Dave Iben is the Chief Investment Officer, Managing Member, Founder, and Chairman of the Board of Kopernik Global Investors.
Like many people in the mid-nineteenth century, Samuel Clemens headed west to try his hand at mining. Fortunately, he failed at that, opting to be a humorist and writer instead.
Here he was much more successful, writing mostly under the nom de plume Mark Twain. Amongst his many purported quips was, “the definition of a mine is ‘a hole in the ground with a liar standing next to it.’” Given his experience, and the experiences of many others, that is a statement that has been too often true.
Here in the twenty-first century we are being sold not mines, but many other supposed “bonanzas.” We are told that a virtually profitless startup automobile company is worth more than all other successful auto companies combined.
It is believed that northward of $2 trillion is a defensible valuation for one single company. We are told that after nearly two decades of ineffectually developing a vaccine for Severe Acute Respiratory Syndrome (SARS), within the past six months more than a hundred companies are on the verge of successfully conquering Covid-19, and merit being priced for success.
Society seems to be accepting the premise that, via negative interest rates, it is a reasonable investment to loan money at a guaranteed loss to maturity.
For the rest of this column: https://www.forbes.com/sites/daveiben/2020/10/05/was-mark-twain-right-about-miners/#6c4c776206e8