Doug Casey's Take

Fellow Crisis Investors,

It’s the little things that often get you. For want of a nail, the shoe was lost. For want of a shoe, the horse was lost — then the rider, the battle, and the kingdom. Something trivial that’s taken for granted may turn out to be critical for the whole system. When it goes, everything downstream goes with it.

That may be where we are right now with sulfur. I realize that sounds absurd. Sulfur wouldn’t seem to be a chokepoint of modern civilization.

I first encountered the element as a 9-year-old. It was one of the chemicals in my Chemcraft chemistry set. It was interesting to watch the yellow powder melt under the low flame of an alcohol-fueled burner, releasing the acrid smell of brimstone. Brimstone means “burning stone”; it’s the Biblical element that Yahweh favored for smiting wayward cities. Some say the unrighteous will boil in a lake of brimstone for eternity…

Despite its ancient credentials, most people can’t tell you where it comes from or how it’s now used. It’s produced mainly from sour natural gas processing — and as a byproduct of refining sour crude (like Venezuelan). It’s a costly nuisance for oil men that needs to be removed during refining. It’s also an unwanted byproduct from refining metal ores, which are mostly sulfides. It’s the fifth most common element on the planet. Before the ongoing Hormuz crisis, it was quite literally cheaper than dirt, often selling for around $50 a tonne.

Even though it can be a bothersome pollutant to oil and gas men, it’s valuable and essential to the world at large. It depends on where it is, and how much it costs to transport and transform into sulfuric acid — the most-produced industrial chemical on earth. Half of it is made into fertilizer. It also mines your copper (if the ore is an oxide, as opposed to a sulfide). It refines uranium, rare earths, nickel, cobalt, and reacts with lead for automotive batteries. It underwrites the entire industrial economy.

Until three months ago, about half of the world’s seaborne sulfur passed through the Strait of Hormuz, a byproduct of oil and natural gas production and refining around the Gulf. Then Washington, guided by Tel Aviv, launched what may be the most dangerous and outrageous war in recent memory — an unprovoked attack on Iran in the middle of active negotiations. It was a foolish decision Americans will spend decades trying to justify, rationalize, and pay for.

You know what happened next. Iran shut the Strait. And Trump’s threats, ultimatums, and shifting deadlines can’t pry it back open. It’s been closed for almost three months. It’s now more than just supply disruption — it’s turning into supply destruction. Refining and production infrastructure across the Gulf is being hit, and the damage to that kind of capacity isn’t measured in days or weeks. It will take months or years to return to the status quo ante. Persian Gulf sulfur exports are down roughly two-thirds. At the same time, China, by far the world’s leading sulfuric acid exporter, announced an outright ban on exports. Partially to protect its own farmers, and partially (I suspect) to intimidate other countries. Another three million tonnes of supply, gone overnight.

So now the price of sulfur itself is up almost 100%, and sulfuric acid is up roughly 160%. Every industry that depends on it is now forced to either pay whatever it costs, ration, or shut down.

This creates tension between food producers and metal producers. A little more than half of sulfuric acid goes to fertilizer. Much of the rest goes to mining. Both need it, both will get less and pay more. The decision over who gets priority will mostly be made by governments, not by markets. I know which way most governments lean.

For my part, I’ve bought the corn ETF we own in the portfolio (CORN). I’m also long rice in the futures market, because rice is a fertilizer hog. In fact, all the grains impress me as being underpriced. Shortages, and higher prices, are very likely because of the US/Israel versus Iran war.

The bottom line is that the damage is already locked in. The Strait could reopen tomorrow — it won’t but pretend it could — and the daisy chain of consequences would still play out for years. Sulfur capacity, like that of the oil and gas it comes from, doesn’t switch back on with a press release. Fertilizer not applied this spring isn’t a harvest deferred. It’s a harvest lost. Mines that idle their leach circuits don’t restart them in a week. The world spent years and tens of billions of dollars building the relevant infrastructure. Rebuilding it will take much, much longer than the war.

Yet the markets are still mostly sleepwalking. There’s a lot of apathy because people seem unable to fully grasp the situation. The shelves are still stocked, and the gas station pumps still work. The human brain is famously bad at reacting to slow-moving catastrophes.

For what it’s worth, the sulfur cascade is just one of several running in parallel. Energy lockdowns are starting to show up across Asia — four-day work weeks for state employees, jet fuel rationing, calls to cut air travel. Trucking is wobbling on six-dollar diesel. There’s a motor-oil shortage almost nobody is talking about yet, because the high-grade base stocks for modern synthetic oils mostly come from the Persian Gulf.

The supply cascades from the closed Strait will be with us for years. And I expect they’ll get worse before they get better. Trump is highly unpredictable; he could do anything now that he’s punched a giant tarbaby. However, I feel confident that the Iranians aren’t going to roll over. They’re righteously offended and expect more than a ceasefire. They’ll want reparations.

Sulfur is the element in this drama that most people aren’t watching. The cascade is already in the data — the wheat plantings, the cuts at acid-dependent mines, the empty acid storage tanks in Chile. The question isn’t whether any of this affects you; it will. The real question is whether you’ve positioned yourself to benefit while most people are getting crushed by it.

A small number of companies are going to come out the other side of this substantially richer than they went in. The one Lau walks you through this month is one of them. Details below.

Regards,

Doug Casey

Continue reading at: www.crisisinvesting.com/p/hormuz-closed-sulfur-spi…

4 months ago | [YT] | 147

Doug Casey's Take

If you’ve been paying attention to commodities lately, you’ll have noticed something.

Coal — the industry the Western world wrote off a decade ago and declared dead at every climate summit — is quietly having a moment.

Take what just happened with a single power plant in Michigan. J.H. Campbell in West Olive is a 1,420-megawatt coal-fired generating station owned by Consumers Energy. The utility had been planning to retire it for years. The retirement date was set for May 31, 2025.

It never closed. Eight days before that date, the U.S. Department of Energy (DOE) stepped in and issued an emergency order under Section 202(c) of the Federal Power Act requiring the plant to keep running. That was a year ago. Last week, the DOE issued another such order, the latest in a series, extending Campbell’s operations through mid-August 2026.

And Campbell isn’t unusual.

Since May 2025, the DOE has issued 43 such emergency orders to keep coal-fired (and oil-fired) plants running past their scheduled retirement dates. That’s more than double the total number of times the agency used this authority in the entire 25-year period from 2000 through mid-2025.

Why? Because renewables don’t run baseload. Nuclear takes a decade to build. And the grid is losing firm, dispatchable generation faster than it can replace it. The U.S. has reached the point where the government is forcing retiring plants to stay open because the system literally cannot keep the lights on without them. And coal-fired generation in the U.S. jumped 13% in 2025 alone. That’s the biggest annual increase since the post-COVID rebound.

And it's not just a U.S. story. China commissioned 78 gigawatts of new coal capacity in 2025, the most in ten years. India is on track for its largest annual coal-capacity build in a decade. And coal stocks as a group have been quietly rallying through most of 2026 — exactly the opposite of what the consensus narrative said should happen.

Given all that, and considering most people (including a lot of investors) know very little about how the coal industry actually works, I thought a proper coal industry primer might be in order. So here it is.

Continue reading at: www.crisisinvesting.com/p/forget-the-coal-eulogies…

5 months ago | [YT] | 88

Doug Casey's Take

There’s a serious shortage forming in the global market, and it’s centered on an unglamorous chemical 99% of people didn’t even know existed — until the Iran war shut Hormuz. Most still don’t. It’s called sulfur. But it’s used in almost everything. It helps mine and refine your metals. It also helps grow your food. And so much more.

Note: Matt Smith walked through all of this in much greater detail last week. If you haven’t yet read his Shortages Are Coming essay, you probably should.

For decades, sulfur was the cheapest input in the industrial chain — a chemical so abundant that nobody could give it away. You could see it pile up at oil refineries and copper smelters, sold for pennies a pound. As recently as 2024, the average U.S. price was under US$50 a metric ton.

Then came the Iran war, and the Strait of Hormuz shut. As I’m writing this, sulfur is up 95% in three months. Sulfuric acid is up nearly 160% in ten weeks. Bigger moves than oil itself. And almost nobody’s talking about it.

Today’s Chart of the Week tells you why. Take a look.

Continue reading at: www.crisisinvesting.com/p/the-most-important-chemi…

5 months ago | [YT] | 120

Doug Casey's Take

Dear reader, let me pose you a question.

Which sector has the highest profit margins right now?

If you guessed tech or financials, you’d be way off. Both sectors have dominated headlines and capital flows for years — tech especially, on the back of the AI trade. But neither is anywhere near the top of the chart below.

As you can see, mining — specifically, the top 20 largest precious and base metals producers, stacked against the major S&P 500 sectors — is throwing off 31% margins. That’s nearly double Tech and Financials. More than four times what Consumer Staples or Communications are earning.

And here’s the part that should be impossible.

The market hasn’t noticed. Not in a way that matters anyway.

Despite earning fat margins like that, the mining sector as a group still trades at a fraction of the broader market’s cash flow multiple. How does that happen?

My conclusion is that most of the market is still analyzing mining through a framework that was written ten or fifteen years ago. Back then, mining was overcapitalized, undisciplined, and bleeding cash on chase-the-grade exploration and ego-driven M&A. Mainstream investors who tried to own miners through the 2012-2020 commodity malaise got burned — and learned to treat the sector as a place to avoid.

That picture is no longer true.

Continue reading at: www.crisisinvesting.com/p/the-highest-margin-secto…

5 months ago | [YT] | 95

Doug Casey's Take

A few weeks ago, we published our latest issue of Crisis Investing — built around the contrarian argument that coal never went away, no matter how many funerals were scheduled for it.

A reader recently pointed me at a chart that fits the thesis so well I had to share it. It comes from EMBER’s Global Electricity Review 2026 — the UK-based energy think tank’s annual snapshot of how the world generates electricity. This particular chart breaks out the year-over-year change in coal-fired generation in 2025 across the world’s major economies.

Take a look at the top line. The United States burned 13% more of it in 2025. It’s the single biggest year-on-year jump on the chart — more than six times the next largest gain — in the country every analyst had written off as a structural coal decliner.

Keep in mind, the U.S. had spent two decades retiring coal plants.

Now here’s the bigger story: this is 2025 data. Before Hormuz closed. Before the war with Iran. Before oil hit triple digits and the world started scrambling for energy at any price. None of that has hit this chart yet.

And look at Japan in that light. “High-tech” Japan — which imports 87% of its total energy and still gets roughly a quarter of its electricity from coal — was already burning 0.8% more of it in 2025, while LNG was still arriving on schedule. Now imagine where that number’s heading today, with Hormuz closed, two-thirds of Japan’s oil supply blocked, and emergency LNG reserves measured in weeks of cover.

Continue reading at: www.crisisinvesting.com/p/coal-was-already-coming-…

5 months ago (edited) | [YT] | 95

Doug Casey's Take

Let me tell you about the last central banker I grew up under in the Soviet Union.

His name was Viktor Gerashchenko. Soviet banking royalty, in the way only Soviet aristocracies could be — his father ran the financial directorate of the Foreign Ministry, and later served as deputy chairman of Gosbank, the Soviet central bank. The kind of pedigree that put a family one rung below the Politburo.

By 28, the younger Gerashchenko was already running a Soviet bank in London. By the late 1980s, he'd done his father one better — taking the chairman's seat at Gosbank itself. He was at the helm of the Soviet financial system as the whole thing started to come apart.

If you know anything about the Soviet Union in the early 1990s, you probably know about the currency collapse that followed. What you may not know is the central role Gerashchenko played in it. As the system fell apart, he didn’t try to stabilize the ruble — he reached for the printer. Loose monetary policy. Cheap credit to failing state banks. Ruble emission to keep a dying system propped up. Inflation that had been quietly building through the late 1980s exploded into hyperinflation. Prices doubled. Then doubled again. And across the former Soviet sphere, people watched their lifetime savings evaporate in real time.

Families who had spent decades putting money into Soviet ruble savings accounts — for retirement, for apartments, for their children’s future — suddenly discovered those savings were becoming worthless. By the month. Then by the week. Then by the day.

People in my family lost everything. So did most of the people I grew up around. A lifetime of work, gone.

So what did they do? Promote him. In 1992, Gerashchenko was made chairman of the Russian Central Bank — and proceeded to do the same thing, but bigger. The Russian money supply expanded by 18 times in 1992 alone. Yes — eighteen times. In one year.

The disaster culminated on October 11, 1994 — a date now known in Russia as Black Tuesday. The ruble crashed by over 25% against the dollar in a single trading day.

Gerashchenko was fired weeks later. The Harvard economist Jeffrey Sachs called him “the worst central banker in the world.” Quite a distinction in a field where the day job is debasing money.

I’ve been thinking about Gerashchenko lately because Jerome Powell’s last day as Fed Chair was exactly a week ago.

Let’s take a quick look at his legacy.

Continue reading at: www.crisisinvesting.com/p/the-worst-central-banker…

5 months ago | [YT] | 107

Doug Casey's Take

As if you needed any more reasons to own gold these days, here’s another one — straight from Washington itself.

A few months ago, the Congressional Budget Office (CBO) published its latest Budget and Economic Outlook. Almost nobody read it. CBO's job is the dry, technical paperwork of projecting where federal finances are headed. They publish on a schedule. The financial press mostly ignores them.

Add up the projections inside, though, and one number jumps out. $65 trillion.

That’s where total U.S. federal debt sits in just ten years’ time. The path CBO sees is straightforward. Annual deficits hold above $2 trillion for the entire next decade and climb to $3 trillion by 2036. That’s roughly $25 trillion of new debt piled on top of the nearly $40 trillion the federal government already owes — and all of it added in barely a decade. Not a generation. A decade.

By the end of the path, interest expense alone runs to roughly $16 trillion cumulative over the decade. That works out to an average of about $1.6 trillion a year. We start at roughly $1 trillion in annual interest payments today, and by 2036 that figure doubles to over $2 trillion. Remember, Washington is already spending more on interest than on the entire defense budget. Already roughly on par with Medicare. Second only to Social Security.

Now let me put $65 trillion in some context, because honestly, the figure is so mind-bogglingly big it’s hard to properly grasp. $65 trillion works out to about $190,000 for every American man, woman, and child alive today. Roughly $500,000 per household. Thirteen times what the federal government collects in taxes every year. More than what the entire U.S. economy produces in two years. And as you’ll see in a moment, it’s a load the country has no realistic way to repay.

So how does a country dig out from under that kind of debt? History offers three ways.

Continue reading at: www.crisisinvesting.com/p/americas-65-trillion-pro…

5 months ago | [YT] | 108

Doug Casey's Take

A couple of weeks ago, Khaled Balama — the governor of the United Arab Emirates’ central bank — met with U.S. Treasury Secretary Scott Bessent on the sidelines of the IMF Spring Meetings in Washington. Balama quietly raised the idea of a currency swap line — essentially a central-bank-to-central-bank emergency credit facility, the kind the Fed uses to keep dollar liquidity flowing during a crisis. The story generated a few headlines, then quickly faded from view.

But days later, something more interesting happened: the United Arab Emirates walked out of OPEC. After 59 years a member.

OPEC, as you probably know, is the cartel that has coordinated oil production and pricing among the world’s largest exporters since 1960. The UAE joined in 1967 — and for most of the petrodollar era, which is to say for half a century, has been one of OPEC’s most important members.

President Trump’s been running victory laps. He’s been calling OPEC “broken” and “collapsing” on Truth Social, telling Americans the cartel is finally cracking, oil prices are about to come down, and we win at the pump.

But if you understand what OPEC was actually for, the UAE’s exit isn’t a win. It's the petrodollar system — the arrangement that's kept the U.S. dollar standing for 51 years — coming apart in real time.

To see why, let's back up.

In 1971, Nixon closed the gold window. The dollar went pure fiat — no gold, no redemption, just paper. And every oil-producing country was suddenly facing the same question: why sell a real, finite resource for a currency that can be printed in unlimited supply? Only a fool would. The Saudis weren’t fools.

So in 1974, Henry Kissinger flew to Saudi Arabia and cut a deal — in secret. Three terms. The Saudis would price their oil exclusively in U.S. dollars. They would recycle those dollar revenues into U.S. Treasuries. And America would provide military protection and guarantee the survival of the House of Saud.

Interestingly, the full terms of that deal were kept hidden for 42 years. They didn’t surface until a Bloomberg FOIA request in 2016 forced them into the open.

Either way, the deal between the U.S. and Saudi Arabia meant that if countries wanted to trade oil, they had to first get their hands on dollars.

It was pretty genius when you think about it.

Continue reading at: www.crisisinvesting.com/p/the-petrodollar-is-comin…

5 months ago | [YT] | 114

Doug Casey's Take

Last month, Khaled Balama — the United Arab Emirates’ central bank governor — sat down with Treasury Secretary Scott Bessent on the sidelines of the IMF spring meetings in Washington. He raised something unusual: the idea of a currency swap line.

A swap line is essentially an emergency credit arrangement between two central banks. They agree in advance to exchange specified amounts of currency at a fixed rate, giving each side access to the other’s currency in a crisis. The Fed maintains permanent swap lines with the Bank of England, the ECB, the Bank of Japan, the Bank of Canada, and the Swiss National Bank. It has never extended one to a Gulf state.

What was unusual wasn’t just the request. It was the implied alternative. If Washington wouldn’t backstop UAE dollar liquidity through the war’s economic damage, Abu Dhabi might have to start settling oil sales in Chinese yuan instead.

Five years ago, none of that would have been imaginable. And it’s not happening in isolation. Just look at what the financial press has been covering over the past few weeks:

“Iran’s Hormuz yuan play: a direct hit on the petrodollar” — Asia Times

“In Strait of Hormuz, Iran and China take aim at U.S. dollar hegemony” — Al Jazeera

“The US-Israel war on Iran is accelerating de-dollarization and America’s decline” — The Guardian

Those headlines describe something already underway — namely, a yuan toll booth that Iran has been running at the Strait of Hormuz since mid-March. Commercial tankers wanting to transit pay a fee — between $0.50 and $1.20 per barrel of cargo, by recent reporting — settled in Chinese yuan, routed through China's CIPS payment system. France, Japan, Malaysia, the Philippines, and Thailand — all U.S. treaty allies — are reportedly among those paying.

Read that again. U.S. treaty allies, paying Iran in Chinese currency to move oil through a strait Trump has spent the past two months trying to pry back open by force — without success.

This is what an attack on the dollar looks like in the actual world — not a BRICS press release, not a Davos panel, but in the real plumbing of how global oil trade actually settles.

And the worst part is the dollar wasn’t in great shape going in.

Continue reading at: www.crisisinvesting.com/p/what-an-attack-on-the-do…

5 months ago | [YT] | 104

Doug Casey's Take

This past weekend, Spirit Airlines stopped flying.

If you’ve spent any time in a U.S. airport over the past decade, you know Spirit. The bright yellow planes. The $39 fares. The one your college kid took home for spring break and your in-laws used because the Christmas trip wasn’t going to pay for itself in business class. It wasn’t fancy. But it worked. And for tens of millions of Americans who couldn’t afford the alternative, it kept air travel within reach.

Now it’s gone. Seventeen thousand people lost their jobs overnight.

Officially, Spirit went down on long-running financial troubles — bad management, a failed JetBlue merger, the structural pain of the budget-airline model. All true. The company had been wobbling for years.

But wobbling is not dead. What pushed Spirit over the edge was crude above $100 and jet fuel — refined directly from crude — going right along with it. On margins as thin as a budget airline runs, a sustained 40% jump in your single largest input cost isn’t a headwind. It’s a guillotine.

So really, what killed Spirit Airlines was the war.

And yet, if you were sitting at a trading desk in Manhattan today, you’d hardly know any of this happened.

The S&P 500 — the headline number Wall Street treats as the economy — just printed an all-time high. Over 7,300. Up roughly 11% in the past month alone.

Continue reading at: www.crisisinvesting.com/p/the-war-came-home

5 months ago | [YT] | 87