Lyn Alden: Energy Crises, Inflation, and the Lack of Sound Money

Tom welcomes back Lyn Alden, Financial Newsletter Editor & Publisher, to the show. Lyn discusses the difficulty of safely storing wealth from the perspective of inflation and financial censorship. The current world financial system is composed of 180 local monopolies, within which governments demand that wealth is kept, but most are terrible at preserving value. Out of these, only a dozen are any good at holding value. The current system has many inefficiencies and brings significant risk to most. Half of the world lives under varying levels of authoritarian governments, which often use the financial system as a weapon and have banks that censor global payments. Historically, money operated at the speed of commerce, but this changed with the advent of modern communications. This delay between payments and delivery of goods has given governments and banks room to arbitrage. Lyn finds value in Bitcoin and some stablecoins, but she describes some of the problems and risks associated with crypto projects. She also discusses the decline in the Federal Reserve's remittances function and its impact on the U.S. Government's finances. Lastly, she discusses the world's energy requirements and the declining lack of return for what is being invested. Developing nations are looking for cheap, effective energy solutions, while wealthier countries are in a better position to adjust to new technology. She expresses concerns about the lack of capital investment in oil and how this spills over into mining. Time Stamp References:0:00 - Introduction0:32 - Inefficient Money4:03 - Financial Censorship7:06 - Commerce & Money11:50 - Crypto & Confidence16:18 - Digital Gold?20:30 - 2023 & Asset Growth22:30 - Structural Inflation24:44 - Fed Remittances30:34 - Bank Loans & Yield Curve31:14 - Energy & Inflation38:43 - EROI & World Needs45:00 - ESG & Trade Offs46:55 - CapEx & Oil Sector52:25 - PM Mining & Industry56:13 - Key Questions in 202358:18 - Wrap Up Talking Points From This Episode * The current world financial system is composed of 180 local monopolies, with very few of them being able to effectively preserve value.* Governments and banks have taken advantage of the lag between payments and delivery of goods to arbitrage, creating significant risk for most.* Lyn discusses the declining lack of return for energy investments, and the lack of capital investment in oil and mining. Guest Links:Twitter: https://twitter.com/LynAldenContactWebsite: https://www.lynalden.com/Energy Article: https://www.lynalden.com/energy-problems/Money Problems: https://www.lynalden.com/december-2022-newsletter/ Lyn Alden is editor and publisher of LynAlden.com, where she has both a subscription and a free financial newsletter. She says, "Her background lies at the intersection of engineering and finance." Her site provides investment research and strategy, covering stocks, precious metals, international equities, and alternative investments, with a specialization in asset allocation. Whether you're new to investing or experienced, there's a lot there for you. Lyn has a bachelor's degree in electrical engineering and a master's degree in engineering management, focusing on engineering economics and financial modeling. She oversees the finances and day-to-day operations of an engineering facility. She has been performing investment research for over fifteen years in various public and private capacities. Her work has been editorially featured or cited o...