The fund manager deliberately pursues a global investment strategy, arguing that international resource markets offer better value and a deeper mid-cap space compared to Australia. He contends that Australia's $4 trillion superannuation pool inflates domestic asset prices, making them less attractive for new capital.
Significant concern is expressed over Australia's deteriorating investment climate for the resources sector. Recent tax policy changes and a perceived lack of government support are seen as factors that deter private and foreign capital, stifle entrepreneurship, and push major domestic miners to invest abroad.
The current gold bull market is underpinned by two persistent macro drivers: escalating geopolitical risk and high levels of global sovereign debt. Short-term price dips are viewed as liquidity-driven events rather than fundamental shifts, with the long-term thesis strengthened by factors like increased central bank buying.
The market is believed to be massively underpricing the economic consequences of the conflict in the Strait of Hormuz, an event viewed as potentially more significant than the 1970s oil embargo. This is expected to trigger a liquidity squeeze and ultimately force a renewed global focus on energy security, benefiting traditional energy sources and uranium.
The ESG movement has led to a decade of significant underinvestment across the traditional energy value chain, creating a structural supply deficit. This has occurred while global demand for oil continues to grow, setting the stage for a prolonged period of higher energy prices.
Keep pulling the thread on Michel Mamet.