John Rubino tells Dunagan Kaiser that gold bouncing off $4,000 and silver off $60 are reasonable support levels that may mark the bottom after the swoon from the late-January highs. He flags Blackstone’s withdrawal from one of the world’s biggest data center projects, killed by community opposition, as a potential top signal for the AI bubble, warning that a burst strands multiple trillions of dollars and that “the tech elites view the rest of us as exit liquidity,” pointing to the push to open IRAs and 401(k)s to IPOs like SpaceX as smart money distributing to retail at the cycle peak. He also warns buyers that unhedged dealers stuck with overpriced silver inventory are widening spreads, and says producing miners are generating heavy free cash flow ahead of Q2 reports starting July 23rd.
Metals at support: Gold hit $4,000 and bounced, silver hit around $60 and bounced, both reasonable resistance levels after the roughly 50% retracement in silver from January, and worth watching as a possible bottom for the next leg up.
Blackstone’s data center exit: Blackstone pulled out of financing and ownership of one of the world’s largest data centers after community pushback, the divergence Rubino cites for the Dow surging while the Nasdaq sank; he expects the precedent to spawn many more killed projects and “extreme turmoil” in the data center market.
Retail as exit liquidity: The recent two-week push to change IRA and 401(k) rules so moms and pops can buy IPOs of high-fliers like SpaceX is, in Rubino’s view, the smartest money selling to retail, which frequently marks the end of the cycle before things “get very rough very fast.”
Premium trap in physical silver: Unhedged dealers who took on inventory at high prices are underpaying sellers and overcharging buyers to escape losing positions, so buyers should shop around, consider cheaper rounds and bars, or park in physical ETFs trading near spot.
Miner free cash flow and buyouts: Producing gold and silver miners have been generating a ton of free cash flow for a year, with strong Q2 reports expected from July 23rd to fund dividends, buybacks, and acquisitions; juniors are being bought out at two to four times entry prices rather than running as ten-baggers.
Speaking with Daniela Cambone at the Rick Rule Symposium, Nomi Prins holds her call for $6,000 gold and $120 silver by year-end, arguing the June selloff was a paper-driven, AI-algorithm-exacerbated washout of quarter-end margin calls and fund repositioning rather than a change in fundamentals. She says the Fed under Kevin Warsh will not hike and could cut 25 basis points before the midterms, noting the Fed’s balance sheet has quietly grown by the same amount as the 10-year Treasury auction since December, which she calls secretive QE. Central banks remain the anchor bid, with 45% of those surveyed by the World Gold Council planning to increase holdings and gold now the number one reserve asset, having superseded both US Treasuries and the euro.
$6,000 gold by year-end: Prins says gold has already taken its 27-28% correction from the January $5,500 peak, is restabilizing in the $4,100-4,200s, and will pass $5,500 “with a vengeance” as unresolved paper shorts are forced to cover.
SLV paper distortion in silver: SLV normally trades 20-25 million ounces of silver equivalent daily, but during the June selloff volume doubled to 50 million ounces, roughly $10 billion of paper silver a day against only 820 million ounces mined per year; she keeps her $120 silver target.
No hikes, possible pre-midterm cut: Fed Watch odds of two hikes collapsed from 70% to below 30% after weak jobs numbers, and Prins expects inflation to trend down from the 4% prints (though never back to 2%), giving the Fed room to cut 25 basis points before the elections, which is what Trump wants.
Central banks doubling down: The People’s Bank of China has cut its Treasury holdings to $640 billion from $1.3 trillion in 2018 while adding gold, and Prins says central banks only sell gold when they need immediate cash, always rebuying afterward.
Gold-linked Treasuries in play: Prins says the Judy Shelton-style gold-convertible bond won’t happen soon at the Treasury, but banks like JP Morgan and Morgan Stanley can build gold-for-Treasuries derivatives first, and DC conversations about linking a portion of the Treasury market to gold are more active now than at any time she’s seen.
Michael Pento of Pento Portfolio Strategies argues the Fed has engineered the wealth gap, with the top 1% holding 32% of US net worth (over $43 trillion) because trillions in base money creation inflated assets for the rich while destroying everyone else’s purchasing power. He predicts the credit market will fracture, most likely starting in private credit and the AI investment bubble, triggering a depression in which stocks fall 50-80% and equities revert from 235% of GDP toward 100%, after which Warsh will capitulate and monetize $5-6 trillion deficits. He recently doubled his gold exposure and bought miners for the first time in years, and sees gold shattering its highs toward $10,000 an ounce once the printing resumes, followed by intractable stagflation.
Fed-made wealth gap: The top 1% control 32% of the nation’s net worth, more than $43 trillion, nearly equal to the bottom 90% combined; Pento says the problem is not the wealthy but the Fed expanding the monetary base by trillions to enrich banks and asset holders.
Warsh watch: Warsh grew the monetary base $24 billion in his first two weeks before nominally shrinking it, while Powell printed $200 billion of high-powered money in his final five months and cut rates his last three moves; Pento still holds “some hope” Warsh drains the balance sheet but expects him to succumb and print trillions.
The coming credit fracture: His 12-component inflation/deflation model points to the epicenter being private credit, private equity, and the AI bubble; when it cracks, repo and money markets freeze, stocks and real estate plunge in tandem, and deficits hit $5-6 trillion with UBI and TARP-style responses.
Doubled gold, bought miners: After Warsh’s speech he doubled gold exposure and bought miners (down 35% from February highs) at a PE of 14 with a low PEG ratio, arguing gold loves the falling nominal and real rates coming as inflation’s rate of change rolls from 4.2% toward 3%.
Valuation insanity elsewhere: He mocks SpaceX trading at 100 times revenue and investors lending it 50-year money at 200 basis points over Treasuries, while national debt sits at 123% of GDP and 720% of federal revenue; a 60/40 target-date portfolio will “destroy your retirement” in the next brutal recession.
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