A Safe Haven Amid The Chaos

“The normal ‘risk-off’ assets, dollar and Treasurys, are down. I will keep saying it: gold is a better diversifier than Treasurys in this environment of high debt.”

–Wei Li, Investment Strategist at Blackrock

April 11, 2025 — It’s earnings season… again. They come around like Groundhog’s Day.

This year, however, is different.

A few weeks ago, we had “Liberation Day,” which kicked off a global trade war. Now, it is zeroing in as a political spat between Donald Trump and Xi Jinping.

Today, we’re focusing on Big Banks. Their news is pretty good so far. It helps that they’re reporting data for the quarter ending March 31, 2025.

Before “Liberation Day.” It was a simpler time.

Since then, the stock market has melted down. While it’s showing some signs of stabilizing this week, the bond market is also melting down. The markets moving into earnings season have become a global game of asset-class whack-a-mole.

No bueno.

With this rising uncertainty, we’ve already seen that chipmakers (Logitech), airline companies (Delta), and retailers (WalMart) are starting to pull their guidance.

That’s usually a key part, if not the key part of earnings season. After all, the quarterly financial reporting is all rear-view mirror stuff.

Guidance is where the rubber hits the road. It’s a way for company CEOs to paint a vision of the future. And they don’t pull guidance when they see a bright future ahead.

So when the market is in panic mode and a company’s CEO is even “realistic” about their future outlook – a stock can fall. Even if it’s already been trending lower.

During “earnings season,” vibes matter. Pulling guidance during the tariff uncertainty, can really kill a company’s vibe.

Momentum is in. Uncertainty kills.

Markets are likely to grind lower in the weeks ahead. Some companies may keep their guidance but provide a wider variance… or drop their guidance heavily.

Either will likely be bad for any company doing so.

It seems like no sector is safe – except perhaps one: Gold miners.

Amid the market chaos, gold is the last asset class left standing.

Bitcoin is well off its highs and has sharply pulled back during times of the day when other financial markets are closed – the joy of 24/7 trading.

But gold has been truckin’ higher. The metal topped $3,250 per ounce overnight and only briefly pulled back near the stock market lows early in the week.

With gold trending higher, the companies that mine for the metal may be the big winners in the stock market for the foreseeable future.

As Grey Swan Investment Fraternity contributor John Rubino notes:

We’re heading into another earnings season, and with gold outperforming pretty much everything else, this one is looking even better for the miners than Q4.

For context, here’s the XAU gold/silver miners index for the past six months. Note the nice run that started when excellent Q4 miner earnings combined with a rising gold price:

And for a sense of what a higher gold price means for a well-run miner, here are Agnico Eagle’s Q4 results. Note that the average gold price rose from $1,982/oz in Q4 2023 to $2,660/oz in Q4 2024, while Agnico’s net income and free cash flow rose by much more in percentage terms. That’s the kind of operating leverage that makes miners fun to own in bull markets.

In 2025’s Q1 (which ended on March 31), gold averaged nearly $3,000/oz, which means another big operating leverage pop for the miners.

We track gold and gold mining stocks in our model portfolio. And as we shared with paid-up Fraternity members in our Grey Swan Live! meet-up yesterday, they’ve been some of our strongest-performing positions in both our Core Portfolio and our Aggressive Portfolio, and we don’t see that trend ending anytime soon.

With interest rates acting out of sync with market conditions, today’s rising bond yields could also position investors well for lower interest rates in the future. But until we see a sign of a turnaround, that market will likely get worse before it gets better.

We still see gold as the safest play in town, even at today’s prices. And for investors looking for an opportunity in the stock market today, gold mining stocks are getting considerable momentum behind them that will likely carry through their earnings reports this quarter – and at this point into Q2 2025.

The best part?

There’s something for everyone in the gold space, from income-generating miners like the ones we highlighted last year, to exploratory companies with big upside as they make new discoveries of the metal.

Addison Wiggin
Grey Swan

P.S.: Please note that we’ve recently released research on copper and uranium. The building blocks of civilization always heat up during crises in paper assets.

In the immediate, however, oil looks interesting.

Oil prices have sunk as recession odds have soared. If the tariff issue is quickly resolved in the next few months and recession odds slip, oil could be best positioned to take off and soar once again.

As with gold, oil is a sector that offers something for everyone, from global giants to up-and-coming players to income-heavy plays.

On the political front, we wouldn’t be surprised to see Trump reverse another Biden-era mistake and refill the Strategic Petroleum Reserve (SPR) at seriously lower prices.

Or,… even better to find out that Warren Buffett’s Berkshire Hathaway has been buying more shares of Occidental Petroleum (OXY), adding to the 34% of the company that they already own. We discussed that possibility during Grey Swan Live! yesterday, to paid-up members.

Add your thoughts to the mix here: addison@greyswanfraternity.com Have a restful weekend after this hectic market week!

“The normal ‘risk-off’ assets, dollar and Treasurys, are down. I will keep saying it: gold is a better diversifier than Treasurys in this environment of high debt.”

–Wei Li, Investment Strategist at Blackrock

April 11, 2025 — It’s earnings season… again. They come around like Groundhog’s Day.

This year, however, is different.

A few weeks ago, we had “Liberation Day,” which kicked off a global trade war. Now, it is zeroing in as a political spat between Donald Trump and Xi Jinping.

Today, we’re focusing on Big Banks. Their news is pretty good so far. It helps that they’re reporting data for the quarter ending March 31, 2025.

Before “Liberation Day.” It was a simpler time.

No bueno.

With this rising uncertainty, we’ve already seen that chipmakers (Logitech), airline companies (Delta), and retailers (WalMart) are starting to pull their guidance.

That’s usually a key part, if not the key part of earnings season. After all, the quarterly financial reporting is all rear-view mirror stuff.

Guidance is where the rubber hits the road. It’s a way for company CEOs to paint a vision of the future. And they don’t pull guidance when they see a bright future ahead.

So when the market is in panic mode and a company’s CEO is even “realistic” about their future outlook – a stock can fall. Even if it’s already been trending lower.

During “earnings season,” vibes matter. Pulling guidance during the tariff uncertainty, can really kill a company’s vibe.

Momentum is in. Uncertainty kills.

Markets are likely to grind lower in the weeks ahead. Some companies may keep their guidance but provide a wider variance… or drop their guidance heavily.

Either will likely be bad for any company doing so.

It seems like no sector is safe – except perhaps one: Gold miners.

Amid the market chaos, gold is the last asset class left standing.

Bitcoin is well off its highs and has sharply pulled back during times of the day when other financial markets are closed – the joy of 24/7 trading.

But gold has been truckin’ higher. The metal topped $3,250 per ounce overnight and only briefly pulled back near the stock market lows early in the week.

With gold trending higher, the companies that mine for the metal may be the big winners in the stock market for the foreseeable future.

As Grey Swan Investment Fraternity contributor John Rubino notes:

We’re heading into another earnings season, and with gold outperforming pretty much everything else, this one is looking even better for the miners than Q4.

For context, here’s the XAU gold/silver miners index for the past six months. Note the nice run that started when excellent Q4 miner earnings combined with a rising gold price:

And for a sense of what a higher gold price means for a well-run miner, here are Agnico Eagle’s Q4 results. Note that the average gold price rose from $1,982/oz in Q4 2023 to $2,660/oz in Q4 2024, while Agnico’s net income and free cash flow rose by much more in percentage terms. That’s the kind of operating leverage that makes miners fun to own in bull markets.

In 2025’s Q1 (which ended on March 31), gold averaged nearly $3,000/oz, which means another big operating leverage pop for the miners.

The best part?

Addison Wiggin
Grey Swan

P.S.: Please note that we’ve recently released research on copper and uranium. The building blocks of civilization always heat up during crises in paper assets.

In the immediate, however, oil looks interesting.

As with gold, oil is a sector that offers something for everyone, from global giants to up-and-coming players to income-heavy plays.

On the political front, we wouldn’t be surprised to see Trump reverse another Biden-era mistake and refill the Strategic Petroleum Reserve (SPR) at seriously lower prices.

Add your thoughts to the mix here: addison@greyswanfraternity.com Have a restful weekend after this hectic market week!

For now, the mixed economic data means stocks will likely trend higher, until there’s a crisis. And when there is a crisis, the Fed will finally make its move and aggressively cut rates.

And, for now, bond yields are still near their highest level in 15 years. Bond yields, even on U.S. Treasury bonds, are over the rate of inflation.

In short, it’s not a bad time to lock in bond yields now – which will go lower during a crisis, pushing bond prices higher. And in a crisis, today’s high-flying stocks, driven by retail investors with a fear of missing out – could easily get crushed.

Markets are humming, policy dazzles, but beneath the gloss — tech booms, liquidity surges, digital currencies — the very foundations of money, governance, and investor sentiment are cracking, realigning, even smoldering.

The post-World War II Pax Americana isn’t evolving; it’s being dismantled rather quickly.

What’s emerging is accompanied by a load of distraction and showmanship. So it’s important to focus on the actual events taking place right now that are going to affect your portfolio this year.

And, we can’t overstate this, the changes that are actually happening right now to your money.

Today, digital dollars masquerade as cash, tariffs are cloaked as protection, AI layoffs spun as productivity, private assets packaged as democratized. And yet, none of it matters if the final pillar — confidence — crumbles.

When belief falters, no trumpet of “seismic event” grants you shelter.

Private equity tends to perform better than the stock market, provided you do so over time.

Private credit, a newer asset class but a rapidly growing one, also shows strong returns, as well as relatively high current income.

And if you have a retirement account, chances are you’re willing to think long-term.

Win-win, right? Not necessarily.

First, these new funds would also come with an incentive structure similar to investing in a hedge fund. That includes a higher fee than a market index ETF – think 2% compared to 0.1% (or less).

Plus, many of these funds have a hurdle rate attached to them as well. Once they clear 5% returns – which, with private credit, can be easily cleared by making deals with cash returns over 5% – additional incentive fees may kick in.

Several factors are likely at play here. Rising uncertainty over Trump’s tariff and trade policies – even though he’s largely walked those back.

A bigger factor? The rise of AI.

Many big tech companies have been making layoffs this year, citing increased productivity as a reason. For instance, Microsoft just announced another 9,000 in layoffs.

Of course, when an individual company announces layoffs, it’s usually bullish for shares. That company is doing the same – or more – with a smaller headcount. That’s lower costs and higher productivity.

But in a world where every company can lay off a sizable percentage of their staff, we have more unemployed consumers, who tend to cut back on spending.