Show Notes
In 1971, one year of work bought you 85 shares of the S&P 500. Today that same year of work buys you only 11. Same effort and hours - but a fraction of the result. I’ve been going back and forth with Sam Kovacs on why that happened, and gold just gave us a PERFECT real-time example of people getting the whole story wrong: Kevin Warsh gets the Fed nod and market decides there’s a hawkish new sheriff in town. Then gold drops from around $5,400 to roughly $4,000, silver gets crushed right alongside it, and every financial commentator on TV is suddenly writing gold’s obituary like the story’s over. Sam runs a systematic macro fund, advises governments on policy, and he laid out exactly WHY everyone calling the top is missing the point... The mistake is thinking this was ever about one event. Trump leans on the Fed, rates get cut, gold pops, story plays out, done. But that’s not what’s happening. What’s happening has been running since the day Nixon closed the gold window in 1971. It never stopped. Not ONCE That stat I opened with - 85 shares down to 11 - that’s not inflation the way people learn it in school. This is what 5 decades of a currency slowly losing ground actually does to your paycheck. And nobody can point to the day they got robbed. The number on your statement keeps going up. What it buys keeps shrinking. So gold went vertical for a stretch. The momentum guys traded their meme stocks for GLD and SLV and rode it straight up. As we all know, vertical moves always come back down hard. And we just got the hard part. Everyone’s calling it a “healthy” correction. But here’s where it actually MATTERS: Sentiment on gold has collapsed toward zero. Everyone’s out of the pool. The miners look cheap to me right now. Sam won’t fight the tape near-term - price is price, he respects it. But stretch it out 10 or 20 years, and the only people underwater on gold are the ones who bought it yesterday. SCARCITY That’s the word Sam kept coming back to, and it’s the whole thing. Gold’s scarce because of geology. What just got mistaken for a dead trade is the same 50-year reason to own it, right on schedule. GOT GOLD? 🥇 Full interview:
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Our long/short spread widened to 67.4% today, with our longs up 25.9% on average and our shorts down 41.6%.