Gold is the most uncorrelated asset to stocks and bonds, confirmed by 50+ year secular trend analysis and its 13-year breakout in 2020.
Bitcoin shows a strong positive correlation with the stock market since 2013, making it the most correlated asset.
The 2020-2022 stock market bull and bond bear markets are part of a larger 60-70 year inflationary cycle, positioning gold for a potential breakout.
Gold ETF flows rebounded in 2022, while Bitcoin ETF flows went parabolic, indicating shifting investor sentiment as the stock market weakens.
The 40-month moving average is crucial for identifying secular bull and bear markets in stocks, while the 80-month moving average serves as a key indicator for bonds.
Musk and Ramaswamy’s plan, inspired by the Grace Commission and Reinventing Government initiative, aims to create a Department of Government Efficiency to expose waste and develop actionable steps for cutting spending and regulations.
The plan argues that many federal regulations are technically illegal and can be eliminated by executive order, citing Supreme Court rulings like West Virginia v. EPA and Lerch v. Rondo.
Libertarians and small government advocates criticize the plan for its total reliance on politicians who have institutional incentives to resist spending cuts.
The plan includes trimming the federal workforce by requiring remote employees to return to offices and relocating agencies out of DC to more relevant regions.
Specific targets for cuts include funding to the Corporation for Public Broadcasting and addressing significant waste, fraud, and abuse in taxpayer-funded programs.
Scott Bessent’s potential appointment as Treasury Secretary could trigger a global monetary system realignment similar to the Bretton Woods moment, with implications for dollar devaluation and fiscal policy shifts.
The current 7% increase in the dollar over 40 days, with 70% positive days, is viewed as unsustainable, potentially leading to a dollar decline and benefiting emerging markets.
Emerging markets, particularly in Latin America, may outperform US equities as the dollar weakens, capturing outflows from the US dollar and offering better valuations.
Bessent’s bullish stance on gold and its position as his largest holding could significantly influence monetary policy and investment trends.
A potential debt crisis and dollar devaluation are seen as inevitable strategies to address the US debt problem, potentially leading to higher inflation and a painful transition for investors.
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