Frank Trotter on Wealth Disparity – and More Top Quotes from a San Francisco Investment Show
Weeks ago we were delighted to attend an investment conference in San Francisco called The Silver Summit & Resource Expo.
Speakers included well-known voices in the investment community such as Grant Williams, Frank Holmes, Frank Trotter, and Rick Rule. The show was also supplemented with people that have helped to build multi-billion companies: precious metals pioneers such as Ross Beaty, Rob McEwen, and Keith Neumeyer, or mine-finders such as David Lowell.
After attending the show, we reached out to some of the speakers that had piqued our interest. We asked them to send us a key talking point along with the data to back it up.
Jeffrey Christian, from CPM Group, supplied us with a quote and data on the silver market. In his analysis, he’s found the price of silver is highly related to the net additions and net withdrawals in the silver market. When investors buy silver, the price rallies. When net inventories are dropping, the opposite happens. He noted, “If investors want to buy 100 million oz per year, as they are in 2015, prices will decline from current levels. If they want to buy 150 million oz or more, as they did a few years ago, prices will rise back to $20-25/oz.”
Frank Holmes of U.S. Global Investors, in his note to our team, focused on the depreciating currencies of economies that heavily rely on commodity exports. After showing how these national currencies have fared against the U.S. dollar, he added that it is important to see some stabilization in these currencies before investors can expect to see any bounceback in resource demand.
Frank Trotter of EverBank showed us a chart on less-examined effects of the Fed’s policies since the Financial Crisis affecting wealth disparity. Specifically, he is looking at total household financial assets – in other words, who is holding the wealth in the United States. Frank writes, “The Fed policy has created an asset owners bonanza. From 2008 to 2014, Total Household Financial Assets have grown $19.5 trillion; our estimate is that $15 trillion, or 80% is enjoyed by the top 8% of households.”
This last point brought up by Trotter is something that we’ve talked about regularly. Specifically, in this chart of the week we showed that the top 10% of earners are the only group that has fully recovered since pre-crisis levels of income, and that the amount of Americans below the poverty line has increased by 9.4 million since 2007. The Philadelphia Fed, for example, has admitted that these policies have likely contributed to income equality, but this information is still not talked about enough by the public.
Mapped: Solar Power by Country in 2021
In 2020, solar power saw its largest-ever annual capacity expansion at 127 gigawatts. Here’s a snapshot of solar power capacity by country.
Mapped: Solar Power by Country in 2021
The world is adopting renewable energy at an unprecedented pace, and solar power is the energy source leading the way.
Despite a 4.5% fall in global energy demand in 2020, renewable energy technologies showed promising progress. While the growth in renewables was strong across the board, solar power led from the front with 127 gigawatts installed in 2020, its largest-ever annual capacity expansion.
The above infographic uses data from the International Renewable Energy Agency (IRENA) to map solar power capacity by country in 2021. This includes both solar photovoltaic (PV) and concentrated solar power capacity.
The Solar Power Leaderboard
From the Americas to Oceania, countries in virtually every continent (except Antarctica) added more solar to their mix last year. Here’s a snapshot of solar power capacity by country at the beginning of 2021:
|Country||Installed capacity, megawatts||Watts* per capita||% of world total|
|South Korea 🇰🇷||14,575||217||2.0%|
|United Kingdom 🇬🇧||13,563||200||1.9%|
|South Africa 🇿🇦||5,990||44||0.8%|
|United Arab Emirates 🇦🇪||2,539||185||0.4%|
|Czech Republic 🇨🇿||2,073||194||0.3%|
|El Salvador 🇸🇻||429||66||0.1%|
|Saudi Arabia 🇸🇦||409||12||0.1%|
|Dominican Republic 🇩🇴||370||34||0.1%|
|New Zealand 🇳🇿||142||29||0.02%|
|World total 🌎||713,970||83||100.0%|
*1 megawatt = 1,000,000 watts.
China is the undisputed leader in solar installations, with over 35% of global capacity. What’s more, the country is showing no signs of slowing down. It has the world’s largest wind and solar project in the pipeline, which could add another 400,000MW to its clean energy capacity.
Following China from afar is the U.S., which recently surpassed 100,000MW of solar power capacity after installing another 50,000MW in the first three months of 2021. Annual solar growth in the U.S. has averaged an impressive 42% over the last decade. Policies like the solar investment tax credit, which offers a 26% tax credit on residential and commercial solar systems, have helped propel the industry forward.
Although Australia hosts a fraction of China’s solar capacity, it tops the per capita rankings due to its relatively low population of 26 million people. The Australian continent receives the highest amount of solar radiation of any continent, and over 30% of Australian households now have rooftop solar PV systems.
China: The Solar Champion
In 2020, President Xi Jinping stated that China aims to be carbon neutral by 2060, and the country is taking steps to get there.
China is a leader in the solar industry, and it seems to have cracked the code for the entire solar supply chain. In 2019, Chinese firms produced 66% of the world’s polysilicon, the initial building block of silicon-based photovoltaic (PV) panels. Furthermore, more than three-quarters of solar cells came from China, along with 72% of the world’s PV panels.
With that said, it’s no surprise that 5 of the world’s 10 largest solar parks are in China, and it will likely continue to build more as it transitions to carbon neutrality.
What’s Driving the Rush for Solar Power?
The energy transition is a major factor in the rise of renewables, but solar’s growth is partly due to how cheap it has become over time. Solar energy costs have fallen exponentially over the last decade, and it’s now the cheapest source of new energy generation.
Since 2010, the cost of solar power has seen a 85% decrease, down from $0.28 to $0.04 per kWh. According to MIT researchers, economies of scale have been the single-largest factor in continuing the cost decline for the last decade. In other words, as the world installed and made more solar panels, production became cheaper and more efficient.
This year, solar costs are rising due to supply chain issues, but the rise is likely to be temporary as bottlenecks resolve.
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