Gold: Dubious Speculation

Parked my oil tanker to watch this video

The negotiators of iran and us delayed their meet because of dubious speculation 👻

I've ended 9 wars to watch this!

I am Albert Einstein. I paused relativity for this video.

Breakout was 3500. I’ll start DCA there. Silver 50. KISS. May take some time, may even double top before but we need to retest 3500. I’ll wait. *all negated by any Treasury move to further take us toward gold (hard asset) backed reserve currency…

A large part of your thesis depends on an imminent recession. I think that’s becoming less likely given the strength in recent manufacturing data. Over the past four months, manufacturing has been notably strong, and historically it’s one of the earliest indicators in the economic cycle. It tends to lead the upswing: first manufacturing improves, then 3–6 months later job openings rise, followed by wage growth, and then inflation. The key point is that manufacturing is forward-looking, while indicators like employment, wages, and inflation are lagging. As long as manufacturing remains strong, it suggests the expansion still has room to run. On gold price, looking at the relationship between price and cost of production is useful for timing cycle peaks. Around the gold price peak of 1980–1981, gold traded roughly 5× its production cost. At the gold price peak of 2011, it was closer to 2×. Today, gold is a bit over 2× its cost of production. Using 2011 as analogue suggests we may already be near the upper end of this cycle, rather than midway through it. In my view the Iran conflict represents a peak volatility event for this cycle—a classic “sell the news” moment. Since 2020, beginning with the COVID-19 pandemic, markets have been operating in an elevated volatility regime driven by repeated shocks. Looking ahead, the list of plausible, high-impact geopolitical catalysts is limited. A Taiwan invasion is often cited, but its practical challenges and low probability of success make it a less likely near-term trigger, particularly given that Chinese leadership is aware of those constraints. Gold tends to perform best during periods of rising uncertainty—it “climbs the wall of worry.” My argument is that we may be approaching a peak in that worry. If an Iran-related event marks the high point of geopolitical stress, then volatility could begin to fade over the next several years. In that environment, gold’s primary role as a hedge is less in demand, and prices may consolidate or drift. More broadly, volatility is cyclical. Periods of elevated volatility tend to be followed by compression, just as low-volatility regimes eventually give way to new shocks. Since volatility has been persistently high since 2020, the more likely next phase is a period of relative calm. That said, our views aren’t necessarily mutually exclusive. It’s possible gold enters a multi-year consolidation phase from here, only to later “sniff out” a higher-probability geopolitical shock—such as a shift in expectations around Taiwan—and begin a new leg higher toward all-time highs.

I like the old thumbnails more. These don’t have that “this video is a bitcoin dominance video even when it’s not a bitcoin dominance video feeling.”

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I drank the Strait of Hormuz just to watch this video.

5 years ago (September 2021) a 75 year old tall man told me he was buying gold heavily and that I should "watch out". I hope he's alive to see this day