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Ripple Effect

A Simple Pair Trade

Loading ...Addison Wiggin

November 25, 2025 • 1 minute, 16 second read


Banksgold

A Simple Pair Trade

Since early 2023, regional banks have been sitting on massive unrealized losses on their bond holdings:

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Bank losses are off their 2023 lows, but are still over $300 billion. (Source: FDIC)

When the Fed began hiking rates to combat inflation, bond holdings tanked. Banks have been sweating it out, anticipating a rate cut cycle.

If the Fed cuts rates in December — odds now 80% — bond prices will continue to rise. Banks will be in better shape as unrealized losses decline. Hopefully, before a crisis breaks out.

But banks are not out of the woods, yet. And increased competition from digital assets (Dollar 2.0) will further squeeze the traditional banking business model.

Lower interest rates will drive hard assets higher.  In our view, gold’s recent pause in the low $4,000 range is just that – a necessary breather after the run-up this year from $2,800 to $4,400 at the peak.

Don’t fret the safety of the banking system, buy gold… and digital assets.

~ Addison

P.S. While this is a holiday-shortened week, we’ve arranged for a unique video presentation of Tim Sykes’ novel trading strategy on Thanksgiving Thursday.

Tim is one of the top traders in the game today – and he’s sharing details on a strategy he uses to find stocks on Fridays that will likely pop on the Monday open after a restful weekend.

Tim’s innovative strategy will be worth your consideration:

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If you have requests for new guests you’d like to see join us for Grey Swan Live!,  or have any questions for our guests, send them here.


Are We In a Bubble?

November 25, 2025 • Timothy Sykes

CNBC analysts are debating it.

Twitter threads are dissecting it.

Portfolio managers are losing sleep over it.

One question is dominating financial news right now:

“Are we in a bubble?”

Are We In a Bubble?
The AI Boom’s Hidden Ticking Clock

November 25, 2025 • Addison Wiggin

We noticed yesterday, Michael Burry, of Big Short fame, just set up a Substack page to help understand the proper depreciation values of the “Nvidia Model.”

The simple fact is that longevity estimates determine the entire profit picture for Mag 7 companies, whose earnings have been beating expectations.

The current numbers don’t reflect reality. Model sizes grow faster than chip cycles. Performance requirements leapfrog hardware before the ink dries on the purchase orders. Depreciation schedules assume years of usefulness that, in practice, last months.

If that mismatch becomes undeniable, or even a popular meme, the bubble doesn’t burst spectacularly — it simply deflates through balance sheets. Slowly. Silently. Just enough to take the glow off the entire narrative.

The AI Boom’s Hidden Ticking Clock
Buffett’s Thanksgiving Message

November 24, 2025 • Addison Wiggin

I’m happy to say I feel better about the second half of my life than the first. My advice: Don’t beat yourself up over past mistakes—learn at least a little from them and move on. It is never too late to improve. Get the right heroes and copy them.

Remember Alfred Nobel, later of Nobel Prize fame, who—reportedly—read his own obituary that was mistakenly printed when his brother died and a newspaper got mixed up. He was horrified at what he read and realized he should change his behavior.

Don’t count on a newsroom mix-up: Decide what you would like your obituary to say and live the life to deserve it.

Greatness does not come about through accumulating great amounts of money, great amounts of publicity, or great power in government. When you help someone in any one of thousands of ways, you help the world. Kindness is costless but also priceless. Whether you are religious or not, it’s hard to beat the Golden Rule as a guide to behavior.

Buffett’s Thanksgiving Message
Energetic Open To A Sleepy Week

November 24, 2025 • Addison Wiggin

New York Fed President John Williams gave traders a holiday treat on Friday, admitting there may be “room for a further adjustment.”

Futures traders promptly lifted the odds of a December rate cut to nearly 75%, up from 40% just a week ago.

Two consecutive cuts in September and October have already greased the rails. If the Fed goes for a third, the “Santa Powell Rally” may arrive early.

Energetic Open To A Sleepy Week