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

Copper and resources are sending us a cleaner market signal than AI stocks.

Channeling Ludwig von Mises, we observe this morning that price is not just a number; it’s information. Price reflects what buyers and sellers collectively believe: demand, scarcity, fear, speculation, disappointment, future expectations and available supply.

When prices rise, and inventories fall at the same time, the message is usually straightforward: buyers need the stuff, and there is not enough of it.

A low VIX does not predict disaster. It measures complacency. A serial skeptic will read it as the calm before a storm. We shook off that feeling this morning and opted to pursue an opportunity instead.

Here goes:

A VIX reading below 15 means the market is not pricing in much near-term trouble, even though there are obvious risks still sitting in the room: Iran, oil prices, memory chip speculation, circular financing, high valuations, epic high concentrations, spiking long-term interest rates, a regime change at the Fed, a meltdown in Japan and a historic deficit and rising national debt.

Money is not flowing in a clean, straight line from outside investors to productive businesses. The firms at the top are investing in and buying from each other.

Microsoft and OpenAI are the easiest examples to follow.

Microsoft says OpenAI has contracted to purchase an additional $250 billion in Azure services, while Microsoft continues to account for $13 billion in funding commitments to OpenAI as an investment.

At this stage, it’s a stock picker’s market.

We expect space, robotics and some more visible tech startups to remain sources of speculation. After weakness in the first half of 2026, we’re also due for a strong rotation of capital into natural resources, precious metals, critical minerals and energy.

Copper and resources are sending us a cleaner market signal than AI stocks.

When prices rise, and inventories fall at the same time, the message is usually straightforward: buyers need the stuff, and there is not enough of it.

Here goes:

Money is not flowing in a clean, straight line from outside investors to productive businesses. The firms at the top are investing in and buying from each other.

Microsoft and OpenAI are the easiest examples to follow.

Microsoft says OpenAI has contracted to purchase an additional $250 billion in Azure services, while Microsoft continues to account for $13 billion in funding commitments to OpenAI as an investment.

At this stage, it’s a stock picker’s market.