Phosphate is one of the most important commodities in the world, and one of the most misunderstood.

Phosphate is essential to modern agriculture. Without it, crop yields would fall dramatically and a large share of global food production would be at risk. Demand is extremely price inelastic. Even significant price increases tend to have only a limited impact on consumption because there is no practical large scale substitute. And yet most investors still treat it as a dull, oversupplied fertilizer input.

That view is becoming dangerous.

A combination of declining grades in mature basins, extreme concentration of reserves in a single country, export restrictions from major producers, and severe disruptions to sulfur and fertilizer logistics throughout the Middle East has created one of the most significant supply side shocks in the fertilizer market in decades. Finished fertilizer prices have already reacted. High quality phosphate rock is quietly following.

In this report I break down:

• Why the apparent “oversupply” of phosphate rock is a mirage.

• How grade decline, depletion, and geopolitical concentration are changing the long term picture.

• Why most publicly listed phosphate producers are poor pure-play vehicles.

• A detailed ranking of the largest undeveloped phosphate projects in the world.

• The specific characteristics that separate mediocre projects from genuinely high-quality ones.

• Why one particular undeveloped project currently offers a rare combination of quality, economics, and valuation.

This is a long, detailed piece (30+ pages). It is not a quick take. It is the result of weeks of work going through primary filings, technical reports, and industry data.

If you care about asymmetric opportunities in critical commodities, this is one of the more interesting setups I have looked at in recent years.

Read more

My updated analysis suggests it is still trading below its underlying potential.

Full details inside.

Read more

I will keep this report short as I have health issues and I cannot spend much time typing on the computer, sadly.

Read more

In this April 2026 Portfolio Update I’ve pulled together everything that’s been happening with the stocks I actually own this year.

I’ve spent the majority of 2026 heads down researching and writing the last four major reports I’ve published, while still screening 40–50 new stocks every single day.

Because of that, I haven’t had time to send regular updates on my portfolio holdings.This report is the definitive catch up, and there has been a surprising amount of meaningful progress across my positions.

If you want to stay fully up to speed on exactly where my capital is deployed right now and how my holdings are advancing, this is the one to read.

Read more

• This report is the result of a collaboration between me (Alberto Álvarez) and Antonio Ming Rondinella, a military and defense enthusiast. Antonio goes by @trumpeterreport on Substack.

• Structure of the report:

  • Part 1: History of Iran. Written by Alberto.

  • Part 2: The 2026 Iran war. Written by Antonio.

  • Part 3: Conclusion. Written by both of us.

• This report covers the geopolitics, military, history, geography and economy of Iran and the conflict.

• We have not included any way to invest into the war on this report. The reason being that this report is already 50 pages long, and we wish to make this reading as enjoyable and educational as possible. Making it longer would have jeopardized the readability of the report.

About Antonio

Many of you already know me, if not you can read the “About” tab on my blog. Antonio on the other hand is new to Substack. Antonio will introduce himself:

“Hey everyone - I’m Antonio. I’m a rather rare mix in that I’m both an Italian and a Hong Konger, but I consider myself a Westerner first and foremost.

It was around 14 years ago that I discovered I had a great interest in warfare. It has the point where I readily spend as many as 3 hours a day researching and staying up to date with geopolitical affairs. This includes keeping up with the newest weapons procurements and upcoming programs, as well as staying on top of as many ongoing conflicts as I can, while to a lesser degree following the broader news cycle. I majored in International Business, with both a bachelor’s and master’s degree in the field, but my true interest is the realm of defense technology and geopolitics.”

Needless to say I recommend you follow him on his free Substack @trumpeterreport (link). He has not published much yet, but I think you should judge him by his work on this report, which is outstanding.

I would say the 3 hours Antonio mentioned is probably an understatement. He is plugged all day long searching for updates on the wars going on worldwide and the new military technology.

Part 1: History of Iran: The World’s Fortified Highway

Regional Geography

In order to understand a region’s history, one must first comprehend how geography has shaped the local events and peoples. Iran has been the world’s highway for millennia: a route armies, merchants, and ideas would traverse through, but it is also one that exacts a heavy toll and rarely lets travelers remain in control for long.

But why is this?

The reason lies in its geography and topography.

Topographic map. Iran marked as a rectangle (approximately). Red (higher elevation), yellow (average elevation) and green (lower elevation). Mapsland, own elaboration.

Its location is ideal for strategic reasons due to its geography:

To the west: It connects to Mesopotamia (modern Iraq) and the Levant. This means easy access for invasions from the Fertile Crescent.

To the east: Open steppes and passes lead to Central Asia, India, and China.

To the north: The Caspian Sea and Caucasus link to the Eurasian steppes. This was the source of nomadic invasions like Scythians, Turks, and Mongols.

To the south: The Persian Gulf and Strait of Hormuz provide maritime access to the Indian Ocean and Arabian Peninsula.

However, this also makes it a natural fortress:

· Surrounding mountain ranges: The Zagros Mountains in the west form a near impenetrable barrier blocking easy access from Mesopotamia and Iraq. The Alborz mountain range in the north shields it against steppe nomads and invasions from across the Caspian Sea. The other highlands create chokepoints, ambush opportunities, and harsh conditions for large armies.

· Vast plateaus and deserts: The central Iranian Plateau includes extremely dangerous salt flats. This limits maneuverability, water sources, and agriculture for occupying forces while allowing locals to retreat to defensible highlands.

· Rugged coasts and strategic complexity: Southern coasts along the Persian Gulf feature mountains and hidden bases, complicating naval or amphibious approaches.

· Size and dispersal: The country’s sheer scale (over 1.6 million km²) and dispersed population centers render any occupation resource intensive. Invaders can seize cities like Tehran or Isfahan, but holding the countryside drains resources in the long term.

However, if we look at the map above, it should raise an obvious question: Why haven’t armies, merchants and ideas crossed through the north of the Black Sea as opposed to Iran? To the north of the Black Sea are endless flatlands where any number of armies could cross.

While the northern steppe corridor allowed some nomadic incursions, it rarely served as a reliable, high volume invasion highway to the Iranian heartland for several key reasons:

· The route from the north of the Black Sea would require navigating or bypassing the Greater Caucasus range. This is a formidable wall of high, rugged mountains stretching from the Black Sea to the Caspian. Key passes like Derbent (Caspian Gates) or Darial Gorge were narrow, easily defended chokepoints.

· Steppe north of Black Sea and Caucasus: These vast, open grasslands are good for horse nomads (quick raids, mobility). However, they are terrible for sustaining big, slow armies with siege equipment, infantry, and supply trains. No major rivers or roads are available there, unlike in Persia with the Tigris Euphrates corridor.

· Limited population and agriculture: Fewer resources to forage or tax on route compared to fertile Mesopotamia.

In contrast, the Mesopotamian route offered river rich plains which allowed easier movement of armies, resupply via rivers, and access to wealthy cities. It was the “classic” path for conquerors like Alexander the Great (after Gaugamela), the Arabs, Ottomans, and even modern Iraq, which targeted the oil fields in Khuzestan during the Iran-Iraq War. Invaders could seize rich farmlands and trade hubs early, weakening Persian defenses before hitting the plateau.

In short, the northern Black Sea route appears “simpler” on a flat map as a steppe bypass, but it is a nightmarish crossing - a fact that Vladimir Putin was made aware of in early 2022. Ukraine is almost entirely flat, yet Russia has failed to occupy even 20% of its landmass after more than 4 years of brutal fighting which themselves were preceded by 8 years of low-intensity warfare.

The mountains, logistics, defenses, and lack of easy pickings made it far more difficult and less rewarding for invasion and occupation compared to the western/southern “highways” through Mesopotamia. This is part of why the “highway” metaphor holds: Traffic flows where the path is least obstructed, but even then, holding the destination is brutal.

Modern analyses emphasize this: Invading Iran would be “worse than Afghanistan” due to these natural barriers, with experts suggesting a ground invasion to be folly for all but the most determined, skilled foe.

Iran’s History

The Dawn: Kingdom of Elam (c. 2700–539 BCE)

The story begins with Elam, one of the world’s oldest civilizations, emerging around 2700 BCE in southwestern Iran. Elam was centered on the ancient cities of Susa and Anshan.

It was rooted in prehistoric settlements dating back to the 9th millennium BCE. Elam developed as a federation of city states influenced by Mesopotamian Sumerians but distinct in its Elamite language and culture.

The Elamites are generally considered indigenous (native) to the region they inhabited (southwestern Iran), with roots tracing back to the Neolithic period.

The sophistication of the Elamite people is evidenced by their construction of Chogha Zanbil - a massive complex which towered at over 50m in height. Its quality was such that 3200 years later much of it is still standing. At the same time, the surrounding peoples largely remained stuck in the Neolithic.

Elam weathered repeated invasions from Mesopotamian powers like the Akkadians and Assyrians, culminating in the sack of Susa by Assyrian king Ashurbanipal in 646 BCE.

Despite fragmentation and relocation, Elamite artistic and administrative legacies persisted, blending into emerging Iranian identities and laying foundational elements for future polities.

Their first writing system, known as Proto-Elamite, emerged around 3100 BCE. This makes it contemporaneous with (or extremely close to) the invention of writing in neighboring Mesopotamia by the Sumerians. Therefore, when we talk about Iran, we should regard that region as one of the stepping stones in world civilization.

The Rise of Iranian Empires: Median Kingdom (c. 678–549 BCE)

The term “Aryan” (meaning “noble” or “honorable”) was used by ancient Indo-Iranian peoples to refer to themselves.

Aryan tribes migrated into the Iranian plateau in such numbers that by 678 BCE the Kingdom of Elam was no more. In the 7th century BCE these tribes formed the first major Iranian state in western Iran. These Aryan tribes migrated to the Iranian Plateau from the Eurasian steppes of Central Asia and southern Russia and Kazakhstan.

They rebelled against their Assyrian overlords, allying with Babylon and founding an empire that unified tribes from the Zagros Mountains all the way to Central Asia. Median rule emphasized tribal confederations, early Zoroastrian influences, and military prowess.

Note: Zoroastrianism is one of the world’s oldest monotheistic religions, founded over 3,000 years ago in ancient Persia by the prophet Zarathustra. It emphasizes a cosmic struggle between good and evil, urging followers to live by “good thoughts, good words, and good deeds”. In the 19th century Friedrich Nietzsche wrote extensively about Zarathustra.

Though it was short lived, the Median Kingdom was colossal, stretching from modern-day Ankara all the way to the Indus River. It persevered through cultural continuity, with Median nobles integrating into the Persian elite and thereby preserving Iranian linguistic and religious traditions.

From here one will begin to notice that dynasties and kingdoms were replaced constantly. Therefore, the pattern I mentioned will become obvious: Ruling over this land for an extended period is a Sisyphean undertaking.

Another fascinating pattern one may notice is that the conquerors of this land would adopt its customs. These conquerors indulged in Iranian linguistic and religious traditions instead of forcing their own upon the locals.

The Pinnacle of Ancient Persia: Achaemenid Empire (550–330 BCE)

Cyrus the Great, overthrew the Median Kingdom in 550 BCE, founding the Achaemenid Empire: The largest in ancient history, stretching from the Indus River to the Mediterranean Sea. Rulers like Cyrus, Cambyses II, and Darius I implemented tolerant governance, satrapies (provinces), the Royal Road (1,677-mile-long Persian highway), and coinage, while promoting the Zoroastrianism religion.

Topographical map of Iran. Tayeb Raziei.

The empire withstood internal rebellions and Greek incursions during the Greco-Persian Wars (499–449 BCE). These wars weakened the Achaemenid Empire which created an opportunity: A Macedonian king wanted it for himself and he seized the moment.

Achaemenid vulnerability coupled with Alexander the Great’s unparalleled strategic acumen saw his 330 BCE invasion succeed brilliantly.

Despite conquest, Achaemenid traditions lived on: Persian administrative models influenced Alexander’s successors. Cultural symbols like Persepolis inspired later Iranian revivals, ensuring the “Land of the Aryans” concept persisted.

Hellenic Interlude: Seleucid Empire (330–247 BCE)

Following Alexander’s death in 323 BCE, his general Seleucus claimed Iran, blending Greek Hellenism with local customs in the Seleucid Empire. Greek cities and art flourished, but Iranian resistance grew through provincial revolts.

Revival and Roman Rivalry: Arsacid (Parthian) Empire (247 BCE–224 CE)

The Parthians, a group residing in northeastern Persia, rebelled against Seleucid rule. They then established an empire that controlled the Silk Road and even clashed with Rome.

They crushed the Romans at Carrhae (53 BCE) and influenced regions from Armenia to India. Persian language evolved into Middle Persian, maintaining Iranian identity until overthrown by internal rebels.

The Last Pre-Islamic Glory: Sassanian Empire (224–651 CE)

Ardashir I (from southern Iran) founded the Sassanian dynasty by defeating the Parthians and created a centralized Zoroastrian state that rivaled Byzantium.

Expansions included capturing Roman emperor Valerian as well as briefly controlling Egypt. However, near ceaseless warring against the Byzantines weakened it, leading to their collapse following the Arab Muslim invasions in 651 CE.

Sassanian legacy endured; their art, science, and administration were absorbed into Islamic culture.

This was a key first step toward centralization that would prove catastrophic.

Islamic Transformation: Rashidun, Umayyad, and Abbasid Caliphates (651–819 CE)

Arab forces conquered Persia by 651 CE, imposing Islam and ending Zoroastrian dominance under the Rashidun, Umayyad, and Abbasid caliphates. Notice these were three separate entities succeeding each other, therefore there was little stability even during the time of the caliphates.

This invasion exploited the vulnerable Sassanians, who’d been thoroughly weakened from wars and centralization: Provinces no longer had enough power to resist. Once the capital fell, all was lost.

However, all three Islamic caliphates lasted less than 200 years in total.

Heavy taxation sparked resistance, but Persians adapted by influencing the caliphate through Persian culture. They contributed leaders, scholars, and bureaucracy to the caliphate capital Baghdad. Islamization reached 90% by the 11th century, yet Persian language and customs endured within an Islamic framework.

Note: After this invasion, Iran would no longer go back to its Zoroastrian roots, it would become an Islamic region. Only in the modern day has Zoroastrianism (and atheism) begun to make a comeback.

By the 9th century the power of the Caliph had become symbolic in Iran, Samanids took power from the caliphate and started de facto governing.

The following two dynasties ruled from the 9^th century to the 11^th century. They were the Samanid and Buyid dynasties, both of which were Iranian. Even though they were weak and did not control much land, they merged Islamic culture with Persian one. Leading to what we know today as Iranian culture.

The Buyid were Shia Muslims (second largest branch of Islam) but Persia did not become Shia just yet.

Turkic Influx: Seljuk Empire (1037–1194 CE)

The Seljuk Turks migrated from South Siberia, Mongolia, and inner Asia. And they invaded Persia in the early 11^th century. The invasion itself happened in just 10 to 15 years. This is another pattern I have noticed when reading Iranian history for this report: Invasions didn’t take long, but the invaders were not able to stay in power for an extended period of time.

Note: In today’s terms 10 to 15 years for an invasion may seem like a lot, but a millennium or two ago, invasions routinely took generations to see through. Caesar needed 8 years to conquer Gaul (modern France, Belgium, and Switzerland). Rome needed 200 years to conquer Iberia (modern-day Spain and Portugal).

This was a turning point in Iran’s history as the Turkics would be the dominating force in Iran for the next 1000 years. Different groups of Turks conquered Iran from each other many times during this 1000 years.

The Seljuks established the Seljuk Empire which lasted 150 years. They too were influenced by Persian language and culture.

Pre-Mongol Twilight: Khwarazmian Empire (1194–1220 CE)

The Turkic Khwarazmians came from south of the Aral Sea, in modern day western Uzbekistan, northern Turkmenistan, and parts of Kazakhstan. Even though it took them decades to merge with Persia and take full power of Iran, their empire lasted a mere 26 years! From the year 1194 to 1220.

This was the last Iranian state with Persian courts.

Devastation and Adaptation: Ilkhanate (Mongol Rule, 1256–1335 CE)

The following years were horrific. Genghis Khan’s (non-Turkic) 1219 invasion razed cities, killing millions. In less than 3 years the Mongols toppled the Empire. However, local Mongol rulers converted to Islam, adopting Persian ways. Despite horrors, Iran’s endurance came through cultural assimilation, and just like the occupiers before them, the Mongols didn’t stay long, even with their military prowess. In just 80 years the Mongols fell in Persia.

Timurid Empire (1370–1507 CE)

The Timurids (whose founder, Tamerlane, was himself a distant descendant of the Mongols) were invaders from Central Asia’s steppe routes and in the 14^th century they conquered Persia from the Mongols. The death toll is staggering, probably in the hundreds of thousands. However, once again these invaders were absorbed by Iranian culture

Shia Unification: Safavid Empire (1501–1736 CE)

Shah (meaning king) Ismail I (Turkic) reunified Iran in the early 16^th century. He imposed Shia Islam on Sunni Ottomans and Uzbeks. The Safavids centralized power which shaped modern Iran. And from this moment onwards Iran would remain Shiite.

Note: The main branches of Islam are Sunni (comprising roughly 85–90% of Muslims) and Shia (10–15%). Their relationship is often strained by political, rather than purely theological, differences.

Shia and Sunni Muslims share core beliefs in the Quran and Prophet Muhammad; however, they differ primarily on leadership succession after the Prophet’s death in 632 CE. Sunni Muslims believe leaders (Caliphs) should be elected, while Shia Muslims believe in a hereditary line of infallible Imams from Muhammad’s family.

Transitional Warriors: Afsharid Iran (1736–1796)

Around 1722 Ottoman (Turkic) and Russian forces seized Iranian land. Russia took swaths of Iran’s Caucasian territories, while the neighboring Ottomans invaded from the west. A new Iranian warlord (Nader Shah) seized this opportunity and took power from the weakened Safavid dynasty.

Modernizing Monarchy: Qajar Dynasty (1796–1925)

After the death of Nader, Iran plunged into decades of anarchy and tribal conflicts. Many regions seceded and a new leader emerged: Agha Mohammad Khan.

Agha Mohammad’s life was characterized by hardship; he was castrated as a child and imprisoned for 16 years. However, through relentless, brutal military campaigns he defeated his enemies and reunited those regions that had seceded (such as Georgia).

Most notably, Agha moved the capital to Tehran, which he fortified and expanded.

Iran suffered through many invasions while under Qajar rule: two Russo-Persian wars (due to Russian advances), the Anglo-Persian war of 1856 (occupying parts of the Persian Gulf, like Kharg Island), World War I occupations and Ottoman incursions. Overall, the Qajar era is marked by territorial loss. Vast swathes of the Caucasus were taken by Russia while the Qajars were forced to renounce their eastern claims due to British pressure.

Secular Monarchy: Pahlavi Dynasty (1925–1979)

Reza Shah Pahlavi rose to power in the early 1920s primarily due to the weakness of the Qajar dynasty. He also had great military ambition which resulted in a 1921 coup he organized. The coup also received significant external backing from British officials.

The 1953 coup (Operation Ajax): The CIA, supported by Britain’s MI6, orchestrated a coup against democratically elected Prime Minister Mohammad Mosaddegh, who had nationalized Iran’s oil industry (previously controlled by British interests).

This reinstated the Shah as an absolute monarch, marking a pivotal US intervention to prevent perceived communist influence and secure Western oil access. The US government has since acknowledged its central role. After the 1953 coup, the US provided substantial financial aid, military assistance, and training for Iran’s security forces. This included helping establish and train SAVAK - the Shah’s notoriously brutal secret police.

Iran became a key US ally in the Middle East, buying massive amounts of American weapons (Nixon’s “Twin Pillars” doctrine). This supported US positions in Vietnam and against Soviet expansion and ensured Gulf stability after Britain’s withdrawal in 1971.

The economy flourished, with thousands of Americans working in Iran and many Iranians studying in the US. The Shah was seen as a pro-Western bulwark, though his regime’s repression fueled widespread domestic resentment.

Theocratic dictatorship: Islamic Republic of Iran (1979–Present)

The Pahlavi dynasty (1925–1979) brought significant progress: rapid industrialization, infrastructure projects (roads, railways and universities), massive education expansion, economic growth (especially oil-fueled), land reform that benefitted peasants, women’s suffrage, legal rights (divorce, custody), and freedoms like dress choice; many women wore Western styles without hijab mandates.

Nevertheless, the Islamic Revolution happened. It is pertinent to ask why:

During the Shah’s rule, the opposition united diverse groups: secular leftists, nationalists, liberals, intellectuals, merchants, students, workers, and crucially, Shia clerics and their adherents.

In the mid-1970s, about 34% of the Iranian adult population was aged 15–24, and roughly 45% of the population was under 15 years old. Young people have the energy needed for a revolution.

Note: This is a common ingredient found in most revolutions. You need energy and a high risk appetite to succeed. Therefore, a young population is paramount. Even during the American Revolution this was the case; Jefferson was 33 and Hamilton 21 years old when the Declaration of Independence was signed.

The government in Iran was unpopular. The state’s repressive actions, doled out by SAVAK, were a source of discontentment. Economic inequality was acute despite vast oil wealth. Rapid Western-style modernization alienated traditional and religious segments of the population. Corruption too was rampant, and there was a lingering perception of foreign puppeteering. This last point became clear after the 1953 CIA-backed coup.

The Shah aggressively modernized Iran but ruled with an iron fist. He himself was a symbol of the nation’s inequality, living lavishly while the masses were stricken by inflation and unemployment.

Khomeini channeled this popular resentment into an Islamic revolt from his exile in France. Once the Shah fled, Islamists outmanoeuvred his allies, purged moderates and leftists. They then imposed a strict theocratic regime (mandatory hijab, curtailed freedoms) and turned Iran into the Islamic Republic that exists to this day. They reversed many Pahlavi-era liberties in the name of “Islamic purity” and anti-imperialism.

Ayatollah Ruhollah Khomeini was exiled in 1964 for opposing the Shah’s reforms, however, he became the revolution’s unifying figure from abroad. His fiery cassette tape sermons, distributed via mosques, condemned the Shah as a tyrant and puppet of the West, framing resistance in Islamic terms.

Mass protests escalated from 1977–1978: Strikes crippled the economy (especially the oil sector), demonstrations faced brutal crackdowns and the military’s loyalty eroded. The Shah fled Iran on January 16th, 1979. Khomeini returned triumphantly on February 1st, 1979, to massive crowds.

By February 11th, armed revolutionaries overwhelmed loyalist forces, toppling the Shah’s regime. The Islamist faction consolidated power post revolution through strategic manoeuvring: Khomeini purged leftists and moderates and used referendums/institutions to establish the Islamic Republic under clerical supremacy. The hostage crisis (1979-81) radicalized the regime further, rallying support against the West.

Such inward purges are common in history. Revolutionaries often devour each other once the revolution succeeds. The French and Russian revolutions are good examples of such purges.

Ending chapter

The Shia Islamist clergy and their supporters who took power in 1979 were the first in about a thousand years to do so without the backing of Turkic tribal forces

The revolution was overwhelmingly an urban, nationwide Iranian movement centered on Shia religious networks, bazaars, students, and workers; not tribal or ethnic militias.

Virtually every dynasty that ruled Persia since the 11th century, came to power with the backing of Turkic tribal forces, while using educated Persians in their bureaucracy. The 1979 revolution broke from it entirely.

It was an ideological and religious movement (Shia Islamism), it was mass based, and anti-monarchical; not a tribal conquest. The power shift came from popular mobilization and clerical networks, not nomadic warriors. The break from the 1,000-year pattern of Turkic tribal military backing means Iran’s power transition is now driven by mass mobilization forces rather than nomadic conquests.

What it means for Iran to break with this 1000-year-old trend:

· Greater fragility and unpredictability: Without tribal warrior loyalty as a stabilizing “sword,” regimes rely on ideological control, the Revolutionary Guards, and security apparatus. When ideology and repression lose legitimacy, as seen in repeated protests, the system cracks more easily through popular unrest, economic collapse, or elite infighting.

· Demographic reversal weakens revolutionary fuel: The youth helped topple the Shah, but Iran has undergone one of the world’s fastest fertility declines. The population is aging rapidly.

· Persistent internal challenges: Ethnic minorities (the largest group at 15–30 million) no longer serve as conquerors but as potential sources of fragmentation or demands for rights.

· Current trajectory (2026): Iran faces acute economic woes (high inflation, sanctions, currency collapse), fresh nationwide protests, regional setbacks (weakened proxies), and succession questions after aging leadership.

Iran has faced roughly between 8 and 12 major foreign conquests in over 4,000 years of recorded history, plus many smaller incursions. It has also suffered about another 10 revolts from insiders which led to regime changes.

While this is a high number, it is not the absolute highest globally, India for example has been invaded around 200 times. However, as time has passed the duration of each regime in Persia and Iran has shortened. This has happened all over the world too, but in Iran it has been particularly troublesome. For example, since the 16^th century they have gone through 6 separate political entities. While most other countries have gone through one or two.

Since the 18^th century (when the US was founded), Iran’s political systems have lasted an average of 66 years each. This is remarkable and highlights the point of this section: Invading Iran is difficult but controlling it for long periods of time is almost impossible.

Part 2: The 2026 Iran War

Glossary

Order of Battle

Before delving into the war, it would be handy to describe the disposition of forces on both sides. It would be neither useful nor desirable to list absolutely every system in service on each side and state how many are in existence, as this only lends itself to a superficial analysis. Rather, I will talk about the differences in fighting style, and highlight individual platforms when relevant. For example, I will refrain from listing every combat aircraft in the US arsenal or how many they have, as this does nothing for you, the reader. Instead, I shall discuss (broadly) US and Iranian doctrine while pointing out how certain systems such as the F-35 on the US side and the Khorramshahr on the Iranian side fit into this.

Iranian Strategy

Iran’s military is large and divided into 2 main branches: the Artesh, and the Sepah. The Artesh is the regular military; the unmotivated grunt sitting at a kiosk waiting for the day to end is in the Artesh. The committed ideologue bringing suitcases filled with cash to Hezbollah is in the Sepah. The Sepah refers to the Islamic Revolutionary Guard Corps, or IRGC. Several Middle Eastern nations possess such a force; Saddam Hussein’s Iraq famously had its Republican Guard. The Sepah is the more “elite” component of the Iranian security apparatus: a large, comprehensive palace guard whose ranks are made up of true believers of the Islamic Republic.

The existence of the IRGC is in large part due to the autocratic nature of the country, where one of its main purposes is to protect the government from being deposed by the regular army, the Artesh. As such, they possess much of their own, separate equipment, with perhaps the most notable example of this being the IRGC having its own navy. One might think that such separation causes inefficiency, and yes - this belief would be correct. However, this reveals yet another key doctrine of Iran and nations similar to it. Namely, allowing the government to remain in power is the single most important mission the country has; every other consideration must give way to it, and so inefficiency is tolerated if it otherwise bolsters the government’s hold on power.

The longstanding sanctions on Iran have largely prevented it from being able to assemble a modern military in the way the Chinese have been able to (though it’s likely their army would’ve resembled the Russian one more so than the PLA). This has resulted in the Islamic Republic of Iran Air Force (IRIAF) continuing to fly geriatric aircraft such as the American F-5, or more famously, the F-14 Tomcat: an American twin-engine naval interceptor that was retired from US Navy (USN) service in the 2000s! Several of these were destroyed by the Israeli Air Force in June 2025, and as one might expect, the US has been in no mood to supply Iran with spare parts for their American airframes since the Islamic Revolution.

As such, scant few of their US-made aircraft were airworthy even prior to the 12-Day War in 2025. Arguably, Iran’s most advanced multirole aircraft is an aging variant of the Russian MiG-29 Fulcrum which has not been competitive since Desert Storm; those air forces that continue to fly it do so out of necessity, not desire (Ukraine being the clearest example of this). Iran also lacks capable air-to-air missiles for any of its aircraft. It’s unlikely any of the AIM-54 Phoenix BVRAAMs (beyond visual range air-to-air missile) they received in the 1970s are still usable, and Iran never received any R-37 or R-77 BVRAAMs from Russia.

At the same time, any prospects of modernization have fallen short. Russia has failed to deliver 24 relatively advanced Su-35 twin-engine air superiority fighters that they were contracted for, and China has not sold Iran any of its sophisticated J-10C single-engine fighter jets (along with the deadly PL-15E air-to-air missiles they’d sport), contrary to what certain outlets were promulgating in the wake of the 12-Day War. This has resulted in the IRIAF being one of the worst equipped, worst-trained air forces in a region where the average air force ought not be underestimated.

The Iranian navy too is relatively inconsequential, lacking advanced large surface combatants and relying on a small number of Russian Kilo-class diesel-electric submarines for subsurface warfare, as well as a so-called asymmetric strategy of using drone motherships, small speedboats, and missile boats to presumably attack US naval battlegroups. Delving into their navy is by now an entirely moot point as the majority of it has been sunk or rendered inoperable.

Iran’s ground forces are numerous, yet the same could’ve been said of Venezuela, who boasted (on paper) over 4 million members in its national militia, none of whom so much as raised a finger when fewer than 200 American SFOD-D (otherwise known as Delta Force) teams fought their way through Venezuelan leader Nicolas Maduro’s Cuban security detail and brought him back to the US in irons. The more salient point, however, is that the average Iranian soldier is poorly trained, unmotivated, and his loyalty to the regime is questionable at best. The Iranian government itself demonstrates precious little faith in its conventional armed forces, best evidenced by their lack of response to the Hayat Tahrir al-Sham (HTS) militant group marauding across Syria in a lightning campaign in late 2024, resulting in them deposing the Assad government: a key Iranian ally whose absence now allows Israeli strike aircraft to transit Syrian airspace on their way to Iran unimpeded. The IRGC is a somewhat different beast, though war, especially modern war, is a monumentally difficult undertaking. Competence is unduly assumed of most militaries (largely due to the world seeing the US military make modern war appear easy) when only very few are truly deserving of that descriptor.

As an aside, I personally believe Assad’s downfall to be one of the most underrated aspects of this war. Syrian forces, in particular their elderly yet dangerous air defense network, would have added a layer of complexity to any Israeli air operation where Iran was the target.

The IRGC would fare poorly in a land war against a competent power, hence why they delegate its prosecution to Levantine militant groups (such as the Iraqi Popular Mobilization Forces and Hezbollah in Lebanon) and other nations entirely. Avoiding a direct attack, particularly from the United States, has long been a priority. For this reason, they have fought the United States and Israel asymmetrically for decades, funding proxies and hostile states to bog them down across the Middle East. This has been referred to as the Ring of Fire strategy by some analysts.

Its goal is twofold: Expand Iranian influence across the region, and attrit the United States and Israel all while contemporaneously keeping their attention off of Iran itself. In the case of the United States, Iran’s goal has been to push them to draw down their presence in the Middle East, allowing the Islamic Republic to fill the vacuum. With regard to Israel, Iran’s ultimate goal is the total destruction of the Jewish state. Therefore, the main objective here has been to surround Israel with enemies. Hezbollah in Lebanon, Hamas in Gaza, the Assad regime in Syria, and the Houthis in Yemen are all part of Iran’s Ring of Fire. This desire is also why Iran is keen on developing nuclear weapons; they would both enable Iran to (in theory) destroy Israel and deter conventional military action from the United States. This asymmetric strategy had served Iran well, as evidenced by the pervasive influence of pro-Iran militant groups inside Iraq which have successfully infiltrated every sector of Iraqi society. This doctrine was also in play during the Red Sea Crisis, where Iranian naval vessels were aiding the Houthi militant group target US warships and commercial shipping vessels. The Ring of Fire was working as intended, until Iran was finally engaged directly.

Iran’s 3 strong points that would serve in a hot war are their ballistic missiles, one-way attack drones (OWA-UAVs), and air defenses. Iran has employed a variety of ballistic missiles, ranging from short-range ballistic missiles (SRBMs) only capable of striking targets a few hundred kilometers away, medium-range ballistic missiles (MRBMs) capable of reaching targets over 1000km away, and most recently intermediate-range ballistic missiles (IRBMs) that could hit western Europe. Before the war started, Iran had a stockpile in the thousands, mostly comprising cheaper SRBMs.

Iranian missiles (not including converted space launch vehicles that function as IRBMs). Center for Strategic & International Studies

However, across all 4 recent conflicts (including this one) where Iran has used its MRBMs and IRBMs, they have demonstrated a shockingly poor degree of accuracy. Though many were intercepted by the US and Israel, those that were not either fell on civilian areas or failed to strike any targets of significance in Israel. This has not changed. Most recently, Iranian use of their new, 2000km-range Khorramshahr-4 IRBMs armed with cluster warheads revealed the spread of said cluster munitions to be embarrassingly wide and entirely useless in a military context. The submunitions were far too small (only a few kilograms apiece), and spread over far too wide a radius to be considered reliable or have any meaningful effect on target. On the other hand, in this current conflict Iranian SRBMs have performed well, mostly hitting their intended targets.

Illustrative Khorramshahr-4 spread (each faint reddish dot is a submunition). Decker Eveleth

Iran arguably pioneered the concept of the long-range OWA-UAV, famously selling Russia thousands of Shahed-136 one-way attack drones and helping them erect a sprawling drone manufactory in Tatarstan. While it could be argued that Russia now possesses a more sophisticated arsenal of OWA-UAVs than Iran such that they are now supplying Iran with drones (and the United States too has entered this contest with their LUCAS drone), Iran’s capabilities in this sector remain threatening and should not be discounted. Such drones are slow, easy targets with relatively small warheads, yet their precision and low cost render them dangerous. These kinetic effectors serve to strike lower-priority targets, and more importantly, saturate enemy air defenses, allowing heavier, more sophisticated, and expensive munitions to get through. It should be noted that this mostly applies to cruise missiles, as the weapons employed against cruise missiles and drones are rarely those used in ballistic missile defense.

Drones such as the Shahed family also tend to be somewhat modular, allowing for different warheads, jammers, or decoys to be installed. Russia has even conducted (largely ad hoc) experiments attaching short-range anti-air missiles to their OWA-UAVs in an attempt to down Ukrainian helicopters sent to intercept them. While they have thus far failed to do so, these missiles are inexpensive and present an undeniable threat to interceptor aircraft (helicopters and propeller aircraft are at the greatest risk). Iran has not yet attempted this, but possesses the tools and knowhow to do so.

Iranian air defenses were not to be underestimated. Outmatched in the air, Iran focused on denying it to the enemy through their use of ground-based air defenses (GBAD). Iran boasted a mix of Russian-derived as well as indigenous designs that have left their mark across the region. Perhaps most notable is the infamous “358”, a so-called loitering missile which, in the hands of the PKK, a marxist Kurdish militant group, has been responsible for the downing of multiple large, Turkish medium-high altitude drones such as the Aksungur. Additionally, Iran had several modern, long-range radar-guided air defense (LRAD) systems such as the Talaash, Arman, Bavar-373, and Russian-supplied S-300PMU2. On paper, each of these systems is optimized to combat aerodynamic threats such as aircraft and cruise missiles at ranges surpassing 100km.

In terms of medium-range air defense (MRAD) systems, Iran famously employs the Khordad-3 (better known as the Sevom Khordad), a tracked platform similar to the Russian 9K37 Buk. In this category, they also utilize several older, less capable systems such as the American MIM-23 HAWK, and Russian 2K12 Kub. While dangerous, these are far less threatening.

Iranian Talaash (top) and 2K12 Kub (bottom) air defense systems. United States Central Command

Lastly, their short-range air defenses (SHORAD, ranges of <=20km) include weapons such as the Russian 9K330 Tor, and their indigenous Azarakhsh and Majid to name a few. Perhaps counterintuitively, I am of the belief that these SHORAD systems present the greatest threat to US and Israeli aircraft. This is because due to their shorter range, they will be lower on the list of priority targets compared to LRAD/MRAD systems, and will be struck later.

Entire strike missions made up of multiple flights of aircraft might be flown with the intention of neutralizing a single LRAD complex; it is difficult to imagine such energy being devoted toward the destruction of a lone short-range platform. Additionally, systems that fire smaller weapons tend to themselves be physically smaller, and consist of fewer vehicles (LRAD systems are rarely a single vehicle, rather a complex made up of launchers, generators, radars, and control stations) allowing for easier concealment and transport. Finally, these systems tend to employ passive tracking methods - chiefly infrared guidance. Unlike radar-guided systems which emit signals that can be tracked back to the source, SHORAD platforms making use of infrared guidance do not send out easily trackable emissions. As such, weapons like the Majid and Azarakhsh can quickly be unveiled, and if a hostile aircraft happens to be in the vicinity (this does require some luck, as due to their short range, they have a small defended footprint), they can attempt to engage it.

Iran had and still has no reliable ballistic missile defenses to speak of.

US/Israeli Strategy

Since it is the most relevant facet of Western doctrine (especially in this conflict), I will mainly discuss airpower. The US and Israel (henceforth referred to as the Coalition for simplicity) can be lumped into one category, as they largely wage war in the same manner, namely with the focal point being airpower and precision fires. Both nations’ greatest strength is their air forces (in reality it is their “system of systems”, though that is a rabbit hole for another day). This emphasis on airpower exists because controlling the sky is decisive. Mitsuo Fuchida, one of the Imperial Japanese pilots who took part in the attack on Pearl Harbor and the later Battle of Ceylon (modern-day Sri Lanka) in early 1942, stated: “He who controls the air controls the sea, and the world.” These words were true in the Second World War; they remain true today. Ownership of the air allows for the timely observation and destruction of the enemy with relative impunity from the majority of the enemy’s weapons, therefore giving one dominance over the battlespace. More specifically, the Coalition emphasizes precision strike. This is in contrast to a nation like Russia which prefers to use massed fires to solve its problems. This method’s efficacy (or lack thereof) is plainly visible in Ukraine, 4 years, 13,000 wrecked fighting vehicles, and 1.2 million casualties in.

Western doctrine relies on owning the sky. Achieving this is rarely an easy feat, and so great effort is put into the destruction of enemy assets that would attempt to disrupt this mission. SEAD/DEAD, or Suppression/Destruction of Enemy Air Defense, is the first step. This is performed in tandem with the destruction of enemy communications infrastructure and command centers, with the intention of paralyzing the enemy’s military response by blinding and deafening them.

Radars send out emissions that are easily homed in on, and SEAD aircraft - most notably the EA-18G Growler - possess jamming pods such as the AN/ALQ-99 and newer AN/ALQ-249 Next-Generation Jammer (Midband) to disrupt enemy communications and radar. They are then engaged with anti-radiation missiles, which track the origin point of incoming radar emissions. Turning the air defense radar off and then back on has been successfully done in the past, though modern anti-radar missiles such as the AGM-88E will remember the GPS coordinates of the target, making this particular tactic obsolete. These opening strikes will be accompanied by a large salvo of long-range precision strikes using cruise missiles such as the BGM-109 Tomahawk, and ballistic missiles such as the recently debuted PrSM (Precision Strike Missile) to destroy targets deep inside enemy territory.

While SEAD aircraft scour the ground for targets, dedicated air superiority fighters such as the stealthy F-22 and other multirole aircraft such as the F-35, F/A-18E/F, and F-15EX will scan the skies for enemy aircraft. Neutralizing the enemy’s air force is as important as destroying their air defenses, as both pose an unacceptable threat to friendly aircraft. As such, airbases are also a key target. Fuel dumps, aircraft hangars, munitions bunkers, and the runways themselves will be hit with penetrating munitions, both to destroy the aircraft on the ground (thus avoiding having to fight them at all) as well as rendering the airbase itself inoperable.

Air superiority fighters will be “quarterbacked” by an AEW&C (airborne early warning & control) aircraft - a large narrowbody sporting a colossal radar on top. This radar, whose range far exceeds that of any fighter, will both call out as well as confirm enemy targets for the fighters ahead, who will then engage with air-to-air missiles (AAMs). The AEW aircraft also serves as a “battle manager”, directing the overall flow of the air engagement. Those fighters without stealth shaping and radar-absorbent coatings will often rely on onboard jamming pods, such as the Angry Kitten introduced for American F-16Cs, to jam enemy missiles and aerial radar. This is to say nothing of the various additional, unsung assets that perform tasks such as offboard jamming (EA-37B, various ground stations jamming enemy satellites, etc.) and ever-present fleets of aerial refueling aircraft, or tankers, keeping the strike aircraft airborne both before and after the combat.

Once hostile air defenses have been degraded and the airspace is considered sufficiently permissive, strike aircraft will be able to venture further into enemy airspace. This allows the air campaign to shift to cheaper, short-range precision weapons - chiefly the American JDAM, or Joint Direct Attack Munition, which is a guidance kit that turns dumb bombs into guided bombs. Much the same can be said about the Small Diameter Bomb (SDB), a low-cost penetrating guided weapon that is smaller, yet longer-ranged than the JDAM family. Employing these tools allows far more targets to be serviced, as producing JDAMs and SDBs is far cheaper and less complex than producing large quantities of sophisticated long-range weapons like the stealthy AGM-158 cruise missile. JDAMs and SDBs will be fired at any ground targets that are discovered - armored vehicles, fighting positions, command posts, production facilities, missile launchers, and more.

Main Events

Operation Epic Fury as it was named by the United States, began on February 28^th with the first blows struck by the United States in tandem with Israel. It is entirely possible the Coalition would’ve been content to delay H-Hour for several more days if not weeks; the aerial refueling tanker airbridge and surge of US airpower to the region continued well into the war’s opening days. However, it’s likely that Coalition intelligence discovered an opportunity they couldn’t turn down: a meeting of what effectively amounted to the entire upper echelon of the Iranian state apparatus, both military and civilian. What followed were dozens of Israeli strike aircraft turning the site into a crater, with Ayatollah Khamenei, the head of the Islamic Revolutionary Guard Corps, and defense minister all killed in the blasts among dozens of others.

Next came what could only be described as a textbook display of Western airpower doctrine: a systematic dismantling of the Iranian military from above. First on the list: air defenses. A modern air campaign necessitates the neutering of ground-based air defenses (SEAD/DEAD) so that strike aircraft can conduct sorties unmolested. The Israeli Air Force, second only to the United States in this regard, did so successfully in the 12-Day War back in June 2025, losing no manned aircraft in the entire conflict.

This ability had been hinted at in their prior skirmishes with Iran. Notably, their surgical strike on a very rare, very valuable Russian-supplied 30N6E Flap Lid radar belonging to an S-300PMU2 long-range air defense system back in 2024 (destroying its radar effectively bottlenecks an LRAD and renders it useless). This also meant that Iran’s air defenses were far from full-strength when the hostilities began once more in 2026. Against the combined SEAD capability of the US and Israel, this was a foregone conclusion. Both Central Command (CENTCOM, the US’ combatant command responsible for the Middle East Area of Responsibility) and the Israeli Air Force (IAF) released video after video showing various precision munitions destroying a smorgasbord of short, medium, and long-range Iranian air defenses whilst themselves incurring no losses. Simultaneously, as the path was being cleared, more strike aircraft struck command and control sites, and also engaged in what is often called Scud Hunting: seeking and destroying ground-based, mobile ballistic missile launchers. Once again, the Americans’ aptitude in this domain has only improved since the Gulf War. Their success in this mission has been evidenced by the dramatic fall-off in Iranian ballistic missile launches as the war has continued; they have gone from several hundred in the first 2 days of the war to no more than a few dozen per day.

Daily Iranian ballistic missile and drone launches. Dmitri Alperovitch

As air defenses were degraded and ballistic missile launches declined, the Coalition (chiefly Israel) began to go after Iran’s state security agencies. This included strikes against the IRGC, of course, but also the Basij, Iran’s morality police. While it is hard to precisely gauge the damage done to these organizations, given Israel’s extensive intelligence penetration of the Iranian state it is safe to assume the damage has been severe. The Israeli Air Force released several videos showcasing them targeting Basij personnel on the ground in Iran, and according to the Wall Street Journal, hundreds of Iranian security personnel were killed when they inexplicably decided to gather in a football stadium in Tehran.

By this point, Iran’s ability to produce (not launch) ballistic missiles and large drones has largely been annihilated in the most literal interpretation of the word. Not only have the plants performing final assemblies been destroyed, but also just about every facility involved in their ballistic missile supply chain. Propellant, seeker, and casing manufacturers have all been successfully targeted.

Examples of US strikes on Iranian munitions production facilities. United States Central Command.

Iran’s response was, for lack of better terminology, to fire anything and everything - at everyone. One would naturally expect their ire to have solely been directed at the United States and Israel. Not so. Iranian SRBMs, MRBMs, and OWA-UAVs poured onto soft targets across the entire region. While Israel did come under attack from hundreds of IRBMs (mostly targeting civilian infrastructure), a similar number of ballistic missiles rained down across the Gulf. Videos of drones and missile interceptions over Gulf cities such as Dubai, Abu Dhabi, Manama, and notably, Doha, flooded the Internet. Iran’s targeting choice here was revelatory. Though a scant few missiles did strike Gulf oil infrastructure and empty US bases across the region (the strike on the US Navy’s 5^th Fleet HQ in Bahrain comes to mind), with 2 missiles even targeting but failing to reach the US base on Diego Garcia in the southern Indian Ocean, the majority of Iran’s response was directed toward civilian targets: apartment complexes, hotels, shopping malls.

Gulf Trepidation

Iran’s motivation for striking at civilian areas in the Gulf is clear. The Gulf states are conflict-averse nations. Yes, they have collectively spent hundreds of billions of US Dollars building their armed forces; until recently, the Qataris were flying a more sophisticated variant of the F-15 multirole fighter than even the United States! However, these militaries were never intended to fight an actual war (though now that they are at least partially doing so, these investments have paid off). The weapons shopping sprees embarked upon by countries like Qatar were in large part vanity projects. Collecting diverse fleets of advanced 4^th Generation fighter aircraft was always an incomprehensible fool’s errand to the educated observer and a waking nightmare for the logisticians of the nations in question. The reason they did so (other than money) is the same reason why the Gulf states have gone to great lengths to cultivate tourism, sporting talent, and even space programs: prestige.

Prestige in this context can be taken to mean a nation’s standing in the world, and this is a fragile thing. Both the very extensive, very valuable oil infrastructure, as well as the image of luxury these nations painstakingly built, are easily shattered. Were this near-existential danger to be realized, it would have been entirely plausible for them to lobby the United States and Israel to pursue a ceasefire that would’ve simply reset things to the status quo ante bellum. Iran knew this, hence their attacks on Gulf energy and tourism. This was a gamble - a gamble that spectacularly failed to pay off. Not only has Iran hardened the Gulf’s resolve (according to the New York Times, Saudi crown prince Mohammed Bin Salman has been doing the opposite of what Iran wanted, lobbying the White House to keep the pressure on), which now likely views the Iranian regime as a threat to be removed, but it has also alienated one of Iran’s closest allies and gateways to the wider world: Qatar. Mere days into the war, the Qatari state media agency, Al Jazeera, announced that several IRGC sleeper cells had been arrested in Doha. It wasn’t long after that that Qatari F-15s downed a pair of Russian-built, Iranian-operated Su-24 Fencer bombers. This is, to be quite frank, a stunning departure from what had been thought possible in the leadup to the conflict. In spite of all this, I refer to my earlier statement about the Gulf being conflict-averse; they have yet to join the war in any offensive capacity. In all likelihood, however, it will make little difference.

Coalition Airpower

Coalition aircraft have put up astonishing numbers: nearly 1500 targets serviced on day 1 alone, and over 12,000 sorties (air missions) as of March 26^th (disclaimer: it is entirely possible this number refers to targets serviced, though that would change little as the outcome is the same). This means that 2 nations have, by themselves, given Desert Storm’s rates a run for their money with approximately half the aircraft: a testament to the efficiency of modern airpower. This comprehensive strike campaign has progressed relentlessly, and continues apace as of the time of writing. Around day 3 was when the USAF began employing strategic assets. B-2 stealth bombers, their internal weapons bays packed with 2000lb bunker-busting GBU-31 JDAMs, hit underground targets across Iran. It would not be long before the B-52s and B-1Bs were called upon as well. Their work was evident on satellite imagery; multiple Iranian underground missile bases and manufactories had been damaged or destroyed. Notably, the non-stealthy B-1Bs were seen in the UK being armed with JDAMs (Joint Direct Attack Munitions, short-range GPS-guided bombs). The implication is clear. The Coalition had, within days, achieved air superiority over large swathes of Iran such that slow bombers and even MALE (medium-altitude, long endurance) drones like the Israeli Heron and American Reaper could loiter without disruption, joining the hunt for Iranian ballistic missile TELs (transporter-erector launchers) with their short-range Mikholit and AGM-114 Hellfire missiles. Already on day 1, a significant percentage (if not the majority) of Coalition strikes were being conducted with short-range guided bombs like the Israeli SPICE, and American JDAM and SDB (Small Diameter Bomb) families of weapons. The presence of Coalition aircraft inside Iranian airspace, a fact vociferously denied by Iranian propagandists, was once again reinforced when an IAF F-35I scored the model’s first ever air-to-air kill on a manned aircraft against an Iranian Yak-130 light fighter. The Israelis would later publish footage of the shootdown recorded using the F-35’s AN/AAQ-40 Electro-Optical Targeting System (EOTS). Around week 2, Coalition air superiority became even more undeniable when non-stealthy US Navy F/A-18E/F Super Hornets were seen overflying the southeastern Iranian port city of Chabahar at low level on various occasions.

8 Hardened Aircraft Shelters (HAS) in Iran, each likely hit by a single GBU-39 Small Diameter Bomb. Vantor Holdings.

Days into the campaign, the United States had also begun sinking the Iranian Navy. Most ships were sunk in or near port, with CENTCOM publishing multiple videos of Iranian warships being targeted. Yet the Silent Service (the USN’s submarine force) was also able to partake, marking its first kill since WWII, and the 2^nd ever kill for a nuclear submarine (the first being the sinking of the Argentine ARA Belgrano by HMS Conqueror during the Falklands War in 1982) when the USS Charlotte, a Los Angeles-class nuclear attack submarine, sank the Iranian frigate IRIS Dena off the Sri Lankan coast on March 4^th. The IRIAF, largely a nonfactor from the outset, has also been pummeled by Coalition strikes. The IAF had already seen to much of its destruction last year; this has only continued in 2026. Iran was never going to be able to contest the air and sea domains, especially since the rumors of them receiving Russian and Chinese Su-35s and J-10Cs respectively were just that. Even so, their presence would have served mostly as a training opportunity for the Coalition to familiarize themselves against advanced PLAAF aircraft. This, of course, assumes they weren’t simply destroyed on the ground as would’ve almost certainly been the case. The United States is largely uninterested in facing off against enemy aircraft in the sky despite their unparalleled competence for air-to-air warfare; they much prefer to strike them before they can take off.

The IRIS Shahid Bagheri, Iran’s flagship drone carrier, ablaze after a US strike. United States Central Command.

Iran’s missile campaign would soon confusingly expand in scope, targeting even more uninvolved countries. A USN Arleigh Burke-class guided missile destroyer had to down an Iranian ballistic missile that would’ve landed in Turkey (as of the 28^th, this happened 3 times). 2 Iranian OWA-UAVs struck civilian targets in Azerbaijan. Iranian drones would also set ablaze several storage tanks at an oil depot in Oman: the nation which had facilitated US-Iran negotiations prior to the war’s outset to no avail. Some have posited that, following the degradation of their command-and-control in the opening stages of the war, individual battery commanders simply decided to loose their weapons upon whichever country they personally had a grievance with. Whether there is any truth to this claim, I leave that to the reader. As an aside, I believe the Americans’ intention was to use the talks as a façade to begin with so as to obfuscate the otherwise very clear motivation of their massive buildup of forces in theater.

Coalition Losses

Statistically, there was virtually no chance of the Coalition escaping unscathed this time around. This was clear to the planners of Desert Storm; it is clear today. The sheer volume and complexity of Coalition air operations meant that at some point, something was bound to go awry, and it did. The most noteworthy incident was the downing of 3 USAF F-15E Strike Eagles by a Kuwaiti F/A-18C Hornet. The incident took place within visual range, leading to speculation that the act was perpetrated intentionally. For what it’s worth, I am also of this belief, as I see no plausible explanation for the pilot not only failing to identify 3 friendly aircraft on 3 separate occasions, but also failing to realize his mistake after the first shootdown. No US aircrew were killed, however, and it is probable the Kuwaiti government will reimburse the US for the loss of 3 expensive F-15E airframes (around $100mln apiece).

Additional Coalition losses include 6 US servicemen killed on the ground in Kuwait after an Iranian strike. More recently, a USAF KC-135 Stratotanker aerial refueling aircraft went down in western Iraq following a midair collision with another Stratotanker, likely while one was refueling the other. All 6 aircrew on board perished and the surviving airframe suffered damage to its vertical stabilizer. 2 other incidents include a fire breaking out on the USS Gerald R. Ford supercarrier, with 2 sailors seriously injured as a result and the destruction of numerous sleeping quarters on board, as well as some minor shrapnel damage to 5 and destruction of 2-3 US tanker aircraft on the ground at Prince Sultan airbase in Saudi Arabia. That such occurrences are taking place on the Ford is unsurprising; the carrier has now engaged in 2 large-scale military actions without returning to port as originally scheduled. Crew fatigue, combined with general wear and tear, will reap their toll. Finally, an unknown number of Coalition MALE drones such as the US MQ-9B have been lost over Iran; these are unwieldy, non-stealthy, slow platforms and it is no surprise that they have suffered losses. It’s possible upwards of 20 have been downed thus far, though Coalition planners broadly consider such assets to be expendable during major operations.

A downed Israeli Hermes drone in Iran. Source unknown

To put these losses into perspective, one should look no further than Desert Storm itself. Desert Storm is widely considered one of the most successful and devastating military campaigns in history. It saw the near complete destruction or surrender of Iraqi forces in Kuwait to the point where US aircrew were directed to spare Iraqi forces fleeing Kuwait out of concern for the pilots’ mental wellbeing. Furthermore, air defenses inside Iraq as well as the Iraqi air force suffered catastrophically, with multiple instances of Iraqi pilots fleeing, with their aircraft, into Iran, against whom they’d recently fought a war. Thousands of tanks, armored vehicles, and heavy weapons, as well as tens of thousands of Iraqi soldiers, were killed or captured. And yet, even in that campaign the Coalition lost around 300 men killed and 75 aircraft downed, and it should be mentioned that approximately half of these were due to accidents or friendly fire.

Iranian Successes

Iran’s strategy, on the other hand, has seen paltry military successes. It is true that Iranian munitions did strike US bases across the Gulf. The aforementioned 5^th Fleet headquarters. Al Dhafra in the UAE. Al Udeid in Qatar. Ali al Salem in Kuwait. Erbil Int’l airport in Iraqi Kurdistan. What all of these locations have in common is that they were largely vacant of strike and support aircraft. The US was well aware of Iran’s stockpile of SRBMs, which far exceeded their supply of more expensive IRBMs. As such, they concluded that defending their forward bases was (for the most part) futile, and would simply result in the fruitless expenditure of countless missile interceptors. As such, US airpower has largely been sortieing from bases further afield. Ovda and Ben Gurion in Israel. Muwaffaq Salti in Jordan. Prince Sultan in Saudi Arabia (it’s believed the Saudis have not greenlit the use of their bases to stage combat missions, so Prince Sultan is only populated by support aircraft such as tankers and AEW&C. This is in addition to the USS Ford in the Red Sea, and USS Abraham Lincoln in the Arabian Sea. These aircraft carriers serve as mobile airbases that can exploit the most valuable layer of the survivability onion: Don’t be there. This strategy has been successful; only Prince Sultan, the base nearest Iran out of the group, has been hit, with little damage. Iran has (falsely) claimed to have downed a multitude of US strike aircraft; their sole partial success (thus far) was achieving a glancing hit on a US F-35, which nonetheless made it back home. It’s likely this was the result of a SAMbush (a pop-up attack with surface-to-air missiles, or SAMs) using a small, short-range air defense system employing infrared or electro-optical guidance (as opposed to radar guidance, which is what the aircraft is primarily designed to evade), which is always a risk.

Iran’s major success has in fact been its disruption to the global economy through their war on Gulf oil and gas. Additionally, their closure of the Strait of Hormuz, the narrow waterway into the Arabian Sea that tanker ships rely upon to ferry petroleum out of the Persian Gulf, has spiked energy prices enormously. Even so, Iran has been largely incapable of enforcing this closure militarily, with only isolated incidents of tankers coming under attack from one-way attack drones (both naval and aerial types). Rather, it seems skyrocketing insurance rates have been a more intimidating foe in this regard. The US has hitherto declined to escort ships through the Strait. This is a tactically sound plan, as doing so would put valuable US warships at risk. Other nations such as India and Pakistan have both begun to do just that, though far below what would be necessary to consider the Strait reopened; the number of tankers passing through the Strait has been negligible. Other nations have warships nearby on counter-piracy missions that could easily be re-tasked. These include South Korea, Japan, and several European countries involved in the Aspides freedom of navigation operation in the Red Sea. Whether this takes place is purely a matter of will, not capability, though based on statements issued by said European nations, the will to do so is sorely lacking. Given French President Emmanuel Macron’s declaration to escort vessels “once hostilities subside”, one could not be blamed for betting that Europe will remain uninvolved for the remainder of the conflict.

Objectives

Coalition Aims

The objectives on both sides are very simple. There are no complex outcomes that one side or the other is aiming to achieve. The Coalition wishes to depose the Iranian regime. Whether this takes the form of a popular revolt that sees the Islamic Republic ousted, the regime itself surrendering and the Ayatollah (whoever that may be by that point) abdicating, or simply bombing whoever is next in line until a figure emerges whom the Americans deem amenable and malleable to their wishes (this is what occurred in Venezuela, with that figure being acting president Delcy Rodriguez). Barring that, defanging Iran for the foreseeable future is the option that makes the most sense. Destroying their military, nuclear program, missile and drone programs, and as much of their government as possible to keep them off the geopolitical chessboard for the coming years (ideally decades). This is because the United States is gearing up for a war against the People’s Republic of China in the Pacific, and a hostile Iran that takes advantage of that war to strike at US interests in the Middle East would be decidedly suboptimal. Defanging Iran in this manner would not be difficult to achieve and is already being implemented, as doing so involves many of the same steps that would theoretically usher in regime change. Several large transport aircraft employed by the regime to ferry resources to their proxies across the Levant have already been struck. A multitude of facilities involved at every level of the drone and missile supply chains have been leveled. Companies with ties to the Iranian defense sector too have had their buildings airstruck, including 3 separate steel plants across Iran. Such assets are neither cheap nor easily replaced. The Coalition could easily go further by striking Iranian oil infrastructure (the Achilles’ heel of the Iranian economy), as well as civilian power infrastructure. Doing so would, at least temporarily, spike oil prices. Destroying anything tends to be cheaper than building it, and 2000lb JDAMs are inexpensive yet superlative tools of destruction.

In this vein, the deployment of a Marine Expeditionary Unit (MEU) to the region may have as an objective the seizure of Kharg Island, a small Iranian island in the Persian Gulf from which the vast majority of Iran’s oil is loaded onto tankers and exported. The Coalition recently struck targets on Kharg, and one may wonder why the Coalition does not simply annihilate the oil infrastructure present, as it was intentionally spared. It is entirely possible that the Coalition wishes to take and use Kharg as a bargaining chip if Iran proves intransigent and unwilling to end the war once the Coalition’s other objectives are complete (of course, this assumes the most desirable goal of deposing the regime has been deemed unrealistic). Alternatively, the target may be an island or a section of Iran nearer to the Strait itself, with the landing’s objective being that of reopening the Strait. This would, in my opinion, make more sense. Kharg is in the heart of the Persian Gulf; the MEU would need to transit the Strait itself and venture deep into the Gulf, a risky maneuver, to reach it. It is more likely that islands nearer the Strait itself would be targeted, with the intention being that of holding the waterway open by threatening Iranian forces on the coast that would seek to interdict transiting vessels. The Marine Corps has gotten little action (relative to the Air Force and Navy) thus far, and is champing at the bit to get stuck in.

Iranian Aims

Iran’s goal is even simpler. Survival. Given the overwhelming superiority in fires the Coalition enjoys, if this war ends with the current government still in place, they will consider it a victory. The regime is aware that a military victory in the traditional sense, where the enemy’s ability to wage war is removed, is off the table and will thus shift to making this war unpalatable for the broader public in the United States. They will attempt to do so by inflicting an unacceptable level of casualties on US servicemen, as well as through economic means such as closing off the Strait of Hormuz. The US public is largely indifferent to the government’s overseas endeavors as long as casualties remain low, but is highly sensitive to energy costs; the state of the economy is arguably the top issue for the average American voter and the party that goes into election day responsible for a floundering economy should skip the anticipatory champagne. The White House is well aware of the fact that when Americans go to the polls in November, they will assuredly factor in plummeting 401Ks and soaring gas prices when they cast their ballots. As such, Iran partially hopes to force the White House to pull the plug on the war out of concern for their prospects in the Midterm elections.

Where do we go from here?

Whereas the objectives on both sides are easy to elucidate, predicting the future is not. What is clear is that the Coalition prepared for a campaign that would last weeks, and months if necessary. At the earliest, this conflict will wrap up around early to mid-April. But wars only end when both sides admit that they end. Rome famously refused to sue for peace even after their crushing defeat at Cannae despite the custom (and expectation from the Carthaginians) at the time being to do just that. While Rome under Scipio the Younger’s sage guidance subsequently won crushing victories in Iberia (culminating in the Battle of Ilipa, which permanently ended Carthaginian influence in the peninsula) and later defeated Hannibal at Zama, there is effectively no chance of Iran pulling off a similar military comeback.

That said, if Iran continues to fire dozens of loitering munitions across the Gulf every single day, the war cannot be considered ended. It could very plausibly still be raging at the end of July, for instance! Purely militarily, this has been one of the most one-sided campaigns in history, possibly even more so than Desert Storm. However, a military victory is not the same as a political victory, and the White House wants prices at the pump to be manageable in the leadup to November. Both sides have presented mixed signals, but neither side has (thus far) presented demands that even approach acceptability for the other.

I have also been asked, repeatedly: “Will there be a ground invasion?” I don’t see how this is at all realistic. Now, as with all things, I could be wrong, and the US could indeed decide to mass what would effectively amount to the entire US Army and Marine Corps to invade and occupy Iran. The preparation for this by itself would take several months, plus several months to conquer Iran. However, there is currently no indication whatsoever of this being in the works, and believe me, there absolutely would be. The treacherous nature of Iran’s mountainous terrain was explained at the beginning of this report; invading and occupying Iran would require a host larger than the one Russia has deployed in Ukraine at this moment (that is to say, in the region of 700,000 troops). The US would almost certainly need to reinstate the draft to accomplish this. There are stirrings of some US land forces being deployed to the region, yet these total significantly fewer than a division element - not all of whom would even be deployed. At most, they could occupy small sections of Iran’s southern coastline and/or islands in the Strait of Hormuz. Alternatively, they will support a SOF (special operations forces) mission to secure high value targets or assets, such as the enriched Uranium in Iran’s possession.

President Trump enjoys a frankly astounding level of fealty from today’s Republican party; a full-scale invasion would see said Republican party openly rebel against his presidency. He would be fortunate to escape impeachment. This is to say nothing of the guaranteed, crushing, self-inflicted loss that this would cause in the midterm elections, the sheer scale of which would be such that the Democrats might even be handed a supermajority in Congress. President Trump himself has stated in no uncertain terms that such protracted land wars are something he seeks to avoid. Regime change would be ideal for the Coalition, but it isn’t their end-all be-all; avoiding a second Afghanistan is a far higher priority than toppling the Islamic Republic. As stated earlier: There are alternatives to total regime change, and the US simply cannot afford to get bogged down in a land war in West Asia when it is staring down the barrel of a civilization-defining Pacific grudge match within the next 10 years; if you were to ask me personally, I think China could make a move on Taiwan as soon as 2029!

Neutering the Islamic Republic militarily for the next decade, if not more, will serve. It is far likelier that President Trump simply declares victory when the tasks pertaining to this goal are completed, and then negotiates a ceasefire, which would necessarily involve the Strait of Hormuz remaining open (I would be surprised if the Coalition were to end the war with it closed). In this scenario, Iran would be foolish to continue firing missiles and drones across the Gulf, especially since the United States could simply remove its military assets from the region. That being said, it is probable that any ceasefire would be backed up by threat of further violence by the Coalition. Iran’s regime surviving at all would be a victory for them; endangering this victory by continuing to sling OWA-UAVs when the other side has provided you an out would be an act of monumental stupidity.

Personally, an outcome where the Coalition (specifically President Trump) announces its mission to be accomplished, negotiates a ceasefire, and the missiles stop flying, is the one I consider to be the most probable. One ought to remember that, while there would likely be some pain, the US is better positioned than most countries on Earth to simply walk away. They can withdraw their forces to bases outside the Middle East, and don’t rely on the Strait of Hormuz being open, as the US is an energy exporter. When this will happen is far harder to predict, though I don’t see this taking place until early to mid-April at the earliest. The Islamic Regime will probably survive, missing thousands of security personnel and militarily neutered for at least a decade, likely longer. This path simply requires the fewest assumptions of future events, and is what I consider to be the one that we are on track to see. I fully acknowledge that this could be wrong and simply believe this to be the most probable outcome; it is far from the only possible outcome. It could be that the regime is teetering on the brink of collapse, and that in a few more days or weeks, the Iranian people take to the streets once more and together with Coalition airpower oust the Islamic Republic. The United States has publicly stated that there will, at some point, be a signal for the Iranian people to come out in force. However, the massacre of anti-government protestors in January was immense, with the lowest estimates in the tens of thousands, and the highest approaching 100,000 fatalities. This is to say nothing of the tens of thousands that were doubtless imprisoned or incapacitated. It could simply be that a significant percentage of those willing and able to forcibly overthrow the regime was taken off the board in January.

Part 3: Conclusions

No matter how it ends, this conflict will leave a lasting effect on the Middle East, and the globe. The 2026 Iran War is the latest chapter in a 4,000 year story of a fortified highway that armies can cross but rarely hold. Once again, a coalition of outside powers has demonstrated that Iran is relatively easy to devastate from the above; once again, the real question is whether anyone can impose lasting control.

If the Iranian regime escapes annihilation, it will be the first regime in roughly a thousand years to do so without relying on Turkic tribal military backing. That alone marks a historic rupture. However, it will need decades, and tens (if not hundreds) of billions of dollars to rebuild its industry and military. They will likely be even more committed to their nuclear weapons program, regardless of any public statements to the contrary. This implies that at a certain point in the future, Israel will strike them once again, possibly with US assistance.

Survival will have cost the regime dearly: a shattered defense sector, a depleted treasury, and a resentful, tired population that has once more seen the military of its government laid bare. This all began with major popular unrest. After everything that has happened, it is only a matter of time before such events repeat themselves. Whether they are successful, only time will tell. The regime’s likely response will be exactly what history predicts: doubling down on nuclear hedging and asymmetric proxies while tightening internal repression.

For the Gulf monarchies, the war has delivered a painful lesson. Years of diplomatic outreach to Iran and naive presumptions of peace were shattered in a day, and their oil and tourism empires proved to be very attractive, vulnerable targets. Neutral countries have seen how easily the lifeblood of the global economy can be dammed up by a rogue state. Expect determined efforts to build strategic petroleum reserves, diversify energy sources, and general pushes for strategic and resource autonomy.

For the United States and Israel, the campaign has been a military success on a scale that rivals Desert Storm. The key difference is that the crushing military victory of Desert Storm was followed by the achievement of the Coalition’s stated objectives. In this campaign, it is likely the most desirable objective of overthrowing the Islamic Regime will not be achieved. Iran has been defanged for a decade or even more, but the highway remains open. The underlying geography, the enduring Iranian identity, and the pattern of short-lived external control have not changed.

The next round (whether it comes from within Iran or from a new external actor) is already on the horizon. In the end, the 2026 war may be remembered less as the conflict that finally broke the Islamic Republic and more as the latest reminder that conquering the Iranian Plateau is difficult, but holding it has always been nearly impossible. The fortified highway endures, its current owners bloodied, but for now, still in control.

Any feedback is more than welcome in the comments, or you can send me a message on Substack or through my twitter (X) account @AAGresearch.

You can contact Antonio on his Substack @trumpeterreport.

I hope this finds you well.

Disclaimer: I assume no liability for any and all of your actions, whether derived out of or in connection with this information or elsewhere, and you hereby warrant and represent that any and all actions that you take or that you may take at a later date in connection with this information shall remain your sole responsibility and, in case, I shall not be held liable for any such actions.

· On this report I analyse the opportunity behind a commodity that is down 50% in price since its highs 10 years ago. Demand has been growing steadily, and supply will drop around 10% by 2030. I argue this commodity is ready for an inflection point.

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I posted my first report on February 29^th, 2024. The report was called “Ero Copper: Significant upside even if copper expansion doesn´t come through.” I wrote it for another investor platform, but it never got published. So, I decided to post it online. I never expected to get such a positive response.

Incidentally, 2 months prior to my first publishing I had met for dinner a US hedge fund manager who I admire. He told me that perhaps starting my own blog could get my name out and help me focus on my ideas. He was spot on. Thanks to this blog thousands of interesting people have reached out, and I have received excellent feedback and criticism on my ideas and approach to investing.

Given the popularity of the blog, I kept posting the stocks I invest in and why I invest in them. Moving forward to today, the blog has over 4500 free subscribers. Of those 4500 readers, over 100 of you contribute to the blog with a yearly or monthly subscription even though you get nothing in return except my gratitude.

To keep delivering this level of deep-value research and to have the time to answer your emails, I am officially transitioning this blog to a paid model. I do everything myself, and this allows me to maintain the quality you expect.

I am blown away by the support I have received, and no words can describe how grateful I am to all my readers. Researching stocks is my passion and I have discovered that writing also gives me great joy, so I feel unbelievably lucky that people find value in my work.

Since the 29^th of February 2024 I have posted 28 reports, of which 16 are long reports. Each of these 16 reports are between 30 and 40 pages long and took me 100s of hours of research and writing to get them each completed. The other 12 reports were updates and therefore shorter in length and effort. The stocks I covered were mostly litigation, commodities, shipping, and mining stocks.

My message today is that after 2 years of writing for free I have decided to turn the blog into a paid platform. I receive hundreds of emails and messages each week but there is not enough time to answer all of you. By introducing a paid tier, the number of subscribers will likely reduce in number, and therefore the quality and quantity of my responses and posts will increase.

Even though I have made mistakes, I feel like I have produced good research. To keep delivering this level of research and to have the time to answer your emails, I need to transition to a paid model. I do everything myself and I search for stocks one by one.

I prefer doing things the old way. I did not even use an LLM until very late in 2024. And I did not use it for investing until 2025. Even today I prefer to use it to satisfy my curiosity rather than for investing.

Some may think that not using an LLM as my main tool may put me at a disadvantage, but I think it is the opposite. I argue that if everyone uses the same tools, they will achieve the same results. And I aspire to achieve something better.

What you can expect from now on

Since I started the blog, I have averaged about one post per month, whether it was an update or a deep dive. You should expect the same rate of publishing.

I come from a family of wine makers, and my uncle has always told me that you cannot increase output without putting quality at risk, I believe that very much to be true. If I were to promise you an increase in output of ideas, then the quality of each investment idea would be in jeopardy.

Furthermore, I argue that good investment ideas should be bought and waited upon. I first posted about PGMs and Generation Mining on March 2024. Since than Generation Mining is up 200%. Had I posted ideas weekly, the temptation of diversifying into other stocks or switching to another idea may have been too great.

Warren Buffett’s “sitting on your ass” philosophy emphasizes patience, long-term holding, and avoiding unnecessary trading. I believe that philosophy to be the correct one.

As a result of this, not much will change except perhaps you will be getting more updates on the stocks, and you will get quicker responses from me. Too many emails have gone unanswered simply because managing such a big subscriber base is unrealistic.

I could have decided not to answer any emails or messages, but so many of you offer interesting insights into investing and life, and I want to keep those conversations alive.

About myself

I am not sure how to start this, so I guess I will start from the beginning of my investing journey.

I started investing when I was 13 years old by serendipity. My parents and grandparents had put a bit of money each year into a savings account since I was born. When I was 13, I found out that my dad had put all that money into a Spanish stock. I was surprised that such a thing could be done, and I started researching the stock. That is where my journey with investing started.

From the very beginning I was extremely interested in stocks. It seemed to me that a person could make money by turning knowledge and patience into money, regardless of its intelligence. This was very appealing to me as I have always been passionate about knowledge.

From the time I was 13 it already struck me as evident that the price chart of a stock gave me very little insight into the underlying business. I did not know what technical analysis was, but when I found out it made no sense.

Therefore, my way to advance in investing was to read out what the company was doing, the fundamentals were fascinating to me. Each company and sector seemed to me like start fresh on a good book.

I guess the main reason behind this passion is that I am obsessed with history. And a true historian searches for truth, whether it is in the narrative or in the numbers.

Therefore, I argue that there is no difference between a good historian and an investor: Both search for the truth. And in the essence of it, that is what I try to find: The truth behind each stock that I read about.

In the pillars of investing, I believe there are two worlds: The stock price and the fundamentals of the business. And I believe that both are often in a disconnect, leading to inefficiencies. And although my approach to investing has changed over the years, my underlying aim has always been to search for a business where the fundamentals make sense, but the stock price (the market) is giving no value to such business.

That is why I am focused on deep value research.

I currently live in Andorra, but I was born in Spain. I have lived 4 years in England and 2 years in the Netherlands.

Regarding my personality: I said earlier I believe in the “old ways.” I argue that the principles our grandparents stood for made more sense than the ones most people defend today.

The principles that stand the most within me are honesty, respect, integrity, kindness, empathy, gratitude, perseverance, authenticity, loyalty, and hard work. I like these principles because they are achievable by almost anyone.

Whereas a lot of people today appreciate being extroverted, ambitious, charismatic, inspirational or “high energy.” These principles do not make much sense to me because they do not say much about the person and they are not attainable, except by birth.

The performance

Stocks sold in 2025

The performance of the blog has been extraordinary so far. 2025 was the first complete year of the blog and it yielded an average of 67% in average returns for stocks I sold.

Regarding stocks I kept, the return was even better at 172%.

Stocks I still hold.

I have been investing since I was 13, and I am now 28 years old. I have been invested in plenty of stocks throughout the years. Therefore, most of my investing life has happened before I started the blog.

I have made plenty of mistakes, particularly when I was about 17 and 18. I invested in extremely speculative stocks in which I ended up losing 90% of what I invested. I even invested in an engineering firm that ended up going broke. Thankfully, I learned a lot from this, and it was at early (or earlier) age.

My best wins have been mainly three.1. I invested in Tesla when I was 19 years old, but I did not even know why I invested in it. So, I sold really early at a low three digit return on my portfolio. 2. Then in 2017 and 2018, when I was 20 years old, I put all my money into junior uranium mining stocks. I held them for 5 years and I bought more in 2020. I ended up selling all my uranium stocks in 2022 for an average return of over 1000% on my portfolio. My best stocks were the following:

· Global atomic (1138%)

· Boss Energy (1452%)

· Encore Energy (503%)

· Vimy Resources (1229%)

· Bannerman (841%)

My mistake was incidentally not switching into the second derivative of that trade, which would have been nuclear energy stocks like Nuscale or Oklo. I knew these stocks since their IPO, but I just thought they were too speculative.

3. Then my third largest win came since 2022. After I sold all my uranium stocks I switched to copper, gold, platinum, and palladium stocks. This has been well reported on my blog, so I will not go into much detail on it. As you can see on the tables above, Generation Mining has returned 429% on 2025 alone.

Bear in mind that my investment horizon is about five years, so the stories of the stocks I hold are not over yet.

My tendency is to be really early on my investments. I recall buying Fission Uranium stock in 2017 and 2018 and seeing it fall 80% by 2020. And I expect this could have happened (and still could happen) to my PGM stocks. I say this as a warning if I may, you can expect plenty of volatility from the stocks I own.

My investment philosophy

I wrote a 40-page report available on my blog about how I approach investing. So, I will not go into much detail about it.

I aim for maximum absolute returns, regardless of market conditions. I do not aim for good relative performance against indices like the S&P.

I focus on a small, high conviction portfolio. I do not think diversifying makes sense. Although if I am investing in an entire industry, I do not mind doing it across many names.

I am willing to find opportunities almost anywhere regardless of the sector, region, or volatility of the sector. That said, if I feel clueless about an opportunity, I will never invest in it. I want to respect the circle of competence.

Identifying inflection points, particularly in commodities, is one of my aims. This means that you will often see me investing in commodities or sectors that have been down heavily for many years. It also means that I am bit of a contrarian as these opportunities are often found in unloved stocks.

I much rather be early and wait (accepting time, drawdowns, and patience as the cost) over being late and missing out entirely.

Upside is theoretically infinite, while margin of safety is quantifiable. If you see me calculate upside on my reports, it is more about making sure that even if I am wrong by a significant margin, the stock is all right.

Example: If I estimate the stock is worth $4 billion and it trades for $400 million, the upside could be $3.6 billion but that is impossible to know because upside is theoretically infinite. But at least we know that even if I am somewhat wrong and the business is worth $2 billion, the downside is limited.

Pricing

Subscription:

Monthly: $35/month.

Yearly: $350/year.

Founding member: $750/year

Founding Member tier includes:

· A guaranteed quarterly group video call

Any feedback is more than welcome in the comments, or you can send me a message on Substack or through my twitter (X) account @AAGresearch.

As always, I want to thank my wife Yeimy. This report and this blog would not be possible without her. Thank you.

I hope this finds you well,

Alberto Álvarez González.

Disclaimer: I assume no liability for any and all of your actions, whether derived out of or in connection with this information or elsewhere, and you hereby warrant and represent that any and all actions that you take or that you may take at a later date in connection with this information shall remain your sole responsibility and, in case, I shall not be held liable for any such actions.

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· On 2025, the equity investments I sold returned an average of 80%. Open equity investments returned an average of 172% in 2025.

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Throughout this week I have sold my stake at Boab Metals (ASX: BML) (OTCMKTS: BMLQF) for a 456% gain. I bought the shares at A$0.08. I first put out a note on Boab on the 20^th of August 2024, since then the stock has increased 345%.

It was a tough decision as I put many hundreds of hours on my last report, and I still argue that Boab i…

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· In the report I summarized an analysis of every pre revenue silver developer worldwide, the current state of the silver market and my overall take on the mining industry.

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· For the last months I have been living in Andorra with my wife. In this report I will review the reasons as to why we moved to Andorra and how to move there.

· I have written this report as dozens of subscribers have asked me to do so. But it has very little to do with investing.

· There is also a bit of history in the report, as well as thoughts on private property, philosophy, and politics.

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Introduction

For those of you new to the blog, here is a little bit of information on me that is relevant to this report: I started investing when I was 13 or 14 years old. When I was 20 years old, I discovered the uranium investment thesis, I invested all I had in uranium. And by the time I was 25 years old (2021) I had returned over 1000% on my portfolio. So, I became a full-time investor.

Bear in mind I am a frugal person, and with the money I had made in 2021 and 2022 I had more than enough to live with. But I am almost certain that a lot of people would not.

Tax situation in Spain versus Andorra

Since 2021 I had been planning to leave Spain due to many reasons. Primarily for tax reasons. Capital gains tax in Spain goes from 19% to 28%, and most of my income comes from capital gains. A portion of my income comes from dividends from stocks. Dividends in Spain are taxed at 19% flat tax. But companies in Spain are taxed 25% already for corporate tax. So, if I owned a Spanish stock I would be paying double taxes.

Ordinary income (wages) is taxed from 18% to 45% in Madrid, where I lived. If you live in other areas of Spain this tax can be even higher. VAT in Spain is 21%. So, the income of many people in Spain is taxed at over 50% if you include the VAT (consumption) and capital gains tax (savings). I consider this level of taxation to be theft.

In contrast, income in Andorra is taxed at 0% (<24.000 €), 5% (between 24,000 and 40,000 euros) and to 10% for anything more than 40,000 euros. And capital gains tax is 0%.

Furthermore, VAT in Andorra is 4.5% and corporate tax is a flat 10%.

There is no inheritance tax in Andorra.

The nontax factors that affected my decision were the following:

· Increase insecurity in Spain: Corruption, lack of respect for private property and violence have been on the rise in Spain.

· Air pollution: In Madrid 2.4 cigarettes' worth of pollution particles is inhaled daily. Spain is the third largest country in Europe (not including Russia), so there are plenty of areas with little or no pollution. But these areas have little infrastructure, and taxes are the same than in Madrid or Barcelona, if not more.

Freedom

Freedom is an exceedingly difficult parameter to measure. But the most common measurements are the following:

1. HFI Score (0–10): Measures personal and economic freedom (e.g., rule of law, property rights, expression) across 86 indicators; higher scores indicate greater freedom.

2. Freedom House Score (0–100): Assesses political rights (e.g., elections) and civil liberties (e.g., speech, justice); higher scores reflect stronger democratic freedoms.

Freedom scores.

Andorra is not included in most freedom rankings due to its small size. So, to create the table of the Top Free Countries (Including Microstates), I compiled data from the Human Freedom Index (HFI) 2024 and Freedom in the World 2024. Countries like Switzerland (HFI: 9.01, Freedom House: 96), New Zealand, and Denmark are at the top based on personal, civil, and economic freedoms.

For microstates like Luxembourg, Liechtenstein, and Andorra, I used HFI scores (e.g., Luxembourg: 8.71) and Freedom House scores (e.g., Liechtenstein: 90), while San Marino and Monaco were ranked lower (9th, 10th) using Freedom House scores (96, 85) and qualitative data from U.S. State Department reports due to their absence from HFI.

Main downsides of living in Andorra versus Madrid

· Less public transport: The public bus system is good in Andorra, but there are no trains.

· Less availability of cab drivers: No Uber available here and fewer taxis than in Madrid.

· Less availability of home delivery: No Amazon Prime delivery and less restaurants delivering food to your home.

· Fewer homes available: Andorra has much more demand for homes than the existing capability to build them. They need more supply.

· Everything is in Catalan: All contracts, street signs or labels are in Catalan, not Spanish. I do not mind it, and I am learning Catalan, but some people might not like this. However, everyone knows how to speak Spanish.

· No airport.

· Andorra is about 20% more expensive than Madrid. Although the low VAT in Andorra helps.

· Andorra Telecom has a monopoly on internet services and telecom. Plus, there is roaming in Andorra since it is not part of the EU.

Main upsides of living in Andorra versus Madrid

· Better air quality: There is almost no air pollution in most of the country.

· Lower taxes.

· Safer: Andora is among the safest countries in the world.

· Long history of neutrality: Andorra has not been actively involved in any war since its creation in the year 1278.

· Counterpower: Andorra is a parliamentary co-principality. On the one hand there is a democratically elected government. On the other hand, the co-princes of Andorra, the Bishop of Urgell, and the President of France, hold largely ceremonial powers under the 1993 Constitution. However, they can sanction laws, call elections, approve treaties, and appoint officials.

This ensures no given person holds too much power in Andorra.

· Higher quality of life: Supermarkets offer higher quality products and there are better gyms, social clubs, and such.

· Better infrastructure: In Andorra there are very high-quality roads even to the most remote village. My wife and I live in a village and the roads are just as good as in the capital city.

· Water is almost free in your apartment.

· Electricity and gas are much cheaper than in Madrid.

· Private property is respected in Andorra, unlike in Spain where there are squatters.

Deeper insights into why I prefer Andorra

In this segment I will write my thoughts on (often random) ideas that have crossed my mind while thinking about which country I want to move at.

First, bear in mind that I have examined every possible country before deciding on Andorra. I checked out Panama, Paraguay, Dominican Republic, Romania, Hungary, Estonia, Bulgaria, Georgia, Singapore, Hong Kong, New Zealand, Thailand, and many others before making a final decision with my wife.

Andorra made the most sense since almost everyone speaks Spanish here, although the official language is Catalan. The food here is wonderful, you can find both Spanish and French food. The weather is great, at least in my opinion. The winters are cold but skiing here is great. And the summers are mild, so no need for air conditioning. Hiking is amazing since the country in built on the Pyrenees mountains.

I argue that moving to another county is a highly personal decision, regardless of taxes. My wife and I live a calm life. For example, we like going to the gym, hiking, reading, going out to eat, spending time with each other and going to the sauna. So, Andorra is an ideal place for us, it is quiet, clean, and very calm. If you like partying, drinking a lot or doing a wide variety of social activities, Andorra may not be the place for you.

Andorra has been mostly empty throughout its history. Feudal records show that in the year 1300 (when it was founded), Andorra had a population of 2,000 people. However, during the 20^th and 21^st centuries this changed.

The country almost increased tenfold its population from 1960 till today. It went from 8,000 people to around 80,000 today. This was largely driven by massive immigration from Spain. In 1955 only 20% of the population were immigrants. By 1990 this number had exploded to over 70%. Today half the population of Andorra was born here, and the other half are immigrants.

In that sense I argue that the Andorra you can witness today was built on immigrants, just like the US. This is extremely positive for the country as immigrants tend to be the most adventurous and energetic of the population. After all, it takes a lot of courage and energy to move to another country.

That is why migration is so bad for the country from which people are running away. People without an adventurous or entrepreneurial spirit stay, while others leave. That is why countries with more freedom are prosperous: They allow individuals to exploit their inner potential as they seem fit.

This is proven in the numbers: The GDP per capita of Andorra has increased tenfold since 1970.

Another key factor I considered is the geographical location. I believe that demographics and climate change will play a significant role going forward. I do not believe climate change is human-caused, I argue it is just the natural order of things: The weather changes over time. However, I believe that being surround by fertile land in which to grow food is important, and there is plenty of that in Andorra. There is also a massive amount of clean water available in Andorra, which I think will become more important as years pass on.

Regarding demographics, almost all the “western world” has collapsing demographics. This means that fertility rate is well below replacement rate of 2.1. The only exception being Israel. In this sense Andorra is no different from other European countries. But they are smart about it and are very selective with immigration. In most cases, only the most productive can come to Andorra. They even do a health check on immigrants, like the one I went through.

Most people think of demographics in terms of how it will affect our economy going forward. But I prefer to think of it in terms of comparison across regions. Europe, US, and Asia are suffering from very low fertility rates. While Africa is mostly in the green: Population is growing fast. Even South and Central America are going into low fertility rates.

The conclusion I extract from this is that Africans will at some point or another will want to emigrate elsewhere. However, America and Asia have barriers to entry. American has the Atlantic Ocean in between. And Asia has the Middle East, where most countries have extremely strict immigration policies and strong military to contain any unusual migration flows. Therefore, I argue that Europe is the most likely destination for most African migrants, as the Mediterranean Sea has proved that it cannot stop them.

Therefore, I believe that during the next decades, Europe will have some sort of invasion or massive immigration from Africans. Due to two main reasons arising from high population growth: 1. There are not enough opportunities for all the young people in Africa, therefore they must migrate. 2. Quality of life is much better in Europe, so it is only natural that they want to move here.

However, Andorra is somewhat protected from this trend due to several reasons. 1. The country is very high in the mountains, making migration and/or invasion difficult. 2. Andorra is very strict with the immigration policy. 3. It is not part of the European Union; therefore, they can decide on foreign policy. The EU has been extremely soft on this subject, allowing millions to come legally and even more to come illegally.

In Andorra, the taxpayer does not fully subsidize the health system. The user has to pay for a portion of the services. That is important to bear in mind, especially if you come from a country (like Spain) where healthcare is 100% subsidized, often confused with “free”. There is nothing free about it as the taxpayer is handed the bill.

How to move to Andorra

There are three ways to move legally to Andorra. The first one is to find a job, which is particularly easy for those of you with computer science degrees or great programming skills. The second way to move to Andorra is to open a business here. The business must have a real activity with cash flow, and this is the path I have chosen. I have created a consulting company here. However, you must also deposit 50,000 euros to the AFA (Andorran Financial Authority), the equivalent to the SEC in the US. The third and final way to move here is to buy a real estate asset worth at least 600,000 euros.

Bear in mind these ways will get you the Andorran residence permit, but not the nationality.

In some countries you might also face exit taxes. In Spain fortunately I did not have to because I do not have that much money.

If you do not have to pay an exit tax, you do not have to sell your assets before coming here if you do not want to. However, the real estate income (from RE sales or rent) that you own outside Andorra is taxed in the country where that RE is located, not here.

I highly recommend hiring a company to organize your migration process if you decide to make the move. However, do some due diligence as some companies will charge you outrageous rates. For example, one company wanted to charge me 15,000 euros to organize my permits to move here, while another company told me they could do it for 7,000 euros. So be careful who you hire to do this.

To pay taxes here you need to live at least 6 months in Andorra. And if you want to move with your girlfriend or boyfriend here, they must also go through one of the “three ways to move legally to Andorra” or be married to you.

When is the right time to move to Andorra

The main takeaway I want you to take from this report is that there is no perfect time to do something difficult, and moving is hard. Just like there is no perfect time to start a new company or going to the gym, migrating is no different. So, if you want to do it, I encourage you to jump into it.

Many people tell me that they do not have enough money to move here, or that the low taxes do not mean that much to them. This may be true, but if you move to another country just to make more money or to pay less taxes, you are going to have a tough time. As I have explained throughout this report, moving to Andorra is about a lot more than money or taxes for me. It is about freedom, a better future, health, safety, and a better life altogether.

There is no range of income from which you should move here. For example, some people say that once they have 1M euros net worth or make 100k euros per year they will move to Andorra. That is nonsense, those are just excuses people tell themselves so they can remain in their comfort zones. The main thing you need to move here is the will to do it, nothing more. If you want to move here just for the taxes, do not do it.

Personally, I have not felt socially isolated, something many people fear when moving to another country. I did not know anyone when I arrived, but within the first month I had already met people to meet with for a drink or to chat. Half the people here are from outside Andorra, so many people are seeking to make new friends.

I have been hesitant about sending this report as an email, as this blog is investment related. But since so many of you have reached out asking about Andorra, I have sent the report as an email anyway. I hope you do not mind. If you like this kind of reports too, please let me know.

I hope the report has not been boring or too vague. I explore every single factor when making such a big decision. But once it is clear, I make the decision and do not look back.

Any feedback is more than welcome in the comments, or you can send me a message on Substack, or through my Twitter (X) account @AAGresearch.

As always, I want to thank my wife Yeimy, who has helped me a lot while I was writing this by myself. This report and this blog would not be possible without her. Thank you.

I hope this finds you well,

Alberto Álvarez González.

Disclaimer: I assume no liability for any and all of your actions, whether derived out of or in connection with this information or elsewhere, and you hereby warrant and represent that any and all actions that you take or that you may take at a later date in connection with this information shall remain your sole responsibility and, in case, I shall not be held liable for any such actions.

· In this report I have analysed every platinum group metal (PGM) mine, project, and company worldwide. Particularly, I have analysed their production and production capacity long term.

· I have also gathered data on the average global PGM grade, and the depth of mines going back to the 1800s. In addition to this, I have created a supply and demand model that should predict PGMs for the next 25 years. Building a S&D model was the aim of this report.

· There is plenty of production and production capacity today and for the long term. However, there is no incentive to produce PGMs at these prices, particularly due to the low quality of current mines.

· This situation resembles the one I found in 2017, but with a different commodity: Uranium. There was (and is) plenty of production capacity from uranium miners, but there was no incentive to produce it.

Glossary of terms

Glossary of terms.

Projects in developments

I have been working on this project ever since I posted my report “Palladium and platinum: The dawn of a new bull market” on March of 2024.

To build a proper demand and supply demand I need to be able to predict both, with certain assumptions. Demand was the more complicated part as you will see later. The supply side has meant a lot of hard work, but a fun project. For the latter I have first gathered all the data on every single PGM project, mine, and company worldwide.

Mining first starts with exploration and development. Therefore, if I can identify every possible PGM project going online in the next decades, I can predict new supply. For existing supply, I have identified and analysed every mining, refining, and recycling operation for PGMs worldwide.

So, let us start with development and exploration projects:

Company reports. Own research. PGM projects in development.

In this table you can find all PGM projects in development. I have also included exploration stage projects if they have a resource. I have excluded from the table the following items: ownership %, co-owners, location, reserves, resources, attributable reserves/resources, projected production, projected production year, AISC, price assumptions and LOM. I have excluded them to make the table easier to read for you.

However, I have included all these factors into my supply and demand model.

One of the most challenging factors to determine in this report was the projected start year. This is because some projects are at various stages and affected by different regulations.

The logic I followed for the timelines for the projected start year is grounded in historical construction timelines for PGM mines, tailored to each project’s current development stage as of May 2025. Historically, PGM mines take 3–5 years for construction (averaging 4 years) once permits are secured, as seen in examples like Platreef (2022–2025, 3 years) and Mogalakwena (5 years in the 1990s), with permitting often adding 1–2 years (e.g., Marathon: 2023–2025).

For projects with specific start years like Waterberg (2029), Platreef (2027+), and Bengwenyama (2027-2028), I retained the timelines from feasibility studies, as they align with historical averages (permits + 3–4 years construction). For Marathon, now shovel-ready with permits secured on May 22, 2025, I adjusted the start to 2028-2029, reflecting a 3–4 year construction timeline post-permitting.

For those of you as interested in mining as I am, or more, these timelines will seem overly optimistic to you. I have preferred to be optimistic on this factor, so I will obtain a very conservative supply and demand model. I am fully aware that mines can take 20 plus years to get permitted, financed and built.

Historical average global grade for PGM mines

Average PGM grade of mines since the year 1800. Own research.

To get this graph I have had to read through geology and history books on PGMs. Throughout history these have been the main regions where PGMs have been extracted:

Primary regions:

· Colombia (Chocó): Early 1800s, placer mining, ~100 kg/year, grades ~30 g/t.

· Russia (Urals): 1823 onward, placer mining, peaking at 5 tonnes/year, grades declining from 25 g/t to 10 g/t.

· South Africa (Bushveld): Early 1900s and onwards. Massive deposits at increasing depths. Lower grade.

Minor regions:

· United States (California, Oregon): 1850s onward, placer byproduct, negligible output, grades ~20 g/t.

· Australia (New South Wales): 1890s, placer, negligible output.

· South Africa (Transvaal): 1890s, placer, experimental, negligible output.

Trend: Platinum mining in the 1800s was dominated by placer deposits, which were high-grade but quickly depleted. Colombia started the century, but Russia took over by the 1820s, supplying most of the world’s platinum until the early 20th century. In the 20^th and 21^st century South Africa and Zimbabwe have provided the vast majority of PGMs. However, Russia now plays a key role too.

Since 1800 the average grade has dropped 90%. Since 1950 it has dropped 44%. Since 1980 it has dropped 28% and since 2000 it has dropped 13%. Average grade worldwide is now at 2.85 g/t PGM.

The grade represents the combined physical grade of all PGMs (Pt + Pd + Rh + Ru + Ir + Os) in the ore, weighted by the production volumes of each region or mine.

This drop in grade may not sound important to generalist investors, but it is of critical importance for the economics of a project. For instance, lower grade means that more fuel has to be used to transport ore, as it now contains less PGMs. Lower grades also mean that more solvents and acids have to be used. All these factors affect economics, and make current operating projects undesirable.

Data for PGM producers

Data for PGM companies. Company reports.

In this table you can find all PGM companies worldwide. These include refiners, recyclers, and miners. Although Recyclers do not have an AISC, they are mostly profitable. I have excluded from the table the following items: Reserves, resources, price assumptions and 2024 production. I have excluded them to make the table easier to read. However, they are all included in the supply and demand model.

As you can see, most miners are not profitable at metal prices nowadays. Currently both platinum and palladium are hovering the $1000/oz price mark. So right now, only Nornickel and Sylvania have profitable PGM business segments. Sylvania is irrelevant in the market as it is a small producer. But Nornickel produces much of the world´s palladium.

However, as I have posted on other PGM reports in this blog, I think Nornickel is becoming more market orientated than ever before. They are aware that they are flooding the market with cheap palladium, and this is causing other miners to lose money. If this were to continue, Nornickel would not have a market to sell into in a few years.

Plus, other Russian miners are having trouble getting supplies for certain materials. Mining is a very technical business, meaning that they require extremely specific machinery. With the sanctions from the US and the EU, Russian companies have to get supplies from Indian and Chinese companies. However, many of the parts and machines that Nornickel needs are only produced in markets with high added value products, like those in the EU or the US.

Therefore, I believe it is a matter of time before Nornickel encounters supply issues.

Another key factor in this table is the item “Years left of production.” This column represents how many years of production each company has left based on their reserves or resources and their 2024 production.

As you can observe, PGM miners have decades left of production in their reserves, in their resources some of them have centuries left till they run out of ore. Therefore, there is no shortage of resources.

However, with grades going down and the depth of mines increasing, I believe that a lot of the resources and reserves will not be economical soon. This will push miners into taking over higher grade and shallow deposits like those owned by Generation Mining or Bravo Mining.

Average depth of PGM mines worldwide. Own research.

Up until the 20^th century Colombia and/or Russia dominated the PGM industry. In the very early 1900s Russia had to start digging deeper for PGM mining and Canada started PGM mining. At that time, PGM mining went from mining at surface or near surface to mines that were 80+ metres deep. This happened in the span of less than 10 years.

In the 1920s South Africa started mining for PGMs and this only exacerbated the problem. Mines were anywhere from 50m to 300m deep. In the later part of the 20th century Zimbabwe started PGM mining and that meant deeper mines too.

Today the average depth of a PGM mine is around 1800m (5,900ft)

For context, in deep mines like those in South Africa, unventilated areas at 1,800 meters might feel 50–60°C (122–140°F) or hotter due to humidity and equipment heat. With cooling, workers might experience 25–35°C (77–95°F). This means that miners spend capital in building complex cooling systems. All this makes mining more expensive.

Building my supply and demand model

For my model I have considered the following PGM producing mines and operations:

PGM producing assets worldwide. Company reports.

I may have missed a mine or two in the process, so if you notice any missing, please let me know.

So far, I have gathered all PGM projects in development or exploration and all the companies producing PGMs at any point of the cycle. One could think this is enough, but it is not. This is because primary PGM mines produce around 67% of the world´s PGMs. So, I had to dig deeper and find out where the other ounces come from.

Sources of PGMs. Norilsk Nickel, Vale Sudbury and reports from other companies. Own research.

It turns out that recycling makes up 10% of the world's PGMs, mainly from auto parts and electronics. And 22% comes from other mines.

From the 22% of PGMs other mines produce, the vast majority comes from nickel mines that produce PGMs as a byproduct. An example of this would be Russian nickel mines producing palladium.

Now that I have accounted for every ounce available in the market, lets dive into the actual supply and demand model:

Price assumptions. Own research.

The price assumptions for Pt, Pd, and Rh through 2050 are driven by the supply-demand dynamics following a slower EV adoption rate (20% penetration by 2030, 60% by 2050), which causes the decline in Pd and Rh automotive demand while increasing Pt substitution in catalytic converters, exacerbating Pt deficits and tightening Rh’s balance.

Platinum prices rise from $1,000/oz in 2025 to $2,780/oz by 2050, with a 6% annual increase through 2035, reflecting growing deficits (-1,864 Koz in 2025 to -4,273 Koz in 2050) fuelled by hydrogen demand and substitution, surpassing the $1,425/oz incentive threshold by 2028 to spur new supply.

Palladium prices increase from $975/oz to $1,740/oz, with a 3% annual growth through 2035, as smaller surpluses (+1,349 Koz by 2050, down from +3,972 Koz) due to sustained ICE/hybrid demand and industrial growth push prices above the $1,200/oz incentive by 2035.

Rhodium prices grow from $4,550/oz to $10,750/oz, with a 4% annual increase through 2040, balancing a tighter market (+595 Koz by 2050) with industrial demand and substitution risks, exceeding the $5,500/oz incentive by 2030, ensuring supply stability. These forecasts, more responsive to market nuances than WPIC’s flat outlook, align with the need to incentivize new production amid evolving demand trends.

Supply and demand model for palladium, platinum, and rhodium. Own research

My model predicts a deficit until at least 2050. The only outlier may be 2030-2032 as I predict that some of the mines currently in development may come online. However, I may be too optimistic on that front as mining projects can take anywhere from 3 to 20 years to get permitted and built.

The key takeaway here is that the PGM market will experience deficits for longer than the WPIC anticipates. This will push miners into increasing production, but most of their mines are too deep, low grade or in a difficult jurisdiction. Therefore, they will buy out the best developers they can find.

Assumptions in the Supply and Demand Models

This section is about assumptions for the model I built. If it does not interest you, jump onto the next section.

The supply and demand model for PGMs (Pt, Pd, Rh) was built with several assumptions to project supply and demand from 2024 to 2050. I will break these down by component, critically examining their basis and potential impact on accuracy.

Supply Model Assumptions

1. Primary Supply (Mining)

• Baseline Production (2024):

  • Assumption: Total PGM mine production in 2024 is 13,626 Koz, based on Statista’s 2022 figure of 14,047 Koz, adjusted for a 3% decline in 2024.

  • Basis: Statista provides a reliable global estimate, and WPIC’s Pt figure aligns with industry consensus. The 3% decline reflects operational challenges (e.g., South Africa’s 2% decline or Russia’s 9% drop).

  • Impact: If the decline is underestimated (e.g., due to unforeseen disruptions), supply could be lower, increasing deficits.

• Grade Decline:

  • Assumption: Global average PGM grade declines logarithmically from 2.87 g/t in 2024 to 2.60 g/t by 2050 (2.75 g/t by 2030, 2.65 g/t by 2040). This translates to a 0.8% annual production decline through 2035, slowing to 0.4% post-2035.

  • Basis: Historical grade decline data (30 g/t in 1800 to 2.87 g/t in 2024) shows a long-term trend of depletion. The logarithmic decline assumes technological improvements (e.g., better extraction) slow the rate of decline over time.

  • Impact: If technology advances faster (e.g., AI-driven mining), the decline could slow further, increasing supply. Conversely, faster depletion (e.g., deeper UG2 mining) could reduce supply.

• Decline Rates for Existing Mines:

  • Assumption: South Africa declines at 0.8% annually through 2035, then 0.5%; Russia at 2% through 2030, then 1%; other regions (Canada, Zimbabwe, USA) at 0.5% through 2030, then 0.3%. Weighted decline: 1.04% through 2030, 0.6% post-2030.

  • Basis: WPIC notes a 1% decline in South Africa for 2024, adjusted to 0.8% with tech improvements. Russia’s 2% reflects geopolitical risks, easing post-2030. Others’ slower decline assumes stability.

  • Impact: Overestimating declines (e.g., if South Africa stabilizes) could underestimate supply, while underestimating risks (e.g., Russian sanctions) could overestimate supply.

2. Secondary Supply (Recycling)

• Baseline (2024):

  • Assumption: Recycling supply is 1,611 Koz (Pt: 620 Koz, Pd: 680 Koz, Rh: 150 Koz).

  • Basis: WPIC data aligns with industry trends.

  • Impact: If recycling is underestimated (e.g., new tech boosts recovery), supply could increase, reducing deficits.

• Growth Rate:

  • Assumption: Recycling grows at 5% annually through 2035, then 3% through 2050, reaching 21% of total supply by 2050.

  • Basis: Sibanye’s Reldan acquisition suggest faster growth than the previous 3%.

  • Impact: Faster growth (e.g., policy support) could increase supply, while delays (e.g., legislative hurdles) could constrain it.

3. Future Supply (Exploration & Development)

• Project Start Dates and Production:

  • Assumption: Projects start as per the Table (e.g., Darwendale 2026, Waterberg 2029, Luanga 2035), with production estimates based on table data (e.g., Waterberg: Pt 190 Koz, Pd 150 Koz, Rh 30 Koz).

  • Basis: Start dates are from the table, with delays factored in for post-2035 projects (20% probability, e.g., geopolitical risks in Zimbabwe).

  • Impact: Delays or cancellations (e.g., funding issues) could reduce supply, while early starts could increase it.

Demand Model Assumptions

1. Baseline (2024):

• Assumption: Pt: 7,730 Koz (Automotive: 3,130, Jewellery: 1,900, Industrial: 2,400, Investment: 300); Pd: 8,000 Koz (Automotive: 6,800, Industrial: 800, Jewellery: 100, Investment: 300); Rh: 1,000 Koz (Automotive: 900, Industrial: 100).

• Basis: WPIC 2024 data.

• Impact: If demand is underestimated (e.g., stronger hydrogen growth), deficits could widen.

2. Demand Growth Rates:

• Automotive:

  • Pt: Stable in 2025, then 5% growth through 2035 (hydrogen fuel cells), 3% post-2035.

    • Basis: I project 143 tonnes (4,600 Koz) by 2050 for hydrogen, implying rapid growth.

    • Impact: Faster hydrogen adoption could increase deficits.

  • Pd: 6% decline in 2025, 3% annually through 2035 (EV adoption, 30% penetration by 2030), 1% post-2035.

    • Basis: EV trends reduce Pd use in auto catalysts.

    • Impact: Slower EV adoption could increase Pd demand, reducing surpluses.

  • Rh: 1% decline through 2040 (substitution with Pt), then stable.

    • Basis: Substitution trends.

    • Impact: Faster substitution could reduce Rh demand further.

• Jewellery:

  • Pt: 2% growth through 2040 (China demand), 1% post-2040.

    • Basis: WPIC notes 8% growth in 2024, moderated to 2% long-term.

    • Impact: Stronger Chinese demand could increase deficits.

  • Pd: Stable, minor segment.

    • Basis: Historical trends.

• Industrial:

  • Pt: 5% growth through 2035 (hydrogen and glass fibre), 3% post-2035.

    • Basis: I project 50% hydrogen growth by 2050.

    • Impact: Underestimating hydrogen growth could widen deficits.

  • Pd: 3% growth through 2040 (chemicals and/or electronics), 2% post-2040.

    • Basis: Stable industrial use.

  • Rh: 3% growth through 2040 (chemicals), 2% post-2040.

    • Basis: Steady chemical demand as I have observed in chemical industry reports.

• Investment:

  • Pt, Pd: 3% growth through 2035, 2% post-2035.

    • Basis: Precious metal investment trends.

    • Impact: Economic downturns could reduce investment demand, narrowing deficits.

General Assumptions

• Market Stability: No major geopolitical or economic shocks (e.g., global recession, new sanctions on Russia) beyond those already factored in.

  • Impact: Unforeseen events could disrupt supply or demand significantly.

• Substitution: Pt increasingly substitutes for Pd in auto catalysts, but no major breakthroughs in PGM-free catalysts by 2050.

  • Impact: Faster substitution could alter demand dynamics.

Massive conflict of interest

Excluding Norilsk Nickel, my estimates indicate that the PGM mining industry made $657M in 2024 in terms of net income. I have excluded the Russian miner because PGMs only make a portion of their net income. So, the company does not represent the reality of the industry.

The PGM industry has about $12.1B in liabilities, from which half is in the form of debt, which matures between 2028 and 2035. To face this debt, the industry has about $3.5B in cash.

However, if PGM prices remain the same, net income will continue to decrease for the industry. The only reason net income is positive is because gold is at all-time highs, and a lot of these miners produce gold.

Therefore, the industry is facing the same conflict of interest uranium was facing prior to 2020:

Shareholders want to make a return, which may imply closing mines to push PGM prices higher, and reducing management/workforce size or compensation to cut costs. Management does not want to close mines because they do not want to fire employees or face their stakeholders, and management does not want to lower their own salary. Employees do not want to get fired or have mines closed. And finally, bondholders want to get paid, therefore they do not want mining operations to be shut down.

Therefore, mining firms face a conundrum. They must stay alive, but that means sacrificing their own shareholders by keeping PGM operations going, even though they are burning money. This way they keep their salary, employees do not get fired and bondholders get paid.

Some PGM miners have already started reducing workforce and cutting production. But this has not been enough to push metal prices higher.

What is clear is that mining firms need to put their PGM operations on care and maintenance. But none of them have the courage to do so. Perhaps what they need is a good excuse. After all, Cameco shut down Cigar Lake Mine using the Covid pandemic as a reason. And that shut down was the spark that lit the fire for the birth of the uranium bull run in 2020-2021.

Conclusion

The PGM industry stands at a critical juncture, where geological constraints and market dynamics are set to reshape its future over the next 25 years.

Declining global grades—down 90% since 1800 to 2.85 g/t today—and ever-increasing mine depths, now averaging 1,800 meters, underscore the growing challenges of extracting these critical metals, driving up costs and environmental impacts as miners grapple with extreme conditions and complex cooling systems.

My supply-demand model forecasts persistent deficits for platinum, with shortfalls reaching 4,273 Koz by 2050, driven by surging hydrogen demand and substitution in auto catalysts, while palladium and rhodium markets shift toward smaller surpluses and tighter balances due to slower EV adoption.

Current prices—platinum at $1,000/oz, palladium at $975/oz, and rhodium at $4,550/oz—fail to incentivize new production, a situation reminiscent of the uranium market in 2017, where abundant capacity sat idle due to low prices. Norilsk Nickel’s low-cost production ($405/oz AISC) floods the market, undermining profitability for higher-cost miners like Sibanye Stillwater ($1,363/oz AISC), but looming supply chain disruptions from sanctions may force a market rebalance.

A critical barrier to recovery lies in the industry’s stakeholder conflicts: bondholders, with $12.1B in liabilities to protect, prioritize operational continuity; management (PGM miners) seeks to preserve jobs for employees; employees resist layoffs; and shareholders demand profitability, even if it means shuttering unviable mines. This four-way deadlock, reminiscent of uranium’s pre-bull run tensions, hinders decisive action, with the sector’s $3.5B cash reserves offering little buffer if prices remain low.

With decades of reserves left but diminishing economic viability due to depth and grade challenges, the best opportunities lie in high-grade, shallow developers like Generation Mining and Bravo Mining, which I have invested in to capitalize on the inevitable consolidation as majors seek viable assets.

Investors should brace for a prolonged PGM deficit, driving prices toward incentive levels—platinum to $2,780/oz, palladium to $1,740/oz, and rhodium to $10,750/oz by 2050—while keeping an eye on developers poised to meet future demand.

Any feedback is more than welcome in the comments, or you can send me a message on Substack, or through my Twitter (X) account @AAGresearch.

As always, I want to thank my wife Yeimy, who has helped me a lot while I was writing this by myself. This report and this blog would not be possible without her. Thank you.

I hope this finds you well,

Alberto Álvarez González.

Disclaimer: I assume no liability for any and all of your actions, whether derived out of or in connection with this information or elsewhere, and you hereby warrant and represent that any and all actions that you take or that you may take at a later date in connection with this information shall remain your sole responsibility and, in case, I shall not be held liable for any such actions.

· For the past 15 years we have lived through a time with very low volatility and high returns for stocks, with one or two outliers. I believe these two features are about to end abruptly for the most popular asset classes.

Read more

Read more

· In this report I will explain the price mechanism of currencies and their history. I will assume a free-floating exchange rate system.

· Today we count with the help of David Sanz, he is a professor at the Catholic University of Ávila and Omma Business School. At Omma he was my history teacher while I did my master’s degree in Value Investing and Austrian School Economics. Although I have written this paper, he has revised me and advised me as to how to improve it. I thank him for it.

Introduction

This report can be considered a continuation of my report on gold: Gold: The return to a 2000-year-old trend. For those that have not read it, I explained in that report how gold is the closest instrument there is in the world to “Perfect Money” as explained by John Forbes Nash Jr. Nash was the inspiration for the movie A Beautiful Mind, which I highly recommend.

No fiat currency in history has lasted more than 100 years, and I do not think the current fiat currencies will be any different. Considering most of the world uses fiat currencies I believe it is appropriate to write a report on how fiat currencies work and why they fail.

What is a fiat currency?

The word fiat comes from the Latin word fieri, a verb that could be translated into “to become.” Therefore, the term is very self-explanatory, it means the government forces a certain instrument to become a currency. I use the term currency because banknotes are not money in the strict sense of the word. Money is not imposed as a top-down approach in society, it is always bottom-up.

This said, when the quality of a fiat currency is high, society will embrace it in a bottom-up approach. The perfect example of this is the US dollar. Panama, Ecuador, El Salvador or East Timor are examples of countries in which the dollar is legal tender. In other countries like Costa Rica or Honduras the dollar is commonly accepted. The US government didn’t force its use in these countries. But the quality of the dollar is superior to their prior currencies.

There is also a religious connotation to the term fiat. In the Bible in Luke 1:26-38, the word fiat is mentioned. In Latin it says: “Ecce ancilla Domini; fiat mihi secundum verbum tuum.” The version in English is translated into: “I am the Lord’s servant. May your word to me be fulfilled.” However, I prefer the Spanish version as it is more literal: "He aquí la esclava del Señor; hágase en mí según tu palabra". “Hágase” can be translated more precisely into the verb fieri or “do” in English.

Most of the currency households own nowadays is in the form of a deposit in the bank. But banks hold those deposits as current liabilities in their balance sheet. Therefore, bank deposits are not money nor deposits, but bonds with which we finance the banks. And even if we hold the banknotes at home, you will notice those euros or dollars are signed or stamped by the central bank as those notes are debt issued by the central bank itself. Therefore, banknotes are bonds that the banks owe to the holders of those bonds (banknotes).

As a result of this, we should consider banknotes a substitute for money, not money.

What is the demand and supply of a fiat currency?

One of the most misunderstood concepts in terms of currencies is the demand and supply. And it makes sense, because most people might think that purchasing a good with a currency might mean we are demanding the currency. This is not the case.

Simply put in an example: The demand for a fiat currency is a household or government buying that currency and holding it. If I were to exchange my euros for dollars and keep them in a bank account or in my house, that would increase demand for dollars. However, if I were to exchange those dollars for gold, I would increase the demand for gold and decrease the demand for dollars.

M*V = P*Q, relates to the quantity theory of money. In this equation, M represents the supply of money, V represents the velocity of money, P represents the price level, and Q is real output.

The velocity of money measures the number of times that one unit of currency is used to purchase goods and services within a given period. And velocity of money is often correlated with inflation rates, as the users of that currency rush to exchange their currency for other goods as they expect inflation to rise. In fact, from the paragraph above, you can easily see how velocity and supply of money make inflation rise.

Supply of a currency is the amount that is printed or digitally created by any given entity. And I say any given entity because as Professor Richard Werner has explained, money is also created whenever a bank gives out a loan. Therefore, although central banks are responsible for a lot of the currency created, private banks also play a role in this system.

How do fiat currencies derive its value?

Inflation is the destruction of purchasing power of any given currency. As an example, in year 1 you can buy 100 units of goods with X amount of currency, and in year 2 you can only buy 90 units of those exact same goods with that X amount of money. That means you have lost purchasing power and therefore your money has lost value. That is inflation.

So, if inflation is the destruction of currency value, the lack of inflation is the appreciation of the value of said currency. This is called deflation, and it means that you can buy more goods with the same amount of currency you had.

Therefore, inflation dictates the value of a currency, so we ought to explore the phenomenon of inflation. And that is rather simple at first since there is only one factor that determines inflation: Inflation expectations. That's it. Since fiat currencies are the result of government laws, and the willingness of taxpayers to pay their dues to the government, the value of these currencies is primarily subjective.

As a result of this, inflation expectations are the critical element that central bankers are often obsessed with. This is primarily due to the vicious cycle a currency can go into if inflation expectations run out of control. If economic agents have high inflation expectations, velocity of money will increase, increasing inflation and increasing inflation expectations. It is exceedingly difficult to break this cycle.

With all these arguments I am not trying to defend that a government can print as much as they want without affecting inflation. I am arguing that as long as demand outstrips supply, inflation will remain under control. However, this is a dangerous game as demand for a currency can fluctuate. Furthermore, if a government were to print too much currency, this can affect demand for the currency and inflation expectations. But the boundary between too much printing and just enough is not clear. And therefore, governments ought to be careful with how much currency they print.

Finally, it is worth noting that power is the key factor that drives inflation expectations in a fiat currency. As long as the issuer has power, their minting power will remain strong.

Pound Dollar Exchange Rate (GBP USD). Measuringworth & Macrotrends.

A fitting example of this last paragraph is the decline in value of the British pound versus the US dollar. In 1931 Britain left the gold standard. However, in the first decades of the 20^th century we see a lot of fluctuation in the pound, as WWI hits Europe and the US shows its resilience. But WWII and the independence in 1947 of Pakistan and India, followed by others like Myanmar, Sri Lanka, Libya, or Israel (British mandate) proved the UK no longer ruled over the seas. Its power had been diminished.

Case study 1: The US after the 2008 financial crisis

M1 money supply. FRED.

M1 is a measure of the money supply that includes currency, demand deposits, and other liquid deposits, including savings deposits. From 2011 to 2018 the money supply in the US as measured in terms of M1 effectively doubled. However, inflation rates in the US ranged from 0.70% to 3% per year during this period.

Gold and DXY index. Koyfin.

Furthermore, during this period, the US Dollar appreciated against other currencies and gold prices went down a bit. The U.S. Dollar Index (DXY) is an index (or measure) of the value of the United States dollar relative to a basket of foreign currencies. And gold can be seen as a proxy to measure how much purchasing power the US Dollar has lost: The more the gold price increases, the less gold you can buy with your dollars.

I chose gold prices and the DXY as proxies to measure the strength of the US dollar. But other commodities had a similar performance during this period.

Therefore, by any measure that we can imagine the dollar maintained its value or even increased it while the money supply doubled. This can be contradictory for most people as we often assume that there is an inverse relationship between the amount of currency printed, and the value of said currency.

But how can this happen, one could ask himself. For an answer, I refer you to the explanation of demand versus supply I mentioned on the previous section. The money supply doubled over this period, but if economic agents (any actor of the economy) are demanding even more dollars than what is being created, then the price of the dollar will increase relative to other currencies and commodities.

And the only reason that people demand the dollar is because there is trust in the “fieri” of the US government. In other words, economic agents trust the ability of the US government to force the use of the dollar. As long as that trust remains intact, there will be demand for dollars, as economic agents keep holding that currency.

Case study 2: The US in the 1970s

In 1973 US president Nixon stopped the convertibility of the dollar to gold. This was the result of lost trust in the government of the US.

From 1959 to 1971 the M1 money supply had increased by 50%, but the gold that was backing the convertibility had not increased. In fact, the gold held by the government had decreased.

The holders of US government bonds began converting their bonds into dollars and after that exchanging the dollars for gold. And the US government was forced to stop the convertibility of dollars to gold.

Economic agents were witnessing this and their trust in the US dollar was eroded, pushing inflation to 8.70% in 1973 and 12.30% in 1974. In response, the Federal Reserve pushed interest rates to 9%, which provided the economic agents with the tranquility they needed: The Fed was willing to do what was necessary to keep the value of the dollar.

By 1975 inflation had dropped to 6.90% and to 4.9% in 1976. But in the middle of 1975, something unexpected happened: The US lost the Vietnam War. This may seem trivial to us today, but the US was the undisputed world power back then. The fact that they had lost a war in a remote region of Asia to the guerrilla and Chinese communists meant something had changed.

The lost war was a brutal blow to the trust in the US government. And by 1979 inflation had exploded to 13.30% even though interest rates had climbed to 12%. Paul Volcker had to push interest rates to 18% to push the economy into a recession, so economic agents would demand more dollars by holding them. In a recession economic agents will want to hold onto a currency they trust in case things get uglier. This raised demand for US dollars.

With this example I want to prove to you that interest rates can go up to double digits like in 1979. But if the people have lost faith in the ability of the government that has imposed a fiat currency, there is almost no turning back.

Side note: A more recent example could be Argentina. Until recently they had triple digit interest rates, but their currency was devastated. If people do not trust you, no matter how high you push interest rates, the currency will not recover.

Case study 3: German hyperinflation after WWI

When I studied German hyperinflation in history class in school, the teacher taught us how the government had printed too much money. But my teacher put little emphasis on the fact that Germany lost WWI.

In fact, during WWI, England printed a lot more money than Germany did. But this did not cause hyperinflation for England, although they did have double digit inflation rates for most of the war. Furthermore, after the Treaty of Versailles was signed, England went into deflation for almost a decade.

The Economist, 1924. Millions.

The reason I am explaining this case study is that this proves how inflation rates are not dictated by the amount of the currency being printed, but by subjectivity and how that impacts inflation expectations.

Germany had lost the war and was humiliated in the Treaty of Versailles. Economic agents knew Germany could not be trusted to back the currency, and that the debt to other European powers was enormous. At this loss of trust, agents started dumping marks to buy anything at sight and exchanging it for other currencies.

I hope I have made my point clear. Trust is the critical part of the equation to value a fiat currency and there lies its weakness: For how long can a government hold this trust? One can only wonder which inflection point will push to euro or the dollar into hyperinflation. I do not know it and I believe its impossible to know, but I have the certainty that it will happen. However, this inflection point could happen in 1, 10 or 100 years. There is no way of knowing.

A note on cryptocurrencies

On my report about gold, I explained the main advantages gold has versus cryptocurrencies and more specifically versus Bitcoin, so I will not get into much detail here.

However, I would like to propose a thought exercise. In a conference Warren Buffett explained that 100 years ago there were thousands of car companies in the US. Had you known that in the 21st century cars would dominate the transport industry, you may have been tempted to pour all your money into automotive stocks. That would have ended badly. Ford and Tesla are the only car companies that have not gone bankrupt in the US.

According to Statista, there are around 10,000 cryptocurrencies worldwide. Therefore, even if we knew that 100 years from now all trade will be done in cryptocurrencies, it would be next to impossible to know which ones will succeed and which ones will fail.

If the example of the car industry proves to be right, chances are the over 99% of these coins will fail. With perhaps a handful of them having some actual utility 100 years from now.

As a result of this, I much rather watch the crypto market from the sidelines and wait for the market to do what is does best: Evolve and let the fittest survive. Once the cleansing is done, I will happily reexamine the market.

One could argue that Bitcoin has the first mover advantage. Some people may equate Bitcoin to Ford. But that would be a mistake. Pioneers like Nicolas-Joseph Cugnot or Robert Anderson invented vehicles in the 18th and 19th century respectively. But neither got far. I would argue that the first mover advantage is grossly overvalued.

Previous fiat systems and why they failed

In this section I will examine the main attempts to use paper money. I will avoid including some anecdotical attempts such as those during wartimes. Examples of this would be the Spanish attempt to introduce paper money during the Granada War between 1482 and 1492, or the 1683 attempt by the Bank of Amsterdam to do a fiat currency.

1. China´s first attempts: In China we have the first examples of a fiat currency in between the 7th and 13th century AD.

In the 10th century AD, the Song Dynasty issued the first paper money. Theoretically it was backed by silk, silver, and gold but convertibility was impossible.

However, as users of the currency were used to physical commodities being used for money, adoption was difficult. And the Emperors kept printing more paper. The government tried to force its use by making people pay their taxes with paper money, but these efforts failed as people lost trust.

But it was not just the government printing more currency what caused its debacle. In 1209 the Mongols started their invasion of China. And this was the final nail in the coffin.

2. Mongols: After the Mongol invasion of China, Kublai Khan established a paper currency of its own in the year 1260. It had some success as it was first convertible into silk and later it was convertible into silver. By 1350 the notes were not convertible into anything and failed miserably with hyperinflation.

3. Persia: In 1294 Gaykhatu, the ruler of one of the Mongol southern regions of Ilkhanate (Today´s Iran) introduced a paper money. However he quickly lost the trust of the users, the currency failed, and Gaykhatu was assassinated.

4. Sweden: In the 17th and 18th century some attempts to introduce a fiat currency were made. But in the first attempt Johan Palmstruch (the inventor of the currency) was sentenced to life in prison. Palmstruch through the creation of the Stockholms Banco started issuing paper money in 1661. But the bank started giving out too many loans and was liquidated in 1667.

Throughout the next century Sweden attempted other fiat currencies with no success. In 1776 they went into a silver standard.

5. New France: In the 17^th and 18^th century New France was facing a shortage of gold and silver. This forced the local authorities to create paper money. This was a success, and it lasted almost 80 years. However, after the Seven Years' War and the Treaty of Paris (1763), France gave most of these territories to Britain. This forced the French government to turn the paper money from New France into debt issued by France. However, the French were bankrupt and by 1771 this paper money (or IOUs) was worthless.

6. France: During the prerevolution and revolutionary periods of France, a currency called Assignats was created. In 1790, 400,000 livres' worth of assignats were created. A 5% interest was paid on the holders of the assignats. This interest was paid thanks to properties confiscated during the French Revolution from the Catholic Church, the monarchy, émigrés, and suspected counterrevolutionaries for "the good of the nation".

Later that year the interest payments were abolished and a further 800 million units were issued. By 1796 the issues had reached 45.5 billion francs, and the value of the currency collapsed.

7. Spain: During the Spanish Civil War (1936 – Apr 1, 1939) each side of the war printed its own currency. Most of this currency was paper money. The fascist side of the war had little access to precious metals. And the republican side decided to sell 510 tonnes of gold (72% of the national reserve) to Joseph Stalin in exchange for their military support. After the war, the money printed by the Spanish government (Republicans or communists) had no utility under the new regime of Franco. This paper money faced hyperinflation and disappeared.

Conclusion

I do not think any current fiat currencies will go back to a gold or silver standard. I do not believe either that a concept like the bancor is realistic nowadays. The bancor was a supranational currency that John Maynard Keynes and E. F. Schumacher proposed. It was based on the idea that a currency could be backed by a series of commodities.

The main reason I believe this to be true is because no central bank or president is incentivized to back their currency with anything. Doing so would limit their own power.

However, gold and silver will continue to have strong demand, both from monetary and non-monetary sources of demand. And I believe both will serve as strongholds for those of us worried about the declining value of fiat currencies in general.

The value of fiat currencies is linked to the credibility and stability of a country. So how long will the dollar last? It can last a thousand years, provided that the US government is stable all that time.

Although it is true that no fiat currency has lasted for more than 100 years or so, I believe the US dollar will continue being a demanded currency. The reason being that the US holds the most powerful and dynamic economy. They also have the largest military in the world. Therefore, their power is unquestioned.

China is facing a demographic cliff. The European Union faces zero economic growth and political uncertainties. And India´s GDP per capita is 95% lower than the one of the US. Therefore, I cannot think of any country that can substitute the US as the issuer of the most used currency.

In conclusion, I believe the US dollar will probably face a similar fate than the Spanish dollar, also known as the piece of eight. The Spanish dollar was the most used currency in the world from the 16^th century until the early 19^th century. Its decline was very slow, and I believe that will probably happen to the US dollar. Therefore, we can rest assured that the US dollar will continue to have purchasing power for quite some time. To quote the great investor Rick Rule: “The US dollar is the prettiest pig in the slaughterhouse”. Every fiat currency is going to get slaughtered. But I believe the US dollar will be the last.

“How did you go bankrupt?"
“Two ways. Gradually, then suddenly.”

Ernest Hemingway

Any feedback is more than welcome in the comments, or you can send me a message on Substack, or through my Twitter (X) account @AAGresearch.

As always, I want to thank my girlfriend Yeimy, who has helped me a lot while I was writing this by myself. This report and this blog would not be possible without her. Thank you.

I hope this finds you well,

Alberto Álvarez González.

Disclaimer: I assume no liability for any and all of your actions, whether derived out of or in connection with this information or elsewhere, and you hereby warrant and represent that any and all actions that you take or that you may take at a later date in connection with this information shall remain your sole responsibility and, in case, I shall not be held liable for any such actions.

I have been investing since I was 14 years old, now I am 27. In 2017 I was lucky enough that I found out about uranium, and between 2017 and 2020 I went all in in 10 or 11 uranium stocks. By 2020 I had lost over 50% of my money, but I knew the thesis was even stronger in 2020 than in 2017 so I pulled together all the money I had left and poured it into the uranium stocks I had the most conviction in. By January 2022, the table had turned, and I sold all my uranium stocks for an average return on my portfolio of over 1000%. This enabled me to become a full-time investor.

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