41:35,720 --> 00:41:41,960
They didn't build any my house
and and you know, they, they,

666
00:41:42,160 --> 00:41:47,000
they've somehow latched on to,
you know, 60% of people's wages.

667
00:41:48,520 --> 00:41:51,680
And so, and that, that has
consequence because you know,

668
00:41:51,680 --> 00:41:59,040
while that, while that capital
is attracted to, you know,

669
00:41:59,040 --> 00:42:03,640
things that, that aren't
creating wealth, you know, do

670
00:42:03,760 --> 00:42:07,800
do, I guess it's just the, the
recycling of money, paper money

671
00:42:07,800 --> 00:42:11,080
through the economy with, you
know, the long term capital

672
00:42:11,080 --> 00:42:13,560
interests.
You know, as our interest rates

673
00:42:13,560 --> 00:42:16,920
go up and down, you can, you
know, I talk to these, these

674
00:42:16,920 --> 00:42:21,320
people, you know, CF OS,
etcetera, and you know, the cost

675
00:42:21,320 --> 00:42:24,320
of capital for, for mining goes
up and down with it.

676
00:42:24,320 --> 00:42:27,480
So every time we raise interest
rates, you know, they're,

677
00:42:27,480 --> 00:42:31,320
they're all, all of their
projects, you know, go into the

678
00:42:31,320 --> 00:42:33,120
red.
Every time we lower interest

679
00:42:33,120 --> 00:42:35,000
rates, their projects go into
the green.

680
00:42:35,440 --> 00:42:38,120
Like how it's not a way to run
an economy.

681
00:42:39,760 --> 00:42:44,520
It's silly.
But because we've become, I

682
00:42:44,520 --> 00:42:50,760
guess, hypnotized or, or
conditioned to think it's it's,

683
00:42:50,800 --> 00:42:53,880
it's, it's efficient and it's
not efficient.

684
00:42:53,880 --> 00:43:00,920
It's just, it's, you know, it's
not efficient for us to not do

685
00:43:00,920 --> 00:43:03,160
anything.
But it's ridiculous.

686
00:43:03,200 --> 00:43:06,000
But we've we've all latched onto
it as if it's normal.

687
00:43:07,160 --> 00:43:11,840
I think, I think humans have a
great ability actually to ignore

688
00:43:11,840 --> 00:43:14,960
the problem until it gets so
big, yet you kind of have to do

689
00:43:15,120 --> 00:43:20,040
something about it.
And to to tie that into mining

690
00:43:20,040 --> 00:43:23,480
perspective, the point you've
made about approvals and getting

691
00:43:23,480 --> 00:43:26,800
a mine online, these sorts of
things, 30 years in the US, 15

692
00:43:26,800 --> 00:43:29,040
to 20 years in in other parts of
the world.

693
00:43:30,080 --> 00:43:33,000
Do you see that as a lot of low
hanging fruit?

694
00:43:33,000 --> 00:43:35,440
Like I understand that's just
one part of the problem solving

695
00:43:35,440 --> 00:43:38,200
the materiality doesn't solve
the refining problem or anything

696
00:43:38,200 --> 00:43:40,720
like that.
But there seems to be a lot of

697
00:43:40,720 --> 00:43:42,880
low hanging fruit in speeding up
approvals time.

698
00:43:42,880 --> 00:43:44,400
So we can have mines come
online.

699
00:43:45,080 --> 00:43:47,320
You can make the same case for
nuclear reactors.

700
00:43:47,320 --> 00:43:50,720
If we can get the actual know
how of building these things

701
00:43:50,720 --> 00:43:54,360
that a lot of the 10 year build
time is the red tape you have to

702
00:43:54,360 --> 00:43:56,320
jump through.
What do you kind of make of

703
00:43:56,320 --> 00:43:58,720
that?
Well, I don't think that

704
00:43:58,720 --> 00:44:01,640
politicians get it.
You know, we've just had a

705
00:44:01,640 --> 00:44:08,720
lithium refiner closed down in
WA now it was 245 people there.

706
00:44:09,240 --> 00:44:12,960
You know, let's call 200 of them
highly skilled probably.

707
00:44:14,160 --> 00:44:16,440
Where do they go?
What do they do?

708
00:44:16,440 --> 00:44:18,880
They, they get redeployed.
They we're never going to build

709
00:44:18,880 --> 00:44:24,920
a lithium refining capability
over there, you know, on that

710
00:44:24,920 --> 00:44:27,400
basis.
And you know, if we take that to

711
00:44:27,400 --> 00:44:30,040
answer your question, like if we
project that across and

712
00:44:30,040 --> 00:44:35,360
extrapolate it, it's exactly the
same, the same proposition that

713
00:44:36,000 --> 00:44:40,320
that, you know, these low
hanging fruit have to be done in

714
00:44:40,320 --> 00:44:44,360
a coordinated, thoughtful way.
So, you know, OK, we can get the

715
00:44:44,360 --> 00:44:47,000
approvals through from mines and
things like that, but where are

716
00:44:47,000 --> 00:44:49,840
we going to refine it if we're
still going to refine it in in

717
00:44:49,840 --> 00:44:51,440
China?
It doesn't solve the problem.

718
00:44:51,440 --> 00:44:53,800
It doesn't solve the pricing
problem.

719
00:44:53,800 --> 00:44:57,280
It doesn't solve the, the profit
profitability problem.

720
00:44:57,280 --> 00:45:02,000
Yes, we have to get, you know,
the, the, the ESG issues out of

721
00:45:02,000 --> 00:45:03,800
the way because you know, that's
5%.

722
00:45:03,800 --> 00:45:07,120
I was looking, I was talking to
a customer, I was talking to a,

723
00:45:07,360 --> 00:45:13,960
a podcaster in, in Canada
yesterday and you know, their

724
00:45:14,000 --> 00:45:18,880
ESG is costing 5 to 6% of every
mining project.

725
00:45:19,760 --> 00:45:21,520
You know that, that that's just
ESG.

726
00:45:22,600 --> 00:45:25,080
You know, there was a copper
refiner over there that got

727
00:45:25,880 --> 00:45:30,520
Glencor that pulled out of and
it was because they couldn't

728
00:45:32,000 --> 00:45:36,080
turn the, the chemicals into a
solid.

729
00:45:36,400 --> 00:45:39,520
So what they wanted to do is
take the, the pollution that

730
00:45:39,520 --> 00:45:42,760
comes out of the, the copper
refining, like the arsenic and

731
00:45:42,760 --> 00:45:45,000
stuff.
And they wanted to, you know,

732
00:45:45,120 --> 00:45:49,080
spray within the normal ways to
spray water through it and, and,

733
00:45:49,200 --> 00:45:53,640
and, and take it out of the off
off gas and then, and then turn

734
00:45:53,640 --> 00:45:57,040
it into a solid somehow.
And then they wanted to reduce

735
00:45:57,040 --> 00:46:03,600
sulfur emissions by to, to 90.
I think it was 99.5% that, that

736
00:46:03,600 --> 00:46:08,560
just that made the ASG component
of the copper refining 7 or 8%

737
00:46:08,560 --> 00:46:12,320
of the project, you know that.
And that's before they got the

738
00:46:12,320 --> 00:46:13,920
money to do it.
That's before they got

739
00:46:13,920 --> 00:46:17,720
everything to do it.
So, you know, the politicians

740
00:46:18,680 --> 00:46:23,560
continue to to invest into the
into this kind of short term

741
00:46:23,560 --> 00:46:28,360
thinking they, OK, we'll get
copper off China.

742
00:46:28,360 --> 00:46:30,800
But you know, if you get copper
off China, you're probably not

743
00:46:30,800 --> 00:46:33,840
going to make any AVS, You're
probably not going to

744
00:46:33,840 --> 00:46:37,480
manufacture anything.
It's just a slippery, slippery

745
00:46:37,480 --> 00:46:40,240
slope.
And, and it's, and you can see

746
00:46:40,240 --> 00:46:43,200
in an unrestricted warfare
sense, everyone should buy that

747
00:46:43,200 --> 00:46:46,400
book and read it.
The in unrestricted warfare

748
00:46:46,400 --> 00:46:50,640
sense, what they're trying to do
is dumb us down to the point

749
00:46:50,640 --> 00:46:55,240
where we're, we're, we're, they
control everything financially.

750
00:46:55,360 --> 00:46:58,920
And we, and, and to the most
part, we wouldn't have noticed

751
00:46:59,640 --> 00:47:02,640
until we get there, and then
we'll be shocked and horrified.

752
00:47:04,000 --> 00:47:07,640
The, the reframing of, you know,
the, the material constraints

753
00:47:08,200 --> 00:47:11,760
and mining processing, etcetera
in the West as a, as a matter

754
00:47:11,760 --> 00:47:16,080
of, of, of national security of,
of, of critical defence.

755
00:47:16,320 --> 00:47:21,040
I think it, it certainly goes a
long way to, to reorienting the,

756
00:47:22,120 --> 00:47:25,400
you know, the, the importance of
some of these policy changes

757
00:47:25,400 --> 00:47:29,600
like the, the, the, the status
quo for so long has been on, on

758
00:47:29,600 --> 00:47:34,440
hindering the, the, the minerals
industry from actually producing

759
00:47:34,440 --> 00:47:37,240
anything because of, of ESG
critiques and the likes.

760
00:47:37,240 --> 00:47:42,560
And and yeah, with perspectives
like yours making it a much more

761
00:47:42,560 --> 00:47:45,280
mainstream argument and
perspective to have on the

762
00:47:45,280 --> 00:47:48,840
critical importance from a
defense perspective, it it

763
00:47:48,840 --> 00:47:50,800
should go a long way to
unwinding some of the some of

764
00:47:50,800 --> 00:47:52,400
the more peculiar policies that
hinder I.

765
00:47:53,200 --> 00:47:55,520
Have no choice yeah.
What I have no choice.

766
00:47:56,320 --> 00:48:01,520
The, the, the reality is we are
the, Yeah, you, you extrapolate

767
00:48:01,520 --> 00:48:05,320
this out right.
And if you go, OK, well, let's

768
00:48:05,320 --> 00:48:06,960
just continue with the current
system.

769
00:48:06,960 --> 00:48:11,400
We'll, we'll keep worrying about
bread and milk and serving

770
00:48:11,400 --> 00:48:15,120
coffee to each other.
Eventually what happens is that

771
00:48:15,160 --> 00:48:17,720
we just become a complete vassal
state.

772
00:48:17,720 --> 00:48:21,680
We have to take what they tell
us to do because they have

773
00:48:21,920 --> 00:48:25,080
economic power, complete
economic power over us.

774
00:48:25,600 --> 00:48:29,800
And so if we decide, and I'm not
sure all of the West will decide

775
00:48:29,800 --> 00:48:31,520
this way.
I think the Americans will.

776
00:48:32,040 --> 00:48:34,240
I'm not sure where Australia
sits on this.

777
00:48:34,840 --> 00:48:38,160
If we just, if we decide that
we're going to become a vassal

778
00:48:38,160 --> 00:48:43,080
state because it's all too hard,
then, you know, we, we, we, we

779
00:48:43,080 --> 00:48:45,080
become part of the Chinese
state.

780
00:48:45,240 --> 00:48:50,200
You know, we're in in, with
respect to many of our, you

781
00:48:50,200 --> 00:48:53,360
know, our attitudes, ideas, you
know, they've already tried to

782
00:48:53,360 --> 00:48:56,560
impose many of their ideas on us
already.

783
00:48:58,120 --> 00:49:01,880
So it's really a fight for our
freedom in a way that we haven't

784
00:49:02,880 --> 00:49:06,200
conceptualized.
You know, most people want

785
00:49:06,600 --> 00:49:10,240
freedom and liberty and, and all
those good things, but they

786
00:49:10,240 --> 00:49:13,600
think of it as a principle that,
you know, we just stand up for

787
00:49:13,600 --> 00:49:15,400
those things and they magically
happen.

788
00:49:15,400 --> 00:49:18,800
You know, you know, I'm not like
I mentioned, I'm writing an, an,

789
00:49:19,160 --> 00:49:21,720
an Indian return of matter at
the moment.

790
00:49:21,720 --> 00:49:25,960
And you know, they have
traditions, 2000 year traditions

791
00:49:25,960 --> 00:49:28,320
of not doing what exactly what
they're doing.

792
00:49:28,320 --> 00:49:33,960
They, they, they, they, they,
they have what they call

793
00:49:34,000 --> 00:49:37,400
Ashtanga.
I can't pronounce it, but they,

794
00:49:37,720 --> 00:49:42,640
they, they have a, they've had
a, a, a philosophical system of

795
00:49:42,640 --> 00:49:47,560
state independence and, and
resilience that they followed

796
00:49:47,560 --> 00:49:51,800
for 2000 years and then thrown
away because of Western

797
00:49:51,960 --> 00:49:55,760
economists.
And that has to be real estate

798
00:49:55,880 --> 00:49:57,840
established.
That's it's the equivalent of

799
00:49:57,840 --> 00:50:03,400
the Hamiltonian angle in the US
And you know, I might add

800
00:50:03,400 --> 00:50:08,520
Menzies, if you read deeply into
Robert Menzies, who is a was a

801
00:50:08,520 --> 00:50:13,600
wartime Prime Minister.
So you know, he's into logistics

802
00:50:13,600 --> 00:50:17,640
and and self-reliance.
He said, hey, you have to have a

803
00:50:17,640 --> 00:50:19,800
balance between consumption and
production.

804
00:50:20,400 --> 00:50:24,280
Like if you read his 1961
speech, his election speech,

805
00:50:24,720 --> 00:50:28,360
it's, it's exactly what he says.
He's a Hamiltonian guy through

806
00:50:28,360 --> 00:50:32,160
and through.
And, you know, like Menzies was

807
00:50:32,240 --> 00:50:35,920
a was a Prime Minister while
Eisenhower was a general.

808
00:50:37,120 --> 00:50:42,600
These people through, you know,
difficulties, learn the, the,

809
00:50:42,960 --> 00:50:47,040
the truth and, and through our
own, I guess, idiocy, we've,

810
00:50:47,040 --> 00:50:51,760
we've forgotten them.
I think we need to touch on AI

811
00:50:51,760 --> 00:50:54,520
as we kind of wrap the
conversation because that's the

812
00:50:54,520 --> 00:50:57,360
last point.
And it's well out of our, you

813
00:50:57,360 --> 00:51:00,640
know, circle of competence to,
to speak about AI in, in a

814
00:51:00,640 --> 00:51:02,400
meaningful way.
But I think we can all kind of

815
00:51:02,400 --> 00:51:05,200
acknowledge the, we're kind of
on the cusp of a lot of these

816
00:51:05,200 --> 00:51:11,480
kind of implications taking a
role, whether we take AA12510 or

817
00:51:11,480 --> 00:51:13,480
20 year lens on these types of
things.

818
00:51:14,040 --> 00:51:17,360
And specifically on the, the
manufacturing and, and these

819
00:51:17,360 --> 00:51:19,600
parts of things.
Because maybe I think as you

820
00:51:20,480 --> 00:51:23,560
touched on in some of your
writing, this is the key to to

821
00:51:23,560 --> 00:51:27,560
making manufacturing possible in
parts of the world like like

822
00:51:27,560 --> 00:51:30,160
Australia, which we've long
forgotten how to do.

823
00:51:30,160 --> 00:51:33,240
So how does that impact your
thinking and your writing?

824
00:51:34,920 --> 00:51:37,440
I think AI allows us to be
independent.

825
00:51:37,520 --> 00:51:41,000
And you know, we've just
announced we're going to

826
00:51:41,000 --> 00:51:43,520
manufacture ghost sharks for the
whole of Asia.

827
00:51:44,960 --> 00:51:48,640
You know, ghost sharks are the
andoral submarine system.

828
00:51:49,080 --> 00:51:52,240
You know, when we want to, we
can manufacture things.

829
00:51:52,240 --> 00:51:54,640
Now with robots and AI, there's
no excuses.

830
00:51:54,640 --> 00:51:57,400
It's not no longer a wage
arbitrage.

831
00:51:57,400 --> 00:52:00,560
It's no longer that they're
paying $5 a day over there.

832
00:52:00,560 --> 00:52:05,840
It soon will be that we can pay
our, our, our robots $10 a day

833
00:52:06,040 --> 00:52:10,720
or whatever the equivalent is.
So there's no reason why the

834
00:52:11,320 --> 00:52:15,480
principles of moving our
manufacturing offshore, EG we

835
00:52:15,480 --> 00:52:17,760
couldn't be, we couldn't be
competitive.

836
00:52:18,240 --> 00:52:21,960
You know that competitive
differentials narrows and we can

837
00:52:21,960 --> 00:52:25,920
bring a lot of it back.
But AI, you know, like I am

838
00:52:25,920 --> 00:52:30,000
qualified to talk about it.
And AI is, is we've got a whole

839
00:52:30,000 --> 00:52:35,440
bunch of product managers with,
you know, their, their life

840
00:52:35,720 --> 00:52:39,440
hanging on, their ability to
produce revenue, sprouting all

841
00:52:39,440 --> 00:52:43,400
kinds of nonsense about what AI
will be able to do in 18 months.

842
00:52:44,800 --> 00:52:47,800
And, you know, the reality is
they don't know the first thing

843
00:52:47,800 --> 00:52:49,880
about some of the industries
they're talking about.

844
00:52:50,120 --> 00:52:51,960
They can talk about it
functionally, yeah.

845
00:52:51,960 --> 00:52:55,120
And AI can be an accountant will
be able to do the functional

846
00:52:55,120 --> 00:52:57,360
equivalent.
But they don't talk about how

847
00:52:57,360 --> 00:53:02,000
long that those implementations
cycles will take into the, the

848
00:53:02,000 --> 00:53:04,600
accounting economy.
They don't talk about, they

849
00:53:04,600 --> 00:53:10,840
don't know how, how much those
systems are already automated,

850
00:53:12,000 --> 00:53:18,080
you know, via, via Intuit and
all these other SAS vendors, you

851
00:53:18,080 --> 00:53:21,520
know, the, the, a lot of these,
you know, if you spend $700

852
00:53:21,520 --> 00:53:25,320
billion on building AI systems,
you've got to tell the world

853
00:53:25,320 --> 00:53:27,160
that they're going to make a
profit.

854
00:53:27,160 --> 00:53:29,120
And so they say, I've learned
these things.

855
00:53:29,520 --> 00:53:32,960
So I, you know, I think AI in,
in mining is going to be huge

856
00:53:34,280 --> 00:53:36,440
and it's going to increase our
print efficiency and

857
00:53:36,440 --> 00:53:39,560
productivity and all that.
I've got a paper coming up on

858
00:53:39,560 --> 00:53:43,240
that at the moment.
But I, I, I think we've got, you

859
00:53:43,280 --> 00:53:48,400
know, like I, I call it 30% of
30% of 30% everything where I

860
00:53:48,400 --> 00:53:51,480
look, there's efficiency is
going to happen in mining and

861
00:53:51,480 --> 00:53:55,320
it's going to accelerate our
ability to produce goods out of

862
00:53:55,320 --> 00:53:59,200
the earth.
But these things have to, you

863
00:53:59,240 --> 00:54:00,960
know, these things will take
time.

864
00:54:01,480 --> 00:54:05,160
You know, have, have you seen
the eye pulse thing from Robert

865
00:54:05,160 --> 00:54:07,240
Friedland?
You know that, that, that's

866
00:54:07,240 --> 00:54:10,560
crazy.
You know, you've got, you've got

867
00:54:10,560 --> 00:54:12,680
something that I don't know, I
can't remember.

868
00:54:12,680 --> 00:54:16,040
It's three times more efficient
than existing drilling methods.

869
00:54:17,560 --> 00:54:22,280
You know, the, the, the ability
to drill for thermal power in

870
00:54:22,280 --> 00:54:25,120
the United States is, is
ridiculous.

871
00:54:25,120 --> 00:54:28,240
Like if you look at the thermal
power potential map of the

872
00:54:28,240 --> 00:54:30,600
United States, it covers 2/3 of
the country.

873
00:54:31,160 --> 00:54:33,120
Yeah.
Are they going to need all these

874
00:54:33,320 --> 00:54:36,760
nuclear power stations if they
can just drill a hole and set up

875
00:54:36,760 --> 00:54:40,360
a thermal power station next to
the next to the data center?

876
00:54:40,480 --> 00:54:42,120
And will they need all these
data centers?

877
00:54:42,120 --> 00:54:44,440
I think they're going to be edge
computing.

878
00:54:44,440 --> 00:54:47,320
I don't think they they're going
to go into data centers, but

879
00:54:47,320 --> 00:54:50,320
anyway.
Well, one of the big concerns on

880
00:54:50,720 --> 00:54:54,680
AI and it's impacts on mining
again to, to your whole kind of

881
00:54:54,680 --> 00:54:58,360
thesis is that China just runs
ahead and they are the first to

882
00:54:58,360 --> 00:55:00,920
automate mines and, and these
sorts of things.

883
00:55:00,920 --> 00:55:04,720
And their cost of getting these
materials out drops that are,

884
00:55:05,200 --> 00:55:09,600
you know, to a far lower rate
than it is for, for us Western

885
00:55:09,600 --> 00:55:12,680
companies or Western miners in
in other countries as well.

886
00:55:12,680 --> 00:55:16,360
I think that's like the, that's
like the dire, the dire

887
00:55:16,400 --> 00:55:18,280
reflection from, yeah, the
synopsis.

888
00:55:18,280 --> 00:55:21,760
You layout it.
And overnight Ray Dalio, he

889
00:55:22,600 --> 00:55:24,720
penned an article.
It's official.

890
00:55:25,000 --> 00:55:28,040
The current world order is over
and effectively, you know,

891
00:55:28,040 --> 00:55:31,360
declares it in some way, shape
or form you know.

892
00:55:31,400 --> 00:55:33,440
The.
Yeah, the end of the end of

893
00:55:33,840 --> 00:55:38,520
America is 145 year reign.
Reign as a supreme empire.

894
00:55:38,520 --> 00:55:42,720
And I yeah, I just, I just think
that there's no there's there's

895
00:55:42,720 --> 00:55:45,760
an inevitability about the
future that it, it almost feels

896
00:55:45,760 --> 00:55:48,560
defeatist.
But but I don't, I don't

897
00:55:48,560 --> 00:55:51,920
actually think that that that
policy can really change things.

898
00:55:51,920 --> 00:55:54,400
The course is set.
I don't know if you agree or

899
00:55:54,400 --> 00:55:58,360
disagree with that.
I well, it depends, you know,

900
00:55:58,360 --> 00:56:01,320
this is all up to the game of
life, isn't it?

901
00:56:01,320 --> 00:56:03,000
How much do we want it to
change?

902
00:56:03,520 --> 00:56:07,680
How much are we willing to
defend our, our way of life?

903
00:56:07,680 --> 00:56:11,920
And, and, you know, are we
willing to, you know, maybe

904
00:56:11,920 --> 00:56:14,880
there's a future state which
says that the Chinese are the

905
00:56:14,920 --> 00:56:18,280
only superpower.
I, I think we're going to

906
00:56:19,000 --> 00:56:22,480
balkanize, you know, I think
you'll have a, you know, I think

907
00:56:22,480 --> 00:56:26,680
eventually the Chinese ability
to do things will be severely

908
00:56:26,680 --> 00:56:29,960
restricted and you'll have, you
know, you'll, you'll have,

909
00:56:30,280 --> 00:56:33,320
you'll have the, the allies and
they'll stick together.

910
00:56:33,320 --> 00:56:35,880
And then because, you know,
traditionally if you look at

911
00:56:35,880 --> 00:56:38,120
empires, they don't normally
trade with other empires.

912
00:56:38,120 --> 00:56:39,880
They usually trade within
themselves.

913
00:56:40,360 --> 00:56:43,400
So what we've seen is, you know,
unusual.

914
00:56:43,800 --> 00:56:47,400
So I, I think we'll balkanize
and I, I think to some extent

915
00:56:47,400 --> 00:56:52,000
that Australia and the US is
already walking down that path.

916
00:56:53,400 --> 00:56:57,320
You know, I don't know if you
read defence stuff, you probably

917
00:56:57,320 --> 00:57:01,920
don't, but you know, there was
an announcement of the other day

918
00:57:01,920 --> 00:57:07,400
of seven top secret projects in
the Philippines that Australia

919
00:57:07,400 --> 00:57:09,160
was going to build for
infrastructure.

920
00:57:10,640 --> 00:57:17,520
The same week they, they
announced a, a $2.4 billion

921
00:57:17,520 --> 00:57:21,320
contract with Andrew re, these
ghost shark submarines.

922
00:57:21,800 --> 00:57:23,840
Now it's not hard to put the two
and two together.

923
00:57:24,120 --> 00:57:29,880
If you look at the not 2023
defense strategy that the the

924
00:57:29,960 --> 00:57:34,000
the Defense Department put out
themselves, they proposed that

925
00:57:34,000 --> 00:57:38,600
they would take the defense of
Australia offshore and include

926
00:57:38,600 --> 00:57:41,760
all of Asia Pacific and Asia,
Southeast Asia.

927
00:57:42,160 --> 00:57:45,080
You know that that went past and
no one really noticed.

928
00:57:46,440 --> 00:57:50,680
So now we've got, we're starting
to build alliances that are

929
00:57:50,840 --> 00:57:53,560
regional and you know, obviously
that's American based.

930
00:57:54,160 --> 00:57:57,640
And so it'll it'll balkanize,
you know, you, you, we won't be

931
00:57:57,640 --> 00:58:01,880
able to stand up to a lot of
these Chinese practices.

932
00:58:01,880 --> 00:58:05,280
So, you know, we'll regulate
around them and or bar them from

933
00:58:05,280 --> 00:58:08,960
the system, but you know how
that looks and how they unfold,

934
00:58:09,200 --> 00:58:13,440
you know, got any of those?
Greg, you've given us a

935
00:58:13,440 --> 00:58:15,680
tremendous amount to, to think
about.

936
00:58:15,800 --> 00:58:18,320
I can assure you someone who
hasn't cracked 30 that there,

937
00:58:18,320 --> 00:58:21,240
there will be some defense for
our beautiful way of life here

938
00:58:21,240 --> 00:58:23,920
in Australia.
And I think it's just important

939
00:58:23,920 --> 00:58:26,280
that we all are aware of the,
the topics you're writing about

940
00:58:26,280 --> 00:58:28,640
and we're thinking about these
things and, and hopefully some

941
00:58:28,640 --> 00:58:31,600
action comes at the back of it.
But I appreciate you coming on

942
00:58:31,600 --> 00:58:34,040
and and sharing your your
perspectives and your experience

943
00:58:34,040 --> 00:58:37,080
with our audience.
It's been a lot of fun though.

944
00:58:37,080 --> 00:58:41,360
Actually, I'm, I'm, I'm happy to
be here and thank you for the

945
00:58:41,360 --> 00:58:44,680
opportunity to talk everyone
because the only reason I do

946
00:58:44,680 --> 00:58:47,040
this is to wake everyone up.
You know, I haven't got any

947
00:58:47,040 --> 00:58:48,680
subscriptions or anything like
that.

948
00:58:49,520 --> 00:58:53,480
You know, I'm just doing it to,
to shake the tree so that we do

949
00:58:53,800 --> 00:58:58,840
exhilarate action so that, you
know, all my, I've got 7 kids.

950
00:58:58,840 --> 00:59:01,760
I think, I think five of them
are under 30.

951
00:59:02,240 --> 00:59:04,040
You know, we need a future for
them.

952
00:59:04,160 --> 00:59:08,480
What a big picture conversation
that was and we have our

953
00:59:08,680 --> 00:59:10,000
fantastic partners to thank for
that.

954
00:59:10,000 --> 00:59:12,920
Sanded ground support, focus the
platform by market tech

955
00:59:13,280 --> 00:59:17,480
Intralinks and Exceed Capital.
Go Australia.

956
00:59:17,680 --> 00:59:21,040
It'll be money minus.
Now remember, I'm an idiot.

957
00:59:21,320 --> 00:59:23,760
JD is an idiot.
If you thought any of this was

958
00:59:23,760 --> 00:59:26,280
anything other than
entertainment, you're an idiot

959
00:59:26,640 --> 00:59:27,800
and you need to read our
disclaimer.