The Hard Asset Revolution Has Begun — And Most Investors Are Going To Miss It

The financial system is rapidly changing. And those who invest accordingly stand to make fortunes.

The conflict in Iran has revealed something vital to understanding the future of the financial system. Specifically, the most crucial component for the economy is not technology, IP, or even strategy.

No, it’s hard assets.

In the case of the Iranian conflict, oil is the asset in question. Most people think of oil as related to automobiles, but the reality is that oil prices input into everything: heating, electricity, shipping, food, manufacturing, etc. Petroleum oil is a foundational ingredient in jet fuel, heating oil, asphalt, tar, plastics, polyethylene, polystyrene, PVC, synthetic fibers, polyester, nylon, acrylic, spandex, synthetic rubber, tires, shoe soles, gaskets, petroleum jelly, mineral oil, paraffin wax, candles, surfboard wax, fertilizers, pesticides, detergents, household cleaners, paint, lacquer, enamel, adhesives, glues, lubricants, motor oils, ink, lipstick, foundation, eyeliner, shampoos, conditioners, toothpaste, aspirin, antihistamines, synthetic vitamins, food-grade wax, and chewing gum base.

An on and on.

In this context, the world can stomach higher oil prices provided they are short-lived… but if oil remains above $90 per barrel for long… the economy rapidly begins to crumble.

Oil is not the only hard asset proving its value to the economy today. One of the great ironies of the AI revolution is that it will actually be driven by hard assets/ commodities.

In order to function, AI and its derivative assets (data centers, graphics processing units, grid infrastructure) require a laundry list of hard assets: copper, high-purity silicon, silver, gold, aluminum, gallium, germanium, antimony, tantalum, rare earth elements, lithium, cobalt, natural gas, uranium, nuclear fuel rods, high-voltage transformers, electrical switchgear, steel, concrete.

Put simply, the single most important ingredients to economic growth as well as technological innovation are hard assets.

And the financial system is finally waking up to this fact.

The MAG-7 are collapsing… while commodities are SOARING.

Nvidia (NVDA) is the most critical stock in the world to the AI trade. But Gold Miners (GDX) are outperforming it by a MASSIVE margin over the last two years… even accounting for the recent decline in GDX shares due to forced liquidations.