Tavi Costa argues copper is entering a price-discovery phase and remains very cheap versus gold despite all-time highs, while broader hard assets, natural gas, and agricultural commodities should benefit from debt, inflation, and supply constraints.
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This is an interview at the Vancouver Resource Investment Conference with host Daryl Thomas and guest Tavi Costa of Aurora Capital. Costa’s core macro view is that the world does not own enough hard assets because global debt, money dilution, and structural inflation pressures make hard assets the likely “escape valve” for imbalances. He frames the choice as either a debt default/deleveraging cascade or an inflationary path where policy and money creation erode purchasing power, and he thinks the second path is the more likely one over the next 5–10 years. A major theme is that the market is underpricing resource scarcity and geopolitical disruption. Costa argues the Iran/Strait of Hormuz situation is not the primary cause of inflation but rather a symptom of a broader debt-and-populism dynamic that increases conflict risk and supports higher resource prices. …
Copper looks tactically strong after an all-time-high breakout, with miners and related equities likely to keep attracting flow while the market re-prices supply scarcity. Near term, the main risk is a sharp reversal if the breakout fails or if geopolitics cool faster than expected.
Over the next few months, the base case is a continued rotation into hard assets if inflation remains sticky and supply constraints persist across metals, energy, and agriculture. The setup would weaken if demand softens materially or if policy and logistics changes ease bottlenecks faster than the market expects.
The structural view is that the market is entering a longer regime of higher real-asset pricing driven by debt monetization, deglobalization, and recurring supply fragility. In that regime, copper, gas, and food inputs matter more than broad financial assets as durable stores of value and industrial necessities.
Hard assets are underowned and likely to rise because debt burdens and money dilution will force either default or inflationary debasement.
Costa says the world does not own enough hard assets and that they are the 'escape valve' for debt and monetary imbalances.
The market is overly complacent about the Iran/Strait of Hormuz situation and its impact on resource prices.
He argues investors are pricing the war as temporary and are underestimating persistent effects on oil, fertilizers, and agricultural commodities.
U.S. oil independence is constrained by refinery and crude-quality mismatches, not just domestic output volume.
Costa explains that the U.S. produces a lot of light oil but still needs heavier imported crude for its refineries.
What macro themes make you think we do not own enough hard assets?
He says hard assets are likely to go much higher because of debt imbalances, monetary dilution, and the likely need for the U.S. to suppress interest rates and inflate away debt. He sees the world moving toward monetary disorder unless a painful default path occurs first.
Is the recent inflation pressure mainly driven by M2 money supply growth rather than the war?
He says the driver is M2 growth, and he rejects the idea that the Iran war is uniquely responsible for the inflation backdrop. In his view, the war is another consequence of global debt excess and political polarization.
Why is the U.S. drawing down the Strategic Petroleum Reserve if it is energy abundant?
He explains that the U.S. is not fully independent in energy because refinery capacity and oil quality mismatches require blending domestic light crude with heavier foreign crude. The SPR drawdown reflects an infrastructure and refining constraint, not simply a lack of domestic production.
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