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The transcription discusses three main investment categories: scarce assets like rare art and Bitcoin, cyclical plays such as commodities and picks and shovels companies, and cash/bonds. The speaker emphasizes the importance of investing in truly scarce assets and companies with enduring moats for long-term growth, while being cautious with cyclical trends like commodities. They also mention the potential impact of AI on inflation and the need to adjust investment strategies accordingly. The overall message is to prioritize A-grade assets, diversify wisely, and consider the evolving economic landscape influenced by technological progress. play, Commodities and Picks and Shovels – that's the title, the cyclical play, Commodities and Picks and Shovels. So the argument here is this initial AI build-out which kind of affects two different types of things. Sorry, on scarcity and abundance we just covered property, so sorry, I'm going to track back to scarcity and abundance. The other kind of scarcity would be scarcity like gold and bitcoin, where there's a relatively fixed supply, although gold obviously grows at 3% a year. That should outperform abundant stores of value like fiat currency, so that would be another example. When you really scarce things like rare art, the very best Bluetooth NFTs, whatever has a high scarcity value as a store of value should go up as well. The reason is, particularly with regards to things like art, is if you imagine a world where say there's 15% economic growth, that doesn't increase scarcity demand by 15%. It has a more levered impact, because if you assume sort of, I don't know, just as a rough assumption, say 80% of the world's growth just goes to meeting people's needs, and then maybe 20% can be put into scarcity. If the economy grows by 15%, that doesn't increase, well let's say it was 85% in 15, that doesn't increase scarcity demand by 15%, with double scarcity demand. So that's what happens. So in a world where all our basic human needs are met, potentially the actual impact over multiple years of that kind of growth on scarcity demand is many, many factors, like an order of magnitude growth. So that's why if we live in a world of abundance, those things that are truly scarce, like rare art, rare digital art, could do really well. So scarce property, scarce currency in terms of Bitcoin, and also scarce art and other collectibles should do really well. Then the next category that I mentioned before is basically the cyclical play. Commodities and picks and shovels. So the thing about commodities, like obviously we consider gold in the scarcity section, but in terms of commodities like copper, silver, other rare earths, and the same can be applied to the picks and shovels companies of energies that, companies that supply power, or maybe even some of the inputs, the semiconductors. The issue you've got here is they probably have a lot of demand for a few years, but unlike companies with enduring moats and unlike truly scarce items, this is ultimately a cyclical play. Now it could be a very long cycle, but it is cyclical. Like eventually there will be an oversupply of copper because the price will go up. It's worth investing in digging it up. Not to mention AI will actually get better at finding and mining these materials. And with regards to the picks and shovels companies, like the companies that supply power and energy and semiconductors and transformers, there's just going to be more competition and more supply. So they could have a good run, and that run could be an amazing run. The cycle could be for 10 years, could make people a lot of money, but it's not a truly secular trend like scarcity and enduring moats are. So it's definitely worth looking at in the portfolio, but just be careful. There is a timing element to that, and a lot of these things have already gone up a lot and there will be an end date. So unlike the other two areas, it's not a set and forget. The final area that's a little bit interesting is cash and bonds, because in different environments I would argue they're often the worst investment out of just about anything long term. Is AI potentially going to cause a lot of disinflation or deflation? I can imagine a scenario where economic growth of sort of 10, 15% is actually dropping without government intervention, without printing money, would be decreasing prices by 10, 15% or 10% a year. There is a risk that the government steps in too late, so we do go through a period where prices are actually falling, and also a lot of people are losing their job. So there could be mortgage stress. So it probably helps to have a little bit of bonds and cash in the portfolio, even more than it has in the last 20 years. My working assumption is the government will step in and just print enough money to stop deflation from happening. That's why I think betting on scarce assets and companies with enduring moats is the best way to do it. But it probably helps having some bonds and cash in the portfolio. So I have to sort of finally weight what the best assets are. I think the top, the A grade assets are companies with enduring moats who are going to be able to leverage their moat, their competitive advantage into new areas. I think their growth is just so high, it's exponential, they're going to capture a lot of the wealth of this AI boom. And the other one is truly scarce assets, your top quality properties, your blue chip collectibles, and then the scarce currencies of Bitcoin and gold. So the A grade. The B grade are the commodities and picks and shovels. So you probably want to have some of them in your portfolio, but just acknowledging it's a cyclical trend. The C grade is cash and bonds. And then your D grade, the thing you don't want to really be holding, if you can avoid it, is just the middling assets, just your average listed company, your average median property or medium or property like the average office or just below median house price, suburb. And again, you could say, well, that's been true over the last 50 years, what's new in all of this? I think the new thing is that the amount of bifurcation, that the trends in this direction are going to become even more extreme with AI. And then a final note, and I don't know where this fits into the article, is understanding the relationship between technological progress, inflation and money printing. If you imagine a world where you have a stable population, you completely lock the amount of money in the country, there's no money printing, and you have technological innovation and growth tracking at about 3% a year, the cost of goods and services would go down by 3% a year. And then the cost of sort of scarce assets like nice property, et cetera, would stay about the same, maybe go up slightly because there'd be a little bit more spare money because the cost of goods and services had gone down. They'd go up slightly. But we haven't lived in that world. We've lived in a world where it's about 3% technology, we're printing money at about 5% to 6% a year, and so we have this sort of base level inflation of about 2% to 3% a year. That's kind of roughly been how the world's worked over the last 40, 50 years. So what happens when that growth goes up to 10% to 15% a year? Basically it's going to require a tonne of money printing, or we have deflation. So that's why I've outlined the portfolio that I have.