153% Gain in Three Months

153% Gain in Three Months

Notes From the Field By James Hickman (Simon Black)  June 11, 2025

We’ve been extremely consistent—practically shouting from the rooftops over the last year—that there was an absolutely outrageous investment trend that was going to make people who were paying attention a lot of money… and it wasn’t going to last.

What we’ve been saying over and over is that gold’s bull run was just beginning. At $2,000, we said it wasn’t the end. At $3,000, we said it wasn’t the end…  But the bizarre anomaly was that while gold was heading to all-time highs, gold stocks were still remarkably cheap.

And we explained the reason why—gold was hitting all-time highs because central banks were losing confidence in the US dollar and trading for the only truly universal asset in the world: gold.

But central banks were buying gold bars, not gold stocks—so while gold hit all-time highs, gold stocks barely budged.

It was a similar phenomenon with other real assets as well, including silver and platinum.

And in our 4th Pillar investment research service, we identified some of the most ridiculously undervalued companies and presented our research to subscribers.

It didn’t take very long—one of our most undervalued precious metals stocks is up 153% in three months.

Our other best performing precious metals picks of the year have gained:

• 146% in the last eleven months

• 133% in the last two months

• 51% in the last three months

Another five stocks we researched are up between 27-34%.

For the sake of transparency, one is actually down 27%.

And frankly, we don’t think it’s because it’s a bad company.

We think the company’s fundamentals and management are quite sound, so we believe it’s even more undervalued now. And with specific catalysts on its horizon, it’s a great opportunity to pick it up.

But in general, is it too late to find the deals?

Opportunities are definitely thinning, but there are still some out there.

To give you an example, in our most recent 4th Pillar report we sent out last week, we identified a profitable gold business trading for less than cash.

Talk about limited downside— you could literally buy the entire company, repay yourself with its cash, and have the operating business for FREE.

That’s the type of investment opportunities we find.

And just like the companies we identified recently which surged 150%, this one also has a number of catalysts on the horizon which could quickly re-rate the stock much higher.

Those catalysts are in addition to the simple fact that investors are finally catching on, and realizing how much value there is to be had in companies related to mining precious metals.

They’re looking. But we got there first.

We’ve been practically pounding the table on this for over a year.

We said these companies were cheap, we said they were going to skyrocket in value—and that’s exactly what’s happened.

This trend is not over. But it’s definitely something you want to be paying attention to.

I can’t stress this enough, these are the types of companies you want to own in this economic environment.

And we’re very proud of the work we have done to find these opportunities.

To your freedom,  James Hickman   Co-Founder, Schiff Sovereign LLC

https://www.schiffsovereign.com/trends/153-gain-in-three-months-152949/?inf_contact_key=d58655ca9ed07a87030106960cb43a14ca03494014e15f13387d5174cdcb4731

They’ll Ignore It Until It’s a Crisis [Podcast]

They’ll Ignore It Until It’s a Crisis [Podcast]

Notes From the Field By James Hickman (Simon Black)  June 5, 2025

Think for a moment about how many times something has been whipped up into a national issue by either the big legacy media or prominent politicians.

The public has been subjected to what they call “a national conversation” about everything from transgender bathrooms to Confederate monuments to abortion rights to climate change.

Many of these issues only affect a few people. Sometimes more. But not once have these same media or political personalities elevated the ONE issue that could deeply and adversely impact hundreds of millions of people over the next few years.

I’m talking about the US national debt... and its runaway trajectory that could easily become a major financial crisis in a few years.

The impact crater for a US debt crisis is gargantuan. 350 million people in the US would have their lives turned upside down. Dozens of countries who rely on the US financial system would suffer tremendous pain. Billions of people would be affected.

Yet there’s hardly a word about it. Far more ink has been spilled debating who should use which bathroom. It’s crazy when you think about it.

Many of those same people who should be elevating this issue are now complaining that Elon Musk did a “complete 180” because he thinks the $2 trillion projected deficit from the new tax/spending bill is an “abomination”.

I don’t see how this is a 180. Before, during, and after the election, Elon has been laser-focused on personally trying to fix America’s biggest threat: the ticking debt time bomb.

His message hasn’t changed. And the guy sacrificed plenty of time, money, and reputation to personally try and stop the catastrophe that will come if these deficits aren’t dealt with.

At least a few other prominent voices are finally echoing Elon’s warning—like Jamie Dimon, CEO of the world’s biggest bank.

That’s progress. Because the legacy media sure as hell won’t start this conversation on its own.

And that’s exactly why it’s hard to imagine we’ll hit the critical mass of voters needed to force politicians to do the right thing and tackle the deficits.

That’s what we dig into in today’s episode.

We break down how even supposedly serious financial media—like the Wall Street Journal—refuses to report on just how dire this situation really is.

One recent piece from the Journal even mocked people for buying gold to protect themselves from the obvious outcome of inflation. This is utterly hilarious, of course, given that gold has been one of the world’s best performing asset classes for this entire CENTURY.

But, hey, to the Journal, I guess we’re all just a bunch of idiots.

Today’s podcast also covers:

• How everyone loves spending cuts... until you threaten their sacred cow (like taxpayer-funded Sesame Street)
  

• What runaway interest costs mean for your future—and to the future of the US dollar
  

• Why politicians won’t act until there’s a full-blown crisis—and what that will probably look like
  

• That the debt problem is “solvable”—and why JP Morgan Chase CEO Jamie Dimon agrees with the solution we’ve been saying all along
  

• Why slashing regulations needs to be part of that solution
  

• Why strategic assets like gold, silver, uranium, and platinum are now more important than ever.

You can listen in here.

(For the audio-only version, check out our online post here.)

CLICK HERE to listen to our latest podcast.

To your freedom,  James Hickman   Co-Founder, Schiff Sovereign LLC

https://www.schiffsovereign.com/podcast/podcast-theyll-ignore-it-until-its-a-crisis-152910/?inf_contact_key=8a5d9eefd4c7eb9456526842267e29ab2ec2094b0cea6b68b61d0db7a8f697f7

This Is A $118 Billion “Strategy” For Insanity

This Is A $118 Billion “Strategy” For Insanity

Notes From the Field By James Hickman  (Simon Black)  June 3, 2025

Last week when I wrote about America’s new stablecoin legislation (bizarrely called the “GENIUS Act”), a number of readers wrote in asking me to clarify a comment that I made about the Bitcoin company ‘Strategy’, i.e. formerly MicroStrategy.   I explained in the article that I am pro-crypto and have been since the early 2010s; for me it’s about freedom.

Many banks have proven time and time again that they simply cannot and should not be trusted with their customers’ money.

Wells Fargo is the poster child for blatant theft and deceit. And Bank of America is currently the prime example of recklessly irresponsible decision-making; that institution has managed to rack up more than $100 BILLION of unrealized losses from bad investments they made with YOUR money.

 Crypto eliminates all of this. You can store your savings (whether as a risk asset like Bitcoin, or via US dollar stablecoins) and transact without having to deal with a bank. And this is a massive benefit.

 Then there’s Strategy-- the company formerly known as MicroStrategy. By its own description, Strategy is “Bitcoin Treasury company”, which is to say that their primary business is to own Bitcoin.

 And they own lots of Bitcoin-- 580,955 to be exact, worth $61.5 billion at the current price. Yet Strategy’s enterprise value is $118+ billion, or nearly TWICE the value of its Bitcoin. And this is one of the strangest things I’ve ever seen in financial markets.

Yes, technically, Strategy also has a software business, because they barely mention it.

Just have a look at Strategy’s own Q1 update-- a NINETY-TWO-page presentation that had precisely ONE slide (#26) devoted to its software business. Literally one slide. And there wasn’t even much detail-- the slide was entitled “Software Highlights” and only showed top-level revenue.

In other words, the company’s own presentation spends about 1% of its time talking about the software business without bothering to mention whether or it it’s even profitable.

(It’s not profitable; if you read the footnotes and financial addenda, you’ll see that Strategy’s “cloud-based, AI-powered” software loses LOTS of money…)

 The other 99% of the presentation talks about Bitcoin. So, Strategy makes no bones about it-- they are a Bitcoin company. Full stop.

And if they’re not talking about Bitcoin, they’re talking about how much money they’re going to raise, to buy more Bitcoin.

 Strategy’s current plan calls for a whopping $42 billion in new capital-- a number they seem to have landed on not through hardcore financial analysis, but as a joke related to Hitchhiker’s Guide to the Galaxy in which ‘42’ is the answer to the ultimate question of life.

 Half of this $42 billion will be raised by indebting the company more, and the other half by diluting existing shareholders.

*************************************

 Management’s ultimate goal is to increase the average number of ‘Bitcoin per share’ that the company holds. That’s not unreasonable. But for this to happen, there are a number of things that have to go right-- from cybersecurity to crypto markets-- nearly all of which are beyond their control.

 They don’t seem to have given these risks much thought. They assume, for example, that the Bitcoin price will appreciate by 30% per year.

And there are a number of very attractive charts, several of which demonstrate how high Strategy’s stock price will go in various scenarios. They show graphs with lines that start from the bottom left and soar to the top right, and there seems to be no credible way in which investors could lose money.

 Then they polish it all off with made-up metrics like “Bitcoin Yield”, “Bitcoin Multiple”, “BTC $ Income”, and my personal favorite, “Bitcoin Torque”.

 Strategy ends up disclosing six full pages of definitions just to explain what the hell they mean with these new terms.

 For example, they humbly admit that “BTC $ Income is not equivalent to ‘income’ in the traditional financial context.” In other words, it’s not income. But they’re calling it income anyway.

 Honestly it reminds me of Adam Neumann making up his own financial metrics when he infamously published WeWork’s “Community Adjusted Earnings” several years ago.

 Strategy concludes its Q1 update by asking shareholders to spread the word and “educate their peers” about Bitcoin and MicroStrategy securities, i.e. help us keep this bubble going by finding more people to overpay for our assets.

And that’s exactly what it is; again, based on its stock price, Strategy is worth $118+ billion. Yet its BTC holding are worth $61.5 billion. So, anyone who buys Strategy stock solely for the Bitcoin exposure is overpaying by 2x.

 Buying Strategy stock is the equivalent of paying $210,000 for Bitcoin today. And if you are willing to pay $210,000 for Bitcoin today, please contact me right away and I will gladly sell you some of mine.

 Strategy doesn’t hide from this insanity. In fact, they’re leaning into it. They even track this on their website under the metric “mNAV”, i.e. the multiple by which investors overpay for the company’s Bitcoin.

 Their presentation actually tries to rationalize this phenomenon; they claim the 2x mNAV is justified because of their stock’s volatility (which attracts traders) or that their “brand recognition and scale drive superior investor interest.”

 Some of their financial models even assume that this mNAV will INCREASE to 3x!

 Maybe so. But the bottom line is that there’s most likely a lot more upside to own Bitcoin directly. And the hard truth is that if you can’t figure out how to own Bitcoin directly, you probably shouldn’t bother buying Bitcoin to begin with… let alone paying twice the price for it.

To your freedom,  James Hickman  Co-Founder, Schiff Sovereign LLC

https://www.schiffsovereign.com/trends/this-is-a-118-billion-strategy-for-insanity-152900/?inf_contact_key=d0a274af81cebec34b5ad7c006c991b8c61f0136bd9e1f6d9cd3b34032effcc5

Bizarrely, The “GENIUS Act” Might Actually Be Pretty Genius…

Bizarrely, The “GENIUS Act” Might Actually Be Pretty Genius…

Notes From the Field By James Hickman (Simon Black)  May 30, 2025

Peter Schiff isn’t just my partner at Schiff Sovereign-- we’ve been close friends for many years. And we generally see eye-to-eye on most things going on in the world.

 But one area where we disagree is crypto. Not to put words in his mouth, but Peter is pretty vocal in his criticism of Bitcoin; he says it’s “useless” and a “total scam” and predicts it will go to zero.

 I disagree. There are a number of important use cases for crypto-- whether as a speculative asset for capital gain, a store of value, a digital currency for online transactions, a private means to hold wealth, a way to disconnect from the banking system, etc.

 This isn’t a “scam”. Rather, it’s useful, functional technology… which is why I recommended it to my audience as far back as March 2013.

 Obviously crypto has deep flaws and areas to improve. And just like in any frontier boom, plenty of thieves and lunatics have emerged. But to judge crypto based on the misdeeds of Sam Bankman-Fried is like condemning the stock market because of Bernie Madoff.

 All that said, there are still plenty of things that I’m skeptical about.

 For example, I think there’s a bizarre disconnect between Bitcoin’s market cap and its actual value; I recognize that Bitcoin is the original cryptocurrency, and there’s some ‘brand value’ associated with that.

 But as the oldest cryptocurrency, it’s also the most technologically obsolete… therefore it should not be the most valuable; no other sector places the highest value on the most obsolete technology. Only crypto. And that’s a bit odd.

 There are plenty of other oddities; for example, it’s strange that the company Strategy (formerly Microstrategy) has an enterprise value of $112 billion, even though its only asset is $61 billion worth of Bitcoin.

 In other words, the company is worth nearly twice as much as the Bitcoin that it owns; this is bizarre and doesn’t make any sense.

I’m also extremely skeptical of the US government’s involvement in crypto; the pre-election promises of starting a Sovereign Wealth Fund to own Bitcoin struck me as completely ludicrous.

 I mean… think about it: one of the things that would drive up the price of Bitcoin is excessive government spending. So rather than cut spending, the government wants to own an asset that will benefit from their own financial irresponsibility. It’s back asswards in my humble opinion.

Naturally I was also skeptical when I heard about the GENIUS Act (Senate bill 394) to regulate crypto.

 Then I read the legislation. And I concluded that the GENIUS Act might actually be pretty genius.

GENIUS stands for “Guiding and Establishing National Innovation for US Stablecoins”. Something tells me ChatGPT came up with that.

 And the basic idea is for state and federal regulators to authorize “Permitted Stablecoin Issuers” who could… well, do just that-- issue stablecoins.

 States can issue their own licenses and permits to stablecoin businesses. But once a particular coin passes a $10 billion market cap, it must be regulated by the Feds.

 Here’s the smart part: in the definition of stablecoins, they include anything that owns short-term Treasury bills. So, through this legislation, they are creating an entirely new class of investors who would purchase US government debt.

 This is pretty important, because the Treasury Department is in sore need of new lenders.

 Foreign investors are fleeing the Treasury market; after decades of being considered the world’s “risk-free asset”, foreign governments and central banks are aggressively reducing their dollar holdings.

This is THE primary reason why the gold price has come so high: foreign governments and central banks have been cashing in their Treasury bonds, then trading that US dollar cash for gold.

Given that the “One, Big, Beautiful Bill” calls for another $2 trillion deficit this fiscal year, Treasury is going to need all the lenders it can get.

 Remember that stablecoins (especially under this legislation) are basically just money market funds in disguise; they pool capital and buy government bonds.

 So, this GENIUS Act is essentially a way of tapping crypto wealth and diverting that capital into Treasury securities.

 It’s a clever idea. But frankly it would be a lot better if the government simply cut spending rather than come up with innovative ways to finance the deficit.

 To your freedom,   James Hickman    Co-Founder, Schiff Sovereign LLC

https://www.schiffsovereign.com/trends/bizarrely-the-genius-act-might-actually-be-pretty-genius-152877/?inf_contact_key=621bb5036b24c6f1832a991bdeae679376f2a36d5c9f30736335e3c4f3607839

Jamie Dimon Warns About America’s Coming Debt Crisis

Jamie Dimon Warns About America’s Coming Debt Crisis

Notes From the Field By James Hickman (Simon Black)  June 2, 2025

Jamie Dimon is one of America’s most prominent and successful CEOs; he built JP Morgan Chase into a $4 trillion juggernaut, so it’s fair to say that he understands global finance in a way that most people-- and most politicians-- do not.

 On Friday, Dimon sat down for a 30+ minute live interview at the Reagan National Economic Forum-- named after the 40th President who constantly preached cost-cuts and responsible spending.

 Dimon opened his remarks talking about Reagan, who sounded the alarm about the national debt back in the early 1980s when America’s debt to GDP ratio was just 35%. Today it’s 122%. And with each passing year the number becomes even worse.

 Dimon warned the audience that “tectonic plates are shifting,” referring to America’s status as the dominant superpower in the world-- which is rapidly slipping.

 “The amount of mismanagement is extraordinary,” he said. America has added $10 trillion to the national debt in just five years… and for what benefit? Is the country $10 trillion better off? Did any of that $10 trillion improve the lives of anyone who isn’t in Washington DC?

 But all of that debt is quickly reaching a point where it will become nearly impossible to service. Just covering the interest payments on the national debt now costs taxpayers more than $1 trillion per year. And if the current trend on rates and deficit spending hold, it will reach $2 trillion per year by 2028.

(He joked that the government spending is worse than the proverbial “drunken sailor,” because at least a drunken sailor spends his own money.)

 As a result of this insane level of debt and spending, Dimon warned, “you are going to see a crack in the bond market. It’s going to happen.”

 What he means is that US government bonds have long been considered the global “risk-free” asset… and whenever the Treasury Department would sell more bonds, investors would dutifully buy as much debt as the government was selling.

 But that’s no longer the case. “Bond vigilantes are back”, Dimon agreed, and investors are now shunning US government securities.

 This is going to cause a major problem for the United States; running such huge deficits year after year means the Treasury Department NEEDS lenders, it NEEDS investors to buy US government bonds.

 If investors pull back, the natural consequence will be MUCH higher Treasury yields and interest rates, resulting in a full-blown fiscal crisis in the United States… including major inflation.

 “The future- what I see-- is inflationary,” Dimon predicted. “I don’t know if the crisis will be in six months or six years, [but] I’m hoping that we change. . . the trajectory of the debt” before that crisis occurs.

 It was a pretty blunt warning to a room full of policymakers-- which included several officials from the Federal Reserve and the Trump administration.

 Dimon is absolutely right, of course. Peter and I have been talking about this same debt crisis for years, and it’s only become worse.

 For someone of Dimon’s gravitas to sound the alarm bells is a big deal-- and he echos Warren Buffett’s most recent annual letter which similarly admonishes the federal government to get its fiscal act together.

 Sadly, it doesn’t appear that the government is listening.

 On Sunday, Treasury Secretary Scott Bessent dismissed Dimon’s warnings and claimed, rather bizarrely, that “the deficit this year is going to be lower than the deficit last year, and in two years it will be lower again.”

 That statement is just patently false.

 In Fiscal Year 2024, the $1.8 trillion deficit constituted 6.4% of GDP. This year’s deficit hit $1.3 trillion just in the first SIX MONTHS! Let’s be kind and assume that the annual deficit this year will be ‘only’ $2.0 trillion, or 6.6% of GDP -- that would amount to a higher deficit on both a nominal and relative basis.

 Plus, the “One Big Beautiful Bill” will add quite a bit more to the deficit. Don’t get me wrong-- tax cuts are great. But spending cuts are even more critical right now… and this bill is extremely deficient in that department.

 Senator Rand Paul confirmed this later and said (of Bessent’s comments), “the math doesn’t really add up” and that the administration’s current spending plan is to have a total deficit of “five trillion over [the next] two years”.

 Any way you slice it; the deficit is increasing… not decreasing.

 Elon Musk lamented this as well, saying that he was “disappointed” by how the spending/tax bill increases the deficit.

 There do seem to be a handful of Senators willing to take a stand and demand bigger spending cuts. We’ll see how that pans out. But it’s clear that the majority of politicians don’t have a care in the world about the deficit.

 They almost have a sense of entitlement in assuming that investors from around the world will continue buying US government bonds no matter how precarious America’s fiscal situation becomes.

 Jamie Dimon closed his remarks talking companies in the private sector who had a similar sense of entitlement-- Kmart, Sears, Blackberry, Nokia, etc. all had tremendous “arrogance, greed, complacency, bureaucracy.”

 They all assumed their greatness and success would last forever. But that’s a horrible assumption. Greatness and success have to be earned every day, year after year.

 The US government has been doing the opposite for far too long; rather than earning success and greatness, they find unique ways to cripple themselves and make things worse.

 Dimon rightfully pointed out that the ship can still be turned around. And it can. But it certainly makes sense to have a Plan B in case they don’t. These risks are very real, and it’s sensible to take them seriously.

 To your freedom,  James Hickman   Co-Founder, Schiff Sovereign LLC

https://www.schiffsovereign.com/trends/jamie-dimon-warns-about-americas-coming-debt-crisis-152892/?inf_contact_key=10f9bd3e707d2d9c6e43487e62db53cbf2dd6ac02ffa012fb72df8aa66cf6bc6

This Will Either Make You Hopeful… Or Extremely Irritated

This Will Either Make You Hopeful… Or Extremely Irritated

Notes From the Field By James Hickman (Simon Black)  May 29, 2025

Germany’s “Iron Chancellor” Otto von Bismark didn’t pass the world’s first modern Social Security system out of the kindness of his heart.

 The year was 1889, and Bismark was fighting hard against the rising tide of socialism; the second volume of Karl Marx’s Das Kapital had been published just a few years earlier in 1885, prompting growing calls for strikes, protests, and wealth redistribution.

 For Bismark, his social security program was intended to appease socialists while preserving the conservative political order that he had spent decades building. And on May 24, 1889, his new “Old Age and Disability Insurance Law” was passed by the Reichstag and signed by Kaiser Wilhelm II.

 Workers under Bismark’s program became eligible for benefits at age 70, and its costs were paid equally by employees, businesses, and the state.

 It also had its intended effect: support for Germany’s unified socialist party fell dramatically after the law was passed, and it became the leading blueprint for similar programs around the world.

 Franklin Roosevelt pushed for a Social Security program in the United States for similar reasons; socialist movements were growing quickly in America, especially under the economic devastation of the Great Depression.

Politicians like Louisiana Senator Huey Long were calling for full-blown wealth redistribution, promising every family a $5,000 estate (large sum in the 1930s) and guaranteed income.

 Then there was Francis Townsend in California, who proposed a national sales tax to provide a $200 monthly pension to every American over the age of 60-- with the requirement that the money had to be spent within 30 days to stimulate the economy.

 These ideas spread like wildfire, and soon there was major support in Congress for some sort of national pension.

 Roosevelt modeled his program on Otto von Bismark’s-- but lowered the age of eligibility to 65 instead of 70.

The first financial analysis of Social Security came in 1941, when the Board of Trustees published a report stating that the program would remain solvent and well-funded indefinitely, i.e. pretty much forever.

 At the time, there was far more tax revenue being paid into Social Security than there were benefit payments being paid from the system.  So Social Security essentially ran a massive surplus each year… and the accumulated surplus was invested in a giant trust fund.

But eventually cracks started to form.

In 1983, the Social Security trustees issued a more sanguine assessment; this time they claimed that the program would still remain solvent for their 75-year horizon (i.e. through 2057), but that costs of paying benefits to Social Security recipients would exceed tax revenue by 2018… at which point they would have to start drawing down the trust fund.

 Pfff. It was 1983. No one in Washington cared about what might or might not happen 35 years later. So, barring cosmetic adjustments, politicians ignored the problem.

 The Trustees sounded the alarm bells again in the 1990s when they projected that Social Security’s trust funds would run out of money by the year 2042. And, as time has continued to pass, that projected depletion date has become closer and closer.

 Starting in the 2010s, Social Security projected that its trust funds would be fully depleted by 2035-- roughly 20-25 years into the future.

 And according to their latest assessment, the projected depletion date is now 2033. That’s just eight years away.

 So, what does this actually mean?

 Well, Social Security is already running an annual deficit, i.e. the program pays out MORE in monthly benefits than it collects in tax revenue. So, each year they have to dip into the trust fund to make ends meet.

 But in eight years, the trust fund balance will be zero… so they won’t have any savings to offset Social Security’s annual deficit anymore. And that annual Social Security deficit is projected to be more than $500 billion by 2033.

 There will essentially be two options at that point; either

 (1) the federal government will pick up the tab, essentially adding $500 billion per year to the US budget deficit; or

 (2) Social Security beneficiaries will have to take an immediate cut to their benefits. The initial cut would be around 20-25% and become worse over time.

 Option 2 is unthinkable given the political consequences. But option 1 would only lead to more economic problems… and a lot of inflation. The US government needs to be reducing its budget deficit, not expanding it.

The good news is that there are ways to fix Social Security; the program itself has recommended plenty of solutions.

 For example, given that life expectancy at age 65 is now so much longer than it was in 1935, one recommendation is to gradually phase-in a higher retirement age to 69.

 Simultaneously, a small payroll tax increase of 1%, combined with increasing the maximum taxable salary, would render the program solvent for at least 75 more years.

 And these just scratch the surface-- there are plenty of other options.

 The bad news is that the longer Congress waits, the more painful the solutions will become. If they wait until 2030 to pass any reform, there will have to be much more severe tax hikes and much more abrupt changes to the retirement age.

So, dealing with the problem now will make life less difficult in eight years’ time.

 Unfortunately, few are willing to do anything about it.

 On rare occasions some politician proposes necessary reforms. In fact, the last one came last week from Rep. Gwen Moore of Wisconsin, who introduced the Social Security Enhancement and Protection Act.

But these bills never go anywhere and ‘die in committee’.

 Bottom line, the problem is 100% fixable-- just like the rest of America’s economic challenges. The national debt is fixable. Fraud, waste, and abuse is fixable. Inflation is fixable. Everything is fixable.

 There just doesn’t seem to be the will to do what is necessary… so these problems will continue to fester until they become a crisis.

To your freedom,  James Hickman   Co-Founder, Schiff Sovereign LLC

https://www.schiffsovereign.com/trends/this-will-either-make-you-hopeful-or-extremely-irritated-152870/?inf_contact_key=59d47cd22e47efe7ebfd5b60cc10729ee785e10e4d66e1d24c16227e162c13f0

Five Years Later, “Mostly Peaceful” Is Back

Five Years Later, “Mostly Peaceful” Is Back

Notes From The Field By James Hickman (Simon Black)  May 27, 2025

On August 24 in the year 410 AD, a large army of Visigoths entered the city of Rome and rampaged through the streets for three full days.

 They ransacked public buildings. They destroyed monuments. They looted wealthy homes. And they stole just about anything and everything that wasn’t nailed down. Only some churches were spared, given that their king was a Christian.

 The Visigoths even desecrated Roman shrines-- like the tomb of Augustus, where they dumped the former emperor’s ashes (which had been preserved for centuries).

 News spread like a shockwave throughout the Mediterranean.

 Within a few days, refugees and eyewitnesses had already brought the news across the imperial road network to Milan in the north and Ravenna in the east. Within a week, ships bearing the news arrived at major cities in North Africa like Carthage and Alexandria.

 The famed theologian Saint Augustine was in modern day Algeria and received the news in early September. His contemporary Saint Jerome was all the way in Bethlehem, more than 1,500 miles from Rome, when he heard the news shortly after.

 No one had any illusions about the state of the western Roman Empire at that point; it was so weak and feeble that Rome wasn’t even the capital city anymore; it had been moved to Ravenna nearly a decade prior.

 But the city was still a legendary and powerful symbol of the Empire’s former strength. So news of it being sacked and pillaged traveled very quickly and was met with sadness and disbelief. People were stunned.

 The sack of Rome was the ancient equivalent of the 9/11 attacks in 2001… one of those events that goes on to shape culture and history; where everyone knew that life would never be quite the same again; and where people ‘remember where they were’ when they heard the news.

 My dad used to talk about the JFK assassination that way. I personally remember 9/11 like it was yesterday. Many of us probably have a similarly emblazoned memory about Covid, i.e. the day we knew something really bad was about to happen.

 Then there was the death of George Floyd-- also in 2020, exactly five years ago this past Saturday.

 That infamous video came out of a man suffocating to death while multiple police officers looked on and did nothing. And it too became one of those history-defining, culture-shifting, seismic events.

 Some of that change was positive and necessary, and helped to propel civilization forward.

 Other change was completely ludicrous, including the media coverage.

 The legacy media was already on thin ice at that point for their heavily tainted and histrionic COVID fear porn.

 You probably remember how CNN and MSNBC used to have the real time body counts of how many people were supposedly dying of Covid; only later did we find out how inflated those numbers really were.

 They preached constantly about how everyone must stay at home, wear masks, social distance, etc. And then the George Floyd protests started. Thousands of people were out in the streets packed together like sardines. No social distancing. No staying at home.

 After months of being told we had to ‘shelter in place’, suddenly the media decided it was OK to be out in public… but only if you were protesting in the name of George Floyd.

 It was as if everything they had been saying over and over again for the past few months was just thrown out the window and replaced with a new social justice theme. And, just like their coverage of Covid, the facts didn’t matter.

 The public demonstrations quickly turned violent. Looters rampaged through the streets and plundered stores, stealing big-screen televisions and video game consoles-- all in the name of Social Justice, of course.

 And then the media tried to tell us that the protests were “mostly peaceful”. In other words, don’t trust your lying eyes. We’ll tell you what to believe.

 That was probably the moment they lost any shred of their remaining credibility and viewers recognized them for the deceitful propaganda machine that they are.

Naturally, they never learned. And the propaganda didn’t stop. They later used this same approach to insist that Joe Biden was healthy, mentally vibrant, and vigorous. And they’re doing the same thing now with respect to attacks on white farmers in South Africa.

 Donald Trump met with South Africa’s President (Cyril Ramaphosa) at the White House last week, and the media is in agony over the fact that Trump brought up the killings and said a “genocide” was taking place.

 The media is now whining that Trump’s claims are false and part of a far-right conspiracy theory.

 Reuters went out of its way to fact check the President, reporting that the total number of white farmers murdered in South Africa amounts to just 1,363… which is too small a number to be considered genocide or ethnic cleansing.

 Wow. Hard to argue with that logic. Only 1,363 “mostly peaceful” murders.

 Bear in mind that South Africa only has 32,000 commercial farmers. Even if we assume 100% of them are white, this would mean that 1 out of every 23 white farmers has been murdered. Not exactly great odds.

 Reuters also, bizarrely, disputes President Trump’s claim that white farmers are having their land expropriated by the South African government.

Instead, Reuters states that white farmers have been “encouraged” to “sell their land willingly”.

 Unfortunately, says Reuters, “that hasn’t worked”, so President Ramaphosa “signed a law in January allowing the state to expropriate land.”

 So, just to be clear, Donald Trump said that white farmers in South Africa are having their farms expropriated. Reuters complains that this isn’t true. Yet three paragraphs later they said that Ramaphosa signed a law to expropriate land from white farmers.

This is championship level Orwellian doublespeak. You couldn’t make it up if you tried.

 To your freedom,  James Hickman  Co-Founder, Schiff Sovereign LLC

https://www.schiffsovereign.com/trends/five-years-later-mostly-peaceful-is-back-152858/?inf_contact_key=6673bbfdc0557a74993e0cb899d8546e5bea93d6604c4a12e77166adfb8447b0

Investors Have Finally Had Enough With $2+ Trillion Deficits

Investors Have Finally Had Enough With $2+ Trillion Deficits

Notes From the Field By James Hickman (Simon Black)  May 22, 2025

Well, that was fast.

It only took five days after Moody’s downgrade of the US government’s sovereign credit rating for investors to throw a fit. The result was yesterday’s meltdown trifecta in which ALL three major markets-- US stocks, US bonds, and the US dollar-- lost significant value.  I wrote about this extensively last month because we saw the same phenomenon after the “Liberation Day” announcement.

Typically, if there’s bad news in a major developed country, investors will simply shift their money into a different asset class within that same country.

For example, if investors in the US suddenly become concerned that a recession is on the horizon, they’ll pull their money out of the stock market… and then invest that capital into the bond market.

The money remains in the US; it simply moves into a new asset class. So, as a result, stocks decline in value, but bonds increase in value.

But what we saw last month after Liberation Day… and then AGAIN yesterday, is stocks AND bonds both declining simultaneously.

(Remember that bond prices move inversely to yields; so, when bond prices fall, as they did yesterday, it really means that bond yields, i.e. interest rates, are moving higher. More on this below.)

Plus, on top of the stock and bond market routs, the US dollar also took a big hit.

As I explained last month after Liberation Day, this can only mean ONE thing: investors aren’t shifting their money from one US asset class to another. They’re moving their money OUT of the US and into foreign assets.

This is a clear sign that at least some investors are losing confidence in the United States.

And who could blame them? Congress is fiddling while the budget burns. The “One Big Beautiful” tax bill will result in yet another $2 trillion budget deficit.

Trust me, I love tax cuts. Tax cuts are great for the economy. But you can’t just cut taxes without massive spending cuts.

Well, this legislation doesn’t cut spending. In fact, they INCREASED spending… meaning that America’s $36+ trillion debt problem is only going to become worse.

Investors aren’t terribly impressed with that outcome… because they’re the ones who will be asked to finance all that debt and buy trillions of dollars’ worth of US government bonds.

Proof of investors’ dissatisfaction came yesterday when the Treasury Department auctioned off roughly $16 billion worth of 20-year bonds.

This is how the government typically sells its bonds-- through an auction process in which various banks and funds place bids. And ordinarily no one ever pays attention to Treasury auctions; they’re about as exciting as airline safety briefings.

But yesterday was different. Investors put their collective foot down and essentially refused to buy the government’s bonds unless the yield increased dramatically.

In the end, the 20-year yield hit 5.125%… which is almost the highest level it’s been since 2007. 

The auction became a major signal that investors are very concerned about the US government’s horrific finances. Sure, they’ll still buy bonds. But they will demand much higher interest rates… which is debilitating for the US government.

Remember, the government already spends more money paying interest on the national debt than they do on the US military. And total interest payments this year are expected to reach about $1.2 trillion-- more than 20 cents of every tax dollar collected.

Social Security, Medicare, and other mandatory entitlement programs will consume the other 80% of tax revenue… meaning that EVERY discretionary spending program, from the Defense Department to Homeland Security to Border Security, will have to be financed with more debt… at a HIGHER interest rate.

Higher interest rates cause the government’s annual interest bill to be even higher, meaning that the problem will eventually spiral out of control.

Folks, I’m not being pessimistic. It’s just basic arithmetic: there are very few good outcomes when your interest bill and mandatory entitlement spending grow faster than tax revenue.  

Lower interest rates would be helpful. And that’s one of the reasons why the White House has been so vocal in demanding the Fed “lower” interest rates.

Problem is-- the Fed doesn’t really have the power to cut rates anymore.

In the past, all the Fed Chairman had to do to cut rates was utter a few words; the bond market would click its heels, salute, and dutifully comply. Rates would fall just based on a speech.

That doesn’t happen anymore. If you recall when the Fed supposedly cut rates last year, bond yields actually increased. Essentially, investors are no longer paying attention to the Fed. They don’t care.

The market is now in control of bond yields… NOT the Fed. And certainly not the White House or Treasury Department. And the market does not like what it sees:

- $36 trillion national debt

- $2 trillion annual deficits

- $1.2 trillion annual interest bill

- Congress doing nothing about any of it

Bottom line, investors are fleeing-- and not just the bond market. Given the drop in the US dollar yesterday (alongside stocks and bonds), it’s clear that many investors are fleeing the United States entirely and moving their capital elsewhere.

Gold will be a major beneficiary of this trend (along with well-managed gold businesses) simply because foreign governments and central banks need a reliable, liquid asset with minimal counterparty risk to park all the capital they withdraw from the United States.

Gold is one of the few assets that meets these qualifications. And, while nothing goes up or down in an uninterrupted straight line, we continue to believe that there is tremendous upside left in gold… along with silver, platinum, and several other real assets.

 Ultimately, though, this is bad news for the US. No one in government seems to want to fix its terminal spending/deficit problem.

 And given what happened yesterday, it’s obvious that the market is no longer willing to ignore it.

To your freedom,  James Hickman   Co-Founder, Schiff Sovereign LLC

 TO READ MORE:

https://www.schiffsovereign.com/trends/investors-have-finally-had-enough-with-2-trillion-deficits-152831/?inf_contact_key=f9558dfd12e5c3a5b9cf9c6d3593b952611c10abb7b3657801e6f799df81c049

So... Now What?

So... Now What?

Notes From the Field By Simon Black (Simon Black)  May 13, 2025

One of the most mysterious villains in the history of cinema was the fictitious character ‘Keyser Söze’ from the movie The Usual Suspects.

 No spoilers here, but there’s a scene where they describe his rise in the criminal underworld. According to the story, Keyser Söze realized that “to be in power, you didn’t need guns or money or even numbers. You just needed the will to do what the other guy wouldn’t.”

 I’ve written before that there may have been some grand strategy behind “Liberation Day”.

 Perhaps the past several weeks were part of a deliberate effort by Donald Trump to prove that he has the will to do what nobody else (including China) would do… namely, cause a major worldwide recession that would even hurt his own country.

 It’s possible that everything was part of a ‘Keyser Söze’ negotiation tactic-- as the movie goes, “to show those men of will what will really was...” And that maybe, just maybe, this was a masterclass in the Art of the Deal.

 It’s also possible that none of those things is true, and instead the President is trying to undo the damage of his Liberation Day ‘unforced error’ before the US economy careens into recession.

Few people really know the truth. But what clearly is true is that there’s a level of economic excitement again that we haven’t seen since late February. The general consensus has flipped, practically overnight, and people once again believe that everything is going to be OK.

 Investment banks and their chief economists immediately began boosting their economic growth forecasts and slashing the odds of a recession. The stock market roared with approval.

 More importantly, there are serious catalysts on the horizon to potentially boost this momentum and economic optimism.

 I’d expect that we’ll soon hear the administration start hyping up its “Big, Beautiful” tax cut legislation, alongside more bonanza infrastructure spending.

There’s also a supersized National Defense bill as a cherry on top.

 All of that government money should almost certainly keep up the enthusiasm over the next few months.

 Moreover, the President is-- at this very moment-- in the Middle East inking deals with Saudi Arabia, Qatar, and the United Arab Emirates. They’ll tout major investments in the US that are so large as to be unbelievable, like the UAE’s pledge of investing $1.4 trillion.

 But it doesn’t matter if the numbers are real. It only matters that there’s enough hype to maintain the economic optimism.

 There’s also the very real possibility of peace in Ukraine soon, which would likely create even greater lift for the stock market. Plus, energy markets would stabilize, likely benefiting consumers and helping keep prices down in the short-term.

 With key inflation drivers (tariffs and war) out of the way, the Fed would have a pretty clear path to start cutting rates, as just about every major central bank in the world-- Europe, the UK, China, Canada, India, etc.-- has already done.

 Frankly, it doesn’t even matter whether or not the Fed cuts rates. It only matters that markets believe the Fed is likely to do so; this perception alone should provide yet another buoyant short-term lift to asset prices.

 All of that seems great-- higher asset prices, lower inflation, more trade, more prosperity. In fact, it almost sounds like that ‘New Golden Age’ we were promised in January.

 There’s just one problem: spending is still out of control.

 Just in the first six months of the fiscal year (which started October 1, 2024), the US budget deficit reached $1.3 trillion. And we can’t just blame Joe Biden; $600 billion of that $1.3 trillion deficit came since January.

 In other words, despite all the DOGE efforts, despite all the hard talk on budget cuts and responsible spending, they’re on track to post an astonishing $2.5+ trillion budget deficit for Fiscal Year 2025.

 Interest payments on the national debt are also skyrocketing. Last year’s interest bill was $1.15 trillion, and the Treasury Department already anticipates exceeding that amount this fiscal year.

 Bottom line, absolutely nothing has changed with respect to budget deficits and irresponsible spending… and it’s important to be intellectually honest about that.

 So even if the ‘economic war’ between the US and China is over-- and who knows if that’s really true-- the debt and deficit problem still poses a gargantuan risk to the US economy.

This matters, because reckless US spending was a key driver that pushed so many foreign governments and central banks to start diversifying their US dollar reserves back in 2023.

 Sure, there were other factors which also caused a loss of confidence in the US-- including the humiliating withdrawal from Afghanistan, Joe Biden shaking hands with thin air, and 9% inflation.

But it is the US government’s inability to even acknowledge an obvious financial crisis of its own making-- let alone deal with it in a rational and professional manner-- that led foreign governments and central banks to start diversifying away from the US dollar.

 Sadly, this trend has not changed.

So, again, perhaps Liberation Day is firmly in the rear-view mirror. Perhaps it was all a masterful ploy to push other countries to capitulate to America’s iron will. Perhaps the US economy may even be better off as a result…

 But the real problem that America faces, i.e. overspending, is still a five-alarm fire. Congress and the White House may be ignoring it, but foreign governments and central banks are not.

 So, while I expect a short-term pause over the next few months, Project “Find a New Global Reserve Currency” will likely restart in earnest later this year.

 To your freedom,  James Hickman   Co-Founder, Schiff Sovereign LLC

https://www.schiffsovereign.com/trends/so-now-what-152779/?inf_contact_key=8d3971aaf43661189bdd4d5a6f1d8710e6abc7ef250881a26a820a137a2e774a

Yikes. The “ONE BIG BEAUTIFUL” Tax Bill Is The Opposite Of What America Needs

Yikes. The “ONE BIG BEAUTIFUL” Tax Bill Is The Opposite Of What America Needs

Notes From the Field By James Hickman (Simon Black)  May 14, 2025

In the year 428 BC, ancient Athenians imposed a special tax called the eisphora that targeted local business investments in the city-state.

 It was expensive and highly unpopular among investors. And wealthy Athenians simply stopped investing in local businesses to avoid the tax.

 This is almost an iron-clad lesson of history: whenever governments tax something, they end up with less of it. And the inverse is also true: whenever governments subsidize or cut taxes on something, they end up with more of it.

 In 221 BC, the Qin government of ancient China imposed a tax on salt consumption. So, people consumed less of it… which led to significant health issues given that salt was used to cure meat and prevent bacteria growth.

 In 202 AD, Roman Emperor Septimus Severus imposed taxes on olive oil production to help fund welfare for the city’s poor. Farmers cut back on production to avoid the tax, and olive oil supply dropped dramatically.

 In the year 1302, the Republic of Florence imposed a steep tax on new businesses and guild membership. Business registrations dropped by 20% over the next decade, and the Florentine economy suffered significantly.

 Around the same time, cities in Germany’s Hanseatic League (like Lubeck and Hamburg) offered tax exemptions to businesses and merchants. And as a result, the number of registered businesses (especially in Lubeck) rose by 30%.

 And finally, in 17th century Holland, the government offered tax breaks and subsidies to the sugar industry… resulting in, you guessed it, an explosion in per-capita sugar consumption and the invention of sugar-laden desserts.

 All of these examples make perfect sense; most of us have first-hand experience in taxes influencing our own consumer, business, and investment choices. And that’s why I’ve long argued that tax policy is a reflection of a nation’s values and priorities.

 I bring this up because the House Ways and Means Committee released its 389-page “big, beautiful” tax bill yesterday. It’s literally called “THE ONE, BIG, BEAUTIFUL BILL” in all caps.

 I read it last night… and I’m really scratching my head at how this bill reflects America’s current values and priorities.

 For example, families (with adjusted gross income of $200,000 or less) will be able to deduct up to $10,000 per year in interest on car loans.

 Given that the average auto loan rate is 4.77% for borrowers with top credit, this means that a buyer could theoretically purchase a 1,064 horsepower Corvette ZR1 for ~$210,000 with a loan from General Motors and write off all the interest.

 Yes, the vehicle must at least be ‘assembled’ in America, so there’s some support to the US auto industry.

But clearly a tax break on auto loan interest will encourage more people to go into debt to buy a rapidly depreciating vehicle. And as much as I love Corvettes, I’m not sure this should be a national priority.

 An even bigger provision is the “No Tax On Tips” section.

 This was a big campaign promise to win votes from service workers in the swing state of Nevada. But in such a tip-crazy country as the US, where seemingly everyone expects a gratuity these days (including the self-service machines at the airport where no human being is even involved!), it’s a bizarre priority.

Who even understands tipping culture anyhow? A pizza delivery guy almost always receives a tip. But a school bus driver (who must responsibly and safely transport dozens of children) does not.

People will give ten bucks to a valet parking attendant who drives your car 50 feet. Yet, for all the times I ever heard “thank you for your service” when I was in the military, I never once received (nor obviously expected) a gratuity.

 Clearly Americans don’t value pizza over the lives of children, nor valet parking over national defense. But somewhere along the way, tipping culture in America got out of control. This legislation will make it worse… because now there will be an even greater expectation for tips.

 More importantly, what does this tax provision say about national priorities?

 They didn’t pass any tax incentives for careers that can substantially boost US economic growth, like AI developers or nuclear power engineers. Or even critical blue-collar jobs where the country is woefully short-- like truck drivers and oil roughnecks.

 Instead, these politicians seemingly got together and said, “We want more blackjack dealers, let’s create tax incentives for that industry.”

 This will almost certainly have unintended consequences.

 Among them: many of today’s lecherous professions (like online “content creators” and webcam models) technically earn tips. So young people could end up with perverse financial incentives to take their clothes off for a living rather than do something productive.

 I’m not sure how this is going to Make America Great Again; frankly the whole “ONE BIG BEAUTIFUL BILL” is rather underwhelming and provides very little incentive for economic growth.

 Rather, it prioritizes more debt and more consumption… which is the opposite of what American needs right now.

 To your freedom,    James Hickman   Co-Founder, Schiff Sovereign LLC

TO READ MORE:

https://www.schiffsovereign.com/trends/yikes-the-one-big-beautiful-tax-bill-is-the-opposite-of-what-america-needs-152788/?inf_contact_key=bbc027e06452415f180b4e343e6c59b80c973b8936282bcfa17ad90af1aa6cc5 

Why We Can Forget About “Drill Baby Drill” (Podcast)

Why We Can Forget About “Drill Baby Drill” (Podcast)

Notes From the Field By James Hickman (Simon Black)  May 7, 2025

Travis Stice is not one of those rare corporate CEOs who is a household name around the world... like Warren Buffett. But the two share a similar ethos. 

Buffett famously quipped, “Be fearful when others are greedy, and greedy when others are fearful,” which was ultimately a nod to the cyclical nature of markets and the economy. 

As surely as night follows day, and autumn/winter follow summer, bad times follow good... and then good times follow bad. 

Travis Stice understands this cyclicality all too well. As the founder/CEO of a large, pure-play Permian basin shale company (Diamondback Energy), he has seen ridiculously wild swings in the oil market, literally from nearly $150 per barrel all the way down to MINUS $40 per barrel, all within the past 15-20 years. 

So his warnings on the oil market are undoubtedly worth hearing. 

Stice penned an update to his shareholders earlier this week that bears special attention. And in it, he warned of the following:

• Over the past fifteen years, the US energy sector has provided extraordinary benefits to the US economy and American consumers.

• Rising oil production— thanks almost exclusively to shale producers— has kept energy prices low, driven job growth and exports, increased GDP, and filled government tax coffers.

• In 2024 alone, Texas collected $27 billion in state tax revenue from the oil and gas industry— more than the total tax revenue of more than 34 states.

• Yet oil production costs in the US have risen dramatically over the past decade. And tariffs make oil production significantly more expensive.

• There are further geological headwinds preventing further expansion; many shale resources are reaching their peak— or are already past their peak production.

• As a result of these factors, US oil production is now falling. Key metrics like crew counts and rig counts are down by as much as 20%.

• Simultaneously, oil is cheap right now. Adjusted for inflation— and adjusted for the cost of drilling— oil is nearly the cheapest it has been in decades (aside from the pandemic).

• With such cheap prices, there will be very little exploration for new oil... which is really bad for US energy independence, and likely means much higher prices in the future.

Stice sums it up by saying, “This will have a meaningful impact on our industry and our country.”

This is the topic of our latest podcast episode— and, candidly, the future of energy is pretty critical to understand. Oil may be cheap now, but this will likely be short-lived, and we could see a major price spike down the road— especially if the US dollar is displaced as the global reserve currency.

We invite you to listen in to today’s podcast here.

(For the audio-only version, check out our online post here.)
Y
To your freedom, James Hickman Co-Founder, Schiff Sovereign LLC

TO READ MORE: https://www.schiffsovereign.com/podcast/why-we-can-forget-about-drill-baby-drill-podcast-152745/?inf_contact_key=0c98c052bac7e1331af19afe8d90578d6303c23d34f0b6ec81d0174425c11f9a

This Trifecta of Market Declines is Rare… And Not Good

This Trifecta of Market Declines is Rare… And Not Good

Notes From the Field By James Hickman (Simon Black)  April 30, 2025

 In today’s podcast, we explore the rare phenomenon of simultaneous declines in the stock market, bond market, and currency market—a powerful signal of capital flight out of the US.

 We talk about when and where this has happened before, and why the Federal Reserve’s diminishing control over interest rates won’t fix it.

 We also discuss what higher rates mean for the commercial real estate market, and how that reverberates through the banking system.

 And we answer the question: is gold overbought, and inching towards a correction?

 The podcast also covers:

• Why gold, not Bitcoin, remains the ultimate safe haven for central banks.

• Why the US dollar's dominance is fading—and what comes next.

• The case for gold stocks over physical gold in today’s environment.

Give it a listen here.

CLICK HERE to listen to today’s podcast.

(For the audio-only version, check out our online post here.)

To your freedom,  James Hickman   Co-Founder, Schiff Sovereign LLC

https://www.schiffsovereign.com/podcast/this-trifecta-of-market-declines-is-rare-and-not-good-152715/?inf_contact_key=9208cbe90b3b1fba0e934d8d0d4741c056374244ed3079802af78ca168e4c2a0

Bizarrely, Gold Is The Opposite Of The Bitcoin Effect Right Now

Bizarrely, Gold Is The Opposite Of The Bitcoin Effect Right Now

Notes From the Field By James Hickman (Simon Black)  April 28, 2025

You’ve probably heard the story.

As the legend goes, on a late-summer morning in 1929, Joseph Kennedy — patriarch of the famous Kennedy family — was headed into his office in downtown New York City. As he sat for a quick shoe shine, the young boy buffing his shoes, barely a teenager, eagerly offered him stock tips.

 Kennedy listened politely, but inside, he felt a jolt of alarm.

Supposedly he rushed to his office, dumped his entire stock portfolio, and moved heavily into cash. And just weeks later the stock market collapsed.

 There’s a good chance this story isn’t true; I’ve often heard it told with Sir John Templeton in place of Joe Kennedy... and when urban legends can’t even get their protagonists straight, that’s usually a sign of fiction.

 Curiously, however, a similar thing actually happened to me.

It was March 2009— six months after the Global Financial Crisis kicked off that wiped 50% off the S&P 500.

 I was living in Punta del Este, Uruguay at the time and was coincidentally getting my shoes shined before heading to the airport for a trip to Asia.

 The shoe shiner, an elderly Uruguayan man, asked me what I did for a living. I mentioned something about finance, at which point he cautioned me to avoid the stock market.

 At that point the S&P was at its crisis-era low... and would go on to nearly 10x over the next 16 years.

 Another story that is true is from August 1979: Businessweek magazine famously declared "The Death of Equities," capturing the widespread view that stocks (which had suffered in the 1970s) would continue to languish.

Yet the stock market was just about to unleash a multi-decade bull run.

 In April 2019, the same Businessweek ran a cover asking, "Is Inflation Dead?", again capturing the popular idea that there would never be inflation again. That turned out to be 100% incorrect.

Then there was the famous Bitcoin craze in November 2017: families across America spent their Thanksgiving holidays opening up Coinbase accounts and bidding up the price of Bitcoin to its (then) all-time high. Crypto subsequently entered a multi-year bear market...

Anytime I see popular bandwagons, I become nervous. And I’m starting to see some signs of that with gold.

 One glaring signal is that Costco— which sells gold to its customers— sold out its most recent inventory of American Eagle Gold Coins in less than four days. Gold demand is surging among retail investors.

Dealers are reporting crazy volumes. The media is talking about gold daily now, whereas in the past they used to go weeks or months without a mention of gold.

 The Wall Street Journal even ran an article this past weekend entitled “How to buy gold”.

 Big investment bank analysts who, heretofore had ignored gold or been extremely bearish, are suddenly its biggest champions. Even the notorious Goldman Sachs is now projecting nearly $4,000 gold this year.

 And only a handful of analysts are bearish.

Look, we’ve been talking about gold for years... and in particular since 2023 when it became obvious that there were long-term catalysts.

It’s pretty easy to understand: central banks around the world are trading in their US dollars for gold, simply because they don’t have confidence that the dollar will last as the global reserve currency.

 And central banks don’t have a lot of options; there are only so many non-dollar asset classes that can absorb hundreds of billions of dollars worth of capital flows. Gold is one of the most convenient.

I’ve explained before that, because of these capital flow trends and catalysts, we could easily see $5,000 or even $10,000 gold over the coming years.

 But at the same time, the trend line for the gold price has been incredibly steep ever since its low in 2022. And, again, there are now signs that a retail gold mania may be forming.

I’m not saying that gold is too expensive or that it’s time to sell. These short-term market trends are extremely difficult to predict, and I tend to ignore them.

 Instead, I focus on the long-term big picture. And that’s a lot easier to see: the US fiscal situation is in major decline. The government is doing very little about it. And the rest of the world is already diversifying away from the dollar.

All of these trends are good for gold.

 Who knows what investors will do over the next few months? But over the next five years, you can make a very strong case that central banks will continue to buy gold and send the price higher.

 At the same time, I recognize that it’s difficult for some people to buy an asset when it’s at/near its all-time high... especially when it may suffer a short-term correction.

 This is why we’ve been writing about an alternative to gold; because, while gold is near its all-time high, many gold companies are still undervalued relative to gold itself.

 I’m talking about really solid, profitable gold miners trading at less than TWO times forward earnings. It’s ridiculous.

 In a way it’s the opposite of the crypto phenomenon with Microstrategy (MSTR)— the company which primarily owns and holds Bitcoin.

 Microstrategy (technically now called “Strategy”) owns 553,555 Bitcoin worth $52 billion. That’s pretty much their biggest (and nearly only) asset.

 Yet the MSTR’s market cap is $92 billion.

 In other words, the Bitcoin-related company is worth nearly double the amount of Bitcoin it holds. This makes no sense.

 With gold, it’s the opposite. Gold is near its all-time highs... but the gold-related companies are cheap and undervalued.

 Some investors are starting to notice— for example, multiple precious metals companies we have published in our investment research service have risen by 40-60%.

 One has more than doubled in price... yet is still trading at a forward multiple of just 2x.

 So, gold is bizarrely the opposite of the Bitcoin effect with Microstrategy: gold is at a record high, but gold companies are cheap. I’ll say it again— this is not going to last 

To your freedom,  James Hickman   Co-Founder, Schiff Sovereign LLC

 https://www.schiffsovereign.com/trends/bizarrely-gold-is-the-opposite-of-the-bitcoin-effect-right-now-152700/?inf_contact_key=d4ae7d46f485af16ae3e89540a8231548dcae2ba3297e07f93219ba341147496