Deep in the open pit
The world's most important metal
Good morning, my canaries in the coal mine. This is your Stock Market Rundown for July 13th, 2023. Thanks for hanging out with me. Let’s dig in:
TODAY’S TOP STORY: MINING FOR THE RED METAL⛏️
A billionaire has a grim warning: “copper markets are heading for a train wreck.” Robert Friedland, a serial founder of mining companies, recently predicted the price of copper could explode upward by tenfold.
Between low physical inventories and cheap valuations on mining companies, copper supply is getting tighter than Spanx on a drag queen.
Commodity trading old hands refer to the red metal as “Doctor Copper” because it’s a leading indicator of turning points in the global economy. Why is it such a bellwether? Well, it’s used in construction, manufacturing, power generation, electronics—all the physical “stuff” that forms modern life around us.
So the next time you’re ordering an Instant Pot from Amazon, using indoor plumbing, or peeling down the highway over the speed limit, thank a copper miner.
And copper is becoming even more critical, since electric vehicles require four times as much copper as traditional gas-fuelled cars. Next time a buddy with a Tesla is preening that he doesn’t use gasoline, point out that the copper in his vehicle came from open-pit mining and smelting furnaces. Owned.
Copper prices peaked last March, but have pulled back in recent months as China’s economy is flagging, and rising interest rates are growth in developed economies.
Result: Doctor Copper is clinically depressed. But whenever he perks up, global markets are likely to follow.
SO WHAT ELSE IS GOING ON?
Microsoft is laying people off yet again, leading to LinkedIn messages from now-unemployed former employees seeking “new opportunities and challenges”. Meanwhile Bezos is enjoying the beaches of Capri, lucky man.
Carbon footprint? Who cares? Our homie Warren Buffett just purchased a big stake in a liquefied natural gas facility. But hey, Berkshire-Hathaway is one of the largest producers of wind power, so give ‘em a few green points for that.
Bank of America will pay a $250 million fine to the government for screwing over grandma.
Longevity clinics are charging as much as $100,000 for stuff like stem-cell therapy that’s not even approved by the FDA. That price tag better include dinner, a movie, and a kiss goodnight.
As if boomers haven’t done enough to wreck the housing market and the environment, they also might tank the stock market as they age and sell down their portfolios. Can’t we just drop them all on an ice floe to drift out to sea?
That’s it for today, see you bright and early tomorrow. Yours in capitalism, The Axe