“Civilizations die from suicide, not by murder.”
—Arnold Toynbee, quoted often by men who see it coming
Wall Street shook off the rain Monday and opened the week in high spirits. Why? Hope. The ever drug.
Stocks climbed as trade talks between the U.S. and China resumed in London. Optimists are praying the meetings will ratchet tensions down, not up. The White House called the reports from Monday’s session “good.” Trump added, helpfully, “China’s not easy.”
Meanwhile, China’s exports to the U.S. fell 34.5% in May — marking the sharpest decline since February 2020. Back then, it was the virus. This time it’s tariffs, blacklists, and mistrust.
Still, Wall Street is in the back alley, chasing hopium: hedge funds bought a record amount of global equities last month, according to Goldman. As we’ve been observing for the past two months, institutions have been dumping shares into the post-Liberation Day rally.
Even Topgolf Callaway shares spiked after a director put his money where his Titleist is, scooping up $2.5 million in stock. Retail’s still piling in, and now the pros are too.
The question, at least for this morning, will institutions fuel another leg up in stocks — or is it just a hopeful “before summer” gasp of AI fumes?
Trade, Tariffs & 17 Rare Metals You Can’t Pronounce
While the diplomats meet in London, rare earths are at the heart of the conversation — again. China mines 69% of the world’s rare earths and refines 90% of them. That makes them indispensable to modern industry: from electric cars and solar panels to radar systems and missiles.
The U.S. wants access. China wants leverage.
In April, Beijing tightened export restrictions. Then loosened them — barely. Last week, they granted temporary licenses to rare-earth suppliers serving GM, Ford, and Stellantis. Just six months. Just enough rope.
The U.S. doesn’t have many cards left to play — not when China owns the refining capacity, intellectual property, and, increasingly, patience. It will take considerable time for rare earth mining operations to open up in friendlier jurisdictions – time that a complex global economy addicted to rare earths may not have.
From London to Los Angeles
Back home, the conflict is more domestic — and more visceral.
President Trump escalated the military presence in Los Angeles yesterday, deploying 700 Marines alongside the National Guard to quell anti-ICE protests.
California Governor Gavin Newsom is suing, claiming the federalization of state troops is illegal. Trump’s response? Accuse Newsom of obstruction — and threaten arrest.
The protests have turned into nightly clashes. And it’s spreading.
This Saturday, on Flag Day and Trump’s birthday, a 7,000-troop parade is set to roll through Washington. Tanks, jets, and a display of might long dreamed of by this president. Political theater fit for an autocrat? Or an actual show of might? Maybe it’s both.
Once shown, power demands a reaction. And… that could be a problem.
June 15: The Wildest G7 Summit Ever…
The Fourth Turning Has a Stage Number
In 2022, Ray Dalio took his final steps away from his $160 billion empire. For the past three years, he’s been releasing a series of books centered on his lifelong passion for principles.
Yesterday, he blew up X with a series of posts and interview clips discussing Principles for a Changing World Order. His warning: we’re in Stage Five of the “Big Cycle.” That’s the part where institutions fail, wealth gaps explode, trust disintegrates, and civil unrest takes hold.
Stage Six? That’s systemic collapse.
Dalio’s framework reads like a seismograph of the last five years: 93% of partisans think the other side is a threat to the country. The top 1% hold 32.3% of wealth. This morning, government debt is threatening to cross $37 trillion. Social trust? You’d have better odds finding a working fax machine.
Strauss and Howe call it, in their classic book, The Fourth Turning — society’s periodic hard reset. Previous ones? The Revolution, the Civil War, the Great Depression/WWII, all about 80 years apart. This one?
Hmn. We’re living it.
All of which raises the question: what gets resolved this time?
What Is Money?
That’s the question at the heart of the storm.
What is money? The dollar? A promise? A bond backed by nothing but confidence? Or is it gold, silver — scarce, tangible, unyielding? Or bitcoin — decentralized, incorruptible, digital by design?
The global protests, the currency debasement, the record demand for gold and silver — all symptoms of a deeper sickness: a crisis of belief.
As Robert Kiyosaki puts it, gold and silver are “God’s money.” Bitcoin is “the people’s money.” Dollars? They’re the banker’s money. And the bankers are nervous.
Just ask the shareholders of Sunnova Energy, once a darling of the free-money era. It went public at $12, soared to $55 in the pandemic mania, and filed for Chapter 11 on Sunday. The stock last traded at 22 cents. Another casualty of fake growth funded by fake rates using fake money.
Meanwhile in MetaLand…
This morning, Mark Zuckerberg is going all-in on artificial general intelligence.
Frustrated with Meta’s AI flops, he’s putting together a team — and a $65 billion war chest — to catch up. A major bet is Scale AI, a data-labeling startup now in line for the most significant external investment Meta’s ever made.
While Zuckerberg builds robo-brains, Fidelity’s billionaire Johnson clan is offloading Chinese tech stocks at 60% to 80% discounts. Global capital is fleeing the geopolitical crossfire.
It’s a signal: AI may be the future, but trust is still the currency. And few trust the current order anymore.
What to Watch This Week
Tomorrow, we get the latest read from the Consumer Price Index — a real-time gut check on how Trump’s tariffs are feeding inflation for the people. Thursday brings the Producer Price Index, where wholesale prices will start showing the strain first.
On Friday, the University of Michigan releases consumer sentiment data… where we get to see how business owners and consumers alike really feel about all this change happenin’ at once.
The Fed next week (June 17-18). Jerome Powell will again stick his neck out somewhere between a recession and a firehose of fiscal policy. This week, he and the Fed governors will read these aforementioned numbers like their careers depend on it.
*** Fill in your own punchline here. G’head, it’s fun.
Save Yourself, Not the System
Don’t wait for the next Dalio warning. Or the next Fed “pause.” Or the next headline that tells you everything’s fine.
You already know the playbook: inflation steals your savings. Taxes eat your earnings. Paper burns.
Gold holds. Silver shines. Bitcoin moves outside the system.
In a world where banks collapse quietly, institutions pretend, and the money itself lies… sound money is your last line of defense. Become your own bank. Stop saving fake money.
Save gold, silver, and bitcoin.
~Addison
P.S.: Thursday on Grey Swan Live!, we’ll go beneath the surface with Grey Swan contributor John Robb, former advisor to the U.S. Joint Chiefs of Staff.
John is going to give us his view of Dalio’s Stage 5, the civil breakdown in LA, and China tariff tiffs and rare-earth chess match. We’re also going to do a deep dive on the new military tactics being deployed in Ukraine and how the defense department is readying itself for global resource and AI wars.
Your thoughts? Please send them here: addison@greyswanfraternity.com
How did we get here? Find out in these riveting reads: Demise of the Dollar, Financial Reckoning Day, and Empire of Debt — all three books are now available in their third post-pandemic editions. You might enjoy one or all three.
