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Ronnie Stoeferle Profile picture
@RonStoeferle
Mar 14, 2022 • 7 tweets • 6 min read • Read on X
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As the first rate hike of this new (imho very short) rate hike cycle is getting closer, let's have a look at the performance of the #USD, #commodities and #gold before and after the first hike:
Will the #USD rally? Not necessarily..

The period prior to a US tightening shows a rally in the USD but very often weakens in the 6-month period following the first hike....
What about #commodities? Consensus would tell us that raising rates will cause commodities to sell off.

Not really. ..The first rate hike proved to be close to the bottom for the 2015 cycle, and all cycles were higher a couple of months out...
Now what about #gold?

Pundits would say that higher rates should cause gold to sell off, but actually the first hike seems to be a consistent point to buy gold. Only the 1994 cycle saw gold end lower than the rate hike day - and even then, it was by a small amount.
...in the last hiking cycle, the day of the first hike exactly nailed the low in gold...
...while under Greenspan in 1999, gold made its lows only 3 weeks after the first hike and started a 12 year bull market...
Long story short: Don't fear the first rate hike, rather buy it...

ht @kevinmuir and @IGWTreport

#gold #silver #federalreserve #ratehikes #powell #trapped #BTC #USD #commodities #selltherumourbuythefact

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More from @RonStoeferle

Ronnie Stoeferle Profile picture
Mar 26
Just finished reading the brandew "Gold Investing Handbook for Asset Managers" by the World Bank.

The 72 pages report is indeed well worth reading and can be downloaded here:


For your convenience, I have created a little #thread to sum up the highlights of the report:openknowledge.worldbank.org/server/api/cor…
“Because gold has multiple sources of demand and supply as compared to other major asset classes, its liquidity is less likely to dry up during times of market volatility.” #portfoliohedge #liquidity #stressliquidity
"Gold makes up around 18 percent of the total reserves of the central banks, while the share of the US dollar in total global reserves has declined from 71 percent in 2000 to 56 percent in 2022 (according to the IMF Official Foreign Exchange Reserves (COFER)), reflecting the push among public asset managers to diversify their foreign reserves as their safety and capital preservation objectives became more difficult to achieve through investment in traditional assets and currencies, given the negative real yields environment." #Dedollarization #HeelTurn
Read 14 tweets
Ronnie Stoeferle Profile picture
Jan 7, 2023
It seems that #Zoltan has been quite busy lately!

The newest, already 5th part of his "War"-series, was published on January 6th.

In this little #thread i've summarized some of the highlights of his piece "War and Peace:

🧵
"... four “war” dispatches last year: War and Interest Rates, War and Industrial Policy, War and Commodity Encumbrance, and finally, War and Currency Statecraft. In these, I identified six fronts (..) in “macro-land” () where Great Powers were going “at it” in 2022:
"the G7’s financial blockade of Russia, Russia’s energy blockade of the EU, the U.S.’s technology blockade of China, China’s naval blockade of Taiwan, the U.S.’s “blockade” of the EU’s EV sector with the Inflation Reduction Act,
Read 35 tweets
Ronnie Stoeferle Profile picture
Jan 5, 2023
Happy New Year, dear friends!!!!

You know that I enjoy reading every piece that #ZoltanPozsar at #CS writes. His latest piece "War and Currency Statecraft" (Dec. 29th) was again very much worth reading.

Here's a little #thread with the most important parts:
"What are G7 policymakers, rates traders, and strategists to do when threats to the unipolar world order are coming from every angle. They should definitely not ignore the threats, but they still do.

How could they not?"
"For two generations, we did not have to discount geopolitical risks. Since the end of WWII, the only
Great Power conflict investors really had to deal with was the Cold War, and since the conclusion of the Cold War, the world enjoyed a unipolar “moment”... –
Read 30 tweets
Ronnie Stoeferle Profile picture
Dec 28, 2022
Folks, you know that I enjoy reading every piece that #ZoltanPozsar at #CS writes. His latest piece "War and Commodity Encumbrance" (Dec. 27th) was particularly worth reading. Here's a little #thread with the most important parts:
"A recurring theme in my dispatches this year has been that in a moment when the world is going from unipolar to multipolar, the actions of heads of state are far more important than the actions of central banks."
"Central banks will be behind the curve in this game, and if investors read only the speeches of central bankers but not statesmen, they will be even more behind the curve. The multipolar world order is being built not by G7 heads of state but by the “G7 of the East”."
Read 45 tweets
Ronnie Stoeferle Profile picture
Dec 7, 2022
I have just re-read Zoltan's piece called "Oil, Gold, and LCLo(SP)R"....Here's my little summary:
Regardless of fundamentals, global banking reserves are not in danger of a liquidity crunch or default. This is because there are enough emergency backstops in place to essentially bail out anyone that gets into trouble by printing more reserves.
This is not the case in energy markets. Global demand for oil exceeds supply. The US and OPEC+ do not produce enough oil to supply the west. The Biden administration has been relying on the SPR to artificially lower oil prices and meet demand.
Read 7 tweets
Ronnie Stoeferle Profile picture
Dec 6, 2022
Just finished reading the new piece by #ZoltanPozsar "Oil, Gold, and LCLo(SP)R...Fascinating read (as always), here are some highlights:
"The SPR is like the o/n RRP facility. It can be tapped when oil levels are tight. But the SPR is finite, and recent releases have brough reserves down to levels
we haven’t been at since the 1980s. The 400 million barrels left in it isn’t much:
it could help police prices for a year if we released 1 million barrels per day (mbpd), half a year if we released 2 mbpd, and about four months if we released 3 mbpd."
Read 18 tweets

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