The Great Game

“Men who are both right and can sit tight are uncommon.”

–Jesse Livermore

Gold’s value continues to exceed its price…

April 16, 2025 — ‘I resemble that remark.’

–Curly Howard

Like internet advertising, the tariff news keeps coming. Quartz:

A group of Wedbush analysts led by Dan Ives sent a note Tuesday…“This auto tariff (in its current form) will send the auto industry into upside down mode and raise the average price of cars between $5k on the low end and $10k to $15k on the high end.”

The Daily Mail:

Xia Baolong, a top Chinese official…’Let those peasants in the United States wail in front of the 5,000 years of Chinese civilization,’ Xia, the director of China’s Hong Kong and Macau Affairs Office under the State Council, said in a televised speech today.

But what are we watching? Is it a 21st century version of the Great Game…in which the world’s most powerful nations make moves and counter-moves…one trying to protect its empire…the other trying to save face? The Raw Story:

Trade war set to ‘get really ugly’ as ‘Xi won’t back down’: Ex-Trump official

As the White House claims they have the ‘upper hand’ in the China trade war, a new POLITICO report is claiming otherwise…

According to the outlet, Trump’s exceptions are “indicative of the relatively weak position of the administration.”

They also noted a second problem with the tariffs: “The U.S. is imposing new tariffs on Chinese goods in an attempt to move manufacturing back to the U.S., but those tariffs are particularly painful for U.S. manufacturers because they are currently so dependent on Chinese parts.”

In retrospect, the 19th century ‘Great Game’ between Russia and England was a waste of time, money, and lives. Russia believed it was protecting the southern Caucasus from further English colonization. England thought it was protecting India. Neither was a realistic threat.

So maybe this trade spat is not so important, either. Maybe it’s just an entertaining farce…’Trade Stooges’…nyuk…nyuk…nyuk… in which the lead characters whack each other for the benefit of the audience…but nobody actually gets hurt?

They punch. They poke. But no hard feelings!

AP is reporting that Donald Trump, for all his vaudeville jabs, flip flops more than a pair of beach sandals:

Trump considers pausing his auto tariffs as the world economy endures whiplash

“I’m looking at something to help some of the car companies with it,” Trump told reporters gathered in the Oval Office. The Republican president said automakers needed time to relocate production from Canada, Mexico and other places, “And they need a little bit of time because they’re going to make them here, but they need a little bit of time. So I’m talking about things like that.”

In a non-stooge comedy, a leader might want to talk “about things like that” before threatening billions in trade…thousands of jobs…and millions of family budgets.

Besides, there is no way the auto companies are going to relocate production to the US in just a few months. And maybe never. The New York Post:

Honda on Tuesday said it has no plans to move car production from Canada and Mexico to the US, following a report that the Japan auto giant was considering shifting some operations to avoid potentially devastating tariffs.

So, what’s this really about? This is just show business, right?

Maybe not.

Maybe more like ‘The Guns of August’…in which the leading powers blunder into a catastrophic war, with no real cause…no practical strategy…and with nothing really at stake. Once underway, there’s no acceptable outcome…except to win…at any cost. Irish Star:

China orders all airlines to stop taking deliveries from Boeing as trade war explodes

As the trade war with the US intensifies, China has halted deliveries from Boeing…In response, Chinese officials have instructed airlines to cease accepting deliveries from Boeing and to stop purchasing aircraft-related equipment and parts from American companies.

And this from the newswires:

China has sent naval vessels to the wider Western Pacific Ocean via waterways near Japan after a United States aircraft carrier reached the contested region, along with an advanced warship. The Japanese military on Monday announced that three Chinese naval ships had sailed in the waters southwest of Japan on Friday. They were the Type 052C destroyer CNS Changchun, the Type 054A frigate CNS Yangzhou and the Type 903 replenishment ship CNS Qiandaohu.

The Stooges?

The Great Game?

WWI?

Remember how movie theaters used to offer a ‘double feature?’ This looks like a triple feature to us!

Get your popcorn…and your gold…now.

Regards,

Bill Bonner
Bonner Private Research & Grey Swan

P.S. from Addison: We hate to sound like a broken record on gold, but it’s clear that the metal has strong momentum behind it. Our latest research on gold suggests there’s still room to go – and plenty of ways to invest in gold, including investments in gold mining stocks, which have become a standout sector in today’s fearful markets.

P.P.S: And if you’re a paid member of the Grey Swan Investment Fraternity, you can join us for a live discussion tomorrow, Thursday, April 17, 2025, at 11 a.m. ET.

We’ll be analyzing central bank buying of gold, the U.S. dollar’s role as the global reserve currency amid the Trump tariff regime… and how crypto fits into the mix.

You can sign up here to become a member.

Grey Swan Live!
Thursday, April 17, 2025
11:00 a.m. ET

Add your thoughts to the mix here: addison@greyswanfraternity.com

“Men who are both right and can sit tight are uncommon.”

–Jesse Livermore

Gold’s value continues to exceed its price…

April 16, 2025 — ‘I resemble that remark.’

–Curly Howard

Like internet advertising, the tariff news keeps coming. Quartz:

A group of Wedbush analysts led by Dan Ives sent a note Tuesday…“This auto tariff (in its current form) will send the auto industry into upside down mode and raise the average price of cars between $5k on the low end and $10k to $15k on the high end.”

The Daily Mail:

Xia Baolong, a top Chinese official…’Let those peasants in the United States wail in front of the 5,000 years of Chinese civilization,’ Xia, the director of China’s Hong Kong and Macau Affairs Office under the State Council, said in a televised speech today.

Trade war set to ‘get really ugly’ as ‘Xi won’t back down’: Ex-Trump official

As the White House claims they have the ‘upper hand’ in the China trade war, a new POLITICO report is claiming otherwise…

According to the outlet, Trump’s exceptions are “indicative of the relatively weak position of the administration.”

They also noted a second problem with the tariffs: “The U.S. is imposing new tariffs on Chinese goods in an attempt to move manufacturing back to the U.S., but those tariffs are particularly painful for U.S. manufacturers because they are currently so dependent on Chinese parts.”

They punch. They poke. But no hard feelings!

AP is reporting that Donald Trump, for all his vaudeville jabs, flip flops more than a pair of beach sandals:

Trump considers pausing his auto tariffs as the world economy endures whiplash

“I’m looking at something to help some of the car companies with it,” Trump told reporters gathered in the Oval Office. The Republican president said automakers needed time to relocate production from Canada, Mexico and other places, “And they need a little bit of time because they’re going to make them here, but they need a little bit of time. So I’m talking about things like that.”

In a non-stooge comedy, a leader might want to talk “about things like that” before threatening billions in trade…thousands of jobs…and millions of family budgets.

Besides, there is no way the auto companies are going to relocate production to the US in just a few months. And maybe never. The New York Post:

Honda on Tuesday said it has no plans to move car production from Canada and Mexico to the US, following a report that the Japan auto giant was considering shifting some operations to avoid potentially devastating tariffs.

So, what’s this really about? This is just show business, right?

Maybe not.

China orders all airlines to stop taking deliveries from Boeing as trade war explodes

As the trade war with the US intensifies, China has halted deliveries from Boeing…In response, Chinese officials have instructed airlines to cease accepting deliveries from Boeing and to stop purchasing aircraft-related equipment and parts from American companies.

And this from the newswires:

China has sent naval vessels to the wider Western Pacific Ocean via waterways near Japan after a United States aircraft carrier reached the contested region, along with an advanced warship. The Japanese military on Monday announced that three Chinese naval ships had sailed in the waters southwest of Japan on Friday. They were the Type 052C destroyer CNS Changchun, the Type 054A frigate CNS Yangzhou and the Type 903 replenishment ship CNS Qiandaohu.

The Stooges?

The Great Game?

WWI?

Remember how movie theaters used to offer a ‘double feature?’ This looks like a triple feature to us!

Get your popcorn…and your gold…now.

Regards,

Bill Bonner
Bonner Private Research & Grey Swan

P.P.S: And if you’re a paid member of the Grey Swan Investment Fraternity, you can join us for a live discussion tomorrow, Thursday, April 17, 2025, at 11 a.m. ET.

We’ll be analyzing central bank buying of gold, the U.S. dollar’s role as the global reserve currency amid the Trump tariff regime… and how crypto fits into the mix.

You can sign up here to become a member.

Grey Swan Live!
Thursday, April 17, 2025
11:00 a.m. ET

Add your thoughts to the mix here: addison@greyswanfraternity.com

The genius of the American experiment is that it allows for course correction — but only if we remember our role. Not as subjects, but as stewards.

Your role, good sir or wise gentle lady, is to continue doing what you’ve always done: managing your affairs with clear eyes and a steady hand, educating those who’ll carry the torch, and resisting the ever-present temptation to comply just for comfort’s sake.

Yes, the government will grow. Yes, the financial world may turn inside out before breakfast — possibly before your second cup of coffee. But you still have the right to think. To choose. To invest in your own way.

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.