In a wide‑ranging conversation on Share Talk, Zak Mir sat down with Clem Chambes, CEO of aNewFN.com, to pick apart market narratives, technology trends and the practical fallout for investors.
Clem brings his trademark scepticism, dry humour and a keen eye for structural risks. We covered why markets are twitchy, what the Fed’s reverse repo means for liquidity, whether Ukraine headlines are moving commodity prices for good reasons, and what to watch next if you invest in resources, healthcare and crypto.
Where markets stand: a cocktail of banking scares, credit and geopolitics
There was no single neat explanation for the market wobble we saw. Clem and I agreed it’s a mix: messy car‑loan losses in the US, bank liquidity stress reminiscent of the Silicon Valley Bank episode, and fresh headlines out of Ukraine that are nudging certain commodity names.
As Clem put it bluntly:
“”The reverse repo is empty… the bucket of spare money is now dry.””
When spare liquidity dries up, even comparatively small problems can cascade. A few car lenders lending to high‑risk borrowers, repossessed vehicles and securitisation structures that prove fragile can suddenly look systemic if there’s no spare cash to smooth things over.
Reverse repo, the Fed and why liquidity matters
We walked through what the Fed’s reverse‑repo facility actually signals. For years after COVID there was a big excess of cash, and the Fed used reverse‑repo to mop some of it up — essentially paying institutions to park cash with the Fed. That bucket has shrunk substantially.
When the reverse‑repo balance falls toward zero, it’s a sign there’s less “spare” liquidity in the system. That’s good for fighting inflation, but it leaves less buffer to absorb shocks. If a bank needs a few hundred million and the market is tapped out, problems can amplify quickly. The Fed can, of course, print and inject liquidity, but the timing and scale matter — and markets react to perceived fragility in the meantime.
Ukraine headlines and commodity price dislocations
Geopolitics is also playing its part. Clem flagged miners like Ferrexpo (referred to in the conversation as Fair Expo) and other Eurasia‑exposed names that reacted sharply to news out of the region. The logic is straightforward: a 50/50 chance of escalation versus settlement can push prices in either direction — and certain assets swing wildly on that uncertainty.
We discussed how peace doesn’t necessarily eliminate demand for European defence spending; historical distrust of pacts and the need to rearm mean defence budgets can remain structurally higher. That makes some resource and defence exposures resilient even in a peace scenario.
Governance, “democratic dictatorship” and the creeping cost of the public sector
Clem and I veered into governance and public‑policy territory — how systems of governance shape economic outcomes and why the West’s model still has advantages, even if many citizens feel freedoms have been rolled back.
“”China is classified as a ‘democratic dictatorship’… and I suppose maybe we have something similar here.””
That cheeky observation led into a wider point: public sectors in the West have grown massively. Taxes and regulation have risen, and private‑sector dynamism has been squeezed in many places. We discussed the Laffer curve — up to a point taxes raise revenue, beyond that they discourage activity and can reduce total receipts — and the practical consequences of higher taxes and red tape on entrepreneurship.
Clem warned that an oversized public sector with a shrinking private sector creates a vicious cycle: less efficient capital allocation, weaker real GDP growth, and therefore a smaller tax base to support higher public spending.
Politics, democracy and the potential for change
Politics matters because democracies can, at least, pivot. We talked about how ideas that were fringe a few years ago can become mainstream and influence ballot boxes. Clem compared the potential for change to the 1970s and Thatcher’s era — a reminder that democratic shifts can catalyse long periods of economic restructuring and recovery, but they’re unpredictable.
Investment watchlist: copper, miners and oncology/weight‑loss plays
We finished with practical things to watch in the market:
- Copper — Clem believes copper is the next major theme after gold. Electrification and the energy transition point to structural scarcity over time. He highlighted Anglo American as an interesting way to play a rising copper story given its position in developing a top copper asset.
- Ferrexpo & Eurasia‑type names — volatile on Ukraine headlines; potentially big upside in certain geopolitical outcomes, but high risk and binary.
- Nova Nordisk‑style biotech/weight‑loss wave — Clem and I noted the huge interest in GLP‑1 drugs (jabs and pills) and companies that have seen boom‑and‑bust price action. The pattern he described for companies: rocket‑up, crash‑down, flatten, then steady tick‑up — that’s often when value appears if fundamentals remain intact.
Crypto: a flight asset, not a flawless store of value
On crypto, Clem was blunt. Bitcoin and other assets have clear use cases — flight capital, cross‑border transfers, and certain types of payments — but they remain a poor store of value by traditional standards. Big thefts, custodial risks and the myth of perfectly “cold” wallets mean security is imperfect.
“”There is no such thing as a cold wallet… they’re all different levels of warmth.””
We noted that crypto still tends to move with equities: when stock markets sneeze, crypto often catches a cold. That correlation undermines the argument that crypto is a safe, independent store of value in turbulent markets.
Key takeaways
- Market moves this week were driven by liquidity fragility (reverse‑repo shrinkage), bank‑level credit issues and geopolitics.
- The Fed’s balance‑sheet dynamics matter: less spare liquidity increases the chance that small shocks become large ones.
- Commodities tied to geopolitics (iron ore, copper) will remain volatile — but copper is a structural theme to watch.
- Public‑sector expansion, high taxes and regulatory burden can choke private‑sector growth; democratic change is the mechanism that can reset direction, but timing is uncertain.
- Crypto is useful for certain use cases, but it is not a perfect store of value — custody and theft risks are real.
What I’m watching next
- Fed balance sheet and reverse‑repo flows for signs of spare liquidity returning or drying further.
- Bank shares for contagion signals that could force broader market risk‑off moves.
- Anglo American and other copper/industrial miners for exposure to a long‑term copper bull case.
- Biotech and pharma names involved in weight‑loss medicines for opportunities where their crash phases flatten out.
- Bitcoin and major crypto custody news — any large outflows or headline hacks will quickly affect sentiment.
If you want to dig deeper into any of these themes — liquidity dynamics, specific miners, biotech plays or crypto custody strategies — I’ll be back with Clem next Friday to fix the world again. Until then, keep an eye on liquidity, don’t overleverage yourself into headline risk, and consider the structural stories (copper, energy transition, healthcare innovation) that play out over years rather than days.
Disclaimer & Declaration of Interest:
The information, investment views, and recommendations in this Zaks Traders Cafe interview are provided for general information purposes only. Nothing in this interview should be construed as a promotion or solicitation to buy or sell any financial product relating to any companies under discussion or referred to or to engage in or refrain from doing so or engage in any other transaction. Any opinions or comments are made to the best of the knowledge and belief of the commentator but no responsibility is accepted for actions based on such opinions or comments. The commentators may or may not hold investments in the companies under discussion.
