Geez. Even if you like the guy — and admire the Art of the Deal — President Trump’s approach can strike the casual observer as petty and irritating.
Last night, he abruptly ended tariff negotiations with Canada after Ontario released a video quoting Ronald Reagan’s 1987 speech warning against protectionism.
Reagan’s words were vintage Gipper — principled, prescient, and, as the Financial Times noted this morning, “eerily relevant in an age when tariffs are treated like tweets — cheap, fast, and forgotten.”
“When someone says, ‘Let’s impose tariffs on foreign imports,’ it looks like they’re doing the patriotic thing by protecting American products and jobs. And sometimes for a short while it works — but only for a short time. … High tariffs inevitably lead to retaliation by foreign countries and the triggering of fierce trade wars.”
Reagan, in his way, was saying what we’re all thinking: protectionism is the political sugar high that always ends in an economic crash.
Trump laughed off the Canadian ad — “If I was Canada, I’d make that same ad also” — but later accused Ontario of “trying to score cheap political points” ahead of the Supreme Court’s hearing on the Trump tariff strategy.
The Reagan Presidential Foundation also chimed in, claiming Ontario “misrepresented” the former president’s remarks. The irony was lost on no one. As one Bloomberg columnist quipped, “We’ve gone from quoting Reagan to misquoting him, all in the name of loyalty.”
Is it any wonder that the “Debasement Trade” is even getting mentioned in mainstream daily emails from the likes of Investopedia?
The Long History of Debasement
Currency debasement itself is an art form all on its own. An ancient one at that.
When the Roman Republic began minting the denarius in the 2nd century BCE, it was 98% silver. By the 3rd century CE, that purity had fallen below 5%.
You can see the empire’s moral decay in the coins themselves — bright, heavy silver giving way to dull, greenish copper. As The Economist once put it, “Rome didn’t fall in a day; it eroded, one clipped coin at a time.”
Debasement always starts with convenience. “We’ll just add a little copper,” said the Romans. “We’ll just print a few trillion more,” say the moderns.
Each time, the money loses a little more truth, and with it our civilization a little more confidence.
Gold’s ‘Healthy’ Hangover
After its blistering rally, gold shocked newcomers with a 6% two-day plunge this week, the steepest drop in twelve years. CNBC dubbed it “gold’s Halloween scare.”
In a welcome twist, J.P. Morgan called the decline “a much-needed breather,” predicting that prices will “reset for the next leg higher.” Goldman Sachs kept its $4,900 year-end target, saying “sticky, structural buying” from central banks remains intact.
“Gold isn’t falling,” Reuters happily agreed, “It’s catching its breath.”
Even after this week’s wobble, gold remains up 57% year-to-date — an astonishing run fueled by the same quiet panic that’s gripped central bankers from Zurich to Shanghai.
Truth be told, we’re not happy when gold is in the headlines for all the wrong reasons.
That said, we’ve received a lot of reader mail asking… and our answer is “yes,” gold is still a buy – especially physical gold.
As long as our government is completely inept, can’t even keep its own doors open, and yet still runs historic deficits, the “debasement trade” as it has been dubbed, gold is a buy.
“You buy it the same way you buy a home insurance policy – a little bit to protect yourself, not necessarily to profit,” notes our Portfolio Director Andrew Packer.
Given Congressional leadership, that likely means our recommendation to buy gold will last… forever.
The New Denarius
As we mentioned yesterday, the U.S. Treasury’s debt just crossed $38 trillion, rising by $1 trillion every five months.
Moody’s, Fitch, and S&P have all downgraded U.S. credit in the past decade. Yet Washington keeps spending, confident that reserve-currency privilege can defy arithmetic forever.
“The U.S. no longer borrows to build,” the Wall Street Journal offered, a tad snarky this morning, “it borrows to sustain the illusion that it’s still building.”
The Nickel Buffett
Back in the early 1960s, a young Warren Buffett made a quiet, shrewd bet on silver. At the time, U.S. dimes, quarters, and half-dollars were 90% silver — and their melt value was nearly equal to their face value.
Buffett reasoned the government couldn’t keep minting real money forever. He was right: silver prices climbed, and by 1965, the U.S. stopped issuing silver coins altogether.
Fast-forward to today, and one modern imitator is trying the same trick — with nickels.
Investor Kyle Mitchell posted on X that he’s bought $250,000 worth of nickels — that’s five million coins — in a wager that the U.S. Mint will soon change their composition.
Right now, each nickel is 75% copper and 25% nickel, and the metal inside is worth about six cents. With copper near $10,000 a ton and nickel at $15,000, the math isn’t crazy.
The Mint’s latest report shows it costs 14 cents to produce a single nickel once you add in materials and labor. After phasing out the penny, it’s the next logical place to make a change.
If the U.S. switches to cheaper metals, Mitchell’s hoard could become a collector’s dream — or at least a tidy inflation hedge you can jingle in your pocket.
Big Crypto Clemency
Another feature of a toxic political environment, the rush to crypto and digital assets, got a welcome reprieve yesterday in the form of a pardon for Changpeng “CZ” Zhao, the Chinese-born billionaire founder of Binance.
Zhao, convicted under a crypto-antagonistic Biden administration in 2023 for money-laundering violations that “allowed terrorist networks and child exploitation rings to move funds,” served four months in prison before hiring Trump-linked lobbyists to plead his case.
According to The Wall Street Journal, Binance has been a “major backer” of Trump’s World Liberty Financial, a crypto venture that’s “driven a huge leap in the president’s personal wealth.”
The pardon now clears Binance’s path to reenter the U.S. market — possibly with CZ back at the helm.
“Crypto is back in the fold,” declared Forbes, “and it didn’t even have to clean up first.”
What does it say about the rule of law when the most prominent players simply repurchase their way to legitimacy? When money laundering gets laundered through politics, the concept of “debasement” reaches a metaphysical level.
Europe’s Musk Countermove
Across the Atlantic, Europe is staging its own act of defiance. Airbus, Leonardo, and Thales are merging their space divisions into one megafirm — a direct challenge to Elon Musk’s SpaceX dominance.
The new European venture will employ 25,000 and, as Le Monde put it, “reclaim Europe’s seat at the celestial table.” President Emmanuel Macron hailed the project as “a new orbit for European sovereignty.”
It’s a reminder that the space race, like the trade war, is really a tech war — a struggle for who controls the next layer of infrastructure that underpins everything from defense to digital payments.
Apple’s Airball
Meanwhile, Apple has learned the hard way that not every innovation flies. The iPhone Air, barely out of the box, is already being memed to death as “RIP 2025–2025.”
Nikkei Asia reported that Apple has slashed production following “disappointing demand” and customer gripes about battery life and performance. Still, insiders suggest the Air may serve as the testing ground for the long-rumored foldable iPhone.
Even Apple, the world’s most meticulously engineered cash machine, has hit turbulence. As one Bloomberg columnist put it, “The Air was designed to be lighter than air — and so were its sales.”
Markets Catch Their Breath
Despite the circus, stocks closed higher yesterday after mixed earnings soothed nerves. Brent crude spiked on U.S. sanctions against Russia’s oil producers — another lever in Trump’s campaign to squeeze Putin, India, and China all at once.
CNBC’s Closing Bell put it bluntly: “The market isn’t sure whether to cheer the strength or fear the consequences.”
That line could sum up our entire economy. Innovation, debt, and geopolitics have fused into a single system. Every fix creates a new dependency. Every boom sows the seed of its own bust.
If history is any guide, the end of debasement never feels like collapse—it feels like business as usual, right up until the end.
~Addison
P.S. Grey Swan Live! — Today, Friday, Oct. 24 @ 2 p.m. ET, we’re going live with part two of Anatomy of a Stock Market Bubble. We’re going to review our asset allocation strategy and do a model portfolio review with paid annual members of the Grey Swan Investment Fraternity. If you’d like to join us you can upgrade to an annual membership, right here.
We’ll also walk through our Plunge Protection Plan—how to preserve capital, hedge against a stock market correction, and perhaps even profit from herd mentality when it kicks into reverse.
Yesterday’s replay of Anatomy of a Stock Market replay is available here:
