Luke Gromen, founder and president of FFTT, discussed the geopolitical and economic implications of the US and China’s competition for critical minerals and infrastructure, particularly in the context of rare earth elements and semiconductor technology. Gromen highlighted the US’s recognition of the unsustainability of its current economic model, which has led to a significant reliance on China for manufacturing and industrial output. He emphasized that the US’s high debt-to-GDP ratio and political instability necessitate a shift in policy to re-industrialize and strengthen its domestic industrial base.
Gromen argued that China’s strategic initiatives, such as the China 2025 plan, have been underestimated and that China is well-positioned to win the race for high-end semiconductor and AI capabilities. He contrasted this with the US’s challenges in rebuilding its industrial infrastructure, citing examples like the delayed repair of the Francis Scott Key Bridge in Baltimore. Gromen also discussed the potential for gold to serve as a rebalancing mechanism for the global economy, given its role as a neutral reserve asset. He suggested that central banks buying gold signals a shift towards a more stable economic system and that a significant rise in gold prices could help address the US’s debt issues.
Some Competent Links:Website:
https://competentinvestor.comSubstack:
https://competentmanpod.substack.com/X:
https://x.com/CompetentManPodRumble:
https://rumble.com/c/c-7699939
Luke also touches on the role of Bitcoin and stablecoins in the global financial system, arguing that while stablecoins could provide short-term benefits, they may not be a sustainable solution. He expresses skepticism about the US government’s ability to implement effective policies without causing further economic disruptions. Gromen concluded by emphasizing the importance of understanding the broader economic context and being prepared for elevated market volatility. He recommended investing in physical gold, Bitcoin, and electrical infrastructure as sectors poised to benefit from the current economic environment.
Timestamps:00:00:00 – Introduction00:00:31 – US-China Minerals Race00:04:28 – Semiconductor Supply Competition00:13:30 – Rebuilding US Industry Challenges00:18:29 – Government Mining Investments00:23:40 – Oil Price Paradox Explained00:27:13 – Gold as Escape Valve00:32:38 – Bitcoin Stablecoin Dynamics00:42:36 – Central Banks Hoarding Gold00:46:40 – Risks to Gold Rally00:57:43 – Banking Liquidity Concerns01:03:19 – Sectors for Investment01:04:32 – Concluding Thoughts
Guest Links:X: https://x.com/lukegromenWebsite: https://fftt-llc.com/
Luke Gromen began his career in the mid-1990s in Research at Midwest Research before moving over to institutional equity sales and becoming a partner. While in sales, Luke was a founding editor of Midwest’s widely-read weekly summary (“Heard in the Midwest”) for the firm’s clients. He aggregated and combined proprietary research from Midwest with inputs from other sources.
In 2006, Luke left FTN Midwest to become a founding partner of Cleveland Research Company. At CRC, Luke continued to work in sales and edit CRC’s flagship weekly research summary piece (“Straight from the Source”)...
