1- In a functioning economic system, Brent Oil is the Central Banker. 2’s follow oil around on the screen and then the CBs reluctantly follow the 2’s around. But what happens if the President dumps a few hundred million bbl from the SPR and destroys the signal??
2- Then gold becomes the Central Banker. Except, we’ve been interfering with the gold price for years. So then, who becomes the Central Banker?? What if it is copper, or the Tin Barons, or Uranium, or some other minor metal?? Can’t play whack-a-mole on the whole periodic table…
3- That’s what we’re seeing today. CPI is raging, and that’s with all the doctoring they do. Bonds are melting, as is SPZ. Meanwhile, look at oil/silver/copper/gold!! They have bids. Rapidly shaking off the CPI print. They’re the Central Banker now…
4- But shouldn’t gold be following rates…??
Not if it’s “Project Zimbabwe” and we’re entering a fiscal crisis. In that environment, gold gets a bid as everything else gets outflows. It’s the only neutral asset.
5- A lot of Portfolio Managers have never read up about this. They are gonna be lost over the waterfall. I’m ready. We’re all in Zimbabwe now. Get used to it…
6- My book is yoked out long inflation. Go to and read my blog. I’ve been writing the rule-book for this environment. It’s all there. A lot of us will come out the other side, hopefully as winners. Some won’t make it. That’s unfortunate. So far, markets are going with my playbook…Pracap.com
7- How am I playing?? I own assets that are at a huge discount to replacement cost and spitting cash or about to (VAL/TDW/JOE). Own mission critical assets in short supply that are hard to ramp supply (Uranium). Own the exchanges that people will use to leave the fiat system and buy self-custody metals (AMRK). That’s basically my book. Got some other stragglers, some Event-Driven stuff, but they won’t really move the needle. Wish I had more ideas. Wish I could find another AMRK. After 4 years of thinking it through, that’s the best I’ve got. It’s gonna be a rough period. Survive…
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