Bull to bear
2010s
The winner : The US / Tech
You probably don ’ t need to be told about the FAANGs , or whatever synonym you want to use to describe the tech giants that dominated the 2010s . However , Preston says it is interesting that many of the eventual tech winners only came to prominence after the dotcom crash . “ Before , you had venture capital throwing cash at tech , but that disappeared and forced companies to get profitable ,” he explains . “ But it also prevented new competitors entering as it was difficult to raise capital . You really had to pick through the rubble of the collapse .”
What happens next : This , of course , is the billiondollar question . Django Davidson is a founding partner at Hosking Partners , which places an emphasis on how the flow of capital affects the behaviour of industry participants and , ultimately , returns . He says that after commodity stocks went through their own boom-and-bust cycle in the early 2000s , a greater focus on capital discipline today makes them well placed to benefit from the energy transition . “ Analysis by S & P Global shows we have mined around 700 million tonnes of copper since the start of human history ,” he explains . “ If we ’ re going to get to net zero by 2050 , we need 1.4 billion .” It ’ s not just the size of the growth opportunity that excites him , but the lack of supply , with tech “ sucking capital away ” from the mining sector for more than a decade . “ Rather than working out how we can extract more copper from mines that are 1.5 miles deep and hugely inefficient , engineering grads have been creating algorithms for Snapchat , because that ’ s where the money and glamour is ,” he adds . “ I think the next 10 years is going to see that hugely reverse .”
Issue 94 - April 2023 / 41 /