The Middle East’s 11-Year Cycle

Markets go through many Grey Swan cycles – moves that are rare, but forecastable.

Events unfolding in the Middle East fit a pattern… an 11-year cycle tied to sunspot activity:

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Spikes in the sun’s solar activity tend to occur with rising tensions in the Middle East. (Source: Brian Roemmelle via X)

Solar activity was charted by Soviet scientist Alexander Chizhevsky, who researched sunspots dating back to 500 A.D.

Chizhevsky’s research showed that sunspot activity was the leading cause of the 1917 Revolution, not the work of Lenin, Trotsky, and crew.

The ungrateful Soviets threw him in the gulag for his efforts.

Conflicts in Afghanistan and Iraq, then Libya and Syria, fit Chizhevsky’s solar flare-up pulse. This time around, Iran gets the sub’s glare.

The assets we’ve been recommending are well-positioned for a sustained conflict: Gold is back over $5,400; oil, reacting to the closure of the Strait of Hormuz, added to this month’s anticipatory gains, is up another 8% this morning to $73.

~ Addison

P.S. Thank you if you joined us on Friday for a special Grey Swan Live! from inside the Rarcoa Vault in Chicago. The reserved Silver Eagle set we had reserved was quite popular.

Owner Wayde Mills gave us a display and tour of coins never on view for the public. And showed us behind the scenes how rare coins as an asset class offers a unique way to protect your wealth – and they carry the added value of rarity, mint, condition and historical significance.

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Wayde Milas gave us nearly two hours of time to explore some of the great coins of history, some new products that Rarcoa is developing, and a special opportunity for Grey Swan members: a 2025 Eagle Privy Silver Eagle graded NGC MS70 — from the first group of 50,000 pristine minted coins — which he offered to Grey Swan members at a wholesale discount.

Markets go through many Grey Swan cycles – moves that are rare, but forecastable.

Events unfolding in the Middle East fit a pattern… an 11-year cycle tied to sunspot activity:

Turn Your Images On

Spikes in the sun’s solar activity tend to occur with rising tensions in the Middle East. (Source: Brian Roemmelle via X)

Solar activity was charted by Soviet scientist Alexander Chizhevsky, who researched sunspots dating back to 500 A.D.

Chizhevsky’s research showed that sunspot activity was the leading cause of the 1917 Revolution, not the work of Lenin, Trotsky, and crew.

The ungrateful Soviets threw him in the gulag for his efforts.

Conflicts in Afghanistan and Iraq, then Libya and Syria, fit Chizhevsky’s solar flare-up pulse. This time around, Iran gets the sub’s glare.

~ Addison

P.S. Thank you if you joined us on Friday for a special Grey Swan Live! from inside the Rarcoa Vault in Chicago. The reserved Silver Eagle set we had reserved was quite popular.

Turn Your Images On

There’s just something about collectibles. Perhaps it’s because you’re holding something tangible in your hand, not just a share of a company. I certainly get a lot of joy looking through my coin collection or researching prices on pieces I want to acquire someday.

Collectibles had a moment in the sun in 2021 and 2022, as investors were looking for an inflation hedge. The space has cooled off a bit, making now an optimal time to consider investing in collectibles.

While today’s focus – and my personal interest – is in rare coins – you may be more interested in stamps, art, antiques, even vintage cars. In the collectible space, there’s something for everyone. That’s part of the joy.

More importantly, with collectibles out of favor, it may be a good asset to rotate some of your wealth into.

If the S&P 500 closes over 6,910 today, the index will be up for February and continue its strong performance since last April.

But, looking at the monthly relative strength index (RSI), the market is flashing an overbought signal.

Nvidia’s selloff isn’t unexpected. It reports late in earnings season. Most of its customers have already reported how many chips they’ve bought or plan to buy.

Most of those big-tech names sold off after their earnings in recent weeks, too. But we’re seeing signs of a slowdown, of sorts.

Companies like Microsoft and Apple are now increasing their AI spend so much that they’re slowing their spending on other priorities.

For AI-linked companies — Nvidia foremost among them — investor expectations continue to rise along with their valuations. At this point, even billions in profit are not enough.

Like the fiber optic spending plans that dominated the 1990s at the height of the dotcom bubble, AI spending is squeezing the cash flows for the S&P 500’s biggest companies.