But we’re going to call it that anyway. Give me a second here to catch up. Busy morning. Okay, where’s the homepage? There we go. Today we’re going to cover a story breaking out of the FT, which asserts that China’s hidden gold buying drove the record rallying gold. That’s in the lower right-hand quadrant there. And it confirms and vindicates what we’ve been saying and others have been saying for the last three years. And some, if you’re old enough, have been saying for the last 10 years. But before we get into that, I’d like to, and there’s that story.

Before we get into that, I’m going to go through the prices and explain why apparently this is happening. 10-year yields are down five. That’s a flight to safety or recessionary safety. The dollar’s 99.04 down 18. The S&P 500 is 66.60 down 79. The NASDAQ is 24.592 down 425. The VIX is up 2.6%, which is 13% in volatility terms at 22.61. Gold is down a whopping $111 trading $4,059. Silver is down $1.56 trading 50.76. It’s funny to say it. It’s down $1.56 trading 50.76. Copper is $4.98 down 3 cents. WTI is $59.66 up 95 cents.

Natural gas is $4.18 down 11. Bitcoin is $94.817 down $4,700. Ethereum is $3,000 change down 145. Palladium down 40. Platinum down almost 50. Gold silver stable. Considering that gold’s almost down as much as silver today. Again, that’s bullish. It really is. Grains are mixed violently. Wheat is up 1.4%. Corn is unchanged and soy is up 25 basis points. So what is going on? For the last week or so, the markets have been weighing stimulus versus rate cuts. I’m referring to gold. And I’m referring to stocks as well. So on the plus side, you’ll notice over the last 48 hours or so, Trump has been talking about $2,000 stimulus checks.

And best said, essentially confirmed that yesterday or the day before, I should say. Now, that’s the positive force behind these markets. Plus, the expectations that the Fed would cut as much as 50 basis points in December. Now, the counter coming into yesterday was that AI valuations are too high. And that was weighing on the market. The AI valuations too high are a function of two things. The main thing is the Western markets are waking up to things that zero hedge has been saying for a while and banks are now picking up on. And that is that the CapEx incentive and the Build Baby Build, which is really what it is, has incentivized stupid money to borrow to build things.

So my taco stand is now an AI taco stand. That gives me the write off. I take out some debt. So when you when you look at that increased sloppy borrowing, bubble borrowing, combined with the fact that AI really isn’t profitable yet, it only get and reassert and will reassert again, AI will not be top line profitable. It will not create new demand for things that people didn’t want before. It will, however, create bottom line profits. And that’s when people get fired and people are getting fired now. So on the negative column, AI is overvalued.

People are starting to be aware of that. The credit problem is cracking and people are getting fired. That’s recessionary. What’s holding the market up? The stimulus, but more importantly, the Fed saying they’re going to cut essentially cut 50 basis points. That had been a struggle with stocks holding their own, but tech stocks starting to get hit and Bitcoin moving with tech stocks and gold rallying and then backing off and silver rallying more because of its own physical shortcomings. There’s not enough out there and then selling off on financial selling. They’re selling what’s not being tied down.

So now we bring you up to what’s going on right now. What’s going on right now is two narratives are catching hold in the markets. As evidenced yesterday, Fed speakers came out very hawkish and absent data because we still don’t have the proper data and we may not get data for a while, despite the shutdown ending. You actually have the market saying, oh, shit, the Fed may not cut 50 basis points, especially if this is me talking, if Besant is doing stimulus, I view that as him throwing it out there because he’s worried they may not come.

Now, with the Fed 50 basis point cut being potentially rug pulled and the AI concerns out there, well, that’s your washout in tech. Now, let’s be honest about gold for a second. The last $200 as much as I loved it were contingent on the Fed cutting 50 basis points. I mean, we’re trading $4,000. We’re in a big range. We’re at the top of the range. Of course, I was bullish. Of course, I’m long. Of course, I’m losing money. But I’m going to grit and bear it. But staying with the facts, so you have this double whammy out there that’s been kind of looming.

AI is overvalued. AI is overvalued. AI has got a credit problem. Plus, yesterday, the new thing was, oh, shit, the Fed may not cut. And so the combination washed everything out. Is gold being sold off unfairly? Yes, gold should not be down with stocks. But when you look at the fact that there is hot money in gold, there are people who are selling gold now, not because they’re bearish, because they’re long, and they probably figured they’re going to get a chance to buy cheaper later on. I have to think even macro discretionary took a hit today.

And what I mean is they’re long stocks. And the stocks are getting slammed, gold getting slammed, etc, etc. So when you look at it from that lens, and I’m last year, China has been slowly encroaching propaganda wise, on the US American exceptionalism of AI. You know, if you look at Trump as a propaganda artist saying, you know, we’re going to have the best AI, we’re going to spend the most money, and China is coming back saying we did for $5 million. And China is making more announcements to that effect, we’re doing it cheaper.

What you’re doing is, you’re making our valuations look too high on the optimism, you show that we are in a bubble. I believe, frankly, I accuse China of doing what we do. And that is counter propagandizing the markets, they’re exporting their propaganda now to us. Am I blaming them? No, that’s the way the game is played. But this is why things are down. Why is it down so much? So much today? Well, something triggered slowly at first all at once. Michael Barry also closed his short position. That’s probably that was I made a joke yesterday, that’s probably a bearish sign.

Looks like it was. Alright, so all this stuff aggregated is you have a market that had been over its stock market that’s been over its skis, expecting a 50 basis point rate cut. And the lack of data allowed us to delude ourselves to that effect. Now you have speakers for one reason or another, saying we’re not going to cut, there’s a good chance we won’t cut and stocks already freaking out over AI. Okay, over AI profitability concerns are just throwing in the towel. So everything is down today. I said yesterday in the morning meeting, I said, I said, Well, that’s I said, yes, I said, last night, I said, last day wasn’t a bad thing.

But let’s hope that the rest of the week closes, we close out well. So this is a Friday. It’s a bad Friday. Gold is in a range. Okay, 3880 3920 is the bottom. Looks like we have the top being where, unfortunately, where that that top of that ledge was, it looks like we’re back inside that area. And so let me time to put some butterflies on again. Alright, so that’s it. That’s what’s going on right now. If you want to read more about that, zero hedge has a, let me see if that’s premium.

Zero hedge has a story called futures tumble as AI euphoria glistens reverse. Perfect headline. It’s not locked. I would suggest you read that if you want some insight into the stock side of it. Alright, so breaking. The FT put out a story yesterday, the FT asserts China’s hidden gold mine drove the record rally. As noted in this space, and detailed using proprietary methods breaking down reports from Goldman Sachs, sock gen Jeffries, and our own observations, paraphrasing James records several times in this space over the last three years, China Central Bank and related entities appear to be buying far more gold than they officially report, creating a large and opaque source of demand that is closely tied to a broader effort to reduce exposure to the US dollar.

And that helps explain the current record billion prices. Now, it’s not news to you. Oh, let me shrink this load. It’s my, my notes on the side there. That’s not news to you. But it is news to most of the world that we live in. So that’s going to raise awareness. It doesn’t matter what’s happening today matter. No, I was trying to not buy today. Of course, they’re mine. But here we go. China’s real gold mine is far larger than the official numbers. According to that new work highlighted by the multi-year analysis, the PBOC reports small monthly additions, yet evidence from sock gen Goldman and London barflow suggests China may be acquiring hundreds of tons through hidden channels tied to its D dollar rising strategy.

Analysts quoted by the FT sock gen mostly say China’s true holdings could already be near 5,000 tons. It’s more than that. Only one third of global central bank buying is now reported, creating a powerful opaque source of demand that helps explain gold record highs. We also noted that only one third of gold central bank buying is being reported now. So two thirds is not, and it probably has been that way for years, we would remind people that China’s army wealth is not on their balance sheet. It’s separate from the government, the army and the government are separate.

That happens in a lot of countries that aren’t liberal democracies. The army is separate from the government. And so when, as James Rickard used to say, when the army wants to buy gold, that doesn’t get reported, they need to make sure they’re self-sufficient. In the case of revolution, that happens in China and other places. And the first time this actually was disclosed with some sort of evidence was probably zero hedge, a little over two years ago, maybe, and Bloomberg right around the same time. But it was Goldman that actually started to show us in their new methodology, wasn’t new, they had it all along, sharing with us how it’s done.

So that’s the story that was set out today. It’s a very good piece. It doesn’t say anything hardcore gold fix people don’t know already, but it does frame things in a way that the rest of the world will understand. Of course, it makes China look like an evil player. And of course, it demonizes gold a little bit, but there are some new insights in there. For example, if I can think of them, there is a new insight in there about the, oh, I can’t, I can’t remember what it is. We’ll figure it out.

I’ll tell you what, if it’s me up later on, let’s move on. Special announcement that went out yesterday, Ronnie Stauffer, big pullback or peak, very nice slideshow. We’re going to ask him for the, for the video, if there was one of that, because that was a keynote address, go fix PM. You saw that tether hires HSP gold traders and founders am first look special. Coming soon this weekend, Citibank notes, there is not enough physical gold for the coming demand, period. That’s their way of looking at things. And it makes sense. We’ve looked at that, and we’re going to break it down for premium over the weekend.

Next, Catherine Austin fits on stable coins. We said, we’re going to put that out, but we’ve been a little bit busy. And finally special, as much as, as much as some of us may hate to admit it, Bitcoin will be AG seven central bank reserve asset. That’s our opinion. And it’s because we need to stay Western and stable coins and gold are Western. We’ve been saying, we’re going to put that out for a couple of days. We’ve had it written up. We’ve mentioned it to Marty on his show and we actually mentioned it yesterday on Bitcoin news.

But this story came out yesterday. Check central bank buys $1 million in Bitcoin, other crypto assets for testing. Now, if you sit there and you say, oh, they’re just buying it for testing. No, that’s not what they’re doing. See, two years ago, they said in a Reuters story, this is Reuters, by the way, in a Reuters story, they said, we’re skeptical about Bitcoin. In January of this year, they said another Reuters story. We’re looking into Bitcoin. And now they’re buying, they’ve already made up their minds. Okay, now is the Czech central bank, the G7? No, are they a major economy? No.

But Eastern Europe, that former Warsaw Pact nation group, they sit in between the East and the West. And while they may be ideologically Western, you know, freedom democracy, they’re economically Eastern. Who’s been buying gold for the last 10 years? Poland. Who’s been buying gold after Poland for the last 10 years? The rest of the world in Europe and Western Europe is fine too. So the Czech Republic, you have to pay attention to what they do. They’re like Poland. They’re buying Bitcoin and they’re testing it out. That’s what you do. If everyone’s already talking about doing something, you let the little guy go out in there in the field and you let him test it.

And if it goes bad, you could say we didn’t do that. He did. Bitcoin or, you know, again, I say this, I say this genuinely. If Bitcoin survives, whatever’s coming for cryptography, whatever happens. If Bitcoin survives and it’s genuine, and by genuine, I mean an asset that’s, whether it was created or not by the US CIA, I don’t care. It’s out there. And as long as it can’t be rug pulled, it’s safe. Now I want you to assume that it can be rug pulled by the West where the off-ramps and on-ramps can be blocked.

That’s just going to make the East not buy it. And that’s what they’re doing. They’re not buying it, but the G7 will buy it because they’re all in it together. Someone’s going to buy it. And the Czech central bank says that we’re right. Don’t go out by Bitcoin. Okay. Just don’t just understand that when 30% of central banks assets are gold, which they’re going to be Western G7 banks are going to hold, they only hold like 20 now. They’re going to hold 30% of their assets in gold. Why do I know that? Because Poland is going to do that now.

And they’re all going to follow Poland. Now, when you have 30% of your assets in gold, that’s a lot. It’s necessary, but it’s a lot. You need something to mitigate that. Is it Fiat? No, you need to sell more Fiat and buy another substitute stable coin, some stable US treasury and throw a little Bitcoin in there. That’s what we’re going to do. That’s my pay. So gold’s at 118 now. Data on deck today. PPI is not coming up, but we don’t really need any data. Let’s take a quick look at the chart. I don’t want to get it destroyed today.

All right. So the good news is there is no good news. No, the good news is the good news is the bad news is we went back below that area. Shit. Look at that. That ledge like an even star type of thing down. So now we’re looking at this here. Now I don’t expect this to hold. Okay. I’ve already come to terms with the death of that line. I want this to hold, which is 3900. If we stop here and go back up, that’s great. In fact, we’re probably being bought right now by sovereign wealth funds by central banks.

That’s what it was. Uh, uh, the FT said, um, uh, they and sock jet are talking more about the, uh, uh, uh, who else is buying. It’s not just central banks, which we know it’s sovereign wealth funds. It’s entities that are off balance sheet, like the military. That’s what they were saying. Anyway, um, it’s, it’s Friday on the week. We’re doing much better. Here’s the, uh, here’s the zoom out thing on the week. On the week, there’s the S and P chart for the week. Right. What is that on the week? I don’t know how the percentage is up there.

So that’s, uh, 67 40, 66 70. So it’s down 10% on the week. Is that 10% or 1% 1% and gold is still fucking green. Okay. Shitty green, but green silver may still be green as well. It has to be right still green. So the trade is as I, as I, as they do, but I said I was going to do is short tech and buy miners. That’s the trade. And when everything bottoms, then you just buy your tech back. You don’t sell your miners. Well, thanks for watching this morning’s markets and metals with Vince.

We sure appreciate you tuning in and starting your day with us here. Hope you enjoyed the show and we’ll see you again next week. Please note that this video is not intended as legal license, financial trading advice, and it’s to be used for informational purposes only. Please contact your financial advisor before making any decisions and thanks for watching. [tr:trw].

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