1789 Capital's Chris Buskirk on cheap energy as the key to national competitiveness and the rare earth magnet opportunity

one. Good luck with the rest of your live shows. We were talking about jingles. We got to sing you a jingle. Find your happy place. Find your happy place. Book a wonder with inspiring views, hotel grade amenities, dreamy beds, top tier cleaning, and 247 concier service. It's a vacation home but better, folks.

And Chris Buskerk is in the reream waiting room. Let's bring in Buskerk. How you doing, Chris? How are you? Great. Hopefully you got to hear us singing just now. We're we're trying to bring back corporate jingles. We think that there's an unexplored territory there. I don't know your stance. 1789. Ooh, we got something.

I know why we don't I actually know why we don't have them anymore. Please explain. It's because big pharma took over advertising and that killed all the creativity. Oh, interesting. Yeah. And they got to throw those. Yeah. Now it's like you got a 40second commercial.

20 seconds tells you all the bad things that are going to happen to you when you take the drug. It's rough. Well, yeah. So, so, uh, the conspiracy theory there, I don't have my tinfoil hat handy, is that, uh, it's not about even generating awareness. Here we go.

I got we keep one of these anytime we have to discuss a conspiracy theory discuss discuss a conspiracy theory it gives you cover you know I don't I don't believe this necessarily but uh you you listen to these pharma ads and they're after after listening to it I would say you're much more likely to think I don't think this I don't think this is for me right because you maybe hear about some benefits and then you get like 20 seconds of of but it's just it's it's is it a mechanism to just invest so many dollars in a show that the show could not possibly criticize the the the far the pharma industry broadly otherwise you're potentially is this manufactured consent says Nam Chsky but has been written rewritten well it's more like it's more like yeah you're welcome to criticize big pharma but like say goodbye to like what 60% of your revenue overnight anyway not going to be running the show we're not going to be talking about more conspiracies anyway let's kick it off with an introductory theory is always also known as the news six months in the future.

Yeah. Uh but but uh let's introduce yourself. Uh how do you think about yourself? What what what uh what what key projects are you working on right now?

you know, it's uh you know, co-founder of 1789 Capital as you guys know, like I've got some other evocations as well, but you know, just you know, I people always say like how do you split up your time and uh like there was like the that was like the Rubik's cube question for me for a while and then I realized actually the uh the simple answer is right, which is like all the different stuff I'm doing is all the same project which is how do you keep the country peaceful and prosperous?

Like that's really it. Then there's all kinds of different vectors of attack there. There's like there's politics, there's culture, there's business, there's tech, but it's really all with the same tilos. Like how how do we just make life better for this country and the people in it? Yeah.

Give me a give me a temperature check on your view on the business climate. There's been so many new so many stories about tariffs and interest rates and all sorts of stuff. At the same time, the stock market's been like down and then right back to where it was. And so there's like the nothing ever happens view.

There's the incredibly tumultuous times view. How are you just feeling about the business climate generally? And it's amazing. It's like it's better than it's been in a long time. Yeah. Yeah.

I mean this is what you know I've had I I've had the following conversation uh it probably literally like 10 or 20 times in the past few months and people uh whether a lot of investors but also founders builders have said a a different version of the same thing which is uh I didn't know how much I was self-censoring my own thought about what was possible over the past four or five years until you know fill in the blank January February March April whatever just some this year and Then they realized like, oh, the shackles are off.

We can actually go and do really cool stuff now. Um, and there were they everybody had their project like there it was like there was a pain point in their business like oh I can't do this or like you know like the crypto guys or AI like they're really really under under attack you was like regulation by enforcement.

Y um and so they knew what the pain points were and so for obvious reasons were super focused on those things and they were like oh if we could just get through this then we could do this one other thing whatever that may have been.

And what I've heard them what I've heard a lot of people saying is once the pain stopped I realized that there were like 10 other things that not only did I want to do but that I could do. And so like the amount of optimism and energy is just really infectious. It's like it's a great time to be alive. Yeah.

It feels like I mean we saw that with a lot of the nuclear founders like you talk to those folks and I mean it was so rough for a while that they normally like if you invest in my company I don't want you to invest in a direct competitor but the nuclear companies were like look like that's not going to be the thing that does me in like you can go ahead and invest and then now we finally have some clarity from the EO.

We talked to some nuclear founders and it feels like we're on the cusp of some real progress there. Um how much are you focusing on energy? What are the other categories that you find uh interesting right now? What do you see as being like uniquely unlocked uh in this new era?

Yeah, it's we call it the and I don't think we made it up but like we call it like transformational technologies. So that means like AI AI infra uh energy robotics space defense that those are kind of like the big buckets. In a lot of cases there's a lot of they're they're really related.

Um, you know, we like the way at least the way we think about energy is like it's attached to all of those. Sure.

Um and you know that's where that's where nuclear really comes in but particularly around AI and uh crypto and some of the other elements of just security in general like that is the major unlock like one of the things that I tell people all the time is you like if you want to like a just an easy heruristic about like you know how you think about like what are the big unlocks that need to have happen which is that think about it this way the large civilization that has access to the most abundant cheapest energy wins like period.

full stop.

Um I was talking with a friend of mine, another investor last week and I he actually had he had this great um description which I had actually never thought of about colonization of Mars because I was saying how you know like you obviously Elon's been super focused on it and I'm like I don't want to go to Mars.

Like I've never wanted to go to Mars. It seems like it seems like it sucks there. I said but then I realized um that actually like terraforming Mars like that's actually kind of cool because it would make it someplace you'd actually want to go.

So that's why like Mar like Mars colonization's become charismatic because like just like getting to the moon was was interesting and charismatic um in the '60s because it was like can we get there like it was just the it was just like the journey not the not the end but then when you start to think about the idea of uh of of colonization of Mars well it's interesting when you think that like you could make it beautiful and he and what he said was it's just an energy problem.

If you can bring enough energy to bear, then you can terraform then you can terraform Mars. I was like that was actually for me that was like an interesting way to think about it that I hadn't considered.

But the same thing applies to everything else which is if you have if you have super abundant super cheap energy you're as a as a large scale civilization you're going to win because it makes everything else better, easier, cheaper and things that were not possible it makes them possible.

kind of like the way SpaceX what SpaceX has done with launch by just driving the cost per kilogram into the dirt there it unlocks all these other businesses. Yeah, it's fascinating.

So if if great power competition is is energy competition do do we you know I mean that the concern here is that China is just like copy and pasting nuclear reactors and we have a bunch of great nuclear startups that are you know making efforts and some new projects.

I think Meta, you know, has announced some some new initiatives there. Um, but is this not like one of the kind of biggest issues that we're facing from a national security standpoint? There's a way in which it's the biggest because it because it touches everything like it touches literally everything.

I mean you think about like these really critical growth areas AI being the super obvious one but uh you know and there's you know I've seen a number of um analyses that show like the the amount of uh AI compute we need to build just in this country like say in the next 10 years so by 2035 like it would consume more power than we produce right now as a country.

So there's like we need to be producing a lot more power because unlike certain members of Congress, it turns out electricity doesn't just come from the wall. Like you actually have to produce it uh someplace. Yeah. Food comes from the grocery store. Gasoline comes from the pump.

Electricity comes from what are you slow? You just plug in just plug in and there's electricity there. I I do think there's something there's something fascinating about like it's so hard to predict the future.

It's so hard to predict what we will need, you know, a gigawatt, you know, data center for and then all of a sudden it's like we need it today. Like we have the use case, we need it today. Um and and I keep thinking about like what happened in the dotcom boom where we overbuilt all this dark fiber.

Google went and bought it up and a bunch of the tech companies bought it up and then eventually like the the the products caught up.

My my question is um how do you think about projects that might be uneconomical to underwrite on the venture side and so they might need to be underwritten by the government like like I'm I feel like we're probably align in that like we should probably keep the government as narrow as possible but there are some really crazy things like the moon landing like the Mars helicopter stuff that just doesn't make any sense for any private company to go after and then after a while you start seeing saying like, oh, okay, like, you know, they built some roads, they built some infrastructure, and now private companies are catching up and and actually ramping up the the the use of that energy or something.

But how do you see the government playing a role in the next in solving those fundamental problems? Is it purely just on deregulation? Do you want to see funding flow into certain projects? Do you want to see government doing hard projects? What how what's your philosophy on all that? Yeah, it it's it's both.

It's both is the answer is like we've just seen, you know, just as I was saying earlier, like just this year just by getting out of the way unlocks a lot and it just there's so many people um who want to do things and who have the capacity to do things if they're not being shackled and prevented from doing them.

So like we've seen a lot of that in the past six, seven months is just by getting out of the way and giving people permission um to do it, you get a lot of you get a lot of activity. And so that's a big part of it. But then there there are these other issues um where you know China creates its national champions.

And so like great example is like rare earth magnets. You know it is it can be um it is I mean they subsidize it. So it is cheaper to buy a rare earth magnet from Chinese supplier than it is to buy the raw materials in the United States. You know it that is I mean that's very it's that's geopolitics right?

That's not just markets. That's not just economics. That's not just innovation, that's geopolitics. The the Chinese have been on they've been on top of this for 20 years and realized that this was a choke point where they were would be able to get a huge amount of leverage over their competitors and adversaries.

Um, and I guess we're someplace in, you know, in between those two things with with China. And if they were able to subsidize them, they could drive out all the compet the competitors out of business.

and because they go into literally everything of any importance that they'd have massive um not just economic leverage but like geopolitical leverage over the United States and so that's a place where you know government needs to play a role because it's not a company v company competition it is a state actor v company competition as it stands right now and that's something that's critical to national security so you see that I think in a a number of other a number of other spaces but you know the rare earth magnets is like it's just a very obvious example of that where you can't um like a company can be super innovative and can do all the right things but if it is facing a state actor as its competitor versus another company like they're going to lose.

Yeah. On the rare earth materials question, uh there was a story in the Wall Street Journal last week about Apple buying half a billion dollars of rare earths from a company called MP Materials and in Vegas and in Las Vegas.

And it stuck it stuck out to me as kind of a vibe shift because Apple hasn't been at the front of like re-industrialize America, bring back jobs, and you know, let's make everything in America.

They're not saying that, but it feels like maybe behind the scenes they're at least thinking about their supply chain very seriously and trying to diversify and maybe it's a cruise ship, but they're putting their hands on the tiller just a little bit.

And so I took that as like cause for optimism with the overall, you know, energy independence, supply chain independence, but did you see that story?

Are there any other causes for optimism that might be coming from the the the crowd that's not cheering as loud as they can but might be getting, you know, might be working behind the scenes to kind of achieve the same goals that everyone should be aligned around? Yeah.

I mean, look, there's a there's a lot of signal, I think, in that in that move. I mean, they uh at some point Apple has to realize that their supply chains are really really insecure. And this leads to like another point on the rare earth magnets.

Like one of the things like the one of the what great sort of unintended consequences of uh the liberation day tariffs and the and the general policy of tariff policy coming out of the administration is that this actually was turned out to be a forcing function. It made China play their rarest card way too early.

um had they decided for instance to attack Taiwan and then played that card that would have been the optim optimum moment. But what happened was is that in the negotiations around tariffs they they threatened to play the rare earth card.

In fact they did actually like reduce exports uh the past couple months but it was too soon like they they played it early and now there's time for the United States um to catch up.

And this is, you know, in fact, as we saw with MP, you know, and the support they've gotten from the government, another company that we're in the process of investing in called Vulcan Elements is uh is in the space as well.

Um, and we now have a window in time where we can build out an ecosystem to manufacture rare earth magnets in the United States and do it really really uh quickly. So that that's just a place where like there's like there's there's a lot of signal coming out around that as well.

But there's I think the the fact that there is so much happening and uh and at such a rapid rate that's where we're seeing um but that's where we're really seeing the advances here because like I don't know like people ask me like you like are you pleased with the way the admin's gone? Yeah, I am.

Um, what I've been surprised by though is the speed with which they've moved. And what's happened is like they're moving at like founder speed and that that becomes infectious.

And so now you get you get cycles uh that might have taken a year or two or three to to happen and work things work through the system um in the past and now like we see we're I mean we're standing up a rare earth's capacity in in the United States basically overnight.

That was like a pipe dream four or five months ago and now it's actually happening. We got to stop calling them rare earths. They're just Earth's. They're just Earth's magnets. They're not rare. They're not rare. They're They're only The process form is rare. Yes. The industrial capacity is rare, but the product is not.

Let's just call them Earth. It is. It is. You got to You got to uh you know, we we probably criticize uh China more than than most podcasters on Earth.

But you got to give them credit for letting the world think that they were just the Happy Meal toy manufacturing hub for like a couple decades and then just like quietly owned, you know, all all these critical supply chains.

I'm curious how you're thinking about solar and one of the reasons I ask is I've invested in tons of these different kind of hard tech uh new industrials categories and I've yet to back a solar company.

I only, you know, started actively angel investing maybe four or five years ago and it's fallen out of fashion is one way to describe it. Hammer's bringing it back. Yeah. So, Casey is the only Casey's the example and I would I would happily invest in Casey if I had the chance, but curious how you're thinking about that.

It's another area that China is dominant in and it seems like something that we wouldn't necessarily want long term. So, like I've been sort like semiobsessed with solar for a long time. I just like it's mostly just basically being like thrifty.

I'm like, damn, there's all that sunlight and I can just power my house for free, you know? So, like like I like at my house in Arizona, I have solar on it. I've had it for years. Okay. But it's really not economic. Um, and so there's needs to be a pretty big leap forward for it to for it to matter.

Otherwise, why not just build more nuclear, right? Why not why don't we just keep it simple? Yeah. Casey like PV solar actually isn't that good and like the concentrators are like okay but like again like we have the solution already.

So there's got to be a compelling case to be made as to why um under the current like uh you know with the current technology around solar why is that even worth focusing on? Interesting. Yeah.

Casey's point was like China is subsidizing photovoltaic manufacturing and and the and the most hurtful thing you could do is just buy all of it to so that they take a loss on every unit and then build up your capacity.

But I don't know that that actually would would would catalyze a real shift in capacity and we might just get kind of hooked still helping them get extremely good at especially if there's learning curve and stuff. So, I don't know. It's a it's a longer conver and PV is just not that efficient, right? That's the problem.

Yeah.

I I think the I think the the argument was that it's like it's very well matched to the load of the grid of the American consumer because when it's hot out we run our air conditioning and when it's hot out the sun is shining on the PV cells and so there's some match there whereas a nuclear power plant generates just as much at night as it does in the day.

So I don't know there there's a whole bunch of different load use cases for AI training versus inference and all this different stuff but um it's uh yeah it's f it's a fascinating geopolitical dynamic and it seems like the main takeaway is that China has just been saying yes and to everything and and they develop capacity everywhere and and it's like we could try and predict the future but you know if PV winds up being really important I want to have capacity for that.

If nuclear I want that too. I want I want the smores board. give me all the energy. But I don't know, you're building a ton of coal plants, too. Yeah. Yeah. No, 100%. And like fortunately, you know, uh some of the AI uh infrastructure buildouts are are pulling forward some of that.

We're getting a whole bunch of natural gas online. Like we are becoming more energy independent. So, uh green shoots all over the place. Jordy, anything else? Last question. I think that's it for now. This was fantastic.

Yeah, we got to have you back on, especially when there's like big news in your world or anything going on that you can comment on. Anytime. Happy to do it. We need uh we just need 30 seconds notice. We'll drop you the We'll drop you We'll drop you the link. You can just hop right on. Okay, awesome.

Yeah, just you can signal me. Signal me. I'll be on. I will. I'll talk to you soon, Chris. Have a great day, Chris. Cheers. Bye. Uh, and speaking of minerals, we have uh adquick. com. If you're selling minerals, you put it on a billboard. Out ofome