New Year, New Record High

Household debt continues to rise, not just in total dollars, but as a percentage of gross disposable income:

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Households continue to increase their total debt (Source: Goldman Sachs)

Interest rates are coming down, emboldening consumers to take on more debt.

The latest data highlights a central feature of the real economy. Americans no longer manage savings and income but credit cards, HELOCs, and mortgages in an effort to keep up appearances.

Day-to-day expenses, health insurance, housing, car payments and tuition will continue to plague Americans throughout the year ahead of going to the polls in November.

~ Addison

P.S. We just wrapped our first Grey Swan Live! of the year, with Matt Smith, publisher at Casey Research. Matt and co-author Doug Casey have just released a new book titledThe Preparation.

Quick hit: Since 2021, Matt has been operating a “regenerative” cattle ranch in Uruguay.

The Preparation: How to Become Competent, Confident and Dangerous lays out a 16-cycle skills-based alternative to traditional 4-year college degrees.

Maxim Smith, Matt’s 20-year-old son, is on his way to Thailand for an intense training course in martial arts. That’s part of cycle number 4 in the program.

Last year, he crewed a sailing vessel on a journey across the Atlantic from the Falkland Islands to the southern tip of Africa.

Our conversation with Matt was on a different plane than our usual Live! themes. It’ll be well worth your time to listen to the replay, which will be posted to the Grey Swan Live archive in the members’ section later today.

We also recommend members buy a copy of The Preparation for a young man in their lives.

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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.

Household debt continues to rise, not just in total dollars, but as a percentage of gross disposable income:

Turn Your Images On

Households continue to increase their total debt (Source: Goldman Sachs)

Interest rates are coming down, emboldening consumers to take on more debt.

The latest data highlights a central feature of the real economy. Americans no longer manage savings and income but credit cards, HELOCs, and mortgages in an effort to keep up appearances.

Day-to-day expenses, health insurance, housing, car payments and tuition will continue to plague Americans throughout the year ahead of going to the polls in November.

~ Addison

P.S. We just wrapped our first Grey Swan Live! of the year, with Matt Smith, publisher at Casey Research. Matt and co-author Doug Casey have just released a new book titledThe Preparation.

Quick hit: Since 2021, Matt has been operating a “regenerative” cattle ranch in Uruguay.

The Preparation: How to Become Competent, Confident and Dangerous lays out a 16-cycle skills-based alternative to traditional 4-year college degrees.

Maxim Smith, Matt’s 20-year-old son, is on his way to Thailand for an intense training course in martial arts. That’s part of cycle number 4 in the program.

Last year, he crewed a sailing vessel on a journey across the Atlantic from the Falkland Islands to the southern tip of Africa.

We also recommend members buy a copy of The Preparation for a young man in their lives.

Turn Your Images On

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.

Mining stocks amplify everything. First Majestic went from losing money to 45% margins without building anything new. They just held the line on costs while silver did the heavy lifting.

That cuts both ways. If silver drops hard, margins compress just as fast. Same leverage, opposite direction.

The miners with the lowest costs and cleanest balance sheets will hold up best in a pullback and capture the most upside if the deficit keeps grinding.

Economists at Goldman Sachs said this morning they expect core inflation to finish the year around 2% even while GDP rises at a “surprisingly strong” 2.5% clip.

In our view, their inflation forecast is optimistic. Their GDP call? Modest.

The last time we pumped this much liquidity into the system — 2020 through 2022—the result was a manic asset bubble, runaway inflation, and an epic hangover at the Fed.

Goldman’s optimism has triggered a fresh round of bullish bets: cyclical stocks are rallying, “dispersion” in the S&P 500 is spiking, and the Fed is expected to cut interest rates twice before Jerome Powell gets kicked out of Washington at the end of his term on May 15.

Anecdotally, we’re hearing stories of warehouses full of GPUs sitting unused for lack of energy to power them. It’s a natural feature of the heavy capital investment in new machines. The grid has to catch up!

While Trump’s great reset rolls on in 2026, keep an eye on modular nuclear reactors and increased demand for uranium, natural gas and related resources.

These PM producers are literally printing the most ‘hard money’ that they ever have at these metals prices and record margins here at the midway point in Q4.

If there ever was a time for this sector to get overheated and frothy, this would be it… only that isn’t what we’ve seen playing out.

PM producers are still insanely profitable at even at current metals prices and should be far more valuable based on their margins, revenue generating potential, and their resources still in the ground.