Real Assets vs the Dollar
Brian De Groodt 馃彺鈽狅笍@bdegroodt
+3.2%
since Oct 6
The idea
I think a growing deficit keeps weighing on the dollar over the next decade, so I want to own real assets instead of paper money. The core is large energy producers and diversified miners, with agriculture as a second commodity leg and royalty companies layered in since they collect revenue from production without absorbing the cost inflation producers face. I keep 8% in cash to add on weak days, spread across names so no single stock carries the thesis, and I'm holding for years unless the structural dollar story actually changes.
What it owns
- Oil and gas producers earn revenue in dollars while commodity prices rise with a weaker dollar, and return much of it to shareholders as cash. 路 Exxon MobilIt is a large oil producer paid in commodity prices rather than fixed dollars, so oil reserves hold value while currency weakens if production and cash returns stay intact., ConocoPhillipsIt produces oil at low cost, earning profits across most price ranges through cycles, and converts them to cash for shareholders., ChevronIt generates a steady dividend from oil production, delivering a continuing cash stream through periods of dollar weakness as long as output and payout hold., Canadian Natural ResourcesIt operates oil sands reserves that produce for decades with minimal additional capital investment, and earns revenue in Canadian dollars rather than US dollars., EOG ResourcesIt converts US shale production into free cash without chasing growth, so weaker dollars and firmer commodity prices flow straight to shareholders when spending discipline holds.31%
- Metals like copper and iron ore are priced in dollars worldwide, so a weakening dollar tends to lift the earnings of large-scale producers. 路 BHP GroupIt produces iron ore, copper, coal and potash, giving broad exposure to commodities priced in dollars while maintaining diversification and cash generation., Rio TintoIt produces iron ore and copper at scale and pays cash through commodity cycles, providing diversified mining exposure alongside strong capital returns., Freeport-McMoRanIt mines copper priced in dollars worldwide, so a weaker dollar tends to lift prices and earnings when production from major mines continues., Teck ResourcesIt produces copper and zinc, metals that get repriced upward when the dollar slides, while shifting toward copper and managing production costs.25%
- Royalty firms collect a share of production revenue without bearing the rising costs that producers face, so currency debasement flows more directly to their bottom line. 路 Texas Pacific LandIt owns Permian acreage and collects royalties on production with minimal costs, making it a direct claim on real land and real oil output., Franco-NevadaIt collects royalties from gold and energy production without paying rising producer costs, capturing currency debasement in gold prices almost directly., Wheaton Precious MetalsIt buys metal streams at fixed cost and sells at market prices, so dollar weakness that lifts gold and silver flows almost entirely to earnings.18%
- Crops and the equipment and inputs that produce them are real assets that move on their own cycle, independent of energy markets. 路 NutrienIt produces fertilizer, a real input for global crop production priced off demand rather than currency, while moving potash and nitrogen volumes to market., Deere & CoIt sells farm equipment with pricing power strong enough to pass through cost inflation, sustaining orders as long as farm incomes remain healthy., Archer-Daniels-MidlandIt handles and trades crops themselves, earning off the flow of real agricultural goods regardless of price direction as grain volumes move profitably through its network.18%
- Cash8%