Capitalmind looks at stocks, bonds, funds and the macro to bring you their view on the Indian financial markets. We discuss all things related to investing at our focussed podcast that keeps it simple. For more, go to capitalmind.in and to invest with us, visit capitalmindwealth.com
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McAlvany Weekly Commentary에서 제공하는 콘텐츠입니다. 에피소드, 그래픽, 팟캐스트 설명을 포함한 모든 팟캐스트 콘텐츠는 McAlvany Weekly Commentary 또는 해당 팟캐스트 플랫폼 파트너가 직접 업로드하고 제공합니다. 누군가가 귀하의 허락 없이 귀하의 저작물을 사용하고 있다고 생각되는 경우 여기에 설명된 절차를 따르실 수 있습니다 https://ko.player.fm/legal.
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With an estimated 100,000 tourists heading to New Orleans for Super Bowl LIX, we’re exploring a classic American pastime: the tailgate. Most people think of tailgating as a time for sharing beers and team spirit. But in this episode, we find out why tailgating motivates so many people to travel — and get to the heart of its culture. Learn about your ad choices: dovetail.prx.org/ad-choices…
Gold Nears Record Highs
Manage episode 463450936 series 3624741
McAlvany Weekly Commentary에서 제공하는 콘텐츠입니다. 에피소드, 그래픽, 팟캐스트 설명을 포함한 모든 팟캐스트 콘텐츠는 McAlvany Weekly Commentary 또는 해당 팟캐스트 플랫폼 파트너가 직접 업로드하고 제공합니다. 누군가가 귀하의 허락 없이 귀하의 저작물을 사용하고 있다고 생각되는 경우 여기에 설명된 절차를 따르실 수 있습니다 https://ko.player.fm/legal.
Gold and precious metals continue their march higher this week, buoyed by continued enthusiasm for the new US president and administration. Let’s take a look at where prices stand as of our recording on January 23: The price of gold is up 2.5%, sitting at around $2,756. That’s only about $35 away from its previous all-time high. The price of silver is up around 0.9% at $30.85. Platinum is up 2.8%, to $960. Palladium is up 3.9% at $1000, just slightly below platinum. Looking at the broader market… The S&P 500 is up about 2% this week to 6,091. The US dollar is down a little over 1% at $108.22. Big Money Bets on Gold Rise The Commitment of Traders (COT) report shows the aggregate holdings of different participants in the U.S. futures market. These are compiled and published by the Commodity Futures Trading Commission in the U.S. COT reports detail how many long, short, and spread positions make up the open interest. Looking at a recent report, we see that far more institutional investors have been betting long on gold futures. Their bets have paid off handsomely, as gold has recovered from its dip to rise back up to record levels. But will the managed money continue to speculate that gold will go up? Or will they start taking profits? Of course, it’s impossible to predict exactly how the price of gold will change. But here are a few scenarios to consider. Scenario 1: A Mild Selloff If there is an unwinding of those managed money speculative bets, it’s possible that we’ll see gold drop down closer to the lows seen in post-election November and December — potentially around the $2,500 per ounce range. If this happens, gold could trade sideways for a few months. Scenario 2: A Shallow Correction If instead there’s more of a correction, we might see gold in the intermediate term fall to a floor. A shallow correction would look like gold dropping to $2,350 per ounce. A deeper correction might be closer to where gold was during the post-pandemic highs, around $2,075. If silver decides to hold around its current level, that would open up a potential gold to silver ratio trade. That’s because the gold to silver ratio would be closer to 52:1 in this case. However, it looks less likely that this scenario would happen. Scenario 3: Untested Territory There’s a good possibility that a correction might not happen at all. And instead, gold would push up to new high levels into uncharted territory. If this happens, it’s possible that gold could climb to a new high around $3,500 per ounce. Looking at recent charting patterns, it is possible that gold could reach these new highs. Which means that investors waiting on the sidelines to catch the next dip would continue to miss out. Should you buy gold right now? The best way to know what would work for you is to consult a trusted, experienced precious metals professional. Get Started With Expert Advice Our advisors have decades of experience investing in gold and other precious metals, and they can help you find the best strategy to meet your unique needs. They are happy to speak with you about your strategy for investing in gold and other precious metals. Reach us at 800-525-9556.
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251 에피소드
Manage episode 463450936 series 3624741
McAlvany Weekly Commentary에서 제공하는 콘텐츠입니다. 에피소드, 그래픽, 팟캐스트 설명을 포함한 모든 팟캐스트 콘텐츠는 McAlvany Weekly Commentary 또는 해당 팟캐스트 플랫폼 파트너가 직접 업로드하고 제공합니다. 누군가가 귀하의 허락 없이 귀하의 저작물을 사용하고 있다고 생각되는 경우 여기에 설명된 절차를 따르실 수 있습니다 https://ko.player.fm/legal.
Gold and precious metals continue their march higher this week, buoyed by continued enthusiasm for the new US president and administration. Let’s take a look at where prices stand as of our recording on January 23: The price of gold is up 2.5%, sitting at around $2,756. That’s only about $35 away from its previous all-time high. The price of silver is up around 0.9% at $30.85. Platinum is up 2.8%, to $960. Palladium is up 3.9% at $1000, just slightly below platinum. Looking at the broader market… The S&P 500 is up about 2% this week to 6,091. The US dollar is down a little over 1% at $108.22. Big Money Bets on Gold Rise The Commitment of Traders (COT) report shows the aggregate holdings of different participants in the U.S. futures market. These are compiled and published by the Commodity Futures Trading Commission in the U.S. COT reports detail how many long, short, and spread positions make up the open interest. Looking at a recent report, we see that far more institutional investors have been betting long on gold futures. Their bets have paid off handsomely, as gold has recovered from its dip to rise back up to record levels. But will the managed money continue to speculate that gold will go up? Or will they start taking profits? Of course, it’s impossible to predict exactly how the price of gold will change. But here are a few scenarios to consider. Scenario 1: A Mild Selloff If there is an unwinding of those managed money speculative bets, it’s possible that we’ll see gold drop down closer to the lows seen in post-election November and December — potentially around the $2,500 per ounce range. If this happens, gold could trade sideways for a few months. Scenario 2: A Shallow Correction If instead there’s more of a correction, we might see gold in the intermediate term fall to a floor. A shallow correction would look like gold dropping to $2,350 per ounce. A deeper correction might be closer to where gold was during the post-pandemic highs, around $2,075. If silver decides to hold around its current level, that would open up a potential gold to silver ratio trade. That’s because the gold to silver ratio would be closer to 52:1 in this case. However, it looks less likely that this scenario would happen. Scenario 3: Untested Territory There’s a good possibility that a correction might not happen at all. And instead, gold would push up to new high levels into uncharted territory. If this happens, it’s possible that gold could climb to a new high around $3,500 per ounce. Looking at recent charting patterns, it is possible that gold could reach these new highs. Which means that investors waiting on the sidelines to catch the next dip would continue to miss out. Should you buy gold right now? The best way to know what would work for you is to consult a trusted, experienced precious metals professional. Get Started With Expert Advice Our advisors have decades of experience investing in gold and other precious metals, and they can help you find the best strategy to meet your unique needs. They are happy to speak with you about your strategy for investing in gold and other precious metals. Reach us at 800-525-9556.
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251 에피소드
모든 에피소드
×Gold and precious metals saw more volatility over the last week, but overall strong in the beginning of this new year. Let’s take a look at where prices stand as of our recording on February 5: The price of gold is up 3.6% to $2,862. However, gold did break above $2,900 in the futures market. The price of silver rose up 4.8% to $32.32. This has inched the gold to silver ratio down a couple of points to 88 to 1. Platinum is up about 3% to $1,008, from a week earlier. Palladium up about 3.8% to $1,015, rising from a week earlier as of recording. Looking at the broader markets… The S&P 500 moved sideways, and was at 6,058 as of recording. The US dollar index was down about 0.25% to $107.06. But it did reach $110 before making a pretty significant crash back down. A Strong January for Metals Looking back at January performance, precious metals across the board showed strength in the first month of the year. Gold closed out the month up 6.5%, while silver outperformed gold with a rise of 8.6%. It gets none of the attention, but that's because gold's at all time highs. Platinum rose up 8.1% in January, while palladium led the charge overall, up 10.6% by the end of the month. As discussed in our January 24th show, the commitment of traders continues to bet long on gold. We believe that gold could reach a new record high of $3,000 before we see a decline. Bond Market Stabilizes Despite interest rates shifting down 18%, the bond market looks pretty stable. The short-term one-year and two-year bond yields are down around 20%. But looking at the 10-year bond yield, it has only declined 10%. So despite the massive interest rate rise through 2022 into 2023, tapering off in 2024 and down a little bit at the end of last year, the bond rates have stabilized. The bond market is far bigger than the equities market, and it’s encouraging to see money moving into 10 year Treasurys — an indication that big money is happy with the direction the US is going and perhaps even hedging risk in the equity world. Volatility in Cryptos Bitcoin still looks relatively healthy, but Ethereum had a 36% drop in a day. And while it took a significant bounce up, it did also have a significant decline over the last couple weeks and months in some of the alternative cryptos. So we're seeing rampant volatility in certain places right now. While some investors will continue to beat the drum for this gold alternative, cryptocurrencies still haven’t shown the stability of precious metals. Gold is still the original money — real, tangible, and the true hedge against inflation. Protect Your Money With Gold Gold is a powerful safe haven and insurance policy against economic and political uncertainty. Now is the time to reach out to a trusted McAlvany advisor for precious metals investing advice. They are happy to speak with you about your investment goals and strategy for investing in gold and other precious metals. Reach us at 800-525-9556…
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McAlvany Weekly Commentary
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Radical Re-think On Dollar Boosts Gold's Future Read Doug Noland's Latest Credit Bubble Bulletin Read Morgan Lewis' Hard Asset Insights "If the US is to be the primary winner in the restructuring of the global system, it will come at the expense of our trade partners. Think about China and over a trillion dollars in Treasuries. Think about Japan. If that cycle has contributed to the hollowing out of our US manufacturing base, the course he's proposing is one that is decidedly dollar negative. So to boost the value of our trade partners' currencies, to devalue the dollar and rebuild our manufacturing base is a 180 from the conditions that have created our current system of trade and drive our import-export balances to the levels we have. Now, clearly we've got trade deficits on a gargantuan scale. I think we're on the cusp of a major monetary regime change." —David McAlvany Kevin: Welcome to the McAlvany Weekly Commentary. I'm Kevin Orrick along with David McAlvany. Dave, there are times when the guys that we would go to say, "Hey, where is this going to end up?", like Doug Noland or Morgan Lewis or some of the people that help give us instruction. We go, "Okay, so Trump's doing this. Where is this going to end up?" When these guys themselves are saying, "Well, let's analyze it, but I have no idea." That's what it feels like right now, that nobody really knows. What does this look like as we recreate the entire financial and economic structure of America? David: Yeah, the idiom being caught off balance, I think has application because there's not an asset class that hasn't been sort of scratching their head, investors saying, "What exactly does this mean and what am I supposed to do about it?" So yes, there is a sense of being annoyed and disturbed and rattled, and we're seeing that show up in the form of volatility, for sure. Kevin: And that's why it would probably be a good idea for our listeners to go back, if they didn't hear the Tactical Short call with you and Doug last week. It's not only available in recorded form on our website, we'll go ahead and put that on the links, but it's transcripted as well if you'd rather read. David: Yeah. So if you don't want to spend two hours, I think— Last week Doug Noland and I recorded the Tac Short call. There is a brief version of it in the Credit Bubble Bulletin from the weekend. So if you weren't on the call, I insist you take 10 minutes to read this week's Credit Bubble Bulletin. If I told you your financial health depended on it, would you ignore that? And I do think your financial health depends on it. In the show notes, follow the link and just take 10 minutes, read the first part of the weekly Credit Bubble Bulletin. It's the weekly. We do a daily as well, which has the news feeds. So make sure and look for the weekly. Kevin: Well, and just to mention, you're just about to get on a plane, and I love it when you get a chance to go see your dad, I think he's going to be 85 in June, and your mom. But just for the listener's sake, we're recording this one day early, so anything that we say, there'll be a little bit of news events that come before the Wednesday publication of this show. David: Well, the last few weeks, every day there's been news items coming at us fast and furious. But yeah, you're right. My dad's 85 this year. Mom is a spry 78, but with a cancer recovery effort still in play there are even more reasons to be with them whenever possible. So if the events in the call today seem different by the time you're listening, I just wanted you have that context. Kevin: Well, and so let's start putting some things in context because over the last week, we talked about the DeepSeek shock. But we're seeing shocks in a lot of areas: cryptocurrencies, AI, DeepSeek, and honestly a lot of the ramifications from tariffs I'd like to just maybe talk about all of that today. David: Yeah. Last week was DeepSeek and a challenge to the AI narrative....…
Gold and precious metals were largely flat over the week, as broader markets gyrated on AI news from China and the Fed’s decision to keep rates steady. Let’s take a look at where prices stand as of our recording on January 29: Gold is flat at $2,755 from a week earlier. Gold did touch up into its all-time high territory for a moment, but it didn’t reach its record. Silver is sitting at $30.65 — dead even from a week earlier. Silver did have a mid-week dip down 3%, but recovered by the time of recording. Platinum is up 1.5% to $972 from a week earlier. Palladium is down 1.5%, also at $972 from a week earlier. Looking at movement in the broader markets… The S&P 500 is down about 0.5% to 6,040 this week. It did put in a new high as well as about a 2% decline at one point in the immediate reaction of the AI news coming out of China. The US dollar is also dead even at $108. For the first time in quite a while, the dollar did go below $107 for a short period. Dr. Copper Shows Strength in Economy Looking at a chart of copper prices over the past year, the metal has shown a strong pendant formation. And when we look back over the last four years, copper shows its in a rising trend line. The shiny metal is nicknamed "Dr. Copper" because it is an indicator that reflects the health of the economy. With copper’s price rising steadily, the economy is growing stronger. Trump Picks a Fed Fight Trump is blaming Powell and the Fed for high inflation, and he wants the Fed to reduce the target for interest rates. On Wednesday, the Federal Reserve indicated that they would keep interest rates steady and noted the lack of progress toward their 2% inflation rate goal. Cutting rates would further stimulate the economy, increasing the inflation rate and making it harder for people to afford staples like groceries and gas. As we’ve discussed in past episodes, the way to attack inflation is to curb overspending by Congress — an unpopular solution that can kill a political career. One thing that will preserve your purchasing power no matter what move the Fed makes? Turning your dollar bills into gold ounces. Invest in Gold Today Our team of advisors have decades of experience investing in gold and other precious metals, and they can help you find the best strategy to meet your unique needs. They are happy to speak with you about your strategy for investing in gold and other precious metals. Reach us at 800-525-9556.…
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McAlvany Weekly Commentary
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Historic ‘24 Excess Portends Precarious 2025 MWM Q4 2024 Tactical Short Conference Call January 30, 2025 David: Good afternoon. This is David McAlvany. We'll go ahead and get started. This is our January 30th, 2025 Tactical Short conference call titled Historic 2024 Excess Portends Precarious 2025. Good afternoon. Thank you for participating in our fourth-quarter recap. As always, thank you to our valued account holders. We so greatly value our client relationships. With first-time listeners on today's call, we'll begin with some general information. And for those of you unfamiliar with Tactical Short, more detailed information is available at mcalvany.com/wealth/tactical-short/. If you'd like to explore next steps for opening a Tactical Short account or investigate how the service might complement your existing equity exposures, it's a good time to do so. The order of our call today will be my comments on performance followed by Doug's market commentary and then Q&A at the tail end. I have a number of questions already submitted. You may submit further questions to Ted via his email ted@mcalvany.com. And also, for inquiries on Tactical Short and its inclusion in your current strategies, you can also submit those inquiries to ted@mcavany.com. The objective of Tactical Short is to provide a professionally managed product that reduces the overall risk in a client's total investment portfolio, while at the same time providing downside protection in a global market backdrop with extraordinary uncertainty and extreme risk. The strategy is designed for separately managed accounts. It's investor friendly with full transparency, flexibility, reasonable fees, and no lockups. We have the flexibility to short stocks and ETFs and our plan has been to on occasion buy liquid listed put options. Shorting entails a unique set of risks we're set apart both by our analytical framework as well as our uncompromising focus on identifying and managing risk. Our Tactical Short strategy began the quarter with short exposure targeted at 80%. The target was held steady throughout the quarter, focused on the challenging backdrop for managing short exposure. The short in the S&P 500 ETF, SPY remains the default position for this high-risk environment. I'll give you an update on performance. Tactical Short accounts after fees returned negative 1.73 during Q4. The S&P 500 returned a positive 2.39. So for the quarter, Tactical Short accounts returned negative 72% of the S&P 500's positive return. As for one-year performance, Tactical Short after fees returned negative 15.32% versus the 25% return of the S&P, with Tactical Short losing 61.3% of the S&P 500's positive return. We regularly track Tactical Short performance versus three actively managed short-fund competitors. First, the Grizzly Short Fund, which returned a negative 1.64 during Q4, and over the past year Grizzly returned a negative 6.74. Ranger Equity Bear returned a negative 5.71 for the quarter, with a negative 7.97 for a one-year return. And Federated Prudent Bear returned a negative 0.68% during Q4 and a negative 12.32 for the one year. Tactical Short outperformed the actively managed bear funds for the quarter on average by 95 basis points. Tactical Short underperformed over the past year by an average 631 basis points. It has significantly outperformed, Tactical Short has, each of the bear funds since inception. From April 7th, 2017 inception through the end of the year, Tactical Short outperformed each of the three competitors by an average of 1,743 basis points or 17.43 percentage points. There are also the passive short index products. ProShares' short S&P 500 ETFs, which returned a negative 70 basis points for the quarter and a negative 13.51% for the past year. And the Rydex Inverse S&P 500 fund, which returned negative 0.53 in Q4, negative 13.08 for the one-year numbers. And then the PIMCO StocksPLUS Short Fund with a Q4 return of negative 15 b...…
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McAlvany Weekly Commentary
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NVIDIA Loses Over Half Trillion In One Day The World Needs Resources The Fed Can't Print DeepSink Is AI's Sputnik Moment "So earnings growth in the AI space, admittedly meteoric if not miraculous through the early quarters of 2024. Earnings growth slowed considerably in late 2024 and as we come into this year. And if the supply chain for AI is put under the microscope and found to be creating overcapacity, you've got an eerie echo from 1999 and 2000." —David McAlvany Kevin: Welcome to the McAlvany Weekly Commentary. I'm Kevin Orrick, along with David McAlvany. Before we start, Dave, let's go ahead and remind our listeners about the call with Doug Noland this week. David: Yeah, join Doug Noland and me on Thursday afternoon, 4:00 p.m. Eastern, 2:00 Mountain, for the Tactical Short. This is a Q4 recap conference call, “Historic ’24 Excess Portends Precarious 2025.” I announced this call three weeks ago, and the word "precarious” seemed out of place. The comment might not have made sense. Kevin: A little precarious now, though, huh? David: Yeah. Kevin: Yeah. David: Do market conditions seemed more precarious? I think so. Perceptions shift, and with them market pricing does as well. I highly recommend that you join us. If you are inadequately hedged, you can still remedy that. Get informed, register for the call, submit your questions ahead of time, and we'll do our best to address specific issues following the formal remarks. Short exposure has, as you might expect, been the inverse to the markets as they've been rising in recent years. You may not care about short exposure in a rising market without limits, but what about the limits? And what about a falling market? Are you adequately liquid? Do you have a form of financial insurance in place? We look forward to your presence on Thursday's call. Kevin: It's important to talk about hedges. I was thinking this week, Dave, when we saw DeepSeek come out. We can talk about that through the show, but I love South Pole history. I love Ernest Shackleton, or Robert Falcon Scott, or Roald Amundsen, and it reminded me of the story. You probably remember this, but in January of 1912, a very well-stocked team of 65, it started with 65 people. The last five to push to the South Pole for the English, it was Robert Falcon Scott, and four other guys. 65 people, hardware heavy. They had dogs, they had ponies, they had motors that they had to move, but there was a shock when they got there on January 17th, 1912. A Norwegian team had gotten there first. David: Almost a month earlier. Kevin: A month earlier, and they had 19 guys—19 in, 19 out. No one was lost. The Norwegians beat them. It was very light on the hardware. Scott was heavy on the hardware, and unfortunately the five that went in and came back out, all five were lost for the Scott team. So I'm wondering, Dave, if NVIDIA isn't a little bit like the Scott team right now, hardware heavy, and then you had DeepSeek this last week, come in and say, "Hey, you don't need that much hardware." David: Well, it's exactly right. You had a decline of $589 billion in a single day, and that marks the greatest concentrated single-company loss in financial history— Kevin: Wow. David: —in a 24-hour period. Kevin: Almost $600 billion lost. David: Forbes reports, "NVIDIA's nearly $600 billion market cap loss Monday is larger than the individual market values of all but 13 American companies. More than the market cap of titans like health insurer United Health, oil giant ExxonMobil, and retailer Costco. Kevin: Wow. David: And at issue, if Chinese company DeepSeek can do what the large language models do at a fraction of the cost with a fraction of the hardware, then you're looking at the AI supply chain in that Wile E. Coyote moment. Kevin: Wow. David: Gravity is in effect, and so the claim is that this more efficient open-source application was built for under $6 million, uses fewer than 10,…
Gold and precious metals continue their march higher this week, buoyed by continued enthusiasm for the new US president and administration. Let’s take a look at where prices stand as of our recording on January 23: The price of gold is up 2.5%, sitting at around $2,756. That’s only about $35 away from its previous all-time high. The price of silver is up around 0.9% at $30.85. Platinum is up 2.8%, to $960. Palladium is up 3.9% at $1000, just slightly below platinum. Looking at the broader market… The S&P 500 is up about 2% this week to 6,091. The US dollar is down a little over 1% at $108.22. Big Money Bets on Gold Rise The Commitment of Traders (COT) report shows the aggregate holdings of different participants in the U.S. futures market. These are compiled and published by the Commodity Futures Trading Commission in the U.S. COT reports detail how many long, short, and spread positions make up the open interest. Looking at a recent report, we see that far more institutional investors have been betting long on gold futures. Their bets have paid off handsomely, as gold has recovered from its dip to rise back up to record levels. But will the managed money continue to speculate that gold will go up? Or will they start taking profits? Of course, it’s impossible to predict exactly how the price of gold will change. But here are a few scenarios to consider. Scenario 1: A Mild Selloff If there is an unwinding of those managed money speculative bets, it’s possible that we’ll see gold drop down closer to the lows seen in post-election November and December — potentially around the $2,500 per ounce range. If this happens, gold could trade sideways for a few months. Scenario 2: A Shallow Correction If instead there’s more of a correction, we might see gold in the intermediate term fall to a floor. A shallow correction would look like gold dropping to $2,350 per ounce. A deeper correction might be closer to where gold was during the post-pandemic highs, around $2,075. If silver decides to hold around its current level, that would open up a potential gold to silver ratio trade. That’s because the gold to silver ratio would be closer to 52:1 in this case. However, it looks less likely that this scenario would happen. Scenario 3: Untested Territory There’s a good possibility that a correction might not happen at all. And instead, gold would push up to new high levels into uncharted territory. If this happens, it’s possible that gold could climb to a new high around $3,500 per ounce. Looking at recent charting patterns, it is possible that gold could reach these new highs. Which means that investors waiting on the sidelines to catch the next dip would continue to miss out. Should you buy gold right now? The best way to know what would work for you is to consult a trusted, experienced precious metals professional. Get Started With Expert Advice Our advisors have decades of experience investing in gold and other precious metals, and they can help you find the best strategy to meet your unique needs. They are happy to speak with you about your strategy for investing in gold and other precious metals. Reach us at 800-525-9556.…
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McAlvany Weekly Commentary
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Executive Orders Signal Immediate Change Mr. Bond Vigilante Still Has The Strongest Say Uncertainty The Best Driver To Gold "So returning to the executive orders, at the end of page 2, I was saying, "Wow." At the end of page 5, each page with at least 10 executive orders on it, it was awe-inspiring, ambitious in scope, sure to offend, and FDR and Reagan both came to mind. Massive change, very disruptive to the status quo. From a market perspective, I kept thinking disruption, uncertainty. These are things that drive market volatility." —David McAlvany Kevin: Welcome to the McAlvany Weekly Commentary. I'm Kevin Orrick, along with David McAlvany. Well, David, all I can describe is sensory overload. I think about punk rock concerts back in the 1970s through the mid '80s. You had the bright lights, the strobes, you had the loud music, you had all these different things going on, which purposely are trying to create sensory overload. I wasn't really part of that movement, but I remember getting my pilot's license. And the guy who was checking me out was trying to do the same thing while I was flying a plane. Now, if I'm the markets right now, whether you're happy about Trump, whether you're not happy about Trump, but if I'm the markets, how in the world do I know what to do next? David: It's an amazing week. Normally on MLK day, I read a passage from MLK, Jr. and discuss it with my kids. Not this year. We've got the inauguration, the announcement of sweeping changes into the late hours of the evening. I was reading word for word the five pages of links to the new executive orders, redirecting the usual practice and had me a little bit distracted. So we've got the rescindment of 78 Biden-era executive actions. The second executive order stopped bureaucrats from issuing new regulations. The third mandated federal workers return to offices. Imagine that. Kevin: You got to go to work. David: I know. Kevin: You got to go to work. David: Ending government censorship, freezing hiring of the IRS agents, ending some birthright citizenships, signing pardons for 1,500 Jan. 6 prisoners, and then six commutations as a part of that. It goes on and on. Kevin: I told you, bright lights, strobe lights, sounds, it's all happening all at once. David: Yeah. Kevin: And it's presidential. I mean, these are executive orders, Dave. Nobody's voting on this. David: The one word I would apply to the markets going forward—reflecting on the knowns and the unknowns, the intended changes, and really the actual paths forward—is the word volatility. Kevin: Oh, sure. Well, what do you do when you have sensory overload? And again, there may be many really great long-term outcomes coming out of this, but what do you do in the meantime while things are shifting back and forth? David: I'm trying to replay in my mind Sid Vicious soundtracks, cassette tapes—because it would've been a cassette tape. The best way of describing the financial markets in the current context is like a vast casino. And again, you talk about sensory overload. Vegas has gotten a little bit better, even leaving the airport's not quite as loud as it used to be. But our current context is like a casino. You've got high stakes bets. They're rolling through constantly. You've got currency bets and fixed income bets and equity and option bets, cryptocurrency and commodity bets. And all of these bets are based on economic inputs. They're based on external factors which are deemed to tilt the odds in the favor of a certain outcome. Make no mistake, it is a casino and it's no longer clear to the currency players what those external factors are going to be. It's no longer clear to the fixed income players, the options traders, the commodity traders, and the equity operators just how those external factors are going to impact pricing. Kevin: Well, how about crypto? I mean, crypto just has one direction, doesn't it? David: Well,…
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McAlvany Weekly Commentary
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The markets are sitting with bated breath ahead of the inauguration of President Trump. However, precious metals continue to show strength. Let’s take a look at where prices stand as of this recording, January 15: The price of gold is up 1.3%, sitting at around $2,695. The price of silver is up 1.8% at $30.66. It is now comfortably above the $30 mark. Platinum is down 3.3%, to $934. But in the middle of the week, it did hit a high that it hadn’t reached since November 2024. Platinum is stair-stepping up. Palladium is up 5.2%, a big move up the day of recording. at $924, just slightly below platinum. Looking at the broader market… The S&P 500 is up about 1.1% this week to 5,954. It is on an upswing of a downward movement, as it has been stair-stepping down. The US dollar is even this week, hovering around $109.20. But the dollar did have an intraweek high as it broke above $110. If we could look into a crystal ball and predict the future, the outlook right now is one of great optimism There’s a consistent pattern that we’re following according to our election market expectation show. The honeymoon is over, and the markets are settling back into reality — that is, back into the trends that they were in before the election. Economic Watch The CPI report for December indicated that inflation is still hot, rising up 2.9% over the year. The core CPI figure, tracking food and energy prices, rose 0.2%. The markets reacted with enthusiasm, hoping for an additional rate cut by the Fed. The DJIA, S&P 500, and NASDAQ rose up around 2% on the news. Over the last few days, bond yields have been declining while prices continue to rise. Even though yields have declined, bonds appear to be in a holding pattern ahead of the inaugration. Gold to $3,000? For people holding gold, the fundamentals look good. We predict that we’ll be seeing gold peeking above $3,000 per ounce this spring. Gold rising up to $3,000 per ounce in 2025 is a conservative estimate, because that would be a 10% gain at its current price. If you look back over the last 50 years, you will see that gold has been gaining an average of 8.5% - 10% per year. Gold: Silver Ratio Trades As for an upcoming ratio trade between gold and silver, it will depend on whether the ratio widens or narrows to a favorable ratio. The price of silver dipped below $30 a bit earlier in the week. However, silver has bounced back strongly above $30. Silver still has a lot of upside potential, and it is undervalued right now. Industrial demand for silver continues to grow, especially with the development of new EV batteries that rely heavily on the white metal for their manufacturing. There’s also the potential for internal ratio trades — such as trading silver bars for junk silver or silver American eagles. Sometimes, the premiums on one product are significantly lower than for another product, and a trade will give you more ounces without paying for them. Get Started With Expert Advice Will there be a new ratio-trading opportunity coming up this year for you? The best way to know what your ideal next trade would look like is to speak with your McAlvany financial advisor. Our advisors have decades of experience investing in gold and other precious metals, and they can help you find the best strategy to meet your unique needs. They are happy to speak with you about your strategy for investing in gold and other precious metals. Reach us at 800-525-9556.…
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McAlvany Weekly Commentary
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AI Tech Bubble Says, "Feed Me"! How Will Trump Respond To Financial Instability? The Fed Can't Get Longer Maturity Interest Rates To Go Down "This is one of the factors which is super bullish for gold. Bond markets are signaling a divergence for monetary policy, and implicitly saying that either fiscal commitments are already too great or inflation is coming back. Perhaps it's a combination of the two, but either way, yields are telling you where rates are headed next, and it's not lower. The implication is that financial market stability is very much in the cross hairs." —David McAlvany Kevin: Welcome to the McAlvany Weekly Commentary. I'm Kevin Orrick, along with David McAlvany. David, I was just going back and looking at discussions we've had in the past on catastrophe math. Zeeman made that very famous back in the 1960s, 1970s, and what it basically boils down to is, certain factors build to a tension point, like a bridge. A bridge may work for 40 or 45 years and then suddenly collapse. And the question is, is there any math behind that? Is there any predictability in the timing behind that? And you've just brought up in our meeting the sand pile effect, same type of thing. Let's talk about that a little bit because there are some tensions building right now in one direction that can't hold forever. David: Well, first of all, welcome back. You had more eventful weekend than I did, and I'm glad you're in— Kevin: Speaking of catastrophe. Yeah. David: Yeah. You're in good repair, stitches and all. Kevin: Yeah. Yeah, emergency appendectomy, but boy, am I happy that we have a medical system that can actually get that kind of thing out. David: Well, looking ahead to two weeks out, we can put it on the calendar. January 30th, Doug and I will tackle perhaps the toughest analytical mashup ever on our quarterly Tactical Short call. Starting 2025, there is a confluence of major concerns—and this is to your point, Kevin. When you start looking at the various factors, you don't know, considering that sand pile effect, which grain is the culprit for the slide, but there's a confluence of major concerns, whether it's fiscal, economic, financial market—encompassing both equities and bonds, geopolitical and strategic considerations that make this Tactical Short call a feast for the inquisitive. And, I think, full of opportunity, if you are observant and in the markets and agile, assuming you can get a few of these macro themes right. I think the difference could be between your best performance in a calendar year or your worst, and 2025 is shaping up to be very, very interesting. Of great consequence long-term are the impacts on society as a larger expression of your own balance sheet expansion or balance sheet compression because there is a mirror, there is an echo, a reflection. Kevin: Yeah. We just heard Morgan give the update to our meeting today, and he said we have two major, major issues right now, inflation and a debt problem, the interest that we have to pay on our debt. And he calls that a debt spiral. It gets to the point where the Federal Reserve has lost control and we talk about catastrophe. You can have inflation and manage inflation if you don't have too much of a debt problem. You can have a debt problem if you don't have inflation, but when the two come together, it creates a major issue. And I know you've got some other major issues. I would imagine one of the issues you guys are going to talk about is the bond market, which reflects that. David: Well, again, one of the key issues there is with debt being at the level it's at, typically the way that you would fight inflation is by raising rates, except if you're raising rates because of how much debt we already have in play, the interest component is already at an overwhelming level. So to raise interest rates just piles on even more to the deficit via the interest component. And that is unique because typically a debt crisis can...…
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McAlvany Weekly Commentary
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Precious metals started the year strong, with prices rising higher across the board. Let’s take a look at where prices stand as of January 9: The price of gold is up 1.2% currently sitting at around $2,656. Looking back at 2024, gold ended last year strong — moving up about 27% throughout the year. The price of silver is up 4% to $30.11 so far in 2025. Silver rose up 22% in 2024, a good year though not quite as strong as gold. Platinum is up 8% so far in 2025, to $968. In 2024, platinum was actually down 10% — so now it’s about flat from a year earlier. Palladium is up about 2% so far in 2025 at $924, just slightly below platinum. Looking at the broader market… The S&P 500 is up about 1% this week, but it did push up about 24% last year. The US dollar is up about 0.5% to $109.20, also starting the year strong. The dollar index was up about 7% in 2024. Dollar, Gold in Lockstep It is very unusual to have a strong gold market coupled with a strong dollar market. They usually have an inverse relationship, so this is a strange time. In case you missed it, we did a deep dive into the fundamentals of gold investing on our last show. This explains more about how gold moves compared to other asset classes. Inflation Watch It appears as if the market is pricing in expected inflation. If you look at the deficit from the first fiscal quarter of 2024 to the first fiscal quarter of 2025, the US deficit is up over 60% from where it was a year ago. And it looks like it will continue along the same trajectory. The US has a strong economy. Commodity prices are rising according to CPI numbers and inflation is starting to rise. Trump will likely want the Fed to cut interest rates at their meeting in January. A rate cut would drive the credit markets, borrowing and potentially spending. But analysts have noted that there’s less than a 50% change of a rate cut in January because the economic numbers aren’t indicating a rate cut is needed. Gold to Silver Ratio at 90:1 It’s important to note that the gold to silver ratio has shifted again to 90:1 at the close of 2024. The last six times that the ratio has widened that much, there has been a massive rally in silver. The minimum rally in 2024 was a 26% move in the price of silver. In the largest rally, the price of silver gained 79%. So this is a massive opportunity to purchase silver now and see big gains in the near future. Buying Opportunities For silver, the most intriguing product right now is junk silver. Even though silver has been flat to down through the close of 2024, the premiums have come down in that particular product. Junk silver is less per ounce now than the big thousand ounce silver bullion bar. Looking at the collectible gold coin market, US Double Eagles are priced at the same price per coin as Gold Eagles. Fractional European 100-year-old coins are in some instances cheaper than one ounce Gold Eagles. There are some great values right now — if you know where to look. Get Started With Expert Advice Working with an expert in precious metals will help you find the best buying opportunities. If you haven’t had a complimentary meeting with an advisor at McAlvany Precious Metals to talk through your financial objectives, now is a great time to start. Our advisors have decades of experience investing in gold and other precious metals, and they can help you find the best strategy to meet your unique needs. They are happy to speak with you about your strategy for investing in gold and other precious metals. Reach us at 800-525-9556.…
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McAlvany Weekly Commentary
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Interest Rates Rise In Worldwide Competition For Liquidity Mag 7 Stocks Represent 70% Of Trading Volume Gold & Dollar Rise In 2024, What Does That Mean? "Yeah. I mean, breadth is the idea of how spread out the participation is in a market move to higher levels. Are all boats rising with the tide or just a few? And when you have narrow breadth, it's just a few names participating. It's not a good sign when breadth is narrow in only a few names—70% of trading volume in seven names, 20% of global market cap. Breadth this narrow is, to say the least, worrying." - David McAlvany Kevin: Welcome to the McAlvany Weekly Commentary. I'm Kevin Orrick, along with David McAlvany. Well, David, where the holidays fell this year—Christmas on a Wednesday, New Year's on a Wednesday—with my travel plans, with my kids' travel plans, I honestly feel like, well, happy New Year. It feels like the holiday was about a month. It was wonderful. It was wonderful. But gosh, it's sort of nice to be back in the pattern. David: It is good to be back. I love the holidays. I love the guests and hosting parties. I love the family time and the change of pace. And I love getting back to routines as well. As the new year starts, there are the common reflections on the past year and anticipations or goal setting for the new year. And everybody has prognostications of what will be in 2025. I feel this with clients, the number of requests to do financial planning reviews, how are we doing. It increases dramatically in the first quarter. And I encourage you to do that as well. The next four years are likely to have surprises geopolitically, economically, and in the financial markets. And I think getting your bearings is a good idea. So whether it's a quick look at how you're balancing liquidity, precious metals, growth and income assets, real estate, or factoring in new situations like retirement, a new job, other new variables, our staff are a great resource to bring perspective and counsel. Kevin: Well, and you know, Dave, I dream triangles. Okay? I love the triangle, the foundation, the preservation element, and then of course the left side, which has to do with growth and income, and the right side, your cash savings. And that's what I encourage my clients to do. I have, I think, trained— We talk about habits and how you can train yourself in habits. You can also help train others to have good habits. I've been really thinking about this. One of the great habits of what we've done is we draw triangles and we do that analysis, the how-we-are-doing analysis. So that's what I would encourage our clients to do too. I've got my clients calling me right now and saying, "Hey, let's do a triangle update." David: Yeah, I think probably the underemphasized portion of the perspective triangle for most investors is the metals piece. We think of it as insurance, that's the role that it plays in an overall portfolio. From a practical standpoint, it's there as a reserve. And you don't know you need the reserves until you need the reserves. We're watching a lot of currency volatility, 2024, and that's a big question. When do these countries who are defending their currency, supporting their currency with tens of billions of dollars, sometimes in a week, when do they run thin on reserves? That's when you end up with real currency crisis. You can get through any kind of crisis—whether it's an emotional crisis, a spiritual crisis, a family crisis, a financial crisis—if you're adequately reserved, and I think that's worth taking stock of. Kevin: You know, Dave, that's a great point as far as reserves emotionally, spiritually, financially. I remember I was walking out to the car the other day, and sometimes in the first of the year I can also feel a heaviness. It's like, "Wow, what have I got to do this year? There's things I've got to do." I felt this heaviness, and I realized I had forgotten to be thankful.…
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McAlvany Weekly Commentary
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Morgan Lewis answers your question on Gold Recycling/Dollar Recycling Philip Wortman on Crypto and Gold What indicators does David McAlvany look at consistently? Welcome to the McAlvany Weekly Commentary. Happy New Year! I'm Kevin Orrick, along with David McAlvany. Well, I sure enjoyed the questions last week, Dave, and look forward to what you have to say on the questions this week. We're never disappointed, are we? David: No, and I'm grateful to be closing out another year with the Weekly Commentary. Kevin, thank you for your efforts throughout the year. I enjoy the engagement with our audience and am grateful for the questions that have been sent in. You know, some of the questions are beyond what I have the capability to answer, so we bring in Philip Wortman and Morgan Lewis to tackle a couple of the ones that are just right down their alley. Kevin: And I'm looking forward to that. Well, tell you what, let's just go ahead and get started. Jeff asks, "Do you see the stock market correcting, and if so, when will that happen? And will it be a minor correction or a large pullback?" The second part of the question is the commercial real estate market, Dave, in America. "Is it still in trouble? If so, how will that affect the banking system? And thanks for your efforts in putting the weekly podcast together." That was Jeff. David: The answer is yes. No idea when we have a market correction. We just know the context is set, and by any measure valuation, it will happen. When is, of course, the billion-dollar question. A '30s-style crash? I think that's less likely. A '70s-style crash, where performance in real inflation-adjusted terms ends up over a course of time being as grave as the 1930s? I think that kind of pressured environment is more probable. So it's either large and all at once, or less extreme—minor, if you want to think of it in those terms—extended, and excruciating over time because of the impact of inflation. Commercial real estate, there are really big refinance needs in 2025. Estimates are between one and two trillion dollars, and so it makes sense that we would see pressure in commercial real estate. But I think it obviously depends on liquidity dynamics at the time. Your ability to refinance that debt, if it is with commercial lenders or if it's in the private markets, it all depends on the current liquidity dynamics and financial market conditions at that time. Part of the commercial real estate market is finding a bottom, part of the commercial real estate market has yet to materially correct. So if we assume that there is another leg or another segment within that asset class—commercial real estate—then I think your banks—commercial banks—will see a lot of stress on their CRE portfolios. Kevin: Dave, this next question reminds me of a conversation I had with a client the other day. He said he's got a Wednesday morning ritual. He pours a cup of coffee, he listens to the Commentary every Wednesday, and I was surprised at how many people do that. They have rituals for actually sitting down and listening. So James—this question reminded me of this—he said, "It's been great listening to the show over the last few months. It's become part of my Wednesday morning routine at this point. I've got a few questions, no pressure to answer any or all of them." Dave, I know you're probably going to answer them, so I'll ask you the first one. "Are there any often overlooked market indicators that you'll be paying attention to in 2025?" David: Well, I love the rituals. It also reminds me of a friend of ours, a client of ours in Mexico, and that's a common thing. Friday evening at the end of a work week, popcorn, a glass of wine, and the Weekly Commentary. Kevin: That sounds like fun. David: And he and his wife have been doing that for the better part of 15 years. Kevin: Wow. Wow. So what are you looking at in 2025? David: Yeah. Yeah,…
With this mid-week Christmas break, we won’t be going into the usual analysis as we normally do. Instead, we’re going to dive deeper into the fundamentals and a recap of why gold is a great investment tool. Regardless of what will happen economically or geopolitically, some things don't change and those fundamentals are what really move the gold price. Despite a lot of volatility in different investment categories and what policy makers do, gold responds and reacts to underlying fundamentals. Who Buys Gold These Days? There’s a misconception that people who buy gold are somewhat “weird.” And while you might hold a greater percentage of your portfolio in gold if you lose faith in the system, there’s nothing strange about owning gold. Investors buy gold because they want to have real money that’s valued anywhere. Gold is recognized everywhere around the world. You can get on an airplane and fly anywhere in the world, hold up a gold coin and smile. Even if you don’t speak the language, people will know that you’re friendly and you have money. It’s a universal language. Preserves Your Purchasing Power Gold today will buy what it buys in five years regardless of the price. It's a constant store of value. It hasn't changed. Our friend Kevin Orrick on our McAlvany Weekly Commentary talks about how an ounce of gold buys a loaf of bread every day for a year. It's done that for thousands of years, and it still does today. If you’re considering owning gold, it’s smart to think of it as a legacy investment, something that you can hold. Insurance for Your Portfolio Gold is often described as insurance for the rest of the portfolio, but aside from the Justin Case, you went into all these different things that are, because it's guaranteed. Just look at the track record of gold over the years, and you’ll see that it is asset preservation. Tangible and Real Gold gets you out of “paper promise” assets into a tangible commodity. We're not talking about ETFs, mining shares or stocks. We're talking about owning physical coins and bars in various forms in and through various vehicles. It could be in your IRA or in a regular account in a vault. Tangible precious metals also provide a privacy component in the instance that you are holding it at home. What Moves the Gold Price? Most factors that move the price of gold have to do with fear or greed. For example, geopolitical fears such as global instability and threats of war — when the future looks uncertain, fear drives demand and increases the price. Another example is central bank demand — What do they know that we don't know? Why are they stocking up on gold? Obviously they're looking at the same things we see, but thinking, “wow, I don't like what I see. I think I'm going to increase my allocation to gold.” How Much Gold Should You Own? If you want to fund your retirement with gold, the best way to think about it is how much you will spend per month. What's your burn rate? You need to know your projection as well — do you need something like a 10 year or a 20 year annuity? When do you want to retire? You can then put that amount into ounces of gold. For example, if you need two ounces or three ounces a month to live, you start accumulating that ounce by ounce. The other way to look at owning precious metals in our Investment Triangle model. A third of your liquid wealth should be in physical gold. A third on the left hand side of the triangle is for growth and income. A third on the right hand side of the triangle is liquid Add Gold Ounces Today Call us at (800) 525-9556 so we can speak with you individually and walk through your own portfolio. Our team of experts can help you understand the whys and the hows with acquiring gold.…
Kevin: Welcome to the McAlvany Weekly Commentary. Merry Christmas and happy Hanukkah. I'm Kevin Orrick, along with David McAlvany. Well, David, it's fun recording these programs. I had lunch with your son, who is a freshman in college, and I told him, "I'm thinking back 25 years, 26 years when we had lunch together, and what's happened, and then, before that, me working for your dad." What's amazing is these conversations have turned into the Weekly Commentary. And as I was talking to your son, I was thinking, wow, no wonder. There's so many interesting things to talk about, books, the things that we've studied, just our thoughts and dreams moving forward. The questions that our clients ask, I was reading through them and I was thinking, they're really family. Don't you feel like this is sort of family? David: Oh, I do. It's an extended conversation. It's a lot of what we experience, the two of us, when we get together for the regular Commentary meetings on a Monday afternoon and evening. Some of the questions are beyond what I have the capability to answer, so this will be the first Q&A that we bring in Philip Wortman and Morgan Lewis to tackle a couple of the ones that are just right down their alley. Kevin: I'm looking forward to that. Well, tell you what? Let's just go ahead and get started. And I hate to start saying that John Maynard Keynes might be right on something, but here's the question, "Dear Kevin and David, John Maynard Keynes was a complex human, but one thing he got absolutely right was the relationship between macroeconomics and wars. You and Doug (Doug Noland) have been warning of macro risks in China for years now, and we see those warnings playing out in real time. However, as China's economy falters, so does their ability to invade Taiwan. Are the Chinese still serious, and are they a serious military threat to Taiwan? Thanks, Seth." David: Well, thank you Seth. Yes, the Chinese economy has experienced much slower growth, and their primary source of growth has been impaired for many years from the real estate sector. And even now we're beginning to see yields on those companies, so their borrowing costs—numbers that you just can't even wrap your minds around. The very best case scenario is Vanke going from 17.5% to 21.5% just in the last two weeks. And then, on top of that, you've got other yields for companies that are 500%, 1,000%, 12,000%, and higher. So it's basically saying, in that sector, is game over. They do still maintain GDP growth well above that of the U.S. Even if you discount the official statistics by 30 or 40%, I would argue that the case for war does not go away. In fact, it increases with economic desperation. There's the aspect of public distraction on the one hand, playing to nationalist themes, and there's also the positive impact to youth employment, what is today an unemployment problem, both inside the military via conscription and in manufacturing employment growth, as well, for military hardware. So discouraged and unemployed youth need purpose. Low levels of inflation in China also leave them with the latitude to increase spending and money printing with less immediate negative impact to their consumers. Gas war is inflationary, so that's one other aspect of that John Maynard Keynes macroeconomic connection between war and the economy and macroeconomics, but the deflationary malaise they've been locked in is creating a dynamic which increases social and political pressure domestically. Thus far, they've not announced any radical fiscal measures to break that trend, and so I think it's worth keeping in mind that war could very well be an opportunity to redirect that negative attention. I think they understand the global demand for semiconductors and other manufactured goods from Taiwan. They may be inclined to invade Taiwan as if it were a hostile takeover of an industry or company. Not everyone's happy about a change in management, but your suppliers,…
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McAlvany Weekly Commentary
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1 Markets React Sharply to Fed’s Rate Cut: What It Means for Gold 10:20
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Remarks from the Federal Open Market Committee meeting after an expected rate cut rocked the markets, with major indexes falling across the board. Let’s take a look at where prices stand as of December 18: The price of gold dropped to $2,560, or over $100 from a week ago. However, it’s still holding above the November lows and nowhere near longer-term correction levels. The price of silver broke below $30, dropping to around $29.21. It did break below short-term support levels and to the deep 786 fibonacci level on the market push since August. The US dollar rallied sharply above $108 after the Fed announcement. The Dow Jones Industrial Average fell 2.6% or 1,123 points. The S&P 500 fell 2.9% on the news. The Nasdaq Composite declined 3.5%, its worst day since July. The Dow Transportation Index fell 2.75% on the fed funds news. It was down over 10% since its November 25 high. Powell Rattles Investors Sentiment around the Fed’s expected 0.25% rate cut was dampened by hawkish remarks from the Fed Chairman. Markets expected to see four additional rate cuts in 2025, and were surprised when Jerome Powell remarked that, “We think the economy is in a really good place.” In one instance, the Fed noted that there would be at most two more cuts. A cut in the federal funds rate does help make banks more competitive. However, it has not translated into a decline in the 10-year yield on Treasurys. Nor has it dropped the 30-year mortgage rate to stimulate the housing market. Precious metals also declined, opening up a potential buying opportunity for investors looking to add to their ounces of gold and silver. Gold to Silver Ratio Widens With the latest dip in the gold and silver prices, the silver to gold ratio now stands at 88 to one. With silver’s drop disproportionately larger compared to gold, this is a new opportunity for investors to take a position in silver. Adding more ounces of silver on a dip will potentially open up a ratio trade to shift silver ounces into gold when the ratio narrows again. Typically, when the ratio widens as much as 90 ounces of silver equal to one ounce of gold, silver will then rally. So this is a rare time to get in at a good price. Year-End Fundamentals Wrap If you want to know a little bit more about why gold reacts the way it does, sometimes predictably, sometimes unpredictably, we'll discuss it next week. We will go into a deep dive on what causes the gold price to move in the short and the long term, and all those underlying fundamentals. Call for Expert Guidance The McAlvany Precious Metals advisors have decades of experience investing in gold and other precious metals, and they can help you find the best strategy to meet your unique needs. They are happy to speak with you about your strategy for investing in gold and other precious metals. Reach us at 800-525-9556.…
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McAlvany Weekly Commentary
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S&P 500: More Declines Than Advances Every Day In December China Adds 160,000 oz of Gold Send Questions To info@mcalvany.com "We're at this moment where, again, credibility gets thrown out the window for the Fed. And I think that is the final stage of a bull market in metals, where your central bank credibility is lost and investors go scrambling in an effort to survive a loss of purchasing power. And I think in this case, you're also talking about ramifications that are well outside of any central bank's control, and that is geopolitical issues." —David McAlvany Kevin: Welcome to the McAlvany Weekly Commentary. I'm Kevin Orrick, along with David McAlvany. Dave, before we start, let's just remind our listeners this is the last day to submit questions for our upcoming question and answer programs over the next two weeks. So those questions can be sent to: David: Info@mcalvany.com. Kevin: Yeah, info@mcalvany.com. Well, I'll tell you what? This has been a great week. I feel like I lived a month through this week just because of your birthday. What an amazing celebration at your house, various nights. But I was very honored to be invited to meet some of the people that you knew back in college, Dave, relationships that you've kept going all these years. David: Well, actually we had friends that came into town and some of those relationships go back 50 years. So we covered every decade from when I was a wee small lad to still a truncated and underdeveloped wee small lad. I was a late bloomer, so it was about college before I actually added a little bit of height. So then the timeframe of developing college friends and then professional friends, and it was a phenomenal week. Kevin: Dave, it wouldn't surprise our listeners to know that the people who did fly in for your birthday, who you had affected earlier in life, [The Intentional] Legacy is the name of the book that you wrote about—just what we're all about. And I listened to your friends. Some of them I had heard about, but I had never met. And I listened to them each saying, "Hey, this is how you affected my life." And it was very poignant because I realized there's just been a lot to you all the way back. And at the end of the evening with these friends who had known you, well, one of them had known you since you were a child. He's a professional musician. And he pulled a guitar off the wall, very impromptu. He took the first two minutes to tune a very out-of-tune guitar—so it was very impromptu. But what he did was amazing to me. He sang the various stories that people had told throughout the night at the dinner table. He wrote a song and sang it. I could tell it truly was a gift, but talk about a poignant moment. That was completely unexpected, and I really had no idea somebody could do that. I mean, I don't think he forgot a single story. David: Yeah, it was very special. Family and friendship have played a central part in the last five decades, and I can't imagine the future much different than that. So spending time with friends from across the country, very special week. Kevin: Okay, so we're going to get into business here. This is the week of the Fed decision. And inflation hasn't gone away, Dave, and things feel awfully loose for loosening of the interest rate. What do you think? David: We are in a new world. People know who Jerome Powell is. There was a day when the Fed chief was anonymous. Nobody took the time. Nobody really cared. But this week is particularly important. The next Fed decision is here. The bond market's pricing in 97% probability of a 25 basis point cut, a quarter of a point. But the interesting trend remains that in spite of rate cuts dating back to September when this cycle started, interest rates like the 10-Year Treasury have been on the rise. So 3.63 on the 10-year was the yield then, in September, and reached a peak this week of 4.44. So 79, 81 basis points roughly,…
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McAlvany Weekly Commentary
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Rapid Middle East Re-Shuffle With Assad's Exit Invisible Hand Of Free Markets VS Tariff Strategy Send Questions For Q&A Program To info@mcalvany.com "There's a long period of status quo. It was upturned quickly. In this case, you had the Gaza conflict in Israel's engagement with Hamas and Hezbollah. And then we have the Russian invasion of Ukraine, which, you look at these two factors, and they actually inadvertently blew up the 54-year-old regime in Syria. Without Hezbollah on the ground, without Russia in the sky, Assad could not keep the reins of power. So, yeah, timing is everything. Things change quickly, and I think we have to be honest with ourselves when things do change." —David McAlvany Kevin: Welcome to the McAlvany Weekly Commentary. I'm Kevin Orrick, along with David McAlvany. Well, David, today is your 50th birthday, and sorry, I just have to betray the age, but it's pretty darned exciting to have you sitting here and realize that I've known you since, what, you were 12. David: It's been a few years. Kevin: We've had a few Taliskers together. You studied for your pilot's license over at our house when you were just— David: You taught me how to fly-fish. Kevin: Fly-fishing. That's exactly right. But I couldn't wait. I had to give it to you unwrapped. I got you a copy, and one of our clients actually knows about this. I've shared with him just the other day that I found a copy of The Wealth of Nations by Adam Smith, written in 1776, but this was the published date: 1818. It's an amazing copy. You can tell the people who owned it ahead of you, Dave, from 1818 on. They treasured the book because they have marginalia in there and notes to themselves and little clips from articles and magazines from the 1800s that they pasted into the book that added to the commentary of the book. So I was just extremely excited to have you see this. David: It makes me wonder what happens to the books that I've read and the notes that I've made in those books. I don't know that anyone will appreciate the conversations that I've had with the authors, the way I have enjoyed and engaged and appreciated them. Kevin: As you write marginalia in your books. David: Yeah. But I mean, there is a hope that, like this, a couple centuries later, you get to look and say, that's the point, isn't it? Here's the conversation. Here's what he picks up. There's the debate. He nailed it. This is where he engages with the author. And no, Smith's not right on that point. So the engagement, the challenge, the debate, it's pretty cool to see it in the margins. Kevin: Well, and we've been talking about, with Trump coming in there are a lot of applicable things that we can be looking at because right now there's talk here in America of tariffs. Adam Smith addressed tariffs, and you've interviewed Michael Pettis, who recently has written about tariffs, and I don't know that he necessarily agrees with Adam Smith in all occasions. And so wouldn't it be fun if the two could debate each other and actually say, okay, Adam Smith's saying, "No, it's the invisible hand, not the government." And Pettis going, "No. Sometimes the government can get away with it." What do you think? David: Yeah, well, just as a reminder, real quick before we dive in there, we have our Q&A coming up, and so if you would submit questions, would love to engage with you as best we can. Send those over to info@mcalvany.com. That's info@mcalvany.com. If there are questions of a metaphysical nature, I probably will leave those for a private conversation with you. Let's schedule some time. If it's economics, if it's finance, if it's international relations, public policies— Kevin: Scotch recommendations. David: Oh, certainly, we can certainly— Yeah, the merits of peat, let me tell you. Kevin: But talking about timing, what kind of week do we have? What kind of month do we have? We've got a new president coming in here in just a month or a little ...…
Precious metals slow down their climb, but continue to show strength after the Thanksgiving break in the US. Let’s take a look at where prices stand as of December 4: The price of gold inched up about $12 from the previous week, still hovering around $2650. The price of silver is up 4% or $1.20 from a week earlier, to around $31.50. Platinum up about $17, or a little under 2% from the previous week. Palladium about $8, or just under 1% from last week. Looking at the broader markets, most of the major indices are sitting at new, strong highs leading into the holiday season. The S&P 500 is up 81 points, or 1.3% from the previous week. The only exception is the Down Transportation index. The Dow Transports is down 470 points, 2.5%, from the previous week. They are almost back to the November 2021 all-time highs. Gold Continues Predicted Path As we discussed before, the price of gold dropped 13% during the last Republican president term in 2016. But six months later, it rebounded and caught back up to where it was trending. Now that Trump has been elected again in 2024, we are seeing a similar trend. While gold hasn’t dropped quite as much yet, the price has declined about 9% since election day. Looking back further, that’s about a 50% retracement in this last breakout pattern. And while there’s still a chance that gold will drop further in the short term, we don’t expect the lower prices to last. It’s likely that gold will rebound in 2025 and reach a new all-time high around $3,000 or higher. Trump, Musk and Spending Cuts The new administration has promised to make dramatic changes to help reduce excessive spending that’s contributed to the massive US debt. To that end, Trump is bringing in Elon Musk and Vivek Ramaswamy for a newly-created Department of Government Efficiency (DOGE). These two entrepreneurs are tasked with cutting wasteful spending and finding ways to restructure the bloated bureaucracy. It remains to be seen what they will actually cut. Meanwhile, Trump is also pushing for additional interest rate cuts to get more money back in the hands of the people. He is essentially ignoring the long-term inflation problem with a short-term solution that will make his administration look good. If they really want to get the problem under control, they’ll need to do what no one wants to admit needs to be done — and that’s cutting spending AND raising taxes. When to Buy Gold? Given the geopolitical situation and the US financial situation, it makes sense to begin dollar cost averaging ounces of gold with cash sitting on the sidelines. Gold is not affected by inflation, and it allows investors to preserve the purchasing power of their hard-earned money. Purchased consistently every two weeks, it allows investors to stockpile ounces of gold over time. Build Your Gold “Retirement Annuity” How many ounces do you feel like you need to have set aside when you come to retirement? Do you expect to need a 10-year or a 20-year “gold annuity”? For example, if you know that you’ll need two ounces of gold each month to cover expenses, you can plan how many ounces you will need to accumulate. Now is the time to start stacking ounces of gold. The easiest way to do it is to automate your gold and silver investments through our Vaulted app. Get Guidance from an Expert If you haven’t had a meeting with an advisor at McAlvany Precious Metals to talk through your financial objectives, now is a great time to start. Our advisors have decades of experience investing in gold and other precious metals, and they can help you find the best strategy to meet your unique needs. They are happy to speak with you about your strategy for investing in gold and other precious metals. Reach us at 800-525-9556.…
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McAlvany Weekly Commentary
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Falling Yields Globally May Be Signaling Concern Rising Stocks & Cryptos Show Bulls All In Send Questions For Our Q&A Programs To: info@mcalvany.com "I think there's perhaps too many currents swirling together today, just under the surface, to sort out precisely what's happening in the markets. What is undisputable is that credit markets globally have moved to unsound levels, and a variety of pressure points and vulnerabilities, areas of uncertainty, exist in the spheres of public policy, of fiscal policy, and international relations. And so, on the surface, you have a host of catalysts for consequential movement within the markets." —David McAlvany Kevin: Welcome to the McAlvany Weekly Commentary. I'm Kevin Orrick, along with David McAlvany. David, before we get started, let's just announce to our listeners that we would love to hear their responses, their questions. Every year, toward the end of the year, we ask for questions. We ask that you keep them short, something that we can actually read in a short way, and then answer. And so we would ask our listeners to just send that to info@mcalvany.com, and over the next few weeks we'll gather those. And Dave, I know you put a lot of time and effort into every question, so it's very much appreciated. David: Every year gets a little harder. I feel like it's a competition of stump the chumps. The questions get better and better, the answers get thinner and thinner. Now, we'll do our best to put something together that's coherent and reflective. Thanks for sending the Q&A material over. We'll do that on Christmas Eve and New Year's Eve. Just send your questions to info@mcalvany.com. Kevin: Yeah, and just to reiterate, please do keep the questions just to a few lines, because we try to get through everything in several weeks. You know, Dave, you and I, when we were sitting down—and I love the fact that we have our meetings at Table 30—we're 17 years in, but they were out of Talisker last night, but we had Lagavulin instead. So we sat down at Table 30, we had our Lagavulin, but I think we both were on the same page. There's a lot of noise going on right now, and some of it's information with meaning, some of it's information without meaning, and it's an exciting time because there is a change in the wind. But a lot of times when you have changes like that, it's hard to analyze the data. David: Yeah. Times we can stretch our limits in terms of inputs, and for the child with Asperger's, sensory inputs can aggregate and then overwhelm. For the average inquiring mind, my own included, there's a lot of complexity embedded in price trends today, pick your market. There's a lot going on. Not all of it is cohesive and coherent. A lot of it is contradictory or at least sufficiently complex enough to keep you second-guessing real hard conclusions. So what we do on a weekly basis as an asset management team, we review—twice weekly, actually—a spreadsheet with over a hundred financial market variables. These oscillate minute by minute, and they indicate all the nuanced shifts within the financial markets. They provide us with a mosaic very much like the tiled art with a million pieces that in aggregate create a theme. And some days the theme is clear. Other days, all we have is movement with the meaning piece remaining a little bit elusive. Kevin: You and I were talking about Doug Noland last night, that he's got some disciplines, models, that he follows. That can be very, very valuable in an environment of noise. And I remember, Dave, you and I for decades read a wonderful market analyst named Richard Russell. He also had a model that he used called the Dow Theory, and there were times when he disagreed with what his model was saying, and there was still the human element. In other words, it wasn't just an algorithm everybody followed. I think Doug and the team do the same thing, don't you? There's models that you follow that tell you certain things to do.…
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McAlvany Weekly Commentary
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Top Execs Selling 5x More Stock Than Buying Goldman Sachs Calls For $3,000 Gold In 2025 Will Powell Drop Rates Again? "The Wilshire 5000 to GDP, this is a modified Buffett ratio. It touched 202% last week, which is an all-time high. It's a measure like the Buffett ratio, covers the aggregate of 5,000 companies, telling us something. There's notable insider selling. Five to one is the ratio. Actually, just above five to one. Historically, to be fair to the executives who are doing this, they're not making a market call today. They get to a period where they're comfortable and they want to get liquid, and they're usually two to three quarters early before a major downturn. When you see a significant uptick in insider selling, that's two to three quarters. You're on notice." — David McAlvany Kevin: Welcome to the McAlvany Weekly Commentary. I'm Kevin Orrick along with David McAlvany. Well, David, you did it. You did it. You're down in Texas and you told me you were going to do a Spartan race, but I haven't seen you training like I had in the past. How'd it go? David: Not training like I have in the past. How about not at all? It's been a nice 18-month break. The annual pilgrimage to Texas, it's here, it's arrived, like other holidays we spend feasting and celebrating together as family. The special highlight for this one is my second son's birthday. He turned 16 over the weekend. Kevin: Wow. David: On his birthday, he requested that we race together something called an OCR or obstacle course race. You mentioned it, the Spartan race to be exact. Kevin: Okay. If he's turning 16, you're just about to turn 50, aren't you? David: This is a huge year for us. My oldest turned 18; the next, 16; the next, 13; the next, 10, so we're out of single digits. My wife and I celebrate our 25th anniversary, and it's my 50th birthday in about 10 days. Yeah, this is a big year for us. After watching the Tyson-Jake Paul fight a few weeks back, I figured we might have another version of the old lion being surpassed by the young lion. Again, maybe I'm just feeling a little unenthused turning 50, but we did both bleed a little. It was not a competitive race between the two of us. It was just a great day. We ran, we suffered a little, we started and finished as a team, and we hopped over prickly pear in quantities I've never imagined, working through the 25 obstacles over the course. And then the course is about six and a half miles. We got to the end and they gave us this interesting pitch as we crossed the finish line, "Do you want to do an extra mile?" It was like one of those fear of missing out moments. He was like, "Sure, I guess we'll just run an extra mile," but it was a great memory maker. Kevin: And you did that. You did that. Well, that's awesome. I remember one of the people here at the office, Dave. I won't name them. When we were doing the Half Ironman on the big island in Hawaii, the last part of the run was looped. I remember we all had to run two loops. Remember that? David: Oh, yeah. Kevin: You patted me on the back and you passed me quickly. But one of the members of our team thought the loop was just once, not twice. When she got to the finish line, they said, "Oh, no, you need to loop again." That was a miserable feeling. Running that extra mile, I can see that, but if you recall, I think that was an extra six and a half miles for her. David: That's right. That's right. Kevin: Yeah. Let's take it to the economic side of things, talking about running the extra mile. Dave, we were doing this commentary back in 2008, but after the global financial crisis was really playing itself out to look like it was going to be a depression, there was a choice to be made. Do we let the depression happen—which usually is the best thing to happen because you come back out of it? We've talked about other depressions in the past where, if left alone, you come back healthier, not in bad shape.…
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McAlvany Weekly Commentary
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Precious metals continue to follow the playbook laid out by our analysis of a Republican presidential win. Let’s take a look at where prices stand as of November 20: The price of gold is up about 4.3% or $108 to $2,650 from last week, a really nice bounce up in a week. The price of silver is up 3.9% or around $1.15 at $30.86 from a week earlier. Platinum is up about 3.6% or $33 to $958 from a week earlier. Palladium is up 12.5% or $113 to $1,024 from the prior week. That’s a nice recovery from last week’s dip of 5.3%. Copper's up about 15 cents, or around 3.8% to around $3.80. There’s a good chance copper will reach $4 in the next few months. Looking at the equities markets… The DJIA is down 1.5% or 670 points to around 43,200. The S&P 500 is down 80 points or 1.3% to around 5,920. The Dow Transports is off 600 points or 3.5% since last week. The US dollar index is up 7% since October, or 3.5% since the election with a strong bounce off the trading range floor. It’s now pushing up against the ceiling. The Meteoric Dollar Rise The rise in the dollar right now is insane. What’s driving it higher? When you look at where it’s going, it’s knocking on that ceiling right now. This rise isn’t just an influx of money from Asia because of Chinese concerns. And it’s not just the average American thinking Donald Trump will be better for the US dollar. It may also be the flight of capital coming out of Europe due to fear. While the BRICS alliance is trying to put up a strong front for a new BRICS currency, it is not a done deal. It takes a long time to compete with a global reserve currency. Just look back at how the Euro evolved. It was proposed in the 70s and 80s, but it didn’t become the powerhouse currency that it is today until the mid 2000s. With respect to BRICS, there was some infighting between India and Russia and China about how India would pay for their oil. China demanded it be settled in Yuan. Instead, India left the deal to settle it in dollars with the US. So there’s no real agreement yet with the BRICS currency. Gold Doesn’t Follow The Dollar There may be investors out there that believe that gold will correct and go lower — and that will be their entry point. But that’s not what we’re seeing from our years of analysis. Gold isn’t supposed to follow the dollar. But with the dollar at $107 right now and gold at $2,650 per ounce, it’s because of the sheer magnitude of money printing over the last decade. It represents the number of dollars in circulation. The velocity of money is picking up the US dollar. If there’s also economic stimulus with a Trump economic plan, we’ll likely see the dollar rally and gold would follow suit if this is driven by geopolitics. Don’t Miss Out on Gold While China and other international markets have been heavily investing in gold, Americans have been missing out. If you don't own gold yet, now is the time. Get your position now. If there's pullbacks, buy a dip. But the bottom line is you don’t know what gold's going to do. Trump is not the save-all cure- all in these markets. The McAlvany advisor team is here to help guide you. With decades of experience in precious metals investing, they are happy to speak with you about your strategy for investing in gold and other precious metals. Reach us at 800-525-9556…
Trump Is Not In Yet & He's Already Being Blamed Pre-Election October Deficit Largest Ever Ukraine Strikes Into Russia With U.S. Approval & Hardware "I think without tariffs as negotiated and leveraged on other items we lose the power to encourage energy imports from the US. It's the art of the deal. Economists may worry about the inflationary impacts of tariffs, and to the degree that we see it—see that inflation—I think it's going to indicate that Trump didn't get what he wanted. What he really wants is to address the balance of payments deficits via exports, not via penalizing imports." —David McAlvany Kevin: Welcome to the McAlvany Weekly Commentary. I'm Kevin Orrick, along with David McAlvany. David, I did something sort of strange this weekend. I really focused on a year, 1818, because I had heard about the second US central bank tightening credit when inflation was running away. The American economy was booming at the time. People were taking huge debts and buying land, and they were exporting produce to Europe, which was war-torn because of the Napoleonic Wars. So America was booming, but the problem was the debt was creating a lot of growth that wasn't real, that could not be sustained, and it was creating inflation, to be honest with you. And so the head of the second US central bank—we've had three tries at the Federal Reserve in one way or another—went in and just basically tightened credit, and he said, "No more loans." And he called his debts in, and it created what I had not really paid much attention to. It created what they call the Panic of 1819, and a very, very severe depression after that. So we went from, it was called the Era of Good Feelings at the time, to actually one of the worst depressions America's ever been through. And I'm thinking right now, you had a call this morning with an international client who said, "You guys actually are looking like you have a pretty strong economy." But is that being run by a basis of something that can be sustained or is it just purely debt, Dave? David: Well, that's the key. I think when you look at GDP growth, the Atlanta Fed puts their GDPNow number together. It's been coming down a little bit, but it's still, say 2.5%, and the larger figure compiled is 2.8%. So GDP growth just shy of 3%. Now the question is, what would that number look like if you sucked out $2 trillion in deficit spending? Because government spending is a factor in GDP, and there's no distinguishing between debt spending—deficit spending—and just regular old spending. It's economic activity. So it does look pretty good. It reminds me of many years ago. I lived in Los Angeles, and I tell you what, at least 50% of the people who owned BMWs and Mercedes lived in really cheap apartments. They could not afford those cars, but it was what they had to impress the ladies, and they lived on a larger scale with perhaps an ulterior motive. They needed to prove something. And so you live beyond your means so that you can make an impression. Kevin: Well, and a lot of times you can afford something you can't afford for a little while just based on monthly payments. William McChesney Martin, who basically said it's okay to pull the punch bowl back before the party gets out of hand, and we really have left the punch bowl out continually, haven't we? David: Yeah, absolutely. So you've got today the run-up to unsustainable valuations in the stock market. These valuations, it's pretty easy to ignore them because mainly people are making money and they're playing the momentum game, which packs a lot of euphoria into a little bit of time. And we share a good deal in common with the late '20s euphoria, with the year 2000 as well, what you described—was that 1818, in the era of happy feelings? Kevin: Oh yeah, yeah, good feelings. David: Good feelings. Kevin: The Era of Good Feelings, but boy, you take the punch bowl away. But this is why what you brought up last week was so...…
This week it’s more than just a weekly recap but also a bit of a look ahead. There’s been a lot of price action in the last week. So let’s take a look at where prices stand as of November 13: The price of gold is down about 3.9% or $85 from last week. It is down $211 or 7.6% from its high on October 30. The price of silver is down 2.7% or around $0.83 from a week earlier. It is down $4.50 or 12.9% from its pre-election price on October 29. Platinum is down about 5.3% or $52 from top to bottom over the week. It is sitting down 11% or $115 since it reached its peak. Palladium is down 5.3% or $105 from where it was last week. It is down $322 or 25.8% since October 29. The S&P 500 is up 40 points or 0.6%, sitting just under 6,000. It is up 264 points or 4.6% since the election. The Dow Transports are up 62 points or 0.3% since last week. And they’ve risen 1222 points or 7.5% since election day. The US dollar index is up 1.3 points or 1.3% since last week, at around $106.5. They’re up 2.8% since election day. Short-Term Prediction for Gold Looking at the 200-day moving average chart for gold, it appears that gold will likely drift down from its record high levels. It would likely land around the $2,400 per ounce level. This downward movement would likely happen within the next 4-6 weeks. However, this short-term dip will not last long. We are still in the midst of a multi-year bull market that will continue. You can see it when you zoom out a few years to when it started. Gold’s Stair-Stepping Bull Market Looking back, gold had hit a bottom around December 2015. Back then, it was trading just around $1,050 per ounce. Gold continued to trade sideways for the next couple of years, but the floor was slowly rising. And finally it had a breakout point in May 2019. That’s when it had clearly entered a bull market, and it was trading around $1,280. Gold then traded within its 200 day moving average. The only exception was at the start of the pandemic, when the uncertainty took over as no one knew what would happen when the world shut down. But since then, gold has been slowly stair-stepping higher and finding new floors. What we see happening throughout this period is gold has a breakout and reaches a new high, and then the exuberance wears off. There’s a natural selloff and recalibration. So for example, gold went from $1,200 to $2,000 in the beginning of the bull market. The emotional high wore off and gold dropped back down to around $1,700 — a more “reasonable” price. Now that the election has happened, gold has again rallied to a new record high, breaking out from its 200 day moving average. And with this most recent sell-off, we expect it again to drop down even further to sell off the exuberance of knowing who the next president will be in the White House. Build Your Nest Egg No matter what happens in the short term or long term, gold will continue to retain its value. That’s why it is the perfect asset to preserve your purchasing power and build a solid foundation for retirement. Gold’s average is almost 10% a year over time, regardless of the period of time. An ounce of gold will buy in 20 years, what that ounce of gold buys today. So for the sake of your retirement planning, it is smart to include gold in your portfolio. Gold is the guaranteed income when you need it. Buy Gold on The Dip How many ounces of gold can you accumulate on price dips to meet your objective of a secure retirement? It’s best to prepare in advance, because price dips are typically short lived. Speak with a McAlvany financial advisor to put together a strategy so you’ll be ready to buy on the dips. Reach us at 800-525-9556, Monday - Friday. Call or email us, and an advisor will get back to you shortly.…
Left Cannot Ignore Electoral & Popular Sweep Head Of $11 Trillion BlackRock Likes Hard Assets When Will Western Investors Move To Gold? "The adjustment is beginning in their investors' minds to a higher-for-longer environment, an adjustment to debt and deficits which are not quickly resolved, not by a person, not by a party, but this is a dedication to resolving an issue which may take decades. And that's partially through economic growth, that's partially through an increase in revenue, that's partially through a reduction in deficit spending. But until we get to those long-term solutions, we deal with critical issues. And Rieder is saying, avoid the long end of the curve. Rieder is saying, take a look at hard assets." —David McAlvany Kevin: Welcome to the McAlvany Weekly Commentary. I'm Kevin Orrick, along with David McAlvany. David, a lot has changed in a week, but I can't help but think of a man named Onoda Hiroo, who after World War II, Japanese soldier, he fought on 29 years. He was on a Philippine island, and he absolutely refused to believe that the war was over, even when Japanese generals and commanders would come and try to talk him out. He could not believe that. I can't help but think that that's a lot like Arizona and California right now. My wife and I turned on Jimmy Kimmel, and instead of him being funny, he was just standing and crying and talking about the end of the world. And we watched Saturday Night Live on Saturday night, the opening skit, we thought it might be funny, but instead they just really stood and cried and talked about the end of the world. I'm just wondering, is the war over or is it just beginning? David: Yeah, it's a great question. Well, yes, a lot has happened in the last week. We've got President-elect Trump in line for another four years. The cabinet positions are being lined out, and yet a full week later, they're still counting ballots in Arizona and California. Kevin: Yeah, it's like the Japanese soldier on the island. Why are they still counting, Dave? David: It's hard to believe that in states like Florida you can finish the count the day of the election, while states home to Silicon Valley and some of the greatest hardware and software inventions ever, they can't figure it out. The vote count a full week after the election day is still going on. In my mind, election integrity has a black eye from that kind of incompetence. Kevin: Well, and last week you were critical of both parties, and had a little bit of cynicism going, but there seems to be an overwhelming message that's being sent to the United States right now. David: Reflecting on my pre-election comments, I think they were adequately critical of the parties running, maybe overly cynical about the American public. Whether you regard the election outcome as a good thing or a bad thing, there was uniformity in the political shift. It was across ethnic and socioeconomic lines, all swing states, a significant shift in the African-American and Latino communities. There was a sea of red on the American map, 49 out of 50 states shifted red with a wide margin, enough margin in the popular vote to give Trump an unambiguous mandate to fix a few things. The exit polls noted that inflation, immigration, and a fixation on cultural issues which don't help the middle class were top of mind, and threats to democracy ranked high as well, with a good number of those citing that concern voting for Trump, interestingly. So, the shift towards Trump included a surprisingly large college-age contingent, and of course the minority contingents I just mentioned. But maybe minorities have figured out that rhetoric is insufficient to make your life better. And that a strong economy—that tends to lift all boats. The opposite, if you're looking at strong inflation, that uniformly sucks the tide out from under those same vessels. Kevin: Yeah, Dave, the question was asked of Kamala,…
This week, the markets breathed a sigh of relief after a contentious election season. Let’s take a look at where prices stand as of November 6: The price of gold is down about 4.5% or $125 from last week. The price of silver is down a little over 10% or around $3 from a week earlier. Platinum is down about 7% or $74 from top to bottom over the week. It is sitting down below $1,000 again. Palladium is down 15.5% or $190 from where it was last week, hovering around $1,020. The S&P 500 jumped up 3.8% to 5,930, a new all-time high for the index. Gold Dips on Trump Win As discussed in our election market expectations episode, with a potential Republican win in the election, there would be an initial gold decline. It's an immediate response of exuberance of a healthy turnaround in an economy, hopefully some fiscal responsibility. We'll see if that actually ends up being what plays out. At the same time, we see the S&P 500 reaching an all time high. So is the NASDAQ, up over 2.5% today, while the DJIA is up 3.6% or 1540 points as of the day after the election. These are other indications of market exuberance with an expectation of a turnaround in the economy with the Trump administration. If we look at the first election win for President Trump in 2016, we saw a very similar price action as in other elections. It was a short-term, two day response followed by a reversal for a few weeks before resuming that decline. But when Trump won in 2016, we actually saw an unchecked decline of about 13.5% in the gold price. It was a very short period of time — just by December 22nd, 2016, we had bottomed after that November 4th date. We believe that the opposite would've been true if Harris had won. You would have seen a gold spike as a vote against fiscal policies of the left as well as a continuation of some of what they had been doing, and the equities markets likely wouldn't be rallying. De-Dollarization and BRICs News and talk radio veteran John Loeffler, former host of Steel on Steel and co-host of the Financial Sense News Hour with Jim Puplava, joined as our guest in the studio. We asked Mr. Loeffler for his take on recent BRICS discussions of de-dollarization and the US debt dilemma. While it’s impossible to say what’s next, he did share some wisdom on what could happen. “Every fiat currency historically has a shelf life of no longer than 200 to 250 years before it gets inflated into oblivion. And that's what we're watching happen right now with the dollar.” “It's significant that the BRICS discussion is revolving around de-dollarization. In the case of the BRICS countries, they're going to use the stabilization of their own currency with gold and or other precious metals as some kind of a hedge or a block against getting their currencies pulled down as the dollar ceases to be the currency of last resort around the world.” “In other international circles, you’re beginning to hear discussions of the post-dollar era. That means everybody else is thinking about what will happen if the dollar dies or if it ceases to be the currency of last resort that they're actually talking about.” Seek The Truth, Plan Ahead Will the US get the debt under control? It seems unlikely. As we discussed last week, austerity is never popular. Every time the Fed Chair makes an economic prediction — no matter if it’s Janet Yellen, Ben Bernanke, or even Allen Greenspan — they never get it right. The job of the Federal Reserve is to maintain expectations, not tell you the truth. So the most important thing to do is to find sources of information that have been telling you consistently the truth, warning you of things to come bravely and also as you say, have a plan, but be flexible. Plan Your Metals Strategy Now is the time to develop an economic game plan for yourself, for your family, for your loved ones. The Federal Reserve won’t protect your wealth.…
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McAlvany Weekly Commentary
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Morgan Lewis On Emerging BRICS / Gold Strategy Buffett Sells 2/3 Of His Apple Stock Gold Up 33% YTD Is Only The Beginning David: "Friends of mine will point to the legitimacy of one news source or another as if pedigree matters. And ironically, all pedigree gets you today is uniformity, is conformity, is educated imbecility. What matters is integrity, and the mainstream media has demonstrated it has none. News outlets are dying because they failed to see the need for respecting the truth more than what they're choosing as a priority, which is worshiping power and conforming to ideological pre-commitments." —David McAlvany Kevin: Welcome to the McAlvany Weekly Commentary. I'm Kevin Orrick, along with David McAlvany. David, I just really enjoy our Monday nights before we record the Commentary. The Talisker scotch is— A lot of times people say, "Well, why is it that you like Talisker?" And it's way too complicated to explain. It's not just the taste of the scotch, it's the years and years and years of friendship that went into it, and it's just become the taste of when you and I meet. David: Well, and it's something that I think many people would appreciate in those terms. If they don't like single malt, they certainly appreciate the depth of relationship and the ability to bob and weave and go lots of different places. We're going to start this morning by bobbing and weaving with Morgan Lewis. We just came out of a company-wide meeting, and I thought I'd ask him a couple of questions as it relates to foreign currency reserves, the BRICS nations, and kind of a continuation of last week's conversation on that topic. Kevin: Yeah. We had discussed last night, have Morgan come on, just because the Hard Asset Insights that he writes every week. They're fabulous, but this one in particular this week was really good. David: And it should be a part of everyone's weekly staple. That's a Saturday morning read along with the Credit Bubble Bulletin. Not to be missed. * * * Kevin: Morgan, thank you for joining us. David: In the office, we often talk about our debt issues. We talk about the transition for the US dollar system as it is today, as it could be tomorrow. And in last week's Commentary, we did spend a bit of time talking about the meeting in Kazan, Russia, the BRICS meeting. The significance of that we're still trying to figure out, we don't know what exactly will happen. We know the intent. We know the desire amongst the parties involved to see a shift in the status quo. Give us some perspective, Morgan, on the important points that you're connecting. Morgan: Yeah. Well, I mean, I would say that nothing profoundly new came out of the Kazan summit, but there's a lot we already know. And I think it confirmed some of the aspects that are powering the gold market, I would say, in particular right now. The BRICS, the criticism coming out of Kazan has been that they haven't announced some alternative reserve currency, but I think that misses the point. I don't think their intention is to create a US dollar-centric reserve currency model. David: Take me back to 2015 when we had sort of a clear intent expressed by leaders within the People's Bank of China as to the role that they saw gold playing in the future as they were literally just launching and developing this new thing, the Shanghai Gold Exchange. Morgan: Yeah. We know that they are interested in an alternative to the dollar. The PBOC member in 2015 wrote a piece that was titled "The World Needs a New Reserve Currency." In it, he referenced the intention to use the yuan for trade invoicing for commodities like oil and gas, and he said they would like to increase the uses of the yuan in trade using gold. So, this has been talked about for a long time. I think people get a little tired of— The King Dollar narrative is brought up frequently to belittle these claims. And the idea being that they really can't de-dollarize,…
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McAlvany Weekly Commentary
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Late-Cycle Bubble Fragilities MWM Q3 2024 Tactical Short Conference Call October 31, 2024 David: Good afternoon, this is David McAlvany. I want to welcome you to our Tactical Short Third Quarter Conference Call. Thank you for participating in this call. As always, we want to give a special thanks to our valued account holders, we greatly value our client relationships. I came across a quote from Carmen Reinhart, who has been a guest on our weekly podcast in the past. She's spent time at a variety of universities and with the IMF and World Bank, working as an economist. Co-wrote a book with Ken Rogoff a number of years ago. If you don't know Ken, he's a chess Grand Master, Harvard professor, author of many books, including one that they co-wrote, This Time it's Different. They look at debt and what is ultimately sustainable or not sustainable. And as we go into the conversation today with Doug, there's a lot of complexity and a lot of detail, and I appreciate how simple and focused this one quote from Carmen is, because it gets to the nub of what we're dealing with. She says, "If there is one common theme to the vast range of the world's financial crises, it is that excessive debt accumulation, whether by the government, banks, corporations, or consumers, often poses greater systemic risks than it seems during a boom." And just holding onto that simple idea, where we begin today is with that simple idea, we'll move through complexity, and I want to come back around to that simple idea of too much debt ends up being a bad idea when you get out of the boom times. So a little context: With first-time listeners on today's call, we'll begin with some general information for those unfamiliar with Tactical Short, and there is more detailed information available at mwealthm.com/TacticalShort. The objective of Tactical Short is to provide a professionally managed product that reduces the overall risk in a client's total investment portfolio. At the same time, we'd like to provide downside protection in a global market backdrop with extraordinary uncertainty at extreme risk. The strategy is designed for separately managed accounts that gives us the ability to— The advantages of that are that it's investor-friendly. There's full transparency, there's lots of flexibility, reasonable fees, there's no lockups, and that's why we've chosen that structure. We have the flexibility to short stocks and ETFs, and our plan has been to, on occasion, buy liquid listed put options as well. Shorting entails a unique set of risks and we're set apart both by our analytical framework, as well as the uncompromising focus on identifying and managing risk. Our Tactical Short Strategy began the third quarter with a short exposure targeted at 80%. The target has held steady throughout the quarter at that level. Focused on the challenging backdrop for managing short exposure, a short in the S&P 500 ETF, SPY, remained the default position, which is the case for high-risk environments. I'll give you an update on performance, and then I will pass the baton to Doug. Tactical Short accounts after fees returned a negative 4.28% during Q3. The S&P 500 returned a positive 5.89. For the quarter, Tactical Short accounts returned a negative 73% of the S&P 500's positive return. And as for one year performance, Tactical Short after fees returned a negative 20.99 versus the 36.33 return for the S&P. So, Tactical Short's loss was that of 57.8% of the S&P 500's positive return. We regularly track Tactical Short performance versus three actively managed short competitor funds. The first is Grizzly Short Fund, which returned negative 5.48 during Q3. And over the past year, Grizzly has returned negative 14.14. Ranger Equity Bear returned a negative 9.27 for the quarter, with a negative 12.47 for their one-year returns. Federated Prudent Bear Fund returned a negative 3.58 during Q3, and negative 18.63 for one year.…
This week, we see a small bump up in gold and a stronger move up in silver. Let’s take a look at where prices stand as of October 30: The price of gold is up about 1.5% or $68 from last week. However, gold did hit a mid-week high at $2,790. It is inching up to the $2,800 mark. The price of silver is up about 6% or around $2 from a week earlier. At one point intra-week, it was up to a high of $34.80. So silver keeps testing the $35 level. Platinum is down about 1% to around $1,004, after an intra-week bump up to nearly $1,050. That’s a 4% swing through the week. Palladium is up 8% from where it was last week, hovering around $1,125. In a volatile trading week, the white metal rallied up 17% at one point intra-week. The S&P 500 is flat at around 5,800, parked at this level pending the US elections. The price of copper is also flat from a week earlier. Runaway US Debt In order to finance the gargantuan US debt, Janet Yellen is telling the government that they must lower interest rates. So we are going into a period where to carry the debt, the interest rates have to be lower because so much of our $35 trillion is very short term treasury paper. So interest rates will drop according to the Fed. But the bond market will start separating itself from the US government if they can't effectively lower the interest payment on the debt. There’s no hiding the interest level and the trillion dollar annual plus interest payment to fund the deficit. So we’re predicting a period of very strong inflation. And gold seems to recognize this, too. Gold Tests $2,800 With investors bracing for election day next week, we expect to see quite a bit of volatility in the markets across the board. Gold is now flirting with $2,800 per ounce, which could have a psychological effect on trades. So it wouldn’t be a surprise if we had a bit of a pullback in the price of gold. As we discussed in our Election Market Expectations episode, historical charts show short-term moves in the gold price after a presidential election. Following a democratic election, you tend to see gold take a jump up. In a Republican-won election, gold will take a short-term decline. Perhaps the market is getting ready for a shift after the election Too Late to Get In? When gold has been stair-stepping upwards, it can seem like it’s just too late to purchase ounces. Realistically, the best way to invest is to purchase gold incrementally and regularly. Gradually add to the ounces that you own. Another strategy to purchase with less risk — buy silver instead. Silver is undervalued and it has a lot of upside potential. When the gold to silver ratio shifts, you can make a ratio trade from silver into gold. Plan Your Metals Strategy How should you fit precious metals into your portfolio? What’s the best way to add ounces to help you reach your personal goals? The McAlvany advisor team is here to help guide you. With decades of experience in precious metals investing, they are happy to speak with you about your strategy for investing in gold and other precious metals. Reach us at 800-525-9556…
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McAlvany Weekly Commentary
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45 Countries attend BRIC Summit in Russia Gold seen as antidote to political/economic insanity Listen to Doug Noland’s analysis this Thursday: https://mcalvany.com/wealth/tactical-short-registration/ "Gold is sobriety in a world drunk on credit. Credit markets are where the action will be. Maybe that's over the next two to three years, not necessarily the next two to three months, but the downstream implications that stem from a credit bubble bursting will be like a flood, very difficult to contain." —David McAlvany Kevin: Welcome to the McAlvany Weekly Commentary. I'm Kevin Orrick, along with David McAlvany. David, yesterday I was talking to a client in North Carolina, and it's tragic in some places, what happened in North Carolina, and then there's other places that were relatively unaffected—the higher elevation, and my client was in the higher elevation. But what we're seeing right now in real time in the physical world, there seems to be an analogy to that, doesn't there? You've been talking about the debt problem, and we just heard Morgan talking about the debt problem. It seems to me like there's a flood coming, and that is something that we can predict ahead of time. David: I have a picture on my phone. I have a little picnic with my family, and it was in Asheville a year and a half ago. We were looking for colleges for my oldest, and we stopped off at this little arts community, and lots of things, almost like a flea market and art gallery combined. We're sitting there, and off in the distance is this big mural about two stories high of Ruth Bader Ginsburg. And I look at these pictures from Asheville just a few weeks ago, and that entire complex was underwater, entire complex. From the picnic where you don't think that something like that can happen to looking in shock that, wait a minute, that's the tree we sat under. And you can see just the tippy-top of the tree. Kevin: Well, and the problem that you have with something like that, anytime you have an enormous deluge like came through, the dams are the things that you have to worry about because you don't just get the water that came at the time, but you get all the water that's been stored going backwards. David: Yeah, a few weeks back I watched a video that recapped those floods, and one I found fascinating to watch was— I think it has a debt market corollary. Dam nearly overflowing. It's a trickle of water, finding a weak spot through which to run. It went from a trickle to a flood as the dam itself was eroded, and then blew out, and downstream, there was nothing that could be done. So as I think about the debt markets, it's the downstream implications that stem from a credit bubble bursting, very much like a flood. It's difficult to contain. Join us this Thursday, Doug Noland and I will discuss late cycle bubble fragilities. This is our quarterly Tactical Short call. That's 2:00 PM Mountain Time. Register for the call. I think you'll need these insights pre-election. Kevin: Dave, we've often talked about when you were doing triathlon very regularly, about having in reserves— You have to have reserves, toward the end of the race especially. Like a matchbook. We talked about the analogy. You get 24 matches in a matchbook. You don't want to burn them all right off the bat. But I look at our debt. Again, Morgan just gave us our latest update, and this is the year we've talked about the interest on our debt exceeds what we pay for the military, and then next year, it's going to exceed what we pay for Social Security. You've got countries right now that are meeting—we're not talking just four or five BRIC countries. We're talking dozens of BRIC or potential BRIC countries meeting in Russia, Dave. Could they be discussing a critical breach in the dam that they think might be triggered? David: Yeah. Barron's did a great write-up on the 25th. "China, Russia, Brazil Want to Demote the Dollar. Gold is the Answer.…
This week, we see a small bump up in gold and a stronger move up in silver.. Let’s take a look at where prices stand as of October 23: The price of gold is up about 1.5% or $40 from last week. However, gold did hit a mid-week high at $2,750. The price of silver is up 6.5% from a week earlier. At one point on Tuesday, it was up over 10% since our recording last week. Platinum rose up about 2.25% from a week earlier. It is still hovering right around the $1,000 per ounce mark. Palladium up about 3.5% and hovering just above $1,000. So still looking pretty close one to one between platinum and palladium and staggering discount compared to gold. Copper’s Move Spells Trouble Copper’s short term chart makes it look like this commodity is trending down. But if you pull out the chart and look back year to date, or even a full year, it looks like copper is having an upper compression. It’s a similar pattern that you can see in another metal — gold. If there’s something comparable in the way copper is moving, you could see copper reaching a high of $7 per ounce vs $3 per ounce just a couple of years ago. Copper acts as a canary in the coal mine. A rise in the price of copper is the first indicator of an increase in the cost of production and the cost of living globally. And while the S&P 500 continues to rise, it could be simply an inflation driven market push. Gold = Inflation Protection When you want to protect your purchasing power from inflation erosion, gold is your best ally. Now is the time to reach out to a trusted McAlvany advisor for precious metals investing advice. They are happy to speak with you about your investment goals and strategy for investing in gold and other precious metals. Reach us at 800-525-9556…
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McAlvany Weekly Commentary
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Gold Rising With Long Yields Signals Trouble China Military "Shows Love" To Taiwan Central Bank Gold Buyers To Be Followed By Mass Public Buying The McAlvany Weekly Commentary October 23, 2024 "The world of shadow banking and financialization is breaking into new territory. Private credit is what everyone is fawning over today, and it's capturing market share from commercial lenders. In fact, it is the new subprime. You've got juicy fees, you've got opacity, you've got lockups for investors. And frankly, if you can fog a mirror, you have access if you're a borrower. The last week, comments from Neel Kashkari at the Minneapolis Fed, he's claiming that this is actually a safer version of credit expansion than commercial lending. I think we're going to get to test that supposition in the next correction, and I think his credibility will be tested along with it." —David McAlvany Kevin: Welcome to the McAlvany Weekly Commentary. I'm Kevin Orrick, along with David McAlvany. Well, David, we're recording remote today because you have been speaking at a conference. I'd like to hear a little bit about that before we start talking about what you've been talking about. David: Last week was Dallas, this week is Florida. So, from one conference to the next, it's been busy on the road. Kevin: Well, Dave, there's so much to talk about. We've got people calling in saying, "Hey, gold's awfully high right now, isn't it?" And interest rates, we've seen interest rates rising, Dave, over the last few years, and we've seen gold rising at the same time. What does that say? Does that mean Summers-Barsky, the theory that higher interest rates mean lower gold, do you think we're throwing that away at this point and we're seeing something more like the 1970s? David: Well, the conversations at the conference were pretty intriguing. At the end of a long weekend, and I was listening to real estate experts primarily, the group's consensus was in line with the Fed's and with Wall Street equity traders'. Lower rates are here, and more are coming. So, for real estate investors, it's good news, particularly for the battered segments of the real estate market, at least for now, if that's what actually materializes. And I suspect they'll be right for short time, but wrong in the intermediate to long term. Next year, at this time, I think a surprise in bond yields is likely to be to the upside, not to lower levels. We mentioned Stanley Druckenmiller last week on the program. It would seem by his allocations—short the bond market—that our thinking overlaps with his. Kevin: Well, Dave, for years you've brought up the Summers-Barsky thesis, where it says higher interest rates mean that people can go out and get more income, so they're less likely to buy gold. We've seen the rise in interest rates, and you've been talking about, over the last few weeks, the rise in the yields in longer bonds. You would think that if gold was just playing off of the Summers-Barsky thesis, then it would be going down right now. Granted, you're talking about short-term rates coming down, but longer-term rates are still pointing to— Like you said, in the long run, we're nowhere near the end of this interest rate rise. David: Well, noteworthy for the gold market is the breaking of the inverse relationship between gold and interest rates. And this started back in 2020. Rates increased dramatically from negative yields to over five, five-and-a-half percent. Gold moved higher despite that. So, declining yields reduce the opportunity cost for owning gold. Rising yields increase that opportunity cost. So, in theory, that should cause gold selling and a drop in price. Yet rates have been rising, and that has not taken away gold's glint and gleam. This is almost very much like the '60s and '70s. Gold is rising alongside interest rates, and so it forces you to ask the question, is gold telling us there's more inflation ahead?…
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McAlvany Weekly Commentary
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We're looking at primarily increasing prices in the major precious metals indicators. Let’s take a look at where prices stand as of October 16: The price of gold is up about 2.25%, a $60 rise this week and flirting back with those all time highs again at $2,685. The price of silver is up about 4%, or $1.25 to around $31.60. It is still lagging behind gold as a whole in the market, but having a pretty strong week. Platinum even a little bit better, up 4.5%, or around $42 to just over $1,000. Would like to see it break above $1,010 and move to better territory. Palladium is down about 3% on the week, but 5% from the intraweek high, about $60. Looking at the broader markets… The S&P 500 is up about 1% from a week prior. The dollar is up about 0.5% for this week, compared to the prior week. Reading Gold’s Trading Ranges Gold has been skipping along this mid range in the $2,660 - $2,665 range. What is it signaling? Could the $2,600 level be the move backward? Is that our pullback? Most likely not, and that’s because this is only in a short time frame of about 30 days. Since the breakout move in September where gold jumped up to the next level, the price of gold has had a 50% retracement. However, there is not enough time to indicate a trend. Charting gold back earlier in the year, the yellow metal had a big run up from February until about April. There was a shallower percentage decline from peaking out at around $2,430 and pulling back to around $2,080. If we’re seeing any trend in the price of gold, it is moving more in a stair-step pattern. The price will have a runup and then move sideways for a while. Slow and Steady Wins Investors always want to know the best time to buy gold. Where is the best entry point for the next purchase of ounces? Of course, it’s human nature to want to wait for the perfect storm — finding the right time and the right price. You could ask all the right questions, like: What is the outlook for the dollar? What about the US debt and balancing the budget? How will international conflicts affect the US? How will the next US president affect the economy? Truthfully, you’d need a crystal ball to find the perfect timing. It’s not about timing the market. Investing in gold is about consistency. We're in an uncharted territory in the precious metals markets. If you want to leave a little couch cushion money on the side for a pullback, go for it. But your best bet would be to make consistent, regular purchases of ounces. Plan Your Precious Metals Buy The best time to buy precious metals was 20 years ago. The second best time is right now. One of our trusted McAlvany advisors can help determine your strategy for purchasing gold. You can schedule a no-obligation consultation with one of them by calling our office: 800-525-9556.…
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McAlvany Weekly Commentary
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90 Chinese Military Aircraft Enter Taiwan Territory Stock Prices So High It Would Take Till 2060 For Earnings To Catch Up Because Gold Video - vaulted.gold "The inflation target is close, but we're not there yet. And it's not as if we've had any form of deflation where we've seen a decrease in prices, so the fact of the matter is we're just maintaining an elevated level, and we're talking about households that are not seeing any relief. The tourniquet isn't getting turned any tighter, but neither is it loosening at all." —David McAlvany Kevin: Welcome to the McAlvany Weekly Commentary. I'm Kevin Orrick, along with David McAlvany. David, I was laying in bed and I was just thinking about you guys, because twice a year your entire family goes with four other families to Moab. You guys go to the desert and you ride mountain bikes, you talk, you have campfires. I just see how rejuvenated you are when you get back. But I was laying in bed and I was thinking, it's sort of lamenting this time because I knew you were gone this weekend. I knew the families were getting together, but I also knew your eldest son. This is his first year in college, and I was thinking, "Gosh, I wonder how they're doing. I wonder how he's doing missing that weekend for the first time in, what, 12, 13, 14 years? David: Yeah, about 14 years. So I mean, whether it's rappelling or canyoneering or rafting, we were always out there once in the spring, once in the fall. Kevin: So twice a year you guys do this. David: And it's an amazing adventure. We see all these little kids and they used to be knee-high to nothing. Kevin: Now they're going to college. David: Right. So he's not going to make it home for Thanksgiving and he's not going to make it home for Moab. But we created a little surprise for my wife. Kevin: That's what you said. I just heard that— David: He flew in to Denver and then he drove down from there. Kevin: He came in. Oh, that's so good. So he was there. What a surprise for your wife. David: It was amazing. It was absolutely amazing. Kevin: Don't you love those events in life where it's like a little bonus. Tolkien, J.R.R. Tolkien, used to call that a eucatastrophe where you create a good catastrophe in the story. Just at the very moment when everything seems like it's going to fall apart, you have something dive in and completely change the narrative. David: And I think none of us really like market surprises if it is a loss or if it is a catastrophe. But we love surprise if it's a gain. Oh, wow. Check that out. Kevin: I'm going to shift gears here because you just talked about market surprises and every year you typically would go to the Grant's conference and Druckenmiller, from what I understand, was talking at the Grant's conference this year. Is that correct? David: Yeah, and always a host of interesting characters with varied experiences, various points of insight into the market, some fixed income, others trading volatility, others currencies, equities. But Grant's is really about interest rates and a dialogue around money, the cost of money, and what moves markets. So he brings in this wide array of people, and it's always super, super exciting and insightful. Kevin: Well, and the reason I bring that up is because it's either a catastrophe or a eucatastrophe depending on what side of the market you were trading on. I think it would be worth you retelling the story of how Druckenmiller made his name with Soros, and how they broke the pound—his pretty heavy duty bet. And it worked for them. It didn't work for everybody. David: No, that's right. If you're on the other side of the bet, it was painful. The other people on the other side of the bet were the Bank of England, and four times in Stanley's life, he's lost a billion dollars in a day. Kevin: Wow. David: In a day. Kevin: He'd lost, four times. David: Correct. Kevin: That's called a catastrophe,…
Precious metals prices declined over the last week after a lot of movement in recent weeks. Let’s look at where precious metals stand as of October 9, 2024. The price of gold is down about 3% from the $2,685 top it reached. The price of silver is down about 7.5% from the $32.95 top that it reached. However, it is still holding above $30. Platinum is down about 6.7% from its high at $1,016. Palladium is down around 7.2% from its top of $1,120. Gold has been the most steady of all the precious metals on the heels of a significant move up. In comparison, silver has been a bit more volatile. Platinum and palladium have been holding steady side-by-side. Price of Gold and Elections We looked at the last 13 elections — back from 1972 to now. In reviewing the data, we looked at the initial response post-election as well as the next year's charts to see how the price of gold would move. We discovered that when a Democrat wins, the price of gold tends to rise about 0.5% from the Wednesday right after the election through the end of the week. This spike is then followed by an initial decline by about 1.1% for the following two to eight weeks post election. We see the opposite when looking at the other party. If a Republican wins, the price of gold will drop about 0.5% for that same initial period. And that initial drop will reverse and increase by about 1.1% over the next short-term period. Demand for Gold and Elections The focus is often on the price of gold and precious metals. But what gets more interesting is looking at the demand for gold. In the first year and then the subsequent year after that, the physical demand after a Democratic presidency win is twice as high as it is after a Republican presidency win. Gold Predicts Election Winner? In the six months leading up to an election that a Republican ultimately won, the gold price had a very strong six months. In the six months prior to a Democratic win, the price of gold was down to flat. So is gold currently predicting a Republican win? Only time will tell. US Debt Monster Looms No matter who sits in the White House in January, there will still be a $36 trillion debt with interest on the debt now eclipsing military spending. By the end of the year, the debt payments will likely be eclipsing social security spending. That is the unmovable object facing either administration. It will only continue to get worse. There will be a continued erosion of trust from the American people — no matter who wins. Protect Your Wealth With Gold Gold is a powerful safe haven and insurance policy against economic and political uncertainty. Now is the time to reach out to a trusted McAlvany advisor for precious metals investing advice. They are happy to speak with you about your investment goals and strategy for investing in gold and other precious metals. Reach us at 800-525-9556…
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McAlvany Weekly Commentary
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Gold Rapidly Squeezing Out The Petrodollar Hillary Calls For Censorship, "Or We'll Lose Control" Sign Up For the Hard Asset Advantage Webinar - Click Here "The gold market is at a very interesting juncture with the central banks basically flipping the script. They're not interested in Treasurys anymore. They're not interested in US dollar assets anymore. They are interested in something that they're in control of. I think they're interested in gaining control even as others around the world are trying to keep control. If you care about any control, whether it's personal autonomy or how a nation operates, you do have to pay attention to the gold market because it's telling you there's a tussle afoot. How this plays out is going to be absolutely critical, not only to your personal, social, and political freedoms, but also to your financial and economic well-being." — David McAlvany Kevin: Welcome to the McAlvany Weekly Commentary. I'm Kevin Orrick, along with David McAlvany. Well, as advertised, Dave, I told you last week, I love this last weekend because we have clients that come in who are investors on the platform. Man, we just sat down and talked. We shared the same worldview and ideologies. Even though the McAlvany Wealth Management platform is really doing well this year in returns, nobody really cared. They wanted to talk to the people who were managing it. They wanted to talk about the ideas, what's going on in the world, what do we see going forward, what do they see. That's one of the things that I really love about this place, Dave. Like I said last week, it's the ideology, the worldview, the philosophy, and the relationship. David: Well, let me put it in slightly different terms. I think where the emphasis continues to be is on our process, on the thesis, on a very unique team dynamic, which is driven out of that process. Of course, we tend to get along, we like each other. If you're interested in kicking the tires this Thursday, we have a webinar Thursday 10:00 AM Mountain called "The Hard Asset Advantage." What we do for clients, because we're talking about specific companies and things, there's some SEC requirements that'd be exclusively for clients, but this is a more general look at the thesis at what our process entails, who is on the team, and they'll each be sharing as we go through "The Hard Asset Advantage." If you want to register for the call, you can do so. Just follow the link on the show notes. Thursday 10:00 AM Mountain this week, join us. Kevin: Well, and the various members of the team, the presentations were just great. In fact, you just had Morgan re-present his presentation to us just briefly in the meeting that we were in with the company here just a few minutes ago. But what a weekend, Dave. I mean, it starts Thursday, our clients come in, there's meet and greet, and then on Friday, the whole day is really wrapped up with presentations. A lot of charts and graphs, but a lot of meaning behind those, and then a dinner that night. And then Saturday, we privately meet with clients. Those were great meetings, but, Dave, I went home and napped after that. My wife was like, "You must be exhausted." And you, what did you do? You took your boys climbing and then you flew to Denver, went to a Bronco game. David: Right. No, it was a busy weekend. Exactly, we had the client interactions. It's Saturday. Friday was eight to two. Kevin: Yeah. David: And by the way, the Thursday deal, expect that to be about an hour. Very different than what we had. Kevin: Oh, the one coming up here? David: Yes. Yes. Because we went from eight to two in all of our presentations and the Q&A that followed. We will not go that long. It'll be an abbreviated overview of the process, thesis, the team dynamics, and things like that, looking at the four areas of hard assets that we diversify across. Yeah, what a weekend. I realized that with all the client interactions,…
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McAlvany Weekly Commentary
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Precious metals had a lot of movement on the heels of the Federal Reserve last week, but things have kind of calmed down gold, silver, and platinum. Let’s look at where precious metals stand as of October 2, 2024 Gold, silver and platinum were flat week over week. The price of Palladium declined 4%. Although there was a little jump up initially last week, now, it's back down. The dollar has put in an important bottom last week, and some continued decline with divergence. The bounce this week is a trading reaction. The S&P 500 is flat from last week, after reacting to the FOMC meeting. Precious Metals’ Year-to-Date View September marks the eighth straight month that the price of gold ended higher. The gold price closed up 5.3% in September. That’s after rising up 13.6% for the third quarter, and up 27.5% for the year-to-date price. Silver ended September up 7.6%, which made it positive for the third quarter — up 6.5%. And its year-to-date price has climbed 30.3%, which is better than gold’s performance. Platinum has not fared as well. The price of platinum was down 5.2% for the month of September, with a 2% decline for the third quarter. Platinum’s price has declined 4.2% from the year to date price. On the other hand, palladium rose 2.5% in September and it was up 1.5% for the third quarter. But its price is down 9.9% from the year to date. Finally, the gold to silver ratio has increased 5.8% for the quarter, but it is flat on the year otherwise. Wait and See Mode There are several geopolitical issues that could be contributing to the lack of movement in the precious metals market. There is the ongoing conflict in the Middle East, with Iran sending missiles into Israel. There’s the ongoing conflict in Eastern Europe. Domestically, there is the uncertainty of the longshoreman strike that could have a dramatic impact on the US economy. And of course, there’s the upcoming US election which has people on edge. So it’s no surprise that the markets are waiting to see which direction to go next. What’s Next for Metals? The US is just about 30 days or so away from the presidential election, so it is possible that the markets are still in the “buy the rumor, sell the news” phase. Once the election is settled, the US markets will likely look like a safer haven for investors. And the same will go for precious metals. The hotter things get internationally, the better things like precious metals and liquidity assets are going to appear. When to Buy Gold? You can make regular acquisitions through your McAlvany Precious Metals advisor, or through your Vaulted account. If you’re not doing so already, now is the perfect time to connect with your precious metals advisor to determine your best entry points for purchasing gold and other precious metals. You can reach out to the trusted McAlvany advisor team at 800-525-9556. They are happy to speak with you about your investment goals and strategy for investing in gold and other precious metals.…
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McAlvany Weekly Commentary
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Desperate? Chinese Open Up The Liquidity Flood Gate Dock Workers Strike: Headache For Kamala Bonds & Gold Signal Inflation Woes “Be careful what you wish for is a phrase that we often hear, and I think this is a perfect case in point this week in China. They will get their 5% GDP growth rate, and they will be successful in that endeavor. At what cost remains to be seen. From last week to this week, the PBOC liquidity spigots have been turned on and left on. How have markets responded? The CSI 300, the Shanghai Stock Exchange, up between 20 and 30% in less than a week. I'd say that's a positive response. Be careful what you wish for.” —David McAlvany Kevin: Welcome to the McAlvany Weekly Commentary. I'm Kevin Orrick, along with David McAlvany. Last night, Dave, we met and we were talking about what is it that drives us. I've been studying the process of the hero's journey where there's a call to action and then they encounter some sort of trial and then they come away better. And I was thinking back to just meeting your dad and realizing when I was in my twenties that this place was a place that was driven on ideology. There was a hero's journey sort of built in to your dad, to your family. It was just interesting because there's so many financial firms that are out there that really they just want to know how much money they made that day. But there was mission involved in this. I bring that up, Dave, because not only did we talk about that, but last week you were thrust into the position of Mr. Mom and had to teach a little bit about the American constitution and freedoms and just what makes us different and what we're fighting for. David: Yep. Just a rehash of the balance of power, a rehash of thinking through why from a historical perspective it made sense to understand human nature and create this checks and balances between the three branches of government. And the details of when things don't go right, how you address it. It's a complex thing. If you haven't read the Constitution in a while, I would encourage you to take the next couple of weeks and go through each of the main sections and just appreciate what it is. Because I think sometimes not appreciating what we have, you can very quickly fall prey to the modern critique of, it's an old document and who needs it anyways. We live in a new world with new ideas and we can do better. Kevin: And I'm looking at this new world that we live in, Dave, everywhere really, but the United States, which still has the Constitution, even though we're weakly holding onto it. And it concerns me because the Constitution was a sacrificial document that basically said, "Look, we're going to take coercion and domination out of the hands of the government." We had free markets. Okay? And what we have now— Let's look at China, which is a direct opposite of that. China is doing what Mario Draghi did back in 2011. They're basically saying, "We'll do whatever it takes. We're just going to print a bunch of money." And as I was thinking about this, Dave, what we do here is try to stick with keeping people free from coercion and domination. How is that done? Well, you have to protect yourself from the very effects of what these central banks and governments are trying to do to control the people. David: Be careful what you wish for is a phrase that we often hear, and I think this is a perfect case in point this week in China. They will get their 5% GDP growth rate, and they will be successful in that endeavor. At what cost remains to be seen. From last week to this week, the PBOC liquidity spigots have been turned on and left on. Originally it was bank reserve requirements cut by 50 basis points, repo rates cut by 20 basis points, then came direct access by brokers to the PBOC to buy stocks and encouragement, enticement for them to buy stocks. Insurance companies and corporations themselves by the end of the week had access to the PBOC to do stock buybacks.…
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McAlvany Weekly Commentary
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There’s been quite a range of movement in the price of precious metals over the last week, following on the heels of the Fed announcement. Let’s look at where precious metals stand as of September 25: The price of gold is up 4.8% or up $122 to $2,672 from the previous week. The price of silver has increased by 8.5% or $2.50 to around $32.60 from the week before. Platinum is up about $19, or about 1.9% to $984 from last week. Palladium is almost flat for the entire week. It had a range of a couple percent from top to bottom, but ultimately palladium is pretty much dead week over week. The Macroeconomic Perspective Looking at precious metals and commodities from the macro view, time will tell if the Federal Reserve policy will lead to a recession or continued inflation. The market is now talking about another 25 basis points in November, as well as another 25 more in December. That would pull us off a full 1% by the close of 2024. What happens next for markets will depend on whether the economy goes into a recession or not. The timeframe to watch is the six months following a rate cut. If the equities markets have a rally of an average 15% or more, it would indicate that economic policy shifts reignited inflation. Conversely, if the economy goes into a recession following rate cuts, you’ll see an average decline of around 15% or more. Rate Cuts Benefit Who? A quote coming out of Fannie Mae said, “The newly released summary of economic projections implies another 50 basis points and cuts by the end of 2024.” That’s what the organization that provides liquidity and stability in the housing market is hoping for anyway. You would think, in this case, that Fannie Mae is looking out for the consumer when calling for more interest rate cuts. The idea behind interest rate cuts is that borrowing becomes less expensive. So in theory, making large purchases like homes should be more affordable for individuals. However, the price of single-family homes has not declined at all. If anything, the prices continue to increase. Just take a look at this chart of the price of homes compared with the price of gold: Single-family homes are no longer a place for individuals to live. They are part of an investment portfolio owned by conglomerates. Homes are no longer a wealth-transfer vehicle. They become a liability on your personal balance sheet. Gold is one of the remaining tangible assets that preserves its value so you can leave a legacy to your heirs. Protect Your Own Economy Interest rate cuts may look good for short-term economic growth. But they threaten the purchasing power of your hard earned dollars. The best way to protect your personal economy is to turn a portion of your cash into assets that aren’t affected by inflation — like gold, silver and other precious metals. So even if the Fed uses monetary policy to increase the money supply and chip away at your purchasing power, your gold will protect you from wild government spending. Now is the time to reach out to a trusted McAlvany advisor for precious metals investing advice. They are happy to speak with you about your investment goals and strategy for investing in gold and other precious metals. Reach us at 800-525-9556…
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McAlvany Weekly Commentary
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Bond Yields Rise As Powell Cuts Rates Gold Rises As Powell Ignores Inflation Zelenskyy Campaigns For Harris With U.S. Assets "But the mantra kept on being uttered, "we're data dependent," but we knew this last week. Supercore is not suggesting an end to inflation. Tightness in the labor market is not either. And while supply chain contributions to inflation pressures are diminished, you still have geopolitical concerns and rumblings of trade conflict, which keep the likelihood of an inflationary rebound pretty darn high because you don't move away from those supply chain issues when you've got those kinds of things. Again, trade conflict, geopolitical concerns, these circle us back around to supply chain issues, and again, just an inflationary rebound." - David McAlvany Kevin: Welcome to the McAlvany Weekly Commentary. I'm Kevin Orrick, along with David McAlvany. David, let's just try this for a second. All right, so Jerome Powell, Kamala Harris, and Zelensky of Ukraine walk into a bar. They buy everybody drinks, and they say, "Hey, the economy is great, but we're still going to lower the interest rate 50 basis points." Now, you've got long bond in there. David: You had me at free beer. Yay! Kevin: You've got Mr. Long Bond there, and at first he snickers, and then you've got Mr. Gold there, and he snickers and then he bursts into laughter with tears. That's what we saw last week. Gold is hitting all-time highs. The long bond said, "Huh, yeah, you may be buying us free beer, but yeah, interest rates are going up, buddy. Not down." David: Exactly. Exactly. Well, there was a contrast, a very interesting contrast if you look at what happened in the U.S. bond market versus the Chinese bond market a few days later. This week, the PBOC offered support to the Chinese economy in the form of, number one, reduced bank reserve requirements. That gives extra liquidity to be loaned out into the economy to stimulate growth. Kevin: Right. David: And a policy interest rate cut to stimulate growth as well. Chinese 10-year Treasury reached near 2%. Kevin: That's amazing. Aren't we paying double that? I mean, why do Americans have to pay 4% interest? David: Well, that is a good question, because the U.S. 10-year Treasury has often been referred to as the benchmark for the risk-free rate, but it's double that of the Chinese. But the behavior of the Chinese bond was telling. They lowered rates, and lo and behold, the bond market, those yields go lower as well. And monetary policy loosening. Kevin: Does that mean they have credibility where we don't? David: You had TLT, which is an exchange-traded fund, a measure of U.S. long bonds. It's had its fifth day in a row of increasing yields. At least for now, the PBOC has more market credibility than the Fed, and that's tough to swallow. The U.S. government bond market has done its own thing with yields moving higher, and that's the twos, fives, 10s and 30-year, even while the Fed last week dropped rates 50 basis points. Kevin: So that bond market, Mr. Bond is not buying it. He's snickering and then laughing and interest rates are going up. David: It's the opposite of what most market practitioners would assume. This is an incredible market. The Fed says it's time to loosen financial conditions, and the market, the bond market particularly, contradicts that with the response of, "we'll maintain tighter financial conditions if you won't." There is a credibility standoff between the FOMC and Mr. Bond. So data dependency died last week. Actually, data dependency died a bunch of years ago. Kevin: Yeah, they stopped looking at the numbers and just started looking at the politics. David: But the mantra kept on being uttered, "we're data dependent," but we knew this last week. Supercore is not suggesting an end to inflation. Tightness in the labor market is not either. And while supply chain contributions to inflation pressures are diminished,…
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McAlvany Weekly Commentary
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Let’s take a look at our weekly recap of the precious metals markets for September 18. As of this recording, here is where precious metals stand: The price of gold is up about 1.5%, or around $2,560 per ounce from a week earlier. At one point, it was up about 3% or nearly $2,600. The price of silver is up about 4.5% or just over $30 from a week earlier. Like gold, silver rose up at one point as high as 9% to just over $31 per ounce. Platinum is up about 1% to around $965, but earlier this week it was up over 4% or over $1,000 per ounce. Palladium has risen up over $1,000, and it is about $30 over platinum. It had a pretty volatile week, and it is looking relatively strong.. The S&P 500 rose about 1.3% from our recording last week, with a midweek high of about 2.5%. At one point, it inched above the all-time highs in July. The dollar index is down about 0.66%, but it was about 1.5% at one point. It is bouncing around the lows from last December. Volatility on Fed Announcement Wall Street got its wish for a 50 basis point rate cut. Right at the 2:00 pm ET announcement from the FOMC, there was a 30 minute window where every asset spiked higher. That’s when gold reached a new all-time high, just barely kissing $2,600 per ounce, and the S&P 500 also rose to a new all-time high in the interim. And while silver has a while to reach its all-time high of $50, it broke through $31 on the news. Gold dropped 2% from that high right after that announcement. Silver dropped four point half percent after Jerome Powell's press conference. That’s after having climbed 1% to just over $31 per ounce. Most indices also declined after the announcement. However, the dollar has made an inverse move. How Will Rate Cuts Affect Consumers While all eyes have been on how rate cuts impact the markets, there’s a bigger question looming. How will these policy moves affect consumers like you? The CPI number has declined, and certain things have come down in prices. However, everyday prices have not decreased. The consumer is still feeling the pain in their wallets at the grocery store and gas pump. The sense of distrust that the American people have in the system is palpable. Looking at the total revenue for the US in 2024, it has earned $40.39 trillion as the fiscal year comes to a close. Meanwhile, the US is paying about $1 trillion per year in interest payments alone, and that figure is rising rapidly. About 25% of the national income goes just to interest payments on debt. Protect Your Wealth With Gold Gold is a powerful safe haven and insurance policy against changing monetary policy and economic uncertainty. Now is the time to reach out to a trusted McAlvany advisor for precious metals investing advice. They are happy to speak with you about your investment goals and strategy for investing in gold and other precious metals. Reach us at 800-525-9556…
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McAlvany Weekly Commentary
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Elizabeth Warren Wants A 75 Basis Point Cut Supercore Inflation Still Running Hot Employment Numbers Point To Stagflation "I think the Sahm rule implies recession. When you get an uptick in employment off of low levels, that move precedes a reversal in trend and therefore potentially greater softening in the labor markets. Yes, there is a softening. The question is, to what degree? I suspect a recession will emerge, but the pressure on wages remains on the upside. If that continues into 2025, inflation might re-emerge as that two-headed hydra only partially mauled by the Fed's best efforts from that rate tightening cycle—the 2022 to 2024 cycle. The second head is raring to get back into the mischief of consumer pain and anxiety." —David McAlvany Kevin: Welcome to the McAlvany Weekly Commentary. I'm Kevin Orrick, along with David McAlvany. Well, David, as I walk around the office, I see you are Mr. Mom this week. Your wife is in Korea. That's got to be interesting. But how are you holding up? I mean, you're driving the kids from here to there, three different directions all the time. Yet, you're still doing what you do here. David: Yeah. It's pretty fascinating to bounce back and forth between dance, fencing, Civil Air Patrol, breakfast, lunch, dinner, checking up on homework. You realize that doing half of the job—there's a difference between doing half and all. It's 100% difference— Kevin: Well, and the truth of the matter is— David: It's 100% difference. Kevin: Yeah. You're doing 90% more. Because let's face it, your wife— David: That is so fair. That is absolutely a more accurate representation. Kevin: So what is she doing there in Korea right now? David: She's part of a global leadership group that looks at various cultural avenues where there needs to be a broader discussion, a more important discussion, a strategic discussion in the arts and education. Her focus is on the arts, and that's in Bangkok the first week. And then she's at another meeting in Singapore next week. So she'll be gone for two weeks, and I will be either more gray-haired or more of a saint or...I don't know. The next two weeks are a process of spiritual discipline, I think, for me. Kevin: My wife asked how it was going, and I said, "Well, I saw the kids there and they were all engrossed in schoolwork." So fortunately, at least there's a little bit of discipline being applied. I didn't see any of the three playing video games. David: No, no. In fact, I had them sit at one end of the banquet table in our office so that I could walk by and monitor with a glance. And so...anyways. Kevin: And check. Well, okay. So this is the week— I've been thinking about it, Dave. Because with what Elizabeth Warren had recommended that Powell cut interest rates 75 basis points, I started thinking about Goldilocks and the Three Bears. But in this case, let me give it a try, Goldi-Powell and the Three Bulls, okay? 75% basis point drop in interest rates— David: Yeah. Not warranted. Not at all- Kevin: At all. Oh, bad dad joke. Okay. But I'm thinking, 75 basis points would be too hot. 25 basis points, they are already playing down as too cold. And I'm wondering if 50 basis points is just right for Goldi-Powell and the Three either Bulls or Bears. It depends on how it goes. David: Yeah. The main event this week is the Fed decision on rates. And this started with the ascent to current levels in January of 2022. And of course we've held those levels since. This would be the first cut in rates in four years. Cuts usually are advised if business activity is rapidly slowing or if unemployment rates are rapidly increasing or if the Fed calls an unscripted audible to save the stock market from excess volatility. We affectionately know that as the Fed put. They'll step in and protect the downside for the leveraged speculator. In this case, business activity is unimpressive but not weak, and unemployment is rising,…
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McAlvany Weekly Commentary
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Let’s take a look at our weekly recap of the precious metals markets for September 11. As of this recording, here is where precious metals stand: The price of gold is up $20 to around $2,500, relatively flat from a week earlier. The price of silver is down about 50 cents or 1.5% to around $27.76 from last week. Palladium rose up about 9% or around $88 to $1024, surpassing platinum. Moving over to the equities markets.. The S&P 500 is flat this week, though it did have a trading range up and down around 1% either direction. The dollar is up about 0.25% at around $101.80. Oil Drives Commodities Lower Looking at where the oil started the year, it is now down almost 7% but from its peak this spring, it is down 23%. Meanwhile, copper is up 7% for the year, and silver is up over 20% from the year. But if you look at them from their peaks, copper's down 20% from earlier this spring and silver's down almost 12%. It seems the market is transitioning for a period from a stagflation to a phase for the next few months of deflation where the commodities, copper, silver, and oil are all going to soften. Gold to Silver Ratio Widening With the softening in the commodities markets, it will likely push the silver versus gold ratio to 100 ounces of silver equaling one ounce of gold. Right now, the gold to silver ratio has moved up to one ounce of gold to about 87.7 ounces of silver. It seems that ratio will continue to widen back to a hundred to one. So if you have been holding onto gold and looking to buy silver, I think the opportunity for a gold to silver ratio trade is coming soon. Russia Buys Up Gold Russia's finance ministry just said that they plan on allocating 8.2 billion rubles — or $92 million US dollars every day — into gold and foreign currency purchases until October 4th. That's a sevenfold increase. While it’s uncertain what they’re preparing for, we do know that accumulating hard assets is a smart move for uncertain times. Plan Ahead for Ratio Trades To make trade from gold to silver, you would need silver to spike up to over 100 to one. Since these moves can happen within a matter of weeks or even days, it’s always good to plan ahead. Your McAlvany Precious Metals advisor can help you find your individual entry and exit points on products you have already purchased. You can always call us and get a free evaluation about what makes sense for your portfolio. If you haven't talked to your ICA broker in a while, it's time to do so. We can be reached at 800-525-9556.…
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McAlvany Weekly Commentary
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Heroism & Empathy Worth Remembering Current Ad-Hominem Politics Show What We've Forgotten Sahm Rule & Yield Curve Reversal Signal Recession "As we march towards the November elections, we could choose to dehumanize people that we disagree with or we can choose to dignify regardless of differences. We've allowed the absurdity of a platform-free, policy-light election to move ahead, and instead we've invited an ad hominem contest of insults and jabs, attack against the man, and attempt to undermine by avoiding the platform, glossing over policy in favor of personal insults, and aggressive character assassination." —David McAlvany Kevin: Welcome to the McAlvany Weekly Commentary. I'm Kevin Orrick, along with David McAlvany. Well, David, I don't know that we can ever forget 9/11 each time it comes around every year. There are these turning points in history, and that one in our lifetime was major. And I know for you there were some very poignant personal things that involved New York, the South Tower, the World Trade Center. It's a powerful, powerful day to go back and remember David: Occasionally, I have to ask the younger on staff if they even know what 9/11 was. Of course they do because they've been told, but— Kevin: Some weren't even born though. David: Twenty-three years ago. I mean, it is a little bit of time. So I showed up early to work at Morgan Stanley Dean Witter, as it has often happened. I was on the phone with a good friend from Smith Barney before the markets opened, and something unusual occurred. We watched the early news of the first plane crash into the Twin Towers. Not long before that, I had completed my training there in the financial district, in the Twin Towers. Kevin: You had been in New York before that? Yeah. David: Yeah, in the South Tower. So the accident, it appeared, it was well covered by the news as camera crews, helicopters sort of captured the North Tower burning and live as we watched the coverage. Seeing a plane hit the South Tower, there was a mental shift to that point. It had appeared to be an accident. Kind of what happened was confused. After the South Tower was hit, it was like, "That was no accident." That was the second plane. We didn't have the explanation of the first plane. Kevin: I remember that realization too. I was here at this office at the time, and one of the guys had a TV back in the back corner. In fact, you worked in that office when you came back to the office here, and he said, "Hey, Kevin, come back here" because he knew I was a pilot. He said, "Somebody flew a plane into the World Trade Center." So we watched, and we thought it was an accident as well until while we were watching, we saw the second plane hit. And at that point, it's very hard to process, isn't it? When something happens that's so out of the norm, I don't think I really registered when the second plane hit right away. I just was sent into sort of a befuddlement for a few minutes before I started to realize that this was contrived. David: Panic and fear are things that we experience through a variety of circumstances. And one of the reasons I think of 9/11 and reflect on it is the memory of a man who died in the building, and he didn't have to die if he had lived selfishly,. He was clear of the building, and very selflessly went back into the building to look for four colleagues. Rick Rescorla was a soldier of fortune. He fought in Rhodesia. He had been in the British military and somehow made his way into the security apparatus at Morgan Stanley and he didn't care if you were in a $10,000 pinstripe suit, you were going to do what you needed to do in a moment of crisis. Kevin: Didn't he run you guys through drills and the people who were with Morgan Stanley? David: Fire drills were a routine thing and it didn't matter if you were closing a billion dollar deal, you were marching the stairs. And Port Commission, who owns the buildings,…
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McAlvany Weekly Commentary
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1 Why Gold Is Primed for Strong Performance in Today’s Market 13:27
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Precious metals have declined slightly over the week, but that’s not the whole story. Let’s take a look at our weekly recap of the precious metals markets for September 4. As of this recording, here is where precious metals stand: The price of gold has declined about 1% or $20 to around $2,485 from a week earlier. The price of silver is down about $1.25 to $28.24 since last week. Platinum is down about 3.5% or $32 to around $906 from a week earlier. Palladium is dead even at $936 from week to week. Looking at the broader markets… The S&P 500 is down about 90 points to around 5,510, failing to show above some previous highs. The dollar is at $101.20, staying flat week over week. Gold and Silver Stronger This Year Looking at the August numbers, gold and silver continue to trend higher. While gold was up just 3.4% in August, it increased by 21% from year to date at the close of August and up 30% year over year. Gold has been on an upward trend, with rising ceilings going back all the way to April. The yellow metal hit a new high on April 12th, then two more new highs on May 20th and July 16 successively. Its fourth new high level, reached on August 20th gave gold a really strong breakout above previous trading ranges. This trend shows an optimistic look on gold, with it breaking out of a boundary range in the near term. Meanwhile, silver continues to be undervalued. No one is talking about silver, and yet it has had a 30% climb very quietly. Silver rose only 0.7% in the month of August. But silver is up 21% from year to date by the close of August and up 30% year over year in the 12 months. Future EV Demand for Silver Samsung is developing a new electric vehicle battery that will require 1 kilogram of silver per battery for production. This new silver EV battery has the potential to breathe new life into the EV market, which has been floundering. Silver will cut the EV charging time from hours to minutes, and it will extend the driving range for EVs. The batteries won’t be on the market for another year. However, this innovation has the potential to change the fundamentals for silver when they go into full production. Plan Your Precious Metals Buy The best time to buy precious metals was 20 years ago. The second best time is right now. One of our trusted McAlvany advisors can help determine your strategy for purchasing gold. You can schedule a no-obligation consultation with one of them by calling our office: 800-525-9556.…
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McAlvany Weekly Commentary
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Who's Watching The Watchers South Africa: 600,000 Security Guards & Only 150,000 National Police Fear Those Who Disagree - Return To Tribalism "The irreconcilable differences between various political perspectives and the intolerance for or unwillingness to engage in dialogue rests on differences in definitions and cultural contexts. Four traditions have developed from differing cultural bases and a whole differing understandings of what justice is, for that matter, what truth, what rationality are. The influence of cultural bias and tradition has to be acknowledged, and if you want, let's debate the merits of each, except that I fear we're in an age without dialogue and with more and more propaganda, and it becomes clear that to even have a voice takes a real effort." —David McAlvany Kevin: Welcome to the McAlvany Weekly Commentary. I'm Kevin Orrick, along with David McAlvany. David, I know you and your wife have debated on getting another guard dog, but you've got a lovable guard dog, but actually this dog responds to language that you've taught it that really we don't necessarily speak. When you give it an order, I don't understand what you're saying. David: No, it communicates very clearly, but it's because the training has taken place. Now the debate has now gone across two generations. My dad loved German Shepherds. I loved Malinois. We had a German Shepherd. Mary Catherine calls them German Shedders, and so the [unclear] for hair and the collection of hair on all things, clothing, furniture, floor makes dogs detestable to some degree. As delightful, as beautiful, as friendly, as loyal, it doesn't matter, they are hair factories. So we're not getting a second, much to my chagrin. Kevin: Isn't it interesting though that dogs or even we will respond to language that we've been taught? Maybe not everybody understands that same language, but it is, it's very interesting when you tell him to stop barking or whatever you're speaking a different language to him. I'm wondering if that doesn't happen to us sometimes. With all this going on with Zuckerberg, are we being taught a language to speak right now that maybe isn't the language we should be speaking? David: Yeah, I think that's fair. It's because in part we don't take time to find our terms and understand what is being said. We make some assumptions and we work off of what is familiar to us. So we grow accustomed to communication, and it implies meaning, and we assume that we're speaking the same language. But even this last week, Mary Catherine and I are having a conversation and I said, "No, that's not what I said," and she said, "That's exactly what you said." And she gave it to me in different words and I'm like, "This is fascinating." Kevin: We're not saying the same thing. David: Humanoids from the same continent, maybe different states, maybe that's it, Colorado versus Texas. No, it's just fascinating how you just miss each other if you're not clear on your definitions. It happens even innocently within a home and sometimes not so innocently outside of the home. Kevin: So on the topic of guard dogs, because the very fact that you have a guard dog, I mean obviously that offers you some protection, but you think about the world, we look at these campaigns right now, you've got people actually talking about defunding the police, and it's like, okay, so when you defund the police, who actually comes to the door when you call them? And I'm just wondering if you're not going to see a lot more guard dogs. David: Last week's client-only conference, this is for our hard asset strategies, there was a question about platinum and South African companies that mine it, and that was put on the table. The majority of platinum in the world comes from Russia and South Africa. Obviously it's verboten to invest in Russia today, so South Africa is the only way. That was the question, what would you recommend? Interestingly,…
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McAlvany Weekly Commentary
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The precious metals market is relatively unchanged over the past week. Let’s take a look at our weekly recap of the precious metals markets for August 28. As of this recording, here is where precious metals stand: The price of gold is flat at around $2,508, after rising and falling about $30 intra-week. The price of silver is down 11 cents at $29.49 from a week earlier. Platinum is about 2% lower to around $938 from the previous week. Palladium is completely flat at $936 from a week earlier, but it continues its slow trend through August. The S&P 500 is also flat, down around 21 points to around 5,600, looking like it’s waiting for something to happen. The US Dollar is also flat at around $101.20, but it had some good trading indicators intra-week. The SAHM Rule of Recession In macroeconomics, the SAHM rule of recession states that when the three-month moving average of the national unemployment rate is up by 0.5% or more compared to its low over the prior 12 months, the economy is in the early stages of a recession. Looking at the revised employment numbers and Fed Chairman Jerome Powell’s dovish comments at the recent Jackson Hole conference, the recession is indeed here. The Bureau of Labor Statistics tends to “cook” the labor numbers. If you want to understand the implications of the true statistics, the US debt clock reveals more in-depth data of how the US economy is actually performing. Weak Dollar Policy Expectations of a September rate cut could prop up the US economy. However, it also means that the US will have a weak dollar policy. What will it mean for gold? It’s possible that the price of gold will drop while the US dollar will rise higher right after an interest rate cut. Even if the price of gold goes temporarily lower, it would mean a buying opportunity to add more ounces of gold to your portfolio. With the uncertainty around the elections and other geopolitical forces, we expect the gold price to continue its climb and break through to new highs. Plan Your Next Gold Buy If the gold price does indeed dip lower, it may only be for a matter of days. With the ongoing weak dollar policy and global market uncertainty, it is best to plan ahead for your next purchase of gold ounces. One of our trusted McAlvany advisors can help determine your strategy for purchasing gold. You can schedule a no-obligation consultation with one of them by calling our office: 800-525-9556.…
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McAlvany Weekly Commentary
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NVIDIA: $3 Trillion In 21 Months "This Time Is Different" Is Always The Same Jackson Hole Gift Signals September Rate Cut "Politicians will lay claim to the stock market's success if they have success on their watch, and they're blamed by others for its failure. And perhaps it's more coincidence. Perhaps the trends in play are beyond the ability of either party or candidate to control. Only versions of the outcome exist. So an individual politician in a policy suite may make something a little better or a little worse by the policies chosen. But if markets run in cycles, politicians are closer to being coincidental to that history." - David McAlvany Kevin: Welcome to the McAlvany Weekly Commentary, I'm Kevin Orrick, along with David McAlvany. Well, Dave, last week we talked about a 400 ounce bar of gold being over a million dollars for the first time, but as we speak today, it still is over a million dollars. What are you thinking about gold right now? David: Well, sometimes you see these price moves and it is a flash in the pan. And when we had the Russians invade Ukraine, the price went higher. The COT reports got very clustered and crowded. Kevin: That's the Commitment of Traders when you say COT. David: That's right. That's right. And it was a flash in the pan. Kevin: Right. David: I have a feeling that this is a little bit different, and there are a wide array of things that the global audience of investors are looking at and they're not being appeased. There is nothing. Even Nvidia's reports this quarter, it's not enough to keep them from adding to their ounces. Kevin: Well, yeah, it's interesting. Nvidia has been sort of an anomaly. I can't help, when we're talking about Nvidia, I'm thinking about artificial intelligence and I think a little bit about the history of the computer. Von Neumann during the Manhattan Project and other guys working on the IBM computers that ultimately became IBM computers when they were figuring out how to actually make the A-bomb work. But Alan Turing was brought in as well, and they said, "How someday will we know whether it's actually artificial intelligence or whether it's human intelligence?" And so Alan Turing came up with something called the Turing Test to determine whether a computer can actually imitate a human. Now my question would be this, though. Artificial intelligence, AI, has caused Nvidia and other stocks to go through the roof. Is there a test like the Turing Test where we can see, are we in artificial valuation territory, Dave, not artificial intelligence, but artificial valuation? David: Well, of course. And that's one of the reasons why our conversations with Andrew Smithers have been so important. Go back to the archives and listen to those. Or if you want to make your way to Amazon and order a few books, The Q Ratio, I think he wrote that in about the year 2000, and then a few years after, Valuing Wall Street with Stephen Wright, and they were co-authors. And just a brilliant look at how you can look at 10 or 20 different measures of value and which of those 10 or 20 are the very best in terms of consistency through time, through any cycle. And they land on the cyclically adjusted price earnings multiple and Tobin's Q, which is just the measure of the value of stocks compared to their replacement cost. Kevin: Right. Well, and the cyclically adjusted price earnings ratio, a person can google that and just look at the last few decades and just look and see how it tracks. Stock market rises and crashes valuations when they get too high, it always points— That is a good test when I ask about artificial valuation or true valuation. David: Yeah. Now that is one that's looking at earnings. If you're looking for an egregious mark to absurdity, it is Nvidia at price to sales of over 40 times. This week Nvidia reports for the quarter. Why does everyone seem to care? Bank of America study shows 78% correlation between Nvidia shar...…
It’s been a strong week for all the precious metals. So let’s take a look at our weekly recap of the precious metals markets for August 21. As of this recording, here is where precious metals stand: The price of gold is up over 2.3% to $2,511, after hitting a new all-time high of $2,530. The price of silver is at $29.60 or up 6.5%, which is a big run-up from a week earlier. Platinum is back up to $966, an increase of 4.1% from the previous week. Palladium is up $936, a rise of about 1% from a week earlier. The S&P 500 is up 1.4%, a pretty reasonable move up over the last week. The dollar index is down at $101.20, losing a little over 1% this week. Rate Cut Expectations The Federal Reserve of Kansas City will meet for its annual Economic Policy Symposium from August 22-24, focusing on lessons learned from the response of monetary policy to the pandemic and subsequent surge of inflation. The markets are waiting in anticipation for hints of a September interest rate cut in Jerome Powell’s remarks, due on Friday. With this rate cut expectation, the dollar is down at $101. The economy has slowed down. The BLS is expected to revise its job growth report down by up to 1 million fewer jobs than initially reported. As a result, equities are holding steady, and Bitcoin is up 2.5% to over $60,000 as of this recording. Stability of Gold It can be hard to predict where gold will move next when the price of gold is breaking through to new high levels. Taking the big picture view going all the way back to August 1971, gold has equaled the return of the S&P 500. While some Wall Street analysts may joke about gold as a dead asset, it is anything but that. Instead, gold is a solid like a rock — an asset that provides stability in an unstable geopolitical environment and uncertain economy. The Silver Lining As it’s been said before, whatever gold does, silver can do better. Silver has been playing catch up with gold, up over 6% this week. However, the white metal is still technically bearish. Even though it has had a strong move up, it started from the bottom. Anything over $30 would be a better indicator that silver is closer to being out of bearish territory. Making the assumption that silver being the kid's sister to gold, it takes a little bit longer to get going. But once it gets its engine cranked up, it moves pretty quickly. There’s news that silver is being used in a new type of battery, and that it requires about one kilo of silver per battery. This new battery has the potential to change the demand for silver. The bottom line: silver is still undervalued and poised for a breakout. So investing in silver now could set up investors for a lucrative gold to silver ratio trade in the future. Get in Touch Now is the time to reach out to a trusted McAlvany advisor for precious metals investing advice. They are happy to speak with you about your investment goals and strategy for investing in gold and other precious metals. Reach us at 800-525-9556…
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McAlvany Weekly Commentary
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Who's The Target For The Democrat Tax Increase? 400 oz Gold Bar Was $14,000 In 1971 S&P 500 & Gold Increase The Same Since 1971 "The reality of a democracy is that politicians compete for votes primarily through promises to pay. Sure, you've got other tactics. You can inflame the electorate with a particular issue. But the real traction is gained and the real constituents built through the public purse. Cuts are discussed but rarely made. New spending is introduced and often approved. It's an ugly imbalance we've grown accustomed to. Meanwhile, revenue, if not matched to new spending, just further drives up the national debt. That is, if you look at our debt and deficits, these two are our Achilles heels moving forward." —David McAlvany Kevin: Welcome to the McAlvany Weekly Commentary. I'm Kevin Orrick, along with David McAlvany. Dave, my wife and I were watching Ike and Alan Barinholtz win a million dollars on "Who Wants to Be a Millionaire" this week. It was actually very entertaining. But I started thinking about this. John Carpenter, in 1999—Regis Philbin was the host back then, that's when "Who Wants to Be a Millionaire" started—and John Carpenter was the first million dollar winner. At that time, Dave, gold was about 250 bucks an ounce, 252. So he won the equivalent of, if you can imagine, ten 400-ounce bars of gold. He won the equivalent of ten 400-ounce bars of gold. David: And as of today— Kevin: As of today— David: He wins one 400-ounce bar— Kevin: Think of that. Think of the difference between a stack— Okay. So for those who are listening who've never seen a 400-ounce bar of gold, you see it sometimes on the movies like "Ocean's Eleven," things like that. But what they look like, they look like the size of a spice cake. Wouldn't you say it's sort of a spice cake? David: Yeah. That's about right. Kevin: Imagine ten of those, solid gold, in 1999, being handed to the first "Who Wants to Be a Millionaire" winner. Last week, Ike and his father, Alan, winning one of those little tens, basically, the size of a spice cake. What have they done to our money, Dave? David: I know. John Authers was noting in The Financial Times that if you go back to the 1971 period where gold was unhinged from the dollar—this is the Nixon era, the closing of the gold window—the S&P performance from then to now and gold performance from then to now, they're on top of each other. Indistinguishable. Kevin: Really? David: Yep. And— Kevin: Really? After taking all that risk in the stock market and companies coming and going, you could have just owned gold? David: Adjusted for gold, you've not made any progress. It's a really fascinating thing. Kevin: Wow. David: So yeah, we went from a million dollars buying ten of those bars to a million dollars buying one of those bars. This is the first time in history that we've had, in US dollar terms, a 400-ounce Good Delivery bar at a million bucks— Kevin: At a million bucks, it's finally happened. So your thesis on tangible assets, this brings into light why. David: Well, as you know, our interest in hard assets ties to a thesis where the very factors that delivered decades of success for financial assets become impediments, and in turn spur on growth in tangibles. Of course, not all tangibles are equal, and we'll discuss iron ore a little bit later. A lump of iron ore or steel is very different than a lump of gold. We had virtually no inflation, very low inflation. And we have the opposite now. Yes, the inflation growth numbers have come down, but you were talking about growth of the inflation factor. We're not talking about a diminishment or an elimination of inflation. The middle class and lower class household, they're still compounding inflation off of a low base. And a 3% higher number on top of already high levels means that lower inflation numbers are not at all consoling. It's a little bit like the reduction of that pulsing,…
Here’s our weekly recap of the precious metals markets for August 14. As of this recording, here is where precious metals stand: The price of gold is up 2.8% to $2,450, from $2410 a week ago. The price of silver is up 4% to $27.54 since last week. Platinum is gaining ground, up 1% to $922. Palladium had a good week, up 6% to $916 from $880 a week earlier. The S&P 500 is up 3% to 5454. The dollar is flat from a week earlier. Buy Sign for Silver Gold has been steadily rising within its trading range, and it is testing the top. The last time it rose near the top was mid-July, and it didn’t fall anywhere near the bottom. It looks like there will be a strong gold price going into the fall season. Meanwhile, silver has been trading at lower prices recently, well below $30. The gold to silver ratio has shifted from 75 to one back to 90 to one. For those who are looking to eventually do ratio trades, this is a strong buy signal for silver. Since the white metal is well undervalued, we expect its price to rise, which will provide a gold-to-silver ratio trade and an opportunity to potentially double your gold ounces down the road. Avoid Gold Scams Clients come to McAlvany all the time asking about what they should be paying for gold. Because there are a number of bad actors that will sell gold to unsuspecting customers for exorbitant premiums. For example, some gold brokers will try to sell clients non-standard products — such as ¼ ounce gold products. The standard measure for gold products is by the ounce. No matter where you purchase gold, you will have to pay some sort of premium. However, you can find out if you are getting ripped off by understanding what you’re paying per ounce. You can find the true price by taking the price per ounce of gold divided by the spot price — and use the NYMEX spot price for consistency. Then you will understand what premium you’re paying over the spot price. So for example, if you are considering a ¼ ounce product, you need to multiply that price times four to equal an ounce. Then you divide that figure by the spot price — and you will arrive at a percentage over spot that will give you the premium. A reasonable premium should be around 20% or less. If you are quoted a price that includes a much higher premium — say 70% or more — you should run. Get in Touch If you’re considering purchasing gold, reach out to a trusted McAlvany advisor. They are happy to speak with you on the phone and give you a clear price with transparent premiums. Reach us at 800-525-9556, Monday through Friday from 8am to 5pm Mountain Time.…
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McAlvany Weekly Commentary
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Increase Your Ounces Of Precious Metals Through Prudent Trading Decline Number One (Last Week) To Be Followed By Decline Number Two Japan Spooked Out Of Interest Rate Increase "The markets, if I said the man in the street has moved on, he's not thinking hyper fragility. I'll tell you that market practitioners—the pros—recognize that last week was a reveal. It takes virtually nothing to upset the global financial markets and turn them inside out." —David McAlvany Kevin: Welcome to the McAlvany Weekly Commentary. I'm Kevin Orrick, along with David McAlvany. David, we talk often about legacy. But think about those quiet guys that you know through your life that maybe they never looked like they had a lot of money. It's funny how I talk to clients and they'll say, "Well, how much have I made?" And I'm like, "What do you mean? In dollars? That matters?" And they're like, "Yeah." Because that's how they're taught to think. But think about that farmer that you've maybe known or rancher or somebody who, they always drove an old pickup, but strangely enough their farm or their ranch just got bigger and bigger and bigger. And you'd say, "Well, how much do you have in the bank?" "Well, I've got, I don't know, $50,000. I've got about what I need." And you see thousands of acres around them that they had built through a lifetime of just carefully watching the land, trading when they needed to trade, and they've built an empire. And I think about that because if a person starts thinking in something other than these worthless paper dollars that just seem to be getting worth less and less and start thinking about compounding something real, Dave, that's what we do here. I've watched you do that. I've watched your dad teach us that. I've watched guys who've been in the business now— We work with one guy who's been in the business nearly 50 years. David: The information is an interesting thing. We live in an age where there's more information and more access to information than any other time in all of history. And so you've got data centers and storage for the information that's created. You've got the large language models which are trying to capture from that some sense of meaning and real content from these disparate informational nodes. And the best we can do is get stuck in a new cycle, is look at social media, is deal with things that will flip our script every five seconds, every 10 seconds, every five minutes, every five days. And what does it mean? What do we do in light of this? Kevin: What does it mean? See, you just now said— That's the key. What does it mean? What is real? David: And I think this is where having a framework for thinking about things is really important, because it's easy to get lost in the details, in the informational data points, and not have a way of processing it. I appreciate Doug Noland's approach, we did the Tactical Short call this last week. That's available if you want to listen to it or go through the transcript. And there's a framework for understanding the information that is presented to us each day, but it has a context. What we try to do with the Commentary now for 17 years is create context so that as things shift, there's a larger picture in mind that helps us make sense of what this stuff is as it unfolds. Whether it's conflict in Ukraine and Russia or conflict between Israel, Iran, and Hezbollah. These are all things that need context. And without it, what does it mean? And where do we go next? There's more confusion. And I think what happens eventually is people's minds begin to shut down. You get numbed and you're on what is basically informational overload. So what do you do? You just start ignoring all of it. There's a numbness that is a part of life. Kevin: It's the breaking news thing. I remember when they first came out with that breaking news. Breaking news used to actually mean something important. Now it's breaking news all the time.…
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McAlvany Weekly Commentary
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Here’s our weekly recap of the precious metals markets for August 7. As of this recording, here is where precious metals stand: It’s been a surprisingly volatile week for precious metals — including gold, with a high and a low difference of about $100. However, gold is the most steady of the metals right now. The price of gold is down about 2% to $2410 as of this recording. Silver is down about 7% or about $27 since our recording last week. Platinum is down 6% to around $920, almost breaking below $900 during the week. Palladium has declined 5% to around $880 from a week earlier. Looking at the broader equities market… The DJIA has declined about 4% this week. The Dow Transports have lost about 6% in the past week. The S&P 500 has also declined about 6% this week. The NASDAQ 100 is down 8% week over week. The dollar is up 1% over the week — it had a technical bounce, losing 1% during the week but now upas of this recording. Japan Selloff On Monday, the Japanese markets had a big selloff after Japan’s Central Bank increased its interest rate by 0.15%. The Nikkei 225 lost 20% after the move. This decline rocked the global markets early this week, causing a broad selloff. Gold > Bitcoin Some investors believe that Bitcoin is the new gold. If that were the case, Bitcoin should have increased — but instead, it is down 10% this week. Bitcoin is more likely to move in tandem with the broader markets. Unlike Bitcoin, gold can be used for stability in a portfolio amid market turmoil and geopolitical tension. It is also a hedge against inflation and the dollar. Secure Your Future With all of the huge declines seen in the markets between 5% - 8%, gold is the only asset that declined marginally — just 2% week over week. This illustrates the balance gold brings to a portfolio in minimizing the drawdown on a portfolio. If you’re ready to protect your portfolio with the power of gold, McAlvany is here to help. Get in touch with one of our trusted precious metals advisors for a free, no-obligation portfolio review. We can be reached at 800-525-9556.…
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McAlvany Weekly Commentary
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Bubbles Being Bubbles MWM Q2 2024 Tactical Short Conference Call August 8, 2024 David: I think we picked a fantastic week to be talking about volatility in the markets. There's some pretty remarkable things happening in the last week to 10 days, even the last three or four days. And I think you'll be pleased to gain some insight from Doug's commentary today. What we'll do is cover the performance aspects for Tactical Short as we get started. Then Doug's formal remarks. We'll open it up for Q&A thereafter. We have a variety of questions that have already been submitted. We'll handle those questions first. If you're interested in adding an additional question, you certainly may. If you go to the wealth management website, you can look in the bottom right-hand corner and there is a chat box there. Feel free to submit an additional question. If there's something that you'd like for us to expand on or clarify, happy to take a crack at it as best we can. And again, that's on the bottom right-hand corner of our main website. So without further ado, good afternoon. Thank you for participating in our second quarter 2024 recap conference call. As always, a special thank you to our valued clients and account holders. We greatly appreciate those client relationships. With first-time listeners on the call today, I'll begin with some general information for those unfamiliar with Tactical Short and you can find more detailed information available also on our website, mwealthm.com/TacticalShort. Make sure that if you are not already, on a weekly basis, Saturdays, grab a cup of coffee and avail yourself of the Credit Bubble Bulletin. It is a tremendous service that Doug has been doing for a couple decades now. And a labor of love, certainly. Labor of passion and interest. He is very intent on documenting what has happened in the credit markets that has brought us to this point, and you won't find better insight, in my opinion, on the topic. And a quick— While I'm at it—and Doug, this is commendation 2.0—what Doug does on a daily basis, if you're on our website, you can look at Credit Bubble Daily and he's organized a host of news articles for you to look at, the most prescient of the day. And if you're interested in saving yourself an hour, two hours a day of finding the most important information points, do that. I've done that for years, and I owe Doug a lot of hours. It's been fantastic. Okay, the objective of Tactical Short is to provide a professionally managed product that reduces the overall risk in a client's total investment portfolio, while at the same time providing downside protection in a global market backdrop with extraordinary uncertainty and extreme risk. This strategy is designed for separately managed accounts. It's investor friendly, with full transparency, flexibility, reasonable fees, and no lockups. We have the flexibility to short stocks and ETFs, and our plan has been to, on occasion, buy liquid listed put options. Shorting entails a unique set of risks. We are set apart both by our analytical framework as well as our uncompromising focus on identifying and managing risk. Doug will explain some of the interesting and intriguing aspects of that, both in second quarter and as we find ourselves now in the third quarter as well. Our Tactical Short strategy began the quarter with short exposure at 80%. The target was held steady at 80% throughout the quarter, focused on the challenging backdrop for managing short exposure. A short in the S&P 500 ETF, the SPY, remains the default position for high risk environments. That's what it has been, and that's what it continues to be. I'll update you on performance and then pass the mic. Tactical Short accounts after fees returned negative 3.06% during the second quarter. Negative 3.06. The S&P 500 returned 4.28. So for the quarter, Tactical Short accounts returned negative 71% of the S&P 500's positive return. As for one year performance,…
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McAlvany Weekly Commentary
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$6.4 Million Million Lost In Recent Weeks Powell Is Caught Between Wall Street & The World Economy Legendary Central Banker Tells David Gold Is A Good Thing To Own "When liquidity dynamics change, speculative dynamics change and market prices follow. You could say that bull markets are driven by an excess of liquidity; bear markets by its scarcity. In recent years, excess liquidity has been fed by extra cheap capital, low interest rates. There was a world brimming with it during the zero interest rate experimentation phase, and when the global zero interest rate policy came to an end, the Japanese central bank continued to feed the speculation beast with zero rates. This is the carry trade, but what is perhaps new is being witness to a carry trade unwind." —David McAlvany Kevin: Welcome to the McAlvany Weekly Commentary. I'm Kevin Orrick, along with David McAlvany. Well, welcome back. One of my favorite times to see you, Dave, is after you've seen your parents. You guys went over to Italy. Was it Tuscany where you spent your time? David: We spent some time in Tuscany, spent some time in Amalfi, and it was great seeing my parents. We get to see them for that kind of time once every two years. They're getting into their late 70s, early 80s, and they're doing well. They're still working with orphans homes out in Asia. The Asian Pacific Children's Fund is going strong and it's fun to see. They're thinking and planning for how they want to impact the next thousand kids. Kevin: They never stop thinking about orphans. That's awesome. Now I've got to tell you, though, last night when we were meeting you said, "Hey. Do you want to see some pictures?" And invariably, especially in Tuscany, I see pictures of meat. That's what you mainly show me. It's like, "Here's the sausage we bought." What were the steaks that you had? David: When I'm on vacation, I love to cook. It's where I actually unwind. So for my wife and I to head to the markets and find a little of this and a little of that and put together a feast is absolutely a treat. Kevin: You had an itty bitty grill outside and you had this gigantic meat that was larger than the grill. I have no idea how you fed— David: Yeah. Two steaks, 10 pounds or roughly that. I don't know how to do the math. 4.78 kilos, I do remember that. But yeah, just simple things are the things that kind of make me go. Kevin: Over the last— Well, we've done this now how many years? Since 2008. So this Commentary has gone on for quite a while, and what we've seen over a decade is it was the decade of the central bankers. As you recall, in 2011, the central bankers basically came out and said, "Whatever it's going to take, we'll do whatever it takes." David: Well, the big transition actually was when Greenspan went from being the master of Greenspeak, where no one knew what he was talking about—and he was intentionally opaque—to every central banker communicating exactly what was going to happen. So there was no surprises in the market because, after all, the market does matter to central bankers. Kevin: Well, and they said, "We'll give you whatever money you need," and that's what has fueled the market. That worked for a while. But Dave, you've been talking to central bankers here on the Commentary, and then when you were in London you had dinner with a central banker. And the thing that gets my attention is they're sober right now. The things that worked in the past may not work in the future. And when a central banker from the Bank of England or central bankers that were friends with Paul Volcker, when these guys get a sober look and they say, "The tools that we've used in the past don't necessarily work in the future," it gets my attention. It reminds me of the scene, Dave, sorry, I have to bring up Jurassic Park again. John Hammond who had this park that he was managing. Dinosaurs were working, it was almost like a theme park, almost like Disneyland,…
Here’s our weekly recap of the precious metals markets for July 31. As of this recording, here is where precious metals stand: The price of gold is up to $2,450, or about 3% for the week. However, most of those gains happened within the last few hours of this recording. The price of silver is just above $29, up around 3.8% from the week before. Still under $30, but it is increasing. The price of platinum is up to $977, a gain of 4.3% from a week prior. It’s doing the best this week of the metals. The price of palladium is up at $913, about 2% and still sitting a little below platinum. Looking at the US equities markets… The DJIA is up 2.5%, S&P 500 is up about 1.7% and the Dow Transports is up 3.8%, although still lagging behind the other indicators. The US dollar is down 0.25%, sitting just above $104. Sideways Move for Gold The market can cool itself off one of two ways. It can either reverse and correct off some of the highs when it has been overbought. Or it can sit sideways for three or four months. Gold is proving to remain strong with its sideways chopping. It has been choppy throughout the summer, but its price has been steadily increasing — with higher highs and higher lows. The way it looks now, we predict gold won’t dip below $2,000 for a long time — if ever again. Rates Remain Steady For the July 31 meeting of the Federal Open Market Committee (FOMC), there was about a 7% chance of an interest rate cut — and it didn’t happen. The market is looking out to September for a potential rate cut. Meanwhile, there is political instability in the US, concerns in the Middle East and eastern Europe, and the China and Taiwan issue. With all the geopolitical uncertainty stirring up, we see bigger moves for gold in the fall as investors seek stability. Take Action Today If you’re ready to secure your portfolio with precious metals, get in touch with a McAlvany precious metals advisor. Your trusted advisor is available to help you find the right investments to meet your personal financial goals. If you haven't talked to your ICA broker in a while, it's time to do so. We can be reached at 800-525-9556.…
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McAlvany Weekly Commentary
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Charles Goodhart's Central Bank Experience Leans Towards Gold Greg Weldon Is A Current Gold Bull Analyst Jeffrey Christian Sees Gold Higher "What we see in terms of demand dynamics are unique. They are very unique. In the past, we had local concerns in a global gold and silver market, and that took us to all-time highs. This time is different. That's always going to be four dangerous words to conjure, but in each precious metals bull market of the past, there was some domestic audience somewhere doing most of the buying. And this time it's everyone everywhere." —David McAlvany Kevin: Welcome to the McAlvany Weekly Commentary. I'm Kevin Orrick along with David McAlvany. I have to admit, Dave, it was fun; when you talked to the office about doing half Ironman in Hawaii, and you said that you would pay for the entry fee and you applied some money even for the travel, I was in. That surprised me because I could barely swim, and that was fascinating, but that was almost 10 years ago. And I look back, I did mine and I finished, and then I was done. I was pretty good with that, it was time for me to return to my books, my reading, my other hobbies. And you, you instead just kept going. And I think there was a cost to that; you didn't read as many books during that period of time, but by golly, you were fit. David: I did try and— Kevin: Oh, pun intended. I did try. David: Well, I remember one long ride getting ready for the full Ironman in 2019, and I tried listening to the biography that Niall Ferguson wrote on Henry Kissinger. And after listening to it twice, I saved myself reading 800 pages twice, but I could tell you that Metternich was important in his thought development. And that was about it from 800 pages. Kevin: But you got 40 hours of training, physical training, and while you were listening. David: Oh, gosh. Well, there've been a flurry of guests this year, and we started with Edward Chancellor, extending that to the most recent interviews with Jeffrey Christian and Greg Weldon. A little bit of explanation, my schedule has changed in the last year and opened up considerable time to read again. As many of you know, the triathlon bug hit, it was about 10 years ago. I've been reasonably competitive in my age bracket since then. The process described in my book, The Intentional Legacy, is one that comes natural to me, reverse engineering projects and objectives. And that's what the triathlon and my time targets have become, and I've done dozens of them. After a series of back-to-back marathons in 2023, my knees offered a protest, and I decided to listen to my knees. And so training has been substituted with reading, and reading near to the volumes I was running at in 2008 to 2016 prior to the Ironman races. Kevin: You talked about what you wrote about in The Intentional Legacy book that comes naturally to you. Triathlon and a lot of the endurance types of sports are very solitary, and there's benefits to that. I remember the hours of training just for that half Ironman back 2015. Is that when we did that? David: 2016 was the race. We started training in 2015. Kevin: We did, yeah. And I remember a full year of training for that, but it's very solitary. And like I said, that has benefits. But Dave, something that you've always really been careful to do. We are made up of the books we read and the people we surround ourselves with. And you did have to slow down on reading books, but you are really good at assembling teams. I think about the team here at McAlvany, you assemble strategists, traders, people who are really good in their various areas. You've tried to do this through the years—we're on year 17 in the Commentary—you've tried to do this with the books you read and the people you surround yourself with, including interviews. And oftentimes, Dave, when we're sitting, as you know, on a Monday night when we're talking about what we're going to record; our conversation ac...…
Here’s our weekly recap of the precious metals markets for July 24. As of this recording, here is where precious metals stand: The price of gold is at $2,400 down just over 2% — coming off a high of $2455 from a week ago. The price of silver is down 4% at $29, declining from $30.21 last week. The price of platinum is down to $958, sliding 4% from $966 a week earlier. The price of palladium is only down 1% to $949, from $957 a week ago. Looking at the broader markets, there’s a lot of volatility all around. As of this recording the NASDAQ lost 722 points; the S&P 500 declined 128 points or 2.33%; the DJIA fell over 500 points; and the Dow Transports lost over 240 points. US Political Shift The political uncertainty in the US is partially responsible for driving the volatility in the metals markets. President Biden withdrew his bid for reelection on July 21, and he endorsed Vice President Kamala Harris as the Democratic presidential candidate. This move comes off an active Republican National Convention last week. Now, we’re certain that there will be a change in the presidency. However, it’s hard to tell what the political landscape will look like by the end of the year. Gold = Safe Haven Asset While precious metals prices may be on the move during this election year, it’s prudent to plan ahead and be ready for your next gold buying opportunity. Gold provides a layer of protection and stability to a diversified portfolio, especially important during uncertain times. A McAlvany precious metals advisor will be happy to discuss your personal situation and advise you on the best time for you to purchase ounces of gold. You can get in touch and schedule a no-obligation consultation with one of our advisors at 800-525-9556. Our office is open Monday through Friday from 8am - 5 pm Mountain Time.…
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McAlvany Weekly Commentary
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1 Jeffrey Christian: There’s A Lot Of Upside To Gold 1:04:47
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If You're Not Afraid, You're Not Paying Attention We Are Halfway Through The Next Leg Up On Gold Financial Markets Are Divorced From Economic Reality "There is increased awareness around the world about the increased political—international politics and domestic politics—economic and fiscal risks. And there's an increased concern that it's getting worse. There's a myriad of factors that are causing people to, A) be concerned about the risks they're facing today and the probability that the risks will be greater tomorrow." —Jeff Christian Kevin: Welcome to the McAlvany Weekly Commentary. I'm Kevin Orrick, along with David McAlvany. David, our guest today, Jeff Christian, I have a personal memory of this. Almost 30 years ago, the Platinum Guild flew me out to New York to meet with Jeff. We were supposed to have lunch and talk about the gold market and the platinum market. That lunch never worked out. I met with his assistant, we had a great lunch, we talked about those things. But as I was thinking about this interview, Dave, I was thinking of your dad starting this firm back in 1972, and then you've got other names, Jeff Christian goes back to the 1970s. It reminds me a little bit of the dwarves in Lord of the Rings, where you've got the Mines of Moria and the dwarves and all the history. This is an industry that really is generational, and the guys who are really committed to it, they've been around for a long time. David: It's fascinating to me that there are views of the commodity space which are somewhat derogatory if you're talking about the folks on Wall Street today. There seems to be something that has become very pure, the math that allows us to make all of these decisions. And yet you go back a generation, and it's not that math was absent, it was still there. There was still quantitative analysis, but people were connecting dots across the board. So your Gary Cohns and your Lloyd Blankfeins and the folks that were running Phillips or started Glencore or Trafigura, these guys and gals are trading commodities and they're interested in geopolitics, they're interested in public policy, they're interested in a lot of things more than just a mathematical equation or an econometric model. Kevin: Well, and it seems to work. David: And it does factor in, but again, if you think about the old ways and you want to go back to the mines, it's different. It's a different level of interest, a different kind of complexity. Math certainly factors in, but there's more to the story. And I think that's what I appreciate about the commodity space and about the gold space too. When you go back far enough, you find these folks who are interested in economics and geoeconomics and geopolitics, and that's certainly the case with our guest today, Jeff Christian, who runs the CPM Group. * * * Jeff Christian, thank you for joining us on the commentary today. We look at the gold, silver, and platinum yearbooks every year. We've been in the metals business for 53 years. We've done this podcast for 17 years every week, and I can't believe that we haven't had you on to talk about the supply and demand fundamentals. You've had a voice in these programs through the years, just from behind the scenes, because we find those yearbooks to be invaluable. And for anyone who's listening, who wants to dig into the fundamentals of the gold, silver, and platinum market. Those books are available. They're available for 150, 200 bucks, and they can be found in the link provided in the show notes. Jeff, tell us about your history. J. Aron, the CPM Group, the Goldman Sachs Group, and surprisingly to some, the leadership at Goldman Sachs made their way through J. Aron, whether it was Gary Cohn or Lloyd Blankfein, give us some of your history and the history of the company. Jeff: Yeah, sure. Okay. It's funny because several years ago, somebody gave me a book that basically said the problem with Goldman Sachs— The book ...…
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McAlvany Weekly Commentary
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This week we take a quick look at the strong movement of gold, breaking through to a new high. The Dow also shows very strong movement this week, climbing up to over 40,000 points. Gold continues showing strong performance and the next step up will be big. Thanks for listening.
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McAlvany Weekly Commentary
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Gold Will Break To The Upside There's Not Enough Growth To Support The Debt Housing Prices To Fall "Argentina's stock market, new high. Turkey's stock market, new high. Pakistan's market, new high. What do these things have in common? Currencies that are getting filleted. It's gold in those currencies that has kept the value, not the stock markets. And that is something key that U.S. investors are going to have to learn or they're going to get filleted." - Gregory Weldon Kevin: Welcome to the McAlvany Weekly Commentary. I'm Kevin Orrick along with David McAlvany. David, a long-time-ago guest. It's amazing to me that after 17 years we're looking back and going, "Gosh, that was a long time ago that you talked to Greg Weldon." David: The book that he wrote back in 2007, Gold Trading Bootcamp, it was interesting to me. We had him on as a guest, I think it was actually 2009, but this does go back a ways. And it brings some interesting insights into trading, investing the markets in general. Spent some time at Commodity Corporation, a trading outfit on the East Coast, at Princeton, Moore Capital, got to rub shoulders with some interesting people in his day. Whether it was Bruce Kovner or Louis Bacon, Paul Tudor Jones, and the combination of macro thinking and technical analysis and a real open mindedness to connecting a lot of different dots, there are areas where I think we've got some sympathies here. We understand what he's trying to do, might even do it a little bit differently, but really respect the willingness to embrace a lot of different perspectives as you bring together the right patchwork quilt. Kevin: The other day you texted me and you said, "Kevin, do you know any great drum solos?" And I YouTubed you a couple that I like. You YouTubed me one back, and I think about rhythm in music. It's interesting to listen to people who think in let's say 16th notes all the time, 8th notes and 16th notes, they're just moving. Greg is a guy who thinks in that high speed trading mentality. Just a couple of weeks ago, you talked to a man who was 88 years old who was with the Bank of England, who was thinking very, very long-term. That's like whole notes or it's a little different type of thinking. David: Unique cadence. Kevin: Yeah. What I like, though, is for the person who's saying, "All right, come on, Dave, let's don't talk about the next 50 years. Let's talk about maybe the next 24 months," Greg's a good guy to listen to because that's how he trades. * * * David: I think it's been at least 15 years since we last spoke. I read your book back in 2007, 2008 on commodity trading in gold. We talked shortly thereafter. Yeah, the world has changed a lot, and then in many respects, it's remained the same, just multiplied. We're more dependent on credit. The consumer has very little cushion. Real wages are still struggling. Those are a few similarities. On the other hand, a few changes have materialized. The dollar's less popular today. Our trade partners are running the same scale surpluses and their penchant for recycling into Treasurys has only eroded. If our conversation was 2008, 2009, national debt was under 10 trillion. Now it's 35. Budget deficit was 700 billion, now it's 1.6 [trillion]—and that's if you like the CBO's estimates. Probably going to be closer to two. Interest expense was, I don't know, 300, 350 billion? Now we're over a trillion. Unemployment was identical to today, which is fascinating. Gregory, what do you see as the similarities and differences from, gosh, it's been 15 years ago? Gregory: Well, that's a good question 'cause we could talk about that for two hours. I would say that the biggest thing that— I always remember somebody that was really brilliant, one of the people in Market Wizards by Jack Schwager—that great book about great traders—was, look, the market's changed. The market's evolved, and definitely technology has been a big part of that since I start...…
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