It's been 2 years since the WSJ trashed Gold ...
Joris Bastien
Alpha Engines for #HNWI, #familyoffice, #hedgefund and RIA portfolios . Focus on macro and digital spaces. Stoic Epicurean (!) Atomist believing in duty. Fine art photographer.
GEOPOLITICS
USA
Momentum is on Trump’s side at the moment about two weeks before the election, and the Republican candidate's lead in prediction markets has grown steadily.
De-Dollarization Continues, with BRICS achieving a significant shift, settling 65% of trade in local currencies and thereby diminishing the influence of the US dollar and the Euro to below 35%.
Eastern Europe
Russia keeps making progress, especially on the Eastern front, at a faster pace, capturing over 5 times more Ukrainian territory in 2 months than in All of 2023.
Reports indicate staggering losses for the Ukrainian armed forces with estimates reaching 1.8 million casualties, including 780,000 deaths. From June to mid-October 2024 alone, Ukraine has reportedly lost 265,000 soldiers, 45,000 of whom were killed. The current monthly Ukrainian losses are unbearable to keep fighting, let alone win the? war.
In this context, Germany ends military aid, and? will no longer transfer heavy military equipment to Ukraine, according t the German Ministry of Defense.
Middle East?
The conflict in Israel is generating massive displacement of populations:
Israel has requested the US to send, and the US deployed for the first time its THAAD anti-ballistic missile system to Israel in anticipation for an Iranian retaliation to Israel’s attack, deepening the U.S. military involvement in the region as Israel prepares for a possible strike on Iran. Israel plans to target Iranian military sites, not oil or nuclear facilities.
At the same time, Iran and USA suspended nuclear communications at Iran’s initiative. Even during difficult times, these communication channels had never been broken.
Asia
Tensions are rising as well in the Korean peninsula, with North Korea ordering artillery units near the border to be on standby, prepared to fire at a moment’s notice.
In response, South Korea has placed its military on full readiness.
ECONOMY
US consumers' inflation expectations for the next 5-10 years skyrocketed to the highest in over 40 years, doubling in just several months., indicating that Inflation is still a major concern for Americans.
We are seeing signs of inflation re-accelerating again, with core CPI inflation jumping for the first time since March 2023.
The Fed played a dangerous game with 50 bps rate cuts in September, and prediction markets are now seeing a 15% chance of no rate cut in November (Polymarket).
领英推荐
Nobody expects another 50 basis point rate cut in November, odds declining from 53% to 8%.
Meanwhile, Gold, which is often viewed as a hedge against inflation, is regularly making new highs, when investors are ditching bonds even as the Fed cut by 50 bps !
Gold prices typically lead a surge in CPI inflation, which usually lags reality.
Oil not doing well is an indicator of recession as the geopolitical situation has a limited impact on prices. Oil markets appear to be worried about a "hard landing" scenario.
The market is currently pricing in a 35% chance of a recession in the US within the next 12 months, while the next 12-month Fed interest rate policy expectations imply an 84% probability of a recession.
MARKETS
While US Equity markets are on their all time highs, Equity volatility market is rising, while bond market volatility is spiking, at a time the 10-year Treasury yield jumped from 3.64% to 4.10%, and Treasury bonds are falling.
Vix up, Move up, Gold up, Bitcoin up and Interest Rates up is telling us something.
Ignore at your own risk !
Gold has now increased more than $1,000 since Wall Street Journal printed this little gem just over 2 years ago.
Do you actually still follow MSM for anything? Not even their weather forecast is accurate.
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Alpha Engines for #HNWI, #familyoffice, #hedgefund and RIA portfolios . Focus on macro and digital spaces. Stoic Epicurean (!) Atomist believing in duty. Fine art photographer.
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