Today’s the first day in a long time financial markets appear willing to at least consider the reality of the geopolitical situation on the ground for what it is, as opposed to what most people would like it to be. As I’ve noted for months, the “trade war” is just one battle in a much larger, increasingly unstable struggle between the U.S. and China for global power and leverage to shape the next paradigm of world history.
A failure to appreciate how big this really is explains why investors have been so willing to swallow unrealistic happy talk from both sides. The risk that needs to be discounted in the market isn’t a risk of higher tariffs, but the risk of WW3. The U.S. and China were never going to sign a trade deal and blissfully return to the ways things were. That world is over. We now find ourselves in the very early days of a historic struggle to influence the future.
Back in January, I wrote a twitter thread centered around gold which ended up becoming very popular. It’s been around five months since then, so I want to provide a quick update.
I had outlined four reasons why I had become increasingly bullish.
9/ U.S. equities have been in a historic bull market since then, and gold has done nothing but go down. I don’t think the next bull market in gold can really get going until this central bank manufactured 10 year asset bubble begins to burst, and I think this is now happening.
10/ Now I want to summarize why I’m becoming increasingly confident a gold bull market is on the way.
1) Market cycles turning (discussed above).
2) Geopolitics, emerging multi-polar world order.
4) Trading action.744:19 PM – Jan 4, 2019
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