The World Runs on This Tiny Metal Market—and Almost No One Knows It

In January of 1843, a local entrepreneur in the city of Philadelphia named Alexander Simmons launched a weekly publication called the Philadelphia Dollar Newspaper.

(It was named that because the subscription price was a whopping $1… per YEAR.)

There was a lot of competition in the media industry back then, just as there is today. So in order to make a splash, Simmons decided to hold a contest where writers from across America could submit short stories. The winner would receive a cash prize and have his story published in the paper.

Well, the winner of the prize was none other than Edgar Allen Poe— who was already an established name in American literature at that point. And his story was published on June 21, 1843.

The plot revolved around William Legrand, a reclusive intellectual who discovers a mysterious new insect with a golden metallic appearance. In studying the beetle, Legrand finds clues to a hidden treasure which ultimately consumes him and drives him mad.

It’s a story of intrigue, dark psychosis, and cryptic puzzles. And it became one of Poe’s most popular works during his lifetime.

He called it The Gold-bug after the insect that Legrand discovers.

Fast forward a few decades to the 1870s, and there was vigorous debate in the United States about whether to return to the gold standard—a system that had been temporarily suspended during the Civil War.

At the time, some people advocated for a pure gold standard. Others pushed for a bimetallic standard using both gold and silver. And a few just wanted to keep using paper money backed by nothing.

Those in favor of gold were often derisively labeled “gold bugs”, which implied an irrational obsession with gold, similar to the main character William Legrand from Poe’s short story.

And the term is still occasionally used today to mock investors who invest in physical gold.

Personally I’m not fanatical about anything, aside from my children. So I’m not a ‘gold bug’. I don’t think that gold has any special voodoo mystique, nor the ability to perform miracles.

I am, however, a gold bull. I believe the case for higher gold prices is obvious given the clear trajectory of US government debt.

Foreign governments and central banks have been loading up on gold over the past two years precisely for this reason. They aren’t “gold bugs”. They simply view gold for what it is— a commonly-held strategic reserve asset.

For individuals, gold is a solid long-term inflation hedge. It’s also very useful for holding wealth outside the banking system, which also makes it great for estate planning and asset protection.

There are also times when gold isn’t just a good hedge—it’s a smart investment with significant upside. And we’re living through one of those moments.

We’ve been aggressively writing about this for the past few years— starting in early 2023 after the gold price bottomed out. Since then gold has more than doubled in price.

We’ve also written extensively about the other obvious opportunity: gold stocks.

Physical gold prices soared because central banks were buying gold. But those central banks don’t buy gold companies.

So for most of the past two years, there has been a bizarre disconnect between the rising price of gold and the sagging share prices of the companies which produce gold.

We said over and over again that this disconnect would come to an end. And it is starting to do just that, with many gold companies seeing absurd gains this year (including many of the companies featured in our premium investment research publication, The Fourth Pillar).

At this point everyone knows that gold is on a tear. It’s no big secret anymore. But today I want to tell you about another strategic asset… which is very cheap at the moment but poised to rise dramatically in price.

I’m talking about tin.

Hardly anyone talks about tin. There are no TikTok “tinfluencers” breaking down its fundamentals. No one is accused of being a “tin bug”.

Yet tin is absolutely essential to our modern digital economy. Every iPhone, every data center, every AI chip depends on it—because tin is the essential component in solder, i.e. the glue that binds circuit components together.

There simply is no substitute for solder, and hence for tin.

Yet it’s a strange relationship, because while tin is absolutely critical, it’s also dirt cheap. Only a few cents’ worth of tin goes into an iPhone that Apple sells for more than $1,000.

This means that the price of tin could increase by 10x and Apple wouldn’t blink. Consumers wouldn’t notice either.

Yet tin investors would make a fortune.

But why would tin suddenly rocket up in price? Because the market is tiny, and most production comes from a few politically unstable regions where mines get shut down all the time.

In the past, these supply challenges were always balanced out by drawing down old tin stockpiles that date back to the Cold War era. But those stockpiles are now nearly depleted.

Moreover, there are very few tin mines coming online anytime soon. So most likely any production shortage in the near future will result in rising tin prices.

There’s also a strong case to be made for rising tin demand as AI, electrification, and cloud infrastructure continue to scale.

This is the kind of opportunity we tend to focus on in our investment research—critical real assets in tight supply and rising demand which are totally overlooked by mainstream investors.

Tin definitely qualifies. Again, I’m not a tin bug. But I am a tin bull.

And the kicker is that our downside is covered; the tin producer we found is debt-free, profitable, and trading at less than 3x earnings. That’s not just cheap—it’s ridiculous.

The tin price doesn’t have to explode for this to be a winning bet. But if it does—if we see even modest supply disruption, or if investors finally wake up to how critical this metal is—the upside potential is enormous.

You can learn all about this opportunity in our latest issue of The 4th Pillar— we’re currently offering a subscription to our monthly investment research newsletter at a 40% discount.

Click here to learn more.

Source

Simon Black is an international investor, entrepreneur and permanent traveler. His daily letter is both educational and entertaining, and we suggest that those who want unbiased, actionable information about global opportunities sign up for Sovereign Man’s free, actionable newsletter at http://www.SovereignMan.com.

From Simon Black of SovereignMan.com

Source: https://www.schiffsovereign.com/trends/the-world-runs-on-this-tiny-metal-market-and-almost-no-one-knows-it-153195/