The end of the credit supercycle will lead to global chaos, causing unpredictable events like war, hyperinflation, deflation, and stagflation, surpassing previous country-specific currency crises.
Real assets such as gold, silver, energy, and farmland are likely to outperform during financial turmoil, while traditional financial assets may struggle.
Energy prices, particularly oil, play a crucial role in determining inflationary or deflationary pressures, with lower oil prices potentially causing short-term deflation during a recession.
Dollar-cost averaging in precious metals and cautious investment in mining stocks with growth potential is recommended for long-term investors.
Gold mining stocks tend to outperform during metals bull markets, attracting generalist money, despite 70% of financial accounts currently having no exposure to these assets.
Focus on well-managed big miners in gold/silver bull markets, as they offer decent dividends, stock buybacks, and generate substantial free cash flow.
Reshoring and tariffs are inflationary, as relocating factories to developed countries requires expensive raw materials, skilled labor, and higher wages.
Governments facing debilitating interest costs on debt may implement catastrophic policies, potentially leading to a currency reset or return to a gold standard.
Trump’s tariff policies, initially seen as extreme, may incentivize trading partners to agree to zero tariffs, which could be the ultimate goal despite the messy implementation.
Uranium and copper miners offer upside potential amid global electrification trends, with uranium demand rising from mothballed plants and copper facing supply challenges.
Jurisdiction risk is critical for mining investments, with Nevada remaining a AAA jurisdiction for gold/silver, while countries like Mexico pose threats of nationalization.
Building personal resilience through community ties, skill development, and owning productive assets is crucial for weathering potential financial chaos.
Summary
The Trump administration’s proposal to abolish the progressive individual income tax excludes the payroll tax, which funds Social Security and Medicare, as eliminating it would be political suicide.
Tariff revenue, comprising only 2% of federal revenues and 1.2% of federal spending in 2024, is grossly insufficient to fund the government’s extensive spending plans.
Attempting to cut military or Social Security spending would cause the federal deficit to skyrocket, potentially leading to increased money printing and high inflation.
Politicians are incentivized to maintain high federal spending levels due to voter demands, making significant IRS or income tax elimination unlikely without substantial public support for spending cuts.
The Internal Revenue Service, responsible for collecting payroll taxes since 1937, would likely persist under a different name to manage any form of payroll taxation.
Silver price dropped 20% in 2 days (April 2025), signaling a major trend change and potential long-term correction for silver and miners.
Fibonacci levels and technical patterns in silver and gold charts indicate a bearish trend, with silver’s 100% measured move suggesting a bounce followed by multi-month correction.
The SP500 has broken down from a technical breakdown level, indicating a major market top and potential long and painful correction in the stock market.
Massive tariff hikes on most Chinese goods, including vehicles and electronics, are expected to slow business and economies, leading to a recession and precious metals sell-off.
The VIX index has increased 80% in 2 days, signaling high fear and uncertainty in the market, which is bearish for precious metals and overall market.
Energy stocks (XLE) are expected to face 20-30% downside due to oil’s recent 15% drop, breaking a significant pivot low at $65 per barrel.
Gold has held up well despite market chaos, with only a 5% drop compared to 15-25% drops in other assets, positioning it as a safe play and global barometer.
The Magnificent Seven stocks (e.g., Microsoft, Google) are oversold and putting in a bottom, serving as an early warning sign of market turning, with a washout low expected in the next week.
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