PodCasts Archives - McAlvany Weekly Commentary

Europe's GREEN Agenda creates dependence on Putin's energy U.S. severs buying of Russian Oil Battle-tested, gold is worth its weight   The McAlvany Weekly Commentary with David McAlvany and Kevin Orrick Is This Commodity Price Spike Transitory? March 8, 2022 The key is to have the mindset of the institutions that will sit back and wait for weakness. And on every bit of weakness, they’ll add to a position. You don’t have go out and load the boat today, but you do have to recognize that there has been a massive change. A massive shift. The investment world is taking note of inflation stubbornness. They are recalibrating. If you don’t, you will find that you’re lost in the shadow of stagflation in the period ahead. — David McAlvany. Kevin: Welcome to the McAlvany weekly commentary. I’m Kevin Orrick, along with David McAlvany.  Inflation. That seems to be on the minds of everyone. And Dave, before we start this program today, I’d like to read. You turn me onto a book by Barton Biggs called Wealth, War, and Wisdom. You’ll remember this paragraph, it’s on page 213, and it’s about the German hyperinflation back in the early 1920s. So here we go. Reading from Barton Biggs: “No chart can capture the stupendous ascent slope of true hyperinflation. Numbers actually do a better job. From 1919 to 1921, German CPI inflation was gradually rising from virtual price stability to a 2% annual rate. By June of 1922, inflation was at an annual rate of 4%. By September, 22%. By December, 68%. And then it really took off. In March 1923, it hit 285%, then 765% in June, 1,000,500% by September and finally 152,221,670,000% in December.”  Dave, I’m not saying we have hyperinflation, but look at the numbers over the last couple of days. Nickel, I mean, gold. David: Yeah. I will make the case this time, and you’ll be surprised to hear it, but this is transitory. Kevin: Very transitory. It’s going to go away tomorrow. Is it— David: When you have war and price increases, which are, again, price increases that are conflict driven. You’re really talking about a force multiplier for an inflationary trend. We have inflation. We have had inflation, not just for the last 60 days or the last two weeks of the Russian and Ukrainian incursion, but we had a backdrop that was highly inflationary to begin with, and we’re moving towards 10% on the US CPI and 20% for the US PPI. Now we’re going to get there a lot faster because of this conflict. The conflict is transitory. This particular force multiplier for the inflation figures is transitory. Nickel going from 24,000 to 50,000 to 101,000 in a matter of 72 hours— Kevin: Wow. David: —is transitory. There are dynamics there which have nothing to do with the money supply. They have to do with someone who is short— a Chinese billionaire who is short the nickel market, and is being forced to cover with mark-to-market losses in the billions.  So it’s a unique dynamic with each of these commodities. You see wheat going through the roof, whereas other commodities are not because you are dealing with a particular geography, a particular conflict. And yes, when you look at Wealth, War and Wisdom, Biggs’s book, he chronicles how your worst-case scenarios are in fact, transitory. You can get through even a world war in a matter of two to three years, and then it is done. And then it is done. What makes this inflation so pervasive, and I think non-transitory is that it’s driven by money supply growth on a global basis. That it’s driven by money printing on the one hand, but also of fiscal policy maneuvers on a global basis. And that has served to create an inflation that is ubiquitous. And it’s not one particular commodity.  What we’re seeing now is the high drama of conflict. The high drama of war. We’ll get to gold in a minute, but on our way there, we first consider the 30% moves in crude.

Russia & China to seek alternatives to the Dollar Why We Fight: Five key reasons for war March 1st, A year of inflation in a day   The McAlvany Weekly Commentary with David McAlvany and Kevin Orrick The SWIFT De-Dollarization Of The World March 1, 2022 “While it’s a powerful tool and it’s an appropriate tool to use, this elimination of access to SWIFT, it has far-reaching implications, specifically the priority of trade settlement alternatives to the dollar and a shift towards central bank liquidity in non-dollar currencies, and specifically central banks that are non—call it Anglocentric. This is a shot in the arm in essence for the importance of the Yuan or RMB.” — David McAlvany Kevin: Welcome to the McAlvany Weekly Commentary. I’m Kevin Orrick, along with David McAlvany.  David, obviously, the topic today, it’s going to be hard not to talk about Ukraine, but what I’d like to do first is, we just came out of our staff meeting and one of your great staff, Morgan, he came out and gave us our economic update, and he said, “We had in one day a high inflationary year—today.” Okay. So we’re talking, as we record this, this is March 1st. Oil is up 10%, heating oil is up 9%, gasoline is up 7%. We’re talking in one day. Okay? Nickel up 7%; wheat, 5.5%; corn up 5.5%, soybean oil, 5%, and oats—oats, Dave. Living on oatmeal, 5%. So, in one day, really, what we’re seeing is we’re really getting the realization of inflation, aren’t we? David: Yeah. You know the old phrase, “there’s decades where nothing happens and then there’s weeks where decades happen,” and certainly that has been the case over the last week to 10 days. A lot is going on. Yeah. I try to have a serious conversation at home about Ukraine and Russia’s invasion, and I get blasted by a 10- and a 13-year-old with Hamilton lyrics. Kevin: Which song? David: “We’re out-gunned. What? Out-manned. What? Out-numbered, out-planned. You got to make them all stand. Yo, I’m going to need a right-hand man.” It was talking about bringing in George Washington into the mix. Kevin: Right. All this great music in Hamilton. David: It is. Kevin: But war changes many things, doesn’t it? I mean, your kids probably wouldn’t have even been thinking that way and connecting Hamilton to the events over the last week if we hadn’t have seen Zelensky and what’s going on. David: Yeah, I appreciate that they are listening here and there, and contextualizing, and there is a serious and somber tone when it comes to anything war-related. We know a number of people who were born and raised in Eastern Europe, and one of the things that they’ve always said is that in the context of high stress, it’s very important to keep a sense of humor, and that is one of the best ways of relieving tension. Many years ago, you and I read Gonzalez’s book. Kevin: Yeah. Deep Survival is one of the best books on resiliency and survival. David: And one of the things that he points out there, too, is that being able to keep a sense of humor is a way of relieving many tensions. War changes things. People see life differently. They live with an altered perspective, having endured uncertainties, having endured loss, and having seen many horrors. So I think the closer you are to it, the deeper the scars. At the same time, you have leaders that change, some for the better, some for the worse. Treasuries are pressured by massive funding costs. Currencies all too often are devalued as they stretch hope in the national purse towards visions of victory. So, defeat, of course, carries with it in even higher cost, a thousand times the cost. Kevin: We talk about narratives. Sometimes you have to find out how to match a narrative and Putin’s narrative in his mind seemed to have been that he was going to have a very quick victory, almost a blitzkrieg-like quick victory,

Is your broker still managing as if there is no inflation? Can we really blame the Russians for $100 oil? James Grant: "Inflation is kryptonite to the financial markets"   The McAlvany Weekly Commentary with David McAlvany and Kevin Orrick The Ukrainian Tug Of War: Oil Is The Rope February 22, 2022 “I think we could be looking at a 50% to 60% decline in equities between 2022 and 2023. The stage is set. You have all of the ingredients, including Superman pretending like nothing can fell him. That’s the financial markets today—not unlike Superman. Faster than a speeding bullet, more powerful than a locomotive, able to leap tall buildings in a single bound. Nothing holds us down—except a little kryptonite.” — David McAlvany Kevin: Welcome to the McAlvany Weekly Commentary. I’m Kevin Orrick, along with David McAlvany.  There are some major changes sometimes in countries and in the world, Dave. I think about the railroad and the impact that it had on the United States. The main ports for the United States were of course in the East: New Orleans, New York. Those were the main ports, but when the railroad was finished, San Francisco became a critical port. And I remember going to Germany and I remember the impression that I had when I was in Hamburg. Beautiful, beautiful city, but it reminded me of San Francisco. You know how some of these port cities that come on a little bit later, they remind you of far away places? And the reason I bring that up is you and I have been talking about this as to how does that apply to the Ukrainian situation. And what I’d like to do is I’d like to go back and have you tell the listeners a story that I got a chance to hear when you and your son went to the Hamburg Maritime Museum and what you learned there about the shift in world, or at least European, politics and how Hamburg played into that. David: Certainly the reorientation had to do with Lübeck and Hamburg, these two trade cities in Northern Germany. And there was a dramatic shift that happened, particularly as the steam engine came into play, and Hamburg became a provider of products to the world, and a significant European hub. It was a change in orientation in Europe towards the West and away from the East and away from the Baltics, Lübeck being on the Baltic Sea. Kevin: It was a little like the railroad for the United States. It connected to the West and Western trade through San Francisco. Lübeck before that was oriented toward the East and more toward a Silk Road, Eastern orientation. David: Yeah, and certainly towards Russia. The fun part of being in Hamburg on that particular occasion, my son and I left, we had some historical insights. Great museum, by the way, Hamburg Maritime Museum, not to be missed. But we’d parked outside, and we emerged and our car was gone. And I didn’t know if it had been stolen. I was parked legally, but apparently what is legal in one moment is illegal in another. We stayed past our permitted time, and all the other cars that we had been parallel parked along with, they had driven on and gone home. Kevin: And you’re a foreigner now without wheels and without the language? David: And I don’t sprechen sie Deutsch, not very well. So we scrambled to recover the car, which has been impounded, and what a great adventure that was, a crisis to adventure. I think my son will never forget it. Kevin: And I want talk about this, the Hamburg-Lübeck connection, though, because in a way we’re seeing something like this right now. And it has to do with a world shift in geopolitics toward the East, Russia and China, or continued with the West, which of course would be the NATO nations and what have you. So bring Hamburg into that picture because I think it applies to what we’re seeing right now in this geopolitical struggle in Ukraine. David: So for context,

Jeffrey Currie: "We're out of everything, it's the molecule crisis" Producer Price Index up to 9.7% Gold shines for 2022   The McAlvany Weekly Commentary with David McAlvany and Kevin Orrick Is It Financial Inclusion or Exclusion? February 16, 2022 “Inflation is the pin that bursts many a bubble dynamic. And that’s what we’re seeing come to fore is inflation is inflicting pain on fixed income. Inflation is increasing margin pressures for corporations. Inflation is hurting the consumer. Inflation is the only thing that has gotten central bankers off of their keisters to do anything. And inflation happens to be the pin that’s bursting the ego of these central bank planners.” — David McAlvany Kevin: Welcome to the McAlvany Weekly Commentary. I’m Kevin Orrick along with David McAlvany.  Well, on everyone’s mind this week, you would think would be the Ukraine, but actually the truth of the matter is what Trudeau did a couple of days ago, Dave. It reminds me, we have heard this banter from the elite, let’s just say, that we want to try to save the unbanked. Do you remember in India a couple of years ago? The concern was that the unbanked— we needed to get everyone into the banking system, and they called it “financial inclusion,” and they said everyone has the right— I always love it when somebody tells me that I have the right to do something they want me to do. But everyone has the right to be in the banking system and financial inclusion. We just had a meeting, our office meeting before we came into the studio, and you said something really profound. You said you’ve got to watch financial inclusion because it can lead to financial exclusion. Can you elaborate on that? David: Sure. Yeah. Looking at what JT is doing across the boarder, Mr. Trudeau. Mr. Trudeau. Sort of a soft form of martial law. It is a weaponization of banks. It’s a weaponization of the financial industry. And it’s a fascinating thing. I hope we don’t see anything like that here in United States, where free speech and the right to assemble peacefully is called into question. But this is really interesting because you’ve got basically billions and billions and billions of dollars, which did not flow through the economy as a result of government mandated closures. And now individuals who say we’re done with these government mandated closures and restrictions are being blamed for millions and millions and millions of dollars of revenue lost for Canadian businesses. The irony is amazing, pot calling the kettle black is not even to the scale that it needs to be. Kevin: Well, and the ability to move money, right? In India, a couple of years ago, what they did was they took cash, the most common cash off the market, 500 Rupee, 1,000 Rupee notes. They gave them 30 days to get them into the banking system, open up an account, or they would lose value completely. When you talk about inclusion, that sounds great until, let’s say that you, like in China, your Sesame Credits don’t quite add up, or, in Canada, you haven’t done exactly what the government is saying. Then they say, “Well, you can no longer move money. Your banking system is now shut it down.” David: Right. What is a peaceful gathering versus an illegal blockade? Coming back to the financial inclusion piece. In India, USAID was the sponsor and we wanted the unbanked to be banked. In many presentations five years ago, I shared a little highlight of— Kevin: Bill Gates. David: Bill Gates. Kevin: Yeah. Bill Gates was saying everybody had the right to be in the banking system. What he was really saying was you had no right to not be in the banking system. David: Well, the light side is that people have access to credit. The dark side is that creating dependencies on a system allows you to manage the flows of funds, allows you to see everything that is happening,

Central Banks tightening, credit markets take cover Flood insurance works well as long as there is no flood Advice: Prepare for difficult times.   The McAlvany Weekly Commentary with David McAlvany and Kevin Orrick Doug Noland: “Bubbles Don’t Work In Reverse” February 8, 2022 “I do subscribe to the view that the value of gold tends to correspond inversely to central bank credibility, right? When everybody’s confident in central bankers, then why hold gold as much? So I feel we’re moving in the direction of a crisis of confidence for full policymaking and financial assets more generally, and I think that bodes very well for gold and the precious metals. So as a longer-term store of value, the way I see things lining up, I personally much prefer hard assets to financial assets.” — Doug Noland Kevin: Welcome to the McAlvany weekly commentary. I’m Kevin Orrick along with David McAlvany.     I’m really looking forward to this, Dave. You came over to my desk yesterday and you said we’re going to have Doug Noland on, and I said, “Gosh, I think we need to have him on more often.” But you told me the story. Most of us we work Monday to Friday, and we turn things off on Saturday morning. I know you go ski with the family. But before you ski with the family, you wake up, you look at the Credit Bubble Bulletin, which is Doug Noland’s report. And you told me this week, you said, after everything that was happening last week, you hadn’t even put your contacts in, you were just looking at a blurry screen. But you started to realize, “Oh my gosh, we’re going to have to have him on because things are dramatically changing, especially in the credit markets. David: And Doug’s the right person to bring that into focus. So thanks Doug for joining us again on this week’s commentary. Oscar Wilde said, “I wouldn’t give a fig for simplicity on this side of complexity but I’d give my very life for simplicity on the other side.” And there are some simple takeaways at the end of the conversation with Doug Noland today, but I want you to appreciate how important it is to dig into some of the details and some of the complexity of the credit markets as we look at significant pivots in the global credit markets and the global financial system.  Doug, you and I have had the privilege of working together— It’s been my privilege to work with you since 2017. And you manage our Tactical Short product. And I remember years and years ago, having read the Credit Bubble Bulletin and posed a question to you, “What would it look like to someday work together?” And so that has become a reality and I love it. Thank you for being on the team. I want to cover as much ground as we can today. Our clients probably know your background. Perhaps for the sake of new listeners to the weekly commentary you could give a little background as a CPA, as a writer, as an analyst of money and credit, and as a portfolio manager for the last 30 years. Doug Noland: Sure, David. And thanks a lot for having me, and it’s great to work with you. I love the relationship and it’s an honor to be on the Weekly Commentary. I listen to you and Kevin every week and I’m always just so impressed. So nice to be here.  I’m feeling kind of old. I guess I’d say I am a small town working class kid from Oregon. Proud graduate of the University of Oregon, accounting, finance. I loved finance back then. I tolerated accounting. I became a CPA just to get the certification. It was great experience at Pricewaterhouse. And in one of many of my lucky breaks, I left Pricewaterhouse, moved down to Los Angeles, and was a Treasury analyst at Toyota’s US headquarters down there—and what a great experience. Great people, sitting on a trading desk, fixed income trading desk back in 1987, with lots of volatility, currencies, bonds, stocks, and then the crash in ’87. And I just fell in love with the markets and wi...

Central Banks are gobbling up Gold: Demand up 82% in 2021 China demand for gold up 36.5% Derivatives traded exceeds stocks traded The McAlvany Weekly Commentary with David McAlvany and Kevin Orrick Runaway Train Towards Recession: Complements of The FED February 1, 2022 “Any reprieve you have in the markets, any violent volatile moves to the upside from here are characteristic of bear market rallies and should be sold into, sold into, sold into. Now, what do you do next? Hey, listen, I fully support an idea of buttressing a cash position. But to offset your risk of mismanagement by central banks, you’ve got to have some sort of a barbell approach between liquidity in ounces and liquidity in fiat bills.” — David McAlvany Kevin: Welcome to the McAlvany Weekly Commentary. I’m Kevin Orrick, along with David McAlvany.  Well we’re hearing it. We’re hearing that there’s going to be quantitative tightening. We’re hearing that we’re going to see interest rates rising. And I guess my question would be, when you have a leveraged market, a market that’s almost completely built on future money being moved into the present, which is what we call debt and margin, how’s that going to look? David: Yeah. It’s a little bit like oxygen being taken out of a room. Goldman Sachs has five interest rate increases between now and the end of the year. BofA has seven. The standard measure would be four. And certainly, the markets are factoring in something on the measure of two to four. So, many years ago, my wife and I went spelunking. And so, we’re in a cave. We’re going deeper and deeper and deeper into the bowels of the earth. Kevin: And this isn’t one of those public caves, like Cave of the Winds. This is you guys going into something without lights. David: Yeah. So, you bring your own headlamp. Kevin: Okay. David: And bring your own water bottle and snacks and everything else. There’s one thing you generally don’t bring, which is your own oxygen. You have what you have, and that’s it. And the farther you go in, typically the oxygen gets pretty thin. And so, a valuable lesson learned as we get further down, Mary Catherine says, “I’m just not feeling quite right. Something’s off.” And I knew what it was. And we turned around and went back to the surface. So, lesson number one, don’t go spelunking with a pregnant wife. There’s small places— Kevin: Pregnant. David: There’s small places that you just can’t get through. Kevin: Yeah. David: And then number two, be sensitive to oxygen being taken out of the room. In this case, we’re talking about interest rates. Kevin: Sure. David: If it’s Goldman Sachs, if it’s BofA, if it’s just the bond market factoring in a certain number of rate increases for a leverage financial market, it is like taking oxygen out of the room. At some point, somebody’s going to feel funny. And then, that’s when strange things begin to happen, very strange things in terms of market action. Kevin: Well, and I joke Dave as we talk about interest rates rising, confidence, if you were to look at the confidence of the people right now, economically, they’re not confident. In fact, it’s been a while since there’s been this kind of concern. David: Yeah. In fact, the University of Michigan Consumer Sentiment number, I mentioned we were interested in watching it on a Friday when it came out, it’s finally come out. And the gentleman who runs that survey, Richard Curtin, says that overall confidence in government economic policies is at its lowest level since 2014. And the major geopolitical risks may add to the pandemic active confrontations with other countries, although their primary concern is rising inflation and falling real rates. Consumers may misinterpret the Fed’s policy moves to slow the economy as part of the problem, rather than as part of the solution.

What will Putin do after he attends the Olympics in China? U.S. is "overstretched superpower" & Xi & Putin know it. Join us for the Q4 Tactical Short Call - Click Here To Register The McAlvany Weekly Commentary with David McAlvany and Kevin Orrick DOW Drops 1,000 Then Closes Up – First Time Ever January 25, 2022 I think it’s fascinating to understand what is unfolding. We started this Commentary in 2008, for a reason. There’s a lot to talk about. I think we’ve got a lot to talk about today as well. I would be remiss in not noting, it’s fascinating to watch the gold market perform its function as a safe haven here in the first month of the new year. Also, fascinating that the Bitcoin rivalry seems to have faded. Maybe it’s fading with the price. — David McAlvany Kevin: Welcome to the McAlvany Weekly Commentary. I’m Kevin Orrick, along with David McAlvany.  What a week! What a week to have the Tactical Short Call with Doug Noland. If you’re going to have the kind of volatility that we have, not just in the markets, but I’m talking Ukraine, Taiwan, China, you name it. We’ve got the Tactical Short Call coming up and anyone— Right? Am I right on this? Anyone can tune in and listen to you and Doug talk. David: Absolutely. Register ahead of time, show up day of, but we’ll look at the structure of the market, and we’ll expand on geopolitical variables, which add a complicating layer to the financial market pressures. But this is a very good week to consider the structure of the market. Doug has done a great job of that and this last week’s Credit Bubble Bulletin, and of course, as we head into the quarterly call for Tactical Short. Join us, Doug and myself, for the Q4 update for 2021 and a look at the current developments. They are legion in both the financial markets and geopolitical domains. Kevin: And that can be accessed at mwealthm.com. So it’s M-W-E-A-L-T-H-M.com. And like I said, anybody can sign up and listen. So please do. David: Yeah, I don’t think you want to miss it. With an impressive run to all-time highs in the market indices, being short has had its challenges. And the analysis, frankly, doesn’t get any easier just because valuations are stretched to unsustainable levels. Nevertheless, our process is a solid one, and the insights that that process shines a light on are likely to be immensely helpful for you in 2022 and beyond. So if you prize asset preservation, if you’re curious about the context and cause of one of the greatest market tops in financial history, you’ll join us this Thursday at 2:00 PM Mountain, 4:00 PM Eastern. We’ll have our prepared remarks and then Q&A. So the questions are already rolling in, send yours when you register for the call. Kevin: One of the things that we’ve really talked about for the last 13 years is Ukraine. George Friedman has been a guest on the program in the past. We were talking last night, Dave, as we always do. I have my Talisker, and I think at this point you were drinking Coke because you’re on your training program. But we were talking about how a lot of times people see the world from a particular center, and George Friedman has centered on Russia and Ukraine long before it was in the news here recently. And I think we ought to talk to him soon, don’t you? David: Absolutely. When you have a conversation with someone and it appears that their heart is stuck somewhere, and not necessarily in nostalgia, but there’s something that offers rootedness and groundedness. I can’t explain why the Donbas region is so central to the way that George Friedman sees things. Kevin: I think what he would say is it’s like a chessboard. It’s the center of power because you think about Ukraine—he’s talked about this before—whether you’re talking about the days of Napoleon or the days of Hitler, or even going before all that, Ukraine, has been the 500-mile buffer,

Coup of 22: Elizabeth Warren seizes control of American credit Who needs the "war distraction," most? Xi, Putin, or Biden? Need income? Evergrande debt is paying 99%! He Who Controls The Credit Makes The Rules January 18, 2022 “The checks that are going to have to be written to smooth over a number of these issues are very large checks. So does that spell higher rates of inflation as we head into 2022? We redefined the weightings that go into CPI. Statistically, inflation is going away. But my reality, your reality, the reality of every other American who’s paying bills will be quite different. The statistics don’t matter. The reality faces them every day, at the grocery store, at the gas pump. And that’s what we have to come to terms with.” — David McAlvany Kevin: Welcome to the McAlvany Weekly Commentary. I’m Kevin Orrick, along with David McAlvany.  David, there are so many times when I wish the mic was on before we’re actually recording. And this just happened. We were just now talking and it’s like, “Wow, this should be part of the show.” I love our conversations. I just have to say how natural it is. I was even telling my son this because he’s known you all his life. And I said, “You ought to ask Dave. He always brings something new to the table.”  We were just now talking about pragmatism versus idealism, the gold standard versus being able to print money. Let’s just go with this. Let’s just go with this. Because honestly, I think a lot of times, we think that this is all well defined, like politics and banking. Okay. Today, you and I were talking just a little bit about, it’s not necessarily who you elect that makes the rules, it’s who controls the flow of money. And I’d like to talk about that a little bit today. And some of the behind-the-scenes politics that occur. It ain’t Biden making the decisions right now. Let’s just face it. David: No. We had January 6th come and go, and certainly another opportunity to reflect on the drama and the political rancor of our age. I was in the airport yesterday, stuck between Fox in one ear and CNN on the other, literally two big screens, 20 feet apart. And so I— Kevin: You were in the Dallas airport. David: Yeah, I was in the Dallas airport in the Centurion lounge. And so I’ve got these two— I kid you not. There was almost a revolution occurring in my mind as I’m getting bombarded by unqualified statements from the right, unqualified statements from the left and— Kevin: The facts don’t matter. David: The facts don’t matter. Kevin: Right. David: What matters is more heat than light. We’re not after insight, we’re after conflict, because it raises viewership. Kevin: Wow. David: It’s amazing to me that mainstream media is today loving the political rancor, and I think there will be more of it as we head towards November. Kevin: Well, okay. So let’s broach a subject right now that’ll immediately get us canceled, okay, in cancel culture. David: Go for it. Kevin: January 6th, I was told that it was going to be like an earth shattering day by the mainstream media. They really wanted me to be upset about the annual anniversary of January 6th. Where’d that go? Gosh, I forgot what date it was until that night. David: Yeah, I mean, I think any serious student in history would look and say, “We could consider the main inputs for an insurrection or a coup.” I guess what was there, almost nothing. What we did have is the media outlets covering and expecting a great to-do. But there was one piece from the Wall Street Journal, the editorial board, which I thought was very fascinating. They covered the January 2nd— on January 2nd, a series of maneuvers which were coordinated by Elizabeth Warren. And this really is more the marks of a coordinated overthrow. And this is, again, you look at the last few weeks of December.

Current Administration laments "shortage," of entitlement programs Bubbles everywhere - Where do we find cover? Does Taper Tantrum possibly become Taper Tragedy   The McAlvany Weekly Commentary with David McAlvany and Kevin Orrick Don’t Like The Inflation Number? Change The Math January 11, 2022 “What do we do for an encore? Well, the encore comes tail end of the year, and now you’ve got the one-two punch of monetary policy largesse, fiscal policy largesse, and inflation statistics that would scare the whiskers off a cat. In the context of a declining equity market, you know what it spells to me, it’s like the perfect recipe for gold going to the moon, silver following suit. I think 2022 begins to look really attractive for the metals and it’s been underestimated, very, very underestimated by the US investor.” — David McAlvany Kevin: Welcome to the McAlvany Weekly Commentary. I’m Kevin Orrick along with David McAlvany.  You know, you asked me last night. You said, what are your clients talking about? As I go through what we call triangle updates, we basically look at their assets, their gold, their income and growth assets, and their cash. What I’m finding, Dave, is that whatever happened over this last two years, the triangles are becoming very, very cash heavy. The question is becoming very much like it was back in the 1970s. We haven’t really had to worry about a lot of cash being on the right side of that triangle until now. But I remember the 1970s. In the 1970s, you couldn’t keep cash because the inflation rate was so high. I’d like to talk about that today because even the government is expecting a 7% number. But the truth of the matter is, if we were measuring like we did in the late ’70s, it’s really double that. And so, can we cover that after we cover employment numbers and some of the other things? David: I think what you’re talking about is the demographics of the baby boom generation, who have already, in recent memory, they have this experience of significant loss. I talked to a gentleman just the other day who lost half his net worth in 2008. And you know, that was then. He was in his 50s then. He’s in his 60s now. Being that much closer to retirement, that baby boomer generation, he’s very cautious. Not so interested in taking the risks that he once did. He’s happy to sit in cash, and he looks at the 7% inflation number and says, well, that’s an inconvenience. But I’ll tell you what’s more of an inconvenience. Kevin: Losing 30 or 40 or 50%. Yeah. David: Exactly. I think that’s what we’re up against is the psychology of the boomer generation. Now there’s a whole host of folks that are in that category, demographically, who are assuming that they can get out in time. They’re assuming that there’ll be signals, there’ll be signs. There’ll be some sort of a trigger event. There’ll be bad news where they’re able to get out. I think what they perhaps don’t know or have forgotten is that bull markets don’t end on bad news. Bull markets end on the best of news. Kevin: That’s a great point. David: That’s one of the reasons why so few people see them, but they end on the best of news. It’s the end at peak euphoria. They end at peak euphoria. Everyone is very positive about prospects in the future. That’s frankly the nature of the bull market that gets you to those peaks. There’s worry, there’s worry, there’s worry. Climbing the wall of worry until the point where there’s reckless abandon, and all of a sudden speculation takes hold. When speculation has taken hold, you see everything as good news. Frankly, it doesn’t even matter if there’s bad news. Kevin: You’re looking for a reason for good news. You know, let’s just take the employment numbers right now. You couldn’t say that we’re in a recession if you actually looked at what the stated employment numbers are. David: No,

Money made speculatively must be preserved or else lost "There are decades where nothing happens, and weeks where decades happen" See links in description/show notes: https://www.courtlistener.com/docket/60630202/1/doe-v-austin/ https://www.fda.gov/media/150386/download   The McAlvany Weekly Commentary with David McAlvany and Kevin Orrick Your Questions Answered, Part 3 January 4, 2022 “Just because you have stocks, real estate, and bitcoin going up drastically doesn’t mean that they’re a better hedge against inflation. They are trading on their own dynamics for their own reasons as an expression of speculative excess, not necessarily as a ‘hedge.’ We’re really at a fascinating crossroads. And I wouldn’t be too concerned about timing. If you see something in advance, be willing to position for it and be patient because I don’t know that anyone gets to be right in both timing and trend.” — David McAlvany Kevin: Welcome to the McAlvany Weekly Commentary. I’m Kevin Orrick, along with David McAlvany.  Well, my buttons are bursting Dave. I was just in a meeting with you and everyone at our company. And we just talked about, we’re going into the 50th year of McAlvany. And I really think, listening to the various departments giving their reports for the last year and talking about 2022, I really think we are at our best right now. And so I just, I want to thank you for allowing me in your family, allowing me to be a participant in all of this. Before we get into the question and answers, even our listeners, I feel like, are part of the family, and I want to thank them also. David: Yeah, this is a big year for us. It is five decades now in the rear view mirror with our asset management company heading into the 15th year and the Weekly Commentary as we get closer to March, that’ll be the beginning of our 15th year of doing this every week. So we look at these Q&As, these question and answer sessions at the end of each year. And we’re amazed and pleased that we get to have such a robust conversation and interaction with some really bright people out there. And so we appreciate you engaging with us. We hope that you can take these conversations and pass them along to friends and family members so that your conversations more broadly can be informed, inspired, helped along, guided in any way possible.  And this is a major part of what we do on a weekly basis in terms of looking at the world and figuring out what the right things to do from a financial standpoint would be. But yep, 50 years, 15 years, 15 years, these are some milestones as we head into 2022. We’re very excited about 2022. I think there’s some pretty big challenges to be faced within the financial markets, but that’s not daunting if you are adequately engaged and there’s a variety of resources that you need. Hopefully this is adding to some of the resources. Kevin: One of the things that I love about working with your family is the diversity of the conversations that we have. Truth is truth. Whether you’re talking about the financial markets, whether you’re talking about politics, whether you’re talking spiritually, truth is truth. And what I love about our clients, too, and the people who listen to the show, is that’s what they’re pursuing. So the variability of what we talk about, some people think, oh, well, it’s a gold company, or oh, it’s a financial management company.  Really, the only way that you can get to truth is to look at it from every angle. And we’re starting show number three of the answers to the questions. And this is a question from Mike that actually reveals that you have to look at truth from a lot of different directions. Mike says, “In your December 8th podcast, you mentioned that a judge ordered the release of Pfizer’s emergency authorization report. Is there a link or a way I can get this report?

Why is gold lagging as an inflation hedge? Is Bitcoin truly digital gold? Can the Fed Not Ever Raise Rates? 2021 Your Questions Answered - Part 2 December 28, 2021 “Today’s philosopher king may be Klaus Schwab from the World Economic Forum, or some other idealist with a vision for global betterment. The problem is, other people have ideas of betterment at a more granular level. It’s a constant struggle to see who’s directing history and so in that sense, I’m neither a pessimist, an optimist. I think we see development and we see uncomfortable points in history, but we also see adaptation. That’s the story of the last 4, – or 5,000 years.” — David McAlvany Kevin: Welcome to the McAlvany Weekly Commentary. Now, I’m Kevin Orrick, along with David McAlvany.  Well, week two of the question and answer program. Again, thank you listeners for sending such great questions in. This first question, Dave, I had to smile because there’s family history in this for 35 years, I’ve been drawing triangles with people and recommending a particular allocation, but what it really, in a way it resembles something called Harry Browne’s permanent portfolio. We’ve had a chance to actually see this work. So let me read the question and then, I’d like to hear your answer coming from the McAlvany family who all of these years has been looking top down on portfolio distribution.  Okay. So here’s how it goes. “Thanks for your interesting program, for the end of the year Q&A, I was wondering if the old, ‘Permanent portfolio’ in allocation proposed by the late Harry Browne is still applicable today. Could you also touch on this: if this allocation is suitable for both your USA and your offshore clients? Wishing you all the best for Christmas and New Year. Kind regards, David” David: Well, thank you, David. What I like is the balance between assets and the, permanent portfolio theory basically divides you into four categories. You’ve got 25% in Treasurys, 25% in growth stocks, 25% in precious metals or other commodities but predominantly precious metals, and then 25% in real estate. And I like that balance. I like how those assets play off of each other.  The lesson learned is—if I can sort of introduce my own language—the lesson learned is in how to fill those buckets in a balance over a lifetime. And I think the studies on Browne’s four times the 25% allocation, they do work in other geographies, even though the original concept was for a US investor. It’s an all-weather approach and I think it does apply. So you just have to shift, instead of talking about US treasuries, US growth, stocks, et cetera, et cetera. You might be talking about Japanese bonds and Japanese stocks as an alternative.  Oftentimes when I’m discussing wealth accumulation with a young client, I discuss four or five buckets to allocate to, and it’s really throughout a lifetime. It’s not a particular product. So not a financial product as Browne conceived of it, but rather a set of guideposts. And so over a course of 20, 30, 40 years of saving and investing, how do you operate and how do you guide your decisions? So you add to real estate opportunistically, you add to stocks and bonds opportunistically. You add to precious metals opportunistically. You maintain reserves in the form of short-term government bonds or other cash equivalents when there’s nothing that is of value. You may invest in your own business opportunistically.  I’m less inclined to own a product that does it, and more inclined to operate through the decades with the idea that all four segments should be owned, not necessarily in proportion, and that purchases should be made when the price is right. So you make money based on what you pay for an asset.  And so again, just as a young investor comes to the market and says, where do I start and where am I going? I think—conceiving of those four or five buckets,

Why is gold lagging as an inflation hedge? Is Bitcoin truly digital gold? Can the Fed Not Ever Raise Rates? The McAlvany Weekly Commentary with David McAlvany and Kevin Orrick 2021 Your Questions Answered - Part 1 December 21, 2021 “You can accomplish all the benefits of above-market growth if you’re willing to adopt a value approach to investing. But that means you are never all in. So you don’t buy when things are overvalued, you build reserves. Reserves in ounces—to me that has a superior long-term record to reserves in dollars to reserves in euros to reserves in yen. You can be pragmatic with those currencies in the short run. But in the long run, the price of allocating reserves to fiat is a costly one.”— David McAlvany Kevin: Welcome to the McAlvany Weekly commentary. I’m Kevin Orrick, along with David McAlvany.  Man, we got a lot of questions. I realize that you really apply yourself to this, but I’m looking at you right now, Dave, and your eyes are bloodshot and you’re just getting back. Literally it looks to me like you dressed in a tent. I’m sorry, I want everybody to imagine this. But I knew last night you went with some friends. Friends that you’ve gotten into trouble with in the past, as far as the danger that sometimes they put you in. You’re a risk taker, Dave. So tell us what you were doing last night before we start answering some of the questions that people have sent to us. David: Well, my apologies ahead of time, if there’s a degree of incoherence in the answer. It might be because it’s been an interesting morning and certainly a very interesting night last night. Kevin: Tell us about death sledding. What exactly is death sledding? David: Well, I mean, it sounds more harrowing than it actually is. It’s two and a half to three-mile sled run that my friend set up. And then he can haul us back up either with a snow machine or a four-wheeler, depending on the conditions. Kevin: And you got more than one run in. David: Oh, I could have done that the rest of my life. I mean, we came inside, and I think my eyes are red in part because you get all the snow blowing. And when you’re being dragged back up the hill with a four-wheeler 30 miles an hour on the uphill. Kevin: And it’s not the lack of sleep at all. I think you told me you got a full four hours. David: Well, that’s true. It might be the sleep. Great friends, great adventures. And it’s a part of living a balanced life. My wife was out on the town with some of her best friends. And so all of the husbands of these other women were like, well, we should get together. Let’s just go. So we did. Kevin: Death sled. David: Yeah. Kevin: Well, good. Well, all right. So Dave, we are entering, for the next few weeks, we’re entering what I think you and I would consider our favorite time of year. Not just because of the holidays, but because of the questions and answers. We have very intelligent listeners. We get a chance to see that throughout the year, just from comments that people make or calls that we get. But when we get these questions, we really don’t necessarily edit them. The question is, “Hey, please surprise us a little bit.” And that’s what our listeners do, they surprise us. And hopefully, some of the answers won’t just be expected answers, but surprises on the backside. So let me go ahead and start with one of the first questions that came in, Dave. And even my wife, I brought this question up to her and she said yeah. That is the question, what’s going on. And so here we go. The question came in from one of our listeners, “Why is gold not acting as an inflationary hedge and not able to break out, given all the inflation talk?” Why, Dave? David: It’s a great question. So here’s a quick review on the official status of inflation. November 30th was the first admission by Jerome Powell that transitory was n...

Pakistani Bonds are less negative than U.S. Treasuries!? Time to change how we count inflation Biden Style Janet Yellen says spending a lot more money is non-inflationary Send your questions to: info@mcalvany.com Cognitive Dissonance—Please Don’t Confuse Me with the Truth December 14, 2021 “I can tell you what will worry the markets, and that’s capital losses. If you’ve watched the market over the last two weeks, one of the most fascinating aspects of behavior is how radical the swings are. We’ve got crude oil up 8% this last week. We’ve got it down 10% the week before. I mean, we’re seeing massive swings that suggest that we are at the end of a cycle, and you’ve got major players trying to decide how they’re going to position for this.” — David McAlvany Kevin: Welcome to the McAlvany Weekly Commentary. I’m Kevin Orrick, along with David McAlvany.  Dave, just a quick reminder for our listeners. We are taking questions right now for the end of the year question and answer program. We’ll probably be doing that going into the first of the year. Send those questions to info@mcalvany.com. David: Make sure and take a quick minute and jot down a question or two for the end of the year Q&A session. And if you can get those to us this week, we will begin thinking, researching, writing, talking amongst ourselves, and then include them on a program for your benefit as we get to the end of the year. Just send those to info@mcalvany.com. Kevin: We’re preparing for the holidays. There’s not only Christmas parties, but we have birthdays in December, not to mention your own. And it’s interesting when you go out and shop for balloons, I was so surprised at how much the price of balloons went up. So what I did was I went ahead and called Powell, Jerome Powell, and I was like, “The price of balloons, are you measuring that?” And of course I called the White House and I got somebody, they said they were Joe. And I said, “Did you see how much balloons are going up?” And I got the same answer— From Yellen I got the same answer. Over and over and over. They basically said, “We’re not surprised. There’s always inflation in that business.” Balloons. Inflation. Okay. All right. I’m sorry. David: That’s like a dad— You are getting ready for the holidays and family coming home. And that’s a classic dad joke right there. Kevin: Well, it is, it is. And actually we have our receptionist here, puts a joke up on the board every day. And today that was the joke. And it’s like, you know what? This is going to make the Commentary. All joking aside though, I mean, we are preparing for the holidays and I was telling you, we went and bought meat. 20% from last year to this year. It’s better than 20% increase in meat. We talked about farmers, the chemicals that they’re putting on their crops and the things that they use to actually function, over a hundred percent increase in prices. David: The Department of Justice is being called in to make sure that those fertilizer companies are being fair. And it’s like, well, how does this work? Prices go up and they smell a rat here. The department smells a rat. Kevin: Oh, I’ve got to find somebody to blame. Yeah. Yeah. Well maybe the clowns are the problem with the balloon inflation then. Maybe they’re just buying too many. All I know is you’ve got to find someone to blame when you’ve created a problem, whether it’s the Federal Reserve or—  We’re being told now, and I want to talk about this today, Dave. Is this gigantic package that they’re trying to pass, is it going to be anti-inflationary? Is it going to deflate the balloon or is it going to continue to create inflation?  But before we talk about that, because we know what creates inflation in the long run, it’s yeah, it’s printing of money, but actually it starts with debt. Debt, what you do is you start borrowing money and you have to figure ...

FDA request to withhold facts for 55 years denied Record high margin debt crash signal taken by bulls as greenlight to buy?! Recommended read: Vaclav Havel’s The Power of the Powerless…attached https://www.nonviolent-conflict.org/wp-content/uploads/1979/01/the-power-of-the-powerless.pdf   The McAlvany Weekly Commentary with David McAlvany and Kevin Orrick Cognitive Dissonance — Please Don’t Confuse Me with the Truth December 7, 2021 “If you’re going to discuss something, if you’re going to debate something, well, that unhinges the already-settled issues. I think that’s where, when I hear the Schwab notion of “we’re moving from a reset to a great narrative,” I think, “What kind of reality needs to be defined that we all need to sort of get in line with?” Are all issue settled? I thought all issues were up for discussion and debate. But this is maybe the delusions of a philosophy student.” — David McAlvany Kevin: Welcome to the McAlvany Weekly Commentary. I’m Kevin Orrick, along with David McAlvany.  Dave, it’s that time of year. Every year we ask for questions from our listeners, a lot of times we’re the ones who learn through the questions. And so we would ask you to go ahead and get us those questions, in the next few weeks we’re going to do the question and answer program. Dave, do you have the website that they can send those to? David: Send your questions to info@mcalvany.com, M-C-A-L-V-A-N-Y.com. Kevin: My wife and I had a conversation with a couple the other night, and I realized as we were talking, facts didn’t matter, that their minds had been made up. I won’t get into the subject matter, but I’ve had more and more conversations, Dave, with people who are intelligent people, who have made their decision already, and when asked if facts could be provided to you that would prove that maybe some of the things that you’re thinking are in error, would you be interested in seeing them? And I’ve been told several times, recently, from intelligent people, “No, no. Our mind’s made up, we like the way we feel thinking the way we’re thinking.” And so I’m just wondering, Dave, if we’re in a period of time where we no longer can critically think as a society. We’ve chosen what we’ve chosen, and we now just find things that would prove that we’re right on our side. David: Yeah, the organization of facts is really what’s key. If you said to yourself, the command and control dynamics that you see in China are the reason why we’ll never see a crash there, and on display this week is the People’s Bank of China reserve rate requirement cut. Lo and behold, we’ve got a rally in equities in China. Kevin: Yeah. David: Do you see? You see? Kevin: Yeah. David: There’s never going to be a crash in China. There really is no problem there that we need to pay attention to, because they’ve got the tools. The facts are in alignment with that, don’t you see? Kevin: Does this remind you of last week when I quoted your dad, “Always mistrust the obvious.” David: Yeah, it does, because it reminds me when you think you have a solid grasp of the issues, when that’s the position that you’re in, you’re probably not in possession of the most relevant facts. Kevin: And you may not even want them, to be honest with you. That’s the thing that bothers me. David: Yeah. You may think you have an idea of what’s going on, and it’s likely far more complicated. So reading outside your field, conversing with people you don’t necessarily agree with, these are good practices, particularly if big R reality matters to you, or big T truth is on your radar. Certainly, the financial markets illustrate this. What are the relevant facts? To most investors, you’re talking about price action, the direction of the market. That’s the singular— Kevin: If you’re making money, it’s good, right.

Global markets go "Black Friday," volatility rises 50% What does "Financial Reset" mean? Could a Turkish default upend the EU basket?   The McAlvany Weekly Commentary with David McAlvany and Kevin Orrick "Interest Rates CANNOT Rise"—Plan B Anyone? November 30, 2021 "Bond buying program, which $1.85 trillion pandemic emergency program, it comes to an end in March 2022. So we’ve got these issues in Turkey which tie directly into the European financial system. The latitude that the ECB has to step in and solve that problem goes away over the next 90 to 120 days. Inflation being in the wind changes the possible intervention dynamics, because it changes the political tolerances for monetary policy options."— David McAlvany Kevin: Welcome to the McAlvany Weekly Commentary. I’m Kevin Orrick, along with David McAlvany.  I was listening to the Harold James interview again, and I was just really struck with something, Dave, that we’ve talked about for a long time, and that is, centralization sort of managing future history in a centralized way, or what we would call free market, which is decentralization and discovering history as it goes forward. So the difference between managing future history and discovering future history seems to be what it all boils down to. And I’m looking at the markets right now, the amazing volatility that we saw last week when the Omicron was announced, and now we’ve got this new fear worldwide. And my question is, how much of it is centralized managed future history, and how much of this is being discovered as we go? David: That’s what the market’s trying to figure out. So we had a tough week for most commodities. Palladium was off 14% last week, platinum almost eight, silver nearly seven, gold over 3.5%. Oil got clobbered, down 10%. And so that’s what we’re seeing, is the market saying, “Wait a minute, if there’s going to be a major imposition and a return to shutdowns and lockdowns, we know what that looks like and we know what the implications are.” Interestingly, copper was the relative winner. It only gave up 2.7%. And natural gas was up 7.5%. And it flipped and has given up twice that much since then, down 18% off of its peak. Kevin: One, so we talk about discovering future history versus managing future history, volatility seems to be a good measure of shocking discovery. David: That’s right. It’s a surprise. And somebody was caught on the wrong foot. If you look at VIX, the difference between puts and calls, the VIX was soaring higher last week. By the end of the week, it had increased 50%— Kevin: Wow. David: —signaling a large swath of investors caught on the wrong foot. And what that means is that everybody’s been pressing forward with their “risk-on positions” coming into the end of the year. And they’ve got positive seasonality. That’s typical here at the end of the year, and they weren’t prepared for Omicron. Kevin: Isn’t it interesting that it’s called Omicron? My hobby is astronomy. One of my hobbies is astronomy, and I thought one of these days I’m going to sit down and really learn the Greek alphabet, because the stars, they use the Greek alphabet. I never really mastered that, but I did notice there was a strange leap of a couple of letters in the Greek alphabet in the naming of Omicron. David: Well, there’s a strange leap. There’s also an addition of a few letters too. Bush had his nucular, and Biden has his Omnicron, which is— Kevin: Said it over and over, Omnicron. David: —Omnicron. But I guess— Kevin: Sounds like a superhero. David: —And I don’t think Greek was necessarily in his educational repertoire. So no, you can thank the World Health Organization, for demonstrating the high art of diplomacy, skipping over nu and xi, or “kai.” And it’s spelled the same as Xi, which is X-I, in the Greek language, so—