Canada’s Resource Boom Is Coming

[00:00:00]What I believe I'm seeing is a large rearmament cycle even Japan for heaven's sake a large rearmament cycle has got to be a boom to much resource extraction of I got that straight I mean is that is that is is it like a almost unavoidable boom is setting up.

[00:00:19]>> There is and I wrote a whole little paper on it Ron called the rupture cycle cuz the nerd I am I looked at the last four commodity cycles to see what were the patterns what triggered them you know what the effects it had what were the technological drivers the geopolitical drivers and the demand drivers wanting to know well what does it look like for this cycle you know I'm trying to you know get some clarity on what to expect for sure rearmament and reindustrialization in general in the West is is a push especially for Canadian resources all things being equal do prefer it from us but for me it is AI and electrification that is probably the most significant demand driver and then but on the other hand you have a scarcity driver which is to say we under invested for 10 years we've added a billion people we've never added that many people over 10 over a 10-year period before and we are just exhausting some of the reserves that we developed in the last cycle that those are the normal flows but in this cycle you have the added you know problem of for 10 years we had ESG financing and you did not fund resource extraction to the extent that you would if you just followed the invisible hand of the free market you obviously had more regulatory challenges that brought up more you know social license issues and so compared to other cycles we are further down the hole in this cycle to be able to balance what's coming in the future obviously electrification drives natural gas uranium coal battery metals copper aluminum you're already seeing all-time high in copper you're already seeing very low inventories in aluminum and we're at the very beginning of this AI you know kind of you know, cycle that we're going through. But I just want to finish with this run because because my overall thesis is that this is such a bullish setup for Canada.

[00:02:07]>> [snorts] >> If you can imagine we are in a time where people don't want to get mining products from China. That's the world's top mining producer. People don't want to get oil and gas from the Middle East.

[00:02:19]The world's top region for oil and gas.

[00:02:22]Shale oil in United States has peaked.

[00:02:25]And it was the shale revolution that that, you know, upended the last boom that turned that boom into a bust in 2014. Well, now it's peaking.

[00:02:33]Uh and so someone has to fill in the gap that it's been supplying. And finally, Russia is largely out of the picture.

[00:02:40]The other, you know, the biggest country where the second biggest you produces everything just like we produce everything, but no one can invest in Russia, no one can buy from Russia. And I either you you we you've not seen a setup like this ever for Canada. And that's why I feel pretty good about where we are.