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Santiago Capital

Feb 15, 2020 • 25 tweets • 7 min read • Read on X

Many of you have already heard my #Dollar Milkshake Theory.

In fact...I'm pretty sure many (most?) are SICK of hearing about it...

😅😅😅

And some of you may have heard me use three different movies to help explain why the magic trick of sucking up capital from around the world while the dollar kurgan simultaneously cuts the heads off the competition...

But many of you have come back to me and said:

"This is all very interesting...but it just can't happen. The US is in serious trouble. And you are ignoring the trap the Fed has set for itself."

In other words...you don't believe in Magic.

But here's my answer to that:

You are mistakenly focusing on only the 3rd and last step...

"The Prestige"

And that's ok...you should DEFINITELY prepare for the Prestige (or its failure).

But it's also important to understand steps 1 and steps 2.

What are those Steps?

Ah...I'm glad you asked...

Now...focus on this part:

This is where you need to think about the common knowledge game. You need to understand what EVERYONE ELSE is going to do (or believe)...not what YOU want to do (or believe). Because the HERD is going to determine what trends and what doesn't

So even if you know the secret...and you yell it loud and clear...most people won't want to hear it.

They WANT TO BE FOOLED.

So when you tell me something "can't happen"...

I ask...

Because our central bankers are amazing magicians.

And the US Dollar and USD Payment System is a hell of a prop with which to work their magic.

And the Global Monetary System (the magicians theater) is set up to give them every angle, every trick, ever advantage.

So even if YOU don't believe in the magic...

No matter how much you jump up and down and yell and scream...

Most people will still believe...because they want to be fooled.

And after all...are you SURE it's not real?

I mean...who doesn't like Magic???

You REALLY don't????

I mean...If I told you I could read your mind...and I was right...would you believe?

Ok...

Get out a sheet of paper...

and a pen...

Now...are you ready?

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More from @SantiagoAuFund

Santiago Capital

@SantiagoAuFund

May 17

Getting a lot of push back for "shorting silver" this morning. Reasons range from accomodative monetary authorites, a bullish chart, a move above its 5 year high, and the inevitable death of fiat.

So, a thread on my process that led to this decision. 👇

First, I didn't "short silver".
I bought puts on a silver derivative.
Which means I have a defined amount of risk.
I know my max loss whether silver rises 1% from here or 1,000% from here. And IMO the upside of this trade is decent considering the defined downside.

Second, I'm not "all in" on this.
Just a short term tactial trade as part of a diversified overall portfolio. And as part of overall portfolio am long gold. Won't get rich if right & I wont get rekt if wrong.
So why do it?
Bc its part of my job.
Why now?
The process says...

Read 21 tweets

Santiago Capital

@SantiagoAuFund

Oct 20, 2023

OK, potential mea culpa time.
Ive now had 2 phone calls as well as email correspondence with US Treausury Dept about TIC data regarding what it does & does not show.
Long story short, its a bit confusing bc they recently changed methodology and may change it...again.
1/

In thread below I will share what Ive learned.
U are then free to make up your own mind as to what info is saying & what it means for markets.
The debate started a few months ago when charts of UST holdings by China started making the rounds.
TIC is the source for the chart
2/

TIC data is based on CURRENT MARKET VALUE of CURRENT HOLDINGS at the end of period. Meaning it reflects purchases, sales & CHANGE IN VALUATION. This has been confirmed by UST department in person and in writing. Also, see footnotes on TIC data reports below.
3/

Read 10 tweets

Santiago Capital

@SantiagoAuFund

Sep 8, 2023

Much has been made of the recent Fed rake hiking cycle as well as the coinciding collapse in long term UST Bond prices. I thought I'd do a short thread in order to help those who seek a better understanding of what is going on & whether "It's different this time."
Enjoy...
1/

Lets take look at historical hiking cycles.
Since late 70s, have been 7 cycles.
Chart shown below.
Absolute value right hand axis.
% growth shown on chart
(numbers approximate).

77-81 (290%)
83-84 (40%)
87-89 (60%)
94-95 (100%)
04-07 (400%)
15-18 (900%)
22-23 (2000%)

2/

Here we see rate hiking cylcles with price of Long Term UST price overlaid.
We see both over long term, as well as during short term cycles, the UST price has tended to have an inverse correlation to rate hikes.
This is Bond 101.
As rates rise/fall, bond prices fall/rise.

3/

Read 14 tweets

Santiago Capital

@SantiagoAuFund

May 6, 2023

Which does a government hate more?

What is more likely to lead to deflation?

What is more likely to lead to a currency strengthening?

Read 5 tweets

Santiago Capital

@SantiagoAuFund

Mar 26, 2023

For anyone who thinks I haven't done my research, I'm posting a paper I wrote on Bitcoin several years ago.

It is now somewhat dated but please feel free to tell me where I have it wrong or which part I "just don't get".

1/

Read 9 tweets

Santiago Capital

@SantiagoAuFund

Mar 1, 2023

A thread...

I started in this business almost 25 (!) years ago.
In that time, I have transitioned through the .com boom/bust, Sept 11, the RE boom/subsequent GFC, the Euro sovereign crisis, the '18 volmageddon, the '19 repo crisis, the Covid crisis & the '22 Fed hiking cycle.
1/

Safe to say Ive seen many separate episodes of both panic & euphoria. Sometimes right on heels of each other. Despite all of that, I've never seen a more uncertain time than right now. This is long way of saying if someone says they know for certain what comes next...
2/

This is also why I am always a bit surprised when I talk to someone who is a devoted member of some monolithic inflation, deflation, gold, fiat, crypto, hegemonic surpremacy, or global south tribe.
3/