MacroVoices #500 Lyn Alden: What Will Stop This Train?

Summary

• Global Monetary System Concerns: Lyn Alden and Luke Groman both express concerns about the sustainability of the current dollar-centric global monetary system, suggesting a potential shift from gradual changes to sudden disruptions.
• US Fiscal Deficits: Alden emphasizes that US fiscal deficits are unlikely to shrink significantly in the next 5-10 years, driven by structural factors such as entitlement spending and demographic shifts.
• Market Resilience: Despite increasing uncertainty, markets continue to climb, with the S&P 500 showing resilience and gold reaching new highs, indicating strong investor sentiment.
• Energy and Inflation: The discussion highlights the potential for future energy crises due to underinvestment in fossil fuels and the slow transition to nuclear energy, which could exacerbate inflationary pressures.
• Investment Strategies: The podcast suggests hedging strategies for gold investors to protect against potential corrections while maintaining upside potential, reflecting the current overbought market conditions.
• Geopolitical and Political Risks: The conversation touches on the risks of geopolitical tensions and internal political divisions, particularly generational conflicts over entitlement spending, which could impact the US dollar's reserve status.
• Long-term Economic Cycles: Alden discusses the long-term debt cycle and institutional decay as part of the broader economic and societal shifts, aligning with the concept of the fourth turning.

Transcript

[Music] This is Macrovoices, the free weekly financial podcast targeting professional finance, high- netw worth individuals, family offices, and other sophisticated investors. Macrovoices is all about the brightest minds in the world of finance and macroeconomics, telling it like it is, bullish or bearish, no holds barred. Now, here are your hosts, Eric Townsend and Patrick Serzna. Macrovoic's episode 500 was produced on October 2nd, 2025. I'm Eric Townsend. MacroVoice's all-time listener favorite guest, Lynn Alden rocks the house this week in the grand finale of our five episode alltime listener favorites countdown. Lynn picks up where Luke Roman left off last week, sharing her views on what it would actually take to stop this train. And the train isn't a metaphor just for the current stock market rally. She's talking about the current incarnation of the dollar ccentric global monetary system. She chose that topic for this interview before she was even aware of Luke Groman's interview last week. The fact that our two top ever guests both chose a rather dire prognostication for the global financial system without even being aware of the other person's intentions to really give a very similar topic interview really spoke to me as yet another signal that we're moving from slowly at first to then suddenly. Then stay tuned for our postgame trade of the week when Patrick will lay out how gold investors can hedge correction risk without giving up potential gains if this gold bull market stretches even farther from here. And be sure to tune in next week for episode 501 when the single episode download count winner. Yep, there is somebody who's got more downloads even than Lynn Alden, but only in one episode. Lynn did it consistently across several episodes. That's the reason that she's our big winner this week, but we had to give a runner up to someone else. See if you can guess who it is between this week and next week. And I'm Patrick Szna with the macro scoreboard week overweek as of the close of Wednesday, October 1st, 2025. The S&P 500 index up 111 basis points to 6711. In spite of increasing uncertainty, markets resiliently climbing a wall of worry. We'll take a closer look at that chart and the key technical levels to watch in the postgame segment. The US dollar index down 10 basis points to 9770 remains embedded in the middle of a fourmonth trade range. That November WTI crude oil contract down 411 basis points to 6178 failed to bullishly follow through on a breakout attempt sending it back into the trade range established throughout the summer. The November Arbob gasoline down 308 basis points, trading to 189. December gold contract up 342 basis points, trading at 38.97, punching new all-time highs week after week, now just $100 away from the $4,000 mark. The December copper contract up 146 basis points to 4.88. Uranium up six basis points to 8305. and the US 10-year Treasury yield down four basis points, trading to 410. The key news to watch this week is the ongoing government shutdown and impacts on release of key economic data like the jobs numbers. And next week, we have the FOMC meeting minutes and the University of Michigan consumer sentiment and inflation expectation numbers. This week's feature interview guest is Lynn Alden. Eric and Lynn discuss public debt, economic cycles, debt cycles, the dollar reserve status, and more. Eric's interview with Lynn Alden is coming up as macrovoices continues right here at macrovoices.com. [Music] And now with this week's special guest, here's your host, Eric Townsend. Joining me now is Lynn Alden, our number one Macrovoic's all-time listener favorite as measured by listener downloads. Lynn, congratulations on taking the number one slot. >> Well, thank you. I'm humbled. Happy to be here. >> The thing is I I actually feel bad about this. The whole idea was to flatter you and honor you. And what did we do? We set you up to follow Jim Biano, Anna Alaji, Louis Gav, and Luke Groman. How are we going to top Luke Groman? >> I I'm happy to have been part of the journey. It's always interesting when you start as a listener. So I listen to macro voices before I came on the show and so it was of course fascinating to join it and participate along the way. So I certainly thank you for having me on all these times and hopefully I can continue to provide value as far as following all those people. That is certainly challenging. I guess the best I can do is try to add to it, try to build on top of it. Certainly not really trying to top anyone in particular and those are all people that I' I've certainly learned from over the years. >> Well, let's dive right in. You told me that you agreed and disagreed with various different parts of Luke's interview last uh last week. Tell me more. What did you agree with, disagree with, and why? What did you see differently? >> Uh well, I mentioned I pretty much mostly agreed with it. There there's rarely anything that I outright disagree with Luke on. We generally get, I think, correctly lumped together in kind of the same macro camp in some ways. main where area where I I differ I guess I would say from Luke is just areas of of emphasis or areas that he uh has built up more expertise than I have on and other areas that I focus more on. But I I thought that entire interview was directionally correct. One way that I kind of maybe sometimes differ a little bit is that I'm in some ways Luke Groman light uh which is that my time frames tend to be a little bit longer than his. sometimes correctly, sometimes incorrectly, and so I I tend to maybe be a somewhat more muted version of Luke, but otherwise quite similar. So there if there's areas that you want to touch on, I'm happy to go in multiple directions. You just alluded to it. What's really interesting in my mind is this question of what is it that causes or enables that change from slowly at first to then all at once. And of course, that was a major thrust of Luke's interview. I was actually affected more by reactions. You know, when we called the pandemic in January of 2020 on Macrovoices, it was weeks and weeks and weeks of hate mail and angry people saying, "You're alarmists. You're you're fear-mongers. You're crazy." Luke's interview was pretty darn grim, frankly, with respect to its outlook. Lots and lots of attention, almost all of it positive. and we're not getting all of the accusations of fear-mongering so forth. It says to me that people's attitude has changed and this Luke Groman moment idea of a really significant breakdown in the international monetary system because the US dollar is at the center of it and the US dollar is not quite as strong as everybody uh hoped it would be. That was really controversial stuff a few years ago. It seems like everybody's maybe ready to accept it and that scares the hell out of me because it I think it means we're accelerating. Is that am I right to interpret it that way? And what do you think causes that state transition to all at once? >> Yeah, I think that's a reasonable interpretation. And I'll start by saying that I actually remember you talking about the pandemic early on your podcast. I was a listener back then. It was helpful for me hearing you and Jim Biano and others cover it. Uh and so for example, I was able to um have notes about it in my research service and also provide warnings. Uh and that was in large part because of I was listening to the right people at the right time and it was able to kind of dig into myself and help confirm it. So I certainly appreciate the work you did there at the time. Going back to kind of where this goes or are we hitting kind of a gradually than then suddenly moment. Part of why I got into macro in the first place was to answer that very question or more specifically the question was where is the public debt going and when will it matter and so I you know I prior to that listeners probably know I worked as an engineer for a long time I had a long history of investing primarily in equities. I consider myself more of an equity analyst. And I started to realize that we were entering uh and to some extent had already entered a very macroheavy decade. And so more so than just getting individual stocks right, it was really important to get the macro right? Big questions like are stocks going to outperform bonds or vice versa. Are things to run hot and inflationary or are things going to have more disinflationary and contractionary type of things? Getting those really big pieces right. you know what sectors to own uh this kind of major trends and my my kind of starting question was basically so we have rising public debt to GDP throughout the 2010s decade there's lots of polarization there was kind of the the Paul Ryan versus uh Obama era that whole kind of you know the Republican more more fiscal hawks back then and then and Obama on the other side of that and kind of that that great debate around deficits and and public spending and what we started to see at the end of the 2010s decade And Luke covered this early, I started covering it early, was that we started to get rising deficits as a share of GDP even as we had unemployment continue to fall. So there's a multi multi-deade history of those being highly correlated uh and they separated on a sustained multi-year basis in the late 2010s. And there was a handful of reasons. There were some tactical ones like for example in Trump's first term he did unfunded tax cuts which you know around the margins contributed to the deficits. But the really big piece was simply demographics that the baby boomer generation started entering retirement uh in pretty significant numbers and therefore we started to draw down on some of these really big entitlement things. Things that you know like Stanley Ducken Miller and others have been warning about for a long time started to really actually happen. So that whole topheavy entitlement system started to really matter. Then of course co kicked everything into high gear and that distracted people a lot I think from the secular trend. But then after that all eventually subsided, we're still back on this more secular trend of structurally high deficits in large part because of the entitlement system, because of multiple other factors contributing. And so kind of what I became known for over the past five, six years is my emphasis on the importance of fiscal, which is that, you know, so many people are focused on what the Fed's going to do. But of course that is relevant. My view was the really hot fiscal deficits that were running matter. So back in in 2020 2021 and all that it was me kind of warning about inflation and after that kind of hit and eventually you know somewhat cooled off from that really explosive period. It was more about this nothing stops his train thesis which is sure it's not running quite as hot as the the hyper stimulus of 2020 and 2021 and and the lagged after effect but it's more of the sustained run it hot large deficit environment that mutes economic cycles keeps inflation generally above target offsetting a lot of various kind of technologydriven disinflation we would otherwise have and keeps going. So then the question is it goes back to my original thing is where is this all headed? You know when does the public debt truly matter? So my my first answer to that is that it has mattered for at least the past six or seven years ever since we've kind of entered this more sustained fiscally dominant environment. The economic cycles have changed. Things like the yield curve have become less predictive than they historically have been. I think it's fueled some of the political polarization because those in the on the receiving side of the deficits are experiencing on average a very different economy than those not on the receiving side of the deficits and they're instead more on the tight side of monetary policy. So all of this has been mattering but it's not mattered in any sort of like grand moment of crisis. Uh it's more like a bunch of mini crises that string together. I think where I differ from Luke is that I I think it won't matter in the in the true mega crisis sense probably for many years with certain caveats that we could go over. So I'll stop there for a second before we get into that in case you had any any comment. >> Yeah, I definitely want to go a lot of different directions with this. So one of my favorite Luke Groman lines, he he very frequently says, you know, deficits don't matter until they do and then they matter a lot. That's a lot of wisdom built into that. But of course, the question is the timing. When do they start to matter? Because all the grown-ups have really been talking since the 1970s about the fact that the US government was starting to move in a direction that didn't seem to be sustainable. By the 1990s, you had Ross Perau and the 92 presidential election talking about it. Clearly, those people were right about unsustainable aspects of US fiscal policy. But, you know, even though they're not sustainable long term, they were able to sustain them for several decades and it's getting dangerous to say, well, it's a it's going to start to matter really soon, so you better be watch out. So many people have been conditioned to just say, "Oh, come on. It's, you know, everybody knows someday that's going to be an issue, but as you just said, probably not for several years. Why don't we just ignore it and not worry about it?" Well, needless to say, that's what's gotten us here. But how do we know when we're getting close? And how do we assess how close we are to that moment where all of the sudden deficits do matter and matter a lot? >> Good set of questions. Yeah. So the late 80s, early 90s were the peak zeitgeist for the public debt being relevant. So the national debt clock went up in the late 80s. Uh as you point out, Ross Perau really emphasized that ran the most uh successful independent presidential campaign in modern history largely on that topic. And if you look at the chart of interest expense, so public interest expense as a share of GDP, it was peaking right around that time. uh you know prior to then for for you know decades after World War II into the 70s we had falling public debt to GDP and what was different is that in the 80s we went back to a period of rising debt to GDP so after you know 5 10 years of that people I think were rightfully kind of freaking out about that trend we're also hitting giant numbers like you know a trillion dollars in public debt for the first time so that combination was pretty significant I think you know a significant reason for why they were early is throughout the 80s China started to open to the rest of the world. Uh that really kicked into high gear uh in the decades that followed. And then of course the Soviet Union fell by the early '90s. And so what we had was you know this this massive supply of eastern labor and resources was able to connect to Western capital. And so we kind of went into this period of renewed globalization which is which was disinflationary and productive. Now it came at the cost of fragility. You know when you globalize supply chains you make them more efficient but fragile. And so that gave us a wave of disinflation, a very sustained wave, uh, which allowed interest rates to keep falling for longer than people expected and lower than people expected. And so we basically we had a 40-year period of falling interest rates which was able to offset the rising debt to GDP. And so what's different now is is a couple things. One is we are entering the more drawdownheavy period of our entitlement system. So with baby boomers uh entering their retirement years, that's new. That's only in the past, you know, like I said. And the other big factor is we no longer have structurally declining interest rates. We basically bounced off zero. Other parts of the developed world went negative. At that peak, we had something like $18 trillion worth of negative yielding yen and and euro bonds. Outstanding. Uh and so now we're in this period where we no longer have some of the offsets and we have troubling demographics and we're no longer globalizing. Even if we don't rapidly delobize, just the sheer fact that we no longer have that tailwind of ever more productivity, ever more international connections, and ever more fragility, we're instead we're kind of reintroducing local into the equation. We're we're reintroducing the concept of robustness rather than just efficiency. It's not how efficiently can we make things with near zero inventory. It's how can we prepare for shocks along the way. And you mentioned before the pandemic, people weren't yet really accustomed to really big things happening. It was kind of the the idea that nothing ever happens. If anything that these past 5 years told us is that some really big things happened, whether it's of course the pandemic, whether it's Russia invading Ukraine and all the geopolitical stuff that followed there, of course the, you know, massive ongoing conflict in Gaza and the world reorienting and emphasizing that whole situation. So we we've entered a new kind of geopolitical situation where things do happen. I think there's so there's two separate answers to the question. If we look at it from a purely quantitative mindset, and this is probably where I channel my um Brent Johnson for a minute, the milkshake theory with most currencies, as soon as investors and the public lose confidence in it. So confidence is one of those things that it it's hard to predict ahead of time at what stage it will be lost, but once you lose it, it can happen very rapidly. With most currencies, if they lose confidence, they can quickly spiral into disaster because there's no or there's very little required demand for that currency outside of the country. What makes the dollar different of course and what gives us a longer runway uh both to benefit from and to hang oursel with in some ways is that there is a lot of entrenched demand for the dollar that has nothing to do with people's opinion of the dollar. It it's just a bunch of contractual obligations for the dollar which mostly takes the form of debt. So depending on what source you use, the Bank for International Settlements is one of the better sources out there. they show something like $18 trillion worth of offshore dollar dominated debt. Uh and that's mostly not owed to the US. It's mostly owed, you know, between all entities in all these different countries. You know, some entity in Brazil will owe it to some entity in China and so forth. And that's this big entrenched network effect of demand for the dollar. And so that's the part that that historically will likely move very slowly even as public sentiment around the dollar and kind of um the optional side of demand can change very quickly just like it does for any other currency. And so when we quantify that when you have all that offshore debt that I mean that's a that's a bigger amount of debt than there is a monetary base of US dollars and it's smaller than but comparable to the entire US onshore broad money supply. So that's a lot of entrenched demand. So I you know going purely from a quantitative standpoint. Um I think the US still has a long runway ahead which is not to say that it won't matter. It's just that that the magnitude with which it'll matter will be manageable. So for example in the 70s the oil crisis very much mattered. The high inflation very much mattered. But for a variety of reasons, the US uh and its financial system was able to get through it and then even get stronger on the other side of it. And so at the current time, you know, when we have that kind of quantitative basis, that's where I get my kind of nothing stops his train view, which is from now into the 2030s based on how rapidly our money supply is growing and is likely to continue to grow with a couple of these other physical limitations along our way, which for example, Luke Roman covered in your prior interview. things like rare earths, things like our de-industrialized manufacturing base, all these things. So, we're running these big deficits, we're growing money supply, but it's offset by this entrenched global demand for it. So, I I if I were to say, okay, what could shorten it? What can make this not last very long? It's actually less so the macro side and more the political side. We're in the era of big headlines. We're in the era of increased political polarization. We're in the era of realizing that significant percentage of our kind of um structure for how governance work is less so on based on laws is more based on norms and norms can be changed easier than laws. Uh and so you could have nonlinear dislocations where you know contracts that were thought to be you know immutable are defaulted on or changed uh or major geopolitical alignments shift in a very rapid period of time. And that's the kind of hard to predict ahead of time variables that could move forward kind of the the estimate date for when it get it it truly becomes a crisis rather than a series of many crises. So for example in 2022 UK guilts had a crisis. 3 years later it's not as though the UK's currency is trash now. uh that was a mini crisis that they handled and they end up switching their government over it partially and but they got their wheels back on the track. So my kind of base case from a purely quantitative standpoint is that over the next 5 10 years we will continue to have a number of mini crises in the US and elsewhere. Those fires will be put out. There will be ongoing political polarization because the large deficits will remain in effect. People will continue arguing about them. Those on the receiving side will continue to kind of have that higher side of the K-shaped economy, whereas those not on the receiving side will be in the lower part of this K-shaped economy. And that we're in this kind of sustained run it hot slowly meltdown type of environment with the risk of more political driven disruptions along the way. >> Wow. A huge amount to unpack there, Lyn. I want to go back to one of the first things you said, which is the secular driver of a lot of this is retiring baby boomers going from paying into our entitlement systems to drawing down from them. We're only seeing the beginning of that, Lynn. There's still a lot more baby boomer drawdowns to come. We've only uh just gotten to the point where most of the baby boomers have retired. We're not even through that cycle yet. So, this is going to stay with us for a long time. There's going to be a lot of money that has to be spent to service the obligations that we have through our entitlement system to baby boomers. Well, hang on a second. We've got huge political division in the United States already. And one of the big themes is a lot of generation Z and to some extent also the millennials who came before them are kind of down on baby boomers. They they tend to blame baby boomers for a lot of problems in society. You know, it really doesn't matter whether those beliefs are justified or not justified. They hold those beliefs. And we're coming into a period of extreme political division. It seems to me like you can get into a generational war out of that where just as the baby boomers are realizing, wow, all of our benefits could be subject to a complete reversal if we get into a fiscal fiscal crisis. We've got to really stand up for our rights and make sure that nobody messes with our social security. If that happens, just as the zoomers are getting to the age where they're really voting actively and paying attention and feeling like, "No, actually, we don't think the baby boomers deserve all of those overpriced entitlements. Yeah, they supposedly paid into that system, but it was publicly discussed that Social Security was guaranteed to be bankrupt. We're not footing the bill for this. We're going to cut those benefits." that could set up further civil war risk, frankly, and I think we've already got some of that. If that caused the rest of the world to get concerned about the United States, as you said, it could play out a couple of different ways. It could be a mini crisis, although the one I just described is awfully persistent in terms of its duration. But if that causes the rest of the world to start to doubt the US dollar's reserve currency status and especially if we have a digital currency alternative that seems better than the US dollar, all of a sudden you could see an unwind where all of those mechanical factors that cause the artificial demand for the US dollar could start to get unwound. So, it seems to me like there could be this massive vicious cycle that just causes horrible outcomes or it could be broken into many crises and as long as there's some time in between, maybe it's okay. It's really hard to figure out what's going to happen, isn't it? Oh, yeah. Absolutely. As someone who spends part of each year in Egypt, I've been there during 38% official inflation, let alone whatever the kind of the real inflation number was. I'm sure other listeners uh have have kind of been in that environment as well. So I one thing I think is that it takes a pretty bad as that was in Egypt for example because their political situation held together. It didn't spiral into something worse than it could have and then they at least for now partially stabilized the issue. You're absolutely right that there is this extra artificial demand for dollars and that can over time evaporate. You know, the analogy I've used before is that like a a more balanced economy is like someone standing straight up, whereas the US economy is more like someone leaning against a wall and pushing on it, which is basically we have all this extra demand for our currency, for our reserve currency status. And you know, we run these structural trade deficits with the rest of the world to supply them with that currency. And you know, if that wall were to give out for one reason or another, uh we're unbalanced. We're leaning against it. So we can stumble harder than we can compared to economy that that's more balanced. That that's basically the key risk there. Now when we analyze what what could rug pull that wall away from us or what could break that wall? Well, I mean we can analyze the four major parts of of what the reserve currency status is. One is that you know with well over a hundred currencies some of them are pegged but you know dozens and dozens of large free floating currencies most of them are not very liquid relative to each other. So for example, if you want to convert Egyptian currency into South Korean currency, there's not exactly the the super liquid deep market there because you know the number of combinations between all those dozens of of large currencies would would you know be a huge number. And so the way it usually works is that something like 90% of currency trades dollar's on one side of it. So you trade whatever currency you're starting with into the dollar and then you trade the dollar for whatever currency you want to get to. So you have that really big liquid network effect there that is less so about the stability of the dollar because you know you're potentially only going to be in there for a short period of time but it's more about the sheer scale and liquidity of it. The other big factor and this one I would you know I think it's already been changing is the reserve holding of it which is that central banks and other large pools of of semi-public capital like large pension funds and sovereign wealth funds and things like that uh that they will store a disproportionate share of their holdings in the dollar uh for lack of anything better as kind of the principal ledger for where to store their you know accumulated current account surpluses for example. And that's, you know, around the margins already changing. Uh there's not a lot of foreign demand, official demand for treasuries anymore. There's a combination of increased tonnage of gold buying as well as the appreciation of gold. We're kind of rough at the point where gold is flipping treasuries in terms of how much central banks hold compared to treasuries for the first time in many decades. And around the the margins, there's a very slow diversification even to into other fiat currencies. So I think that the kind of the the more optional thing that's the more optional type of demand for the dollar that can evaporate on a fairly rapid basis because that's a voluntary human decision rather than a contract uh in most cases. And of course the other the two other big pillars of the reserve currency status. One is international contract pricing. So if you're buying commodities from one country from another country or you're selling goods and services often it will be priced in dollars again is the the biggest most liquid trusted ledger to do things in. And then the other one which I mentioned before is crossber lending. all of this dollar diamond debt that's outstanding which is contractually owed and the thing there is when we kind of analyze how how could that Gordian not be untied the main way is you know that it can kind of slowly stop growing the total debt as the US money supply keeps growing until it gets delevered or more rapidly some of that debt could be paid back and then switched over to for example Chinese currency you know there there are various mechanisms that can enable that but generally speaking there's a little bit of a chicken and the egg from because there are entities that have dollars uh that owe dollars and that are owed dollars by others. And so it's it's the creditor countries are the ones that have a little bit more flexibility in terms of saying okay instead of paying me back in dollars, you can pay me back in this other currency for example. But you know if they if they still have significant dollar obligations of their own then you know how do they pay dollars to you know downstream uh who they up? So it that's kind of the complex network effect that usually takes longer to untangle than clean sheet of paper we might expect it to. That's kind of one of those real world standoffs that's really hard to unwind. And so basically these network effects are very strong and the most optional one is that voluntary holding of excess currency. The other ones are are varying degrees of involuntary. There's tens of trillions of dollars of you know the US's negative net international investment position. And so all this foreign capital stuffed into US equities, US bonds, to a lesser extent, US real estate and private equity uh around the margins that can be pulled out. Uh and that that can give us a pretty significant currency drop when it happens. We saw like kind of a a very tiny taste of it around Liberation Day earlier this year, but that can of course happen on a much larger scale. And so those are kind of the entrenched things that even if we do have a significant, you know, political feud that's intergenerational or widening between the the political polls that we have, a lot of that is still there. It's still contractually demanded for. I I think the bigger factors kind of from the US standpoint is, you know, at what point do we risk just outright defaulting on certain foreign obligations or we kind of put up capital controls and say that capital that you stuffed into US markets that you thought you could get out? Well, actually you can't. Uh now those types of more nonlinear things is what can break things more rapidly. And so that's again back to the political realm more than the numbers realm. And at that point you can get these kind of big things that you know much like the pandemic or much like a war things that you know could happen you know they might go a decade or two without happening and then they can kind of happen all at once on a weekend uh where you wake up to like very nonlinear reactions in markets and the defense against that is to own assets that are not necessarily securities things like gold or bitcoin things that can be self-custody things that are outside of the quote unquote system for those types of extreme events. Going back to the the one point and then I'll stop is I do think that the ongoing generational crisis will get worse. That's my expectation. But you know we've already generally seen that baby boomers do vote in pretty large numbers. The younger generation of course has a more spotty record with voting. And while there is a deteriorating social contract there, people generally feel that, you know, compared to decades ago, they don't feel necessarily the government has their back the way that it had prior generations and the way that prior generations generally felt about it. They don't really feel part of a cohesive whole. They feel that that say prior generations were bailed out with for example the global financial crisis uh and that all the stimulus that happened uh in response to the pandemic which you know most analysis showed was actually pretty topheavy uh in the way that it was distributed despite the fact that headlines focus a lot on the you know the STEMI checks uh a lot of it was actually funneled to big corporations to wealthy small business owners a after a series of those types of things I do think that the younger generation is fed up and they do take it out in terms of more political voting uh selections sometimes unfortunately violence and I sadly I think a lot of that's going to get worse and that's where you enter these these more nonlinear effects compared to what otherwise clean sheet of paper is what I would argue is a pretty long process you've used this metaphor of an unstoppable train can stop this train please be very precise at exactly what you mean by that what is the train that can't be stopped but Then look then every train has to stop eventually cuz you run out of tracks. What could stop this train eventually even if that's a ways down the road? >> Yeah, good question. So I I refer to the train as it's US fiscal deficits specifically which is to say that I think there's very low probability in any sort of investable time horizons let's call it 5 10 years that US deficits are going to meaningfully shrink. Now, around the margins, you can add tariff revenue. Uh you can trim Medicaid. You can, you know, there's there's little things around the margins. But right now, we're running six to 7% of GDP deficits. And you know, we're running hot in terms of nominal GDP. We're continue to grow the nominal size of the debt pretty significantly. And I the nothing stops his train thesis is the idea that is not going to stop with very high level of confidence in an investable time horizon. Now, what eventually stops it? I would say death by fire, not by ice, which is that they don't get the deficit under control anytime soon. But that instead it it debases so rapidly or so significantly that the obligations are devalued enough things have become chaotic enough likely politically and then the question is in those depths does the United States manage to stick the landing. So for example, after World War II, uh you know, we devalued a lot of the debt through inflation. Uh but then we pivoted more toward austerity after those debts were sharply devalued. We were in the opposite situation we had now. We had very strong demographics. We, you know, we had a lot of the cards globally. We had the basically the only intact manufacturing base. We had all the gold. We had 40 over 40% of global GDP. And so we were able to kind of grow our way out of it after a significant devaluation. The big question here is after we have a big devaluation, it could take the form of a significant weaker currency, therefore defaulting on bond holders and to your prior point, it could take the form of eventually defaulting on some portion of social security or Medicare and basically saying that those are just going to nominally be lessened to some extent whether it's mean testing, whether it's, you know, cost of living increases for a period of time. There's kind of various mechanisms that could be some type of default on basically purchasing power in that capacity. So after some degree of defaults then the question is can we stop the bleeding? Can we pivot toward a period of predictive growth? Again that's the part that I think that remains to be seen. That's more of a political question than a macro question. The numbers themselves are certainly fixable after a period of sharp devaluation. The question is can we as a country have enough of a shared vision I I think basically to to rebuild from there. And one thing I've kind of emphasized in the past, I've I've borrowed this from Ray Dallio, is the the concept of the long-term debt cycle, which I think has significant aspects to it. And both you and I have discussed the importance of the fourth turning. And you know, some of the push back against the idea of the fourth turning is that it's it's kind of like astrology for investors or demog demographers. Like it's kind of this woowoo cycle theory. And you know, there's I think there's some truth to that criticism, but the reason that I give it so much credence is because behind that that cyclical aspect to it, that kind of roughly 80year uh cycle approach, there are a handful of specific things that grow and die or strengthen and weaken along the way. And some of those are quite measurable. And so the three that I would highlight, one of them is the long-term debt cycle. So basically we go through a period of of recessions over decades. Every time we have a recession the central bank you know gets more dovish. They cut interest rates. They do quantitative easing. Whatever the tool of the day happens to be. They reinflate the growth of debt. In addition you know whenever we have private sector contraction in lending during those recessions we generally blow out the public deficit and that keeps building and building over time as we get lower and lower lower interest rates. And you know, we really hit the apex of that in in 2008. So we basically got interest rates all the way to zero, we got private debt very high. So then we started rotating it onto the public ledger. So as you know, as bank debt and housing debt blew up, we ran very large deficits, we bailed out large swaps of the system. Uh then we did it again basically during COVID during the pandemic. That was another kind of shift from private sector debt more to public sector debt. And so you kind of pile that debt up and up and up. And then once it's on the public ledger, uh, you eventually basically inflate it away. You know, they did that in the Civil War. They did that, you know, during and after the 1940s. And we've really done over the past five or six years as well. I mean, it's been one of the worst environments for bond holders compared to every other asset out there. I don't think it's fully done yet, but basically that's one cycle that happens along that fourth turning, which is basically once you get when it's all the way on the sovereign level and you enter that more sovereign level perching power default phase, that's the fourth turning. So that's one of the three big pillars that's kind of measurable and watchable. The second one is kind of legal accumulation. So during uh a normal course of of operation, you know, every year lawmakers create new laws. they generally create more laws than they repeal. And so we kind of get this layered bureaucracy that kind of builds up over time. It's kind of like if your your paint scratches and you just kind of paint over it and then that layer starts to scratch. So you you paint over that and you know after 30 years you've got 30 coats of paint and that's what happens to a country's legal system. So it becomes very bureaucratic, hard to operate in. People wonder why, you know, we could build the Empire State Building in like a year and a half, but California can't build highspeed rail even given seemingly infinite amounts of time and money. Uh it it's that's one of the factors that goes into it. And so generally speaking, when you have kind of a um forth hurting, you've entered such a complex phase of the law that there are calls for basically breaking of the norms of some of those laws, uh outright disregarding some of those laws or big political movements to to reorganize and reset some of those laws. And that's we can kind of think of that as like a shields down moment for the economy and for governance, which is, you know, when you're undergoing major change, it allows for on one hand much better situations. you can clean out a lot of that. You know, it's kind of like if you leave your computer on and it gathers memory leaks and eventually have to reset it. You know, it allows that kind of opportunity where you can streamline laws. Um, you can reorganize things. You can make sure that the that the laws are kind of geared to the present day. But, of course, it also means that you can go off the tracks and wind up in either fascism or communism. You kind of go off on one of the the two sides where you're not kind of shielded in in the same way that you are in a more normal operating environment. basically we're we're entering that kind of era of some degree of legal resets going on in addition to that long-term debt cycle and and so you know we kind of have those kind of playing together and then the third one would be institutions. So institutions are generally created uh to solve a set of problems or social needs in one era. And we know when you kind of look at the forth turning analogy is basically you know after after four human lifetimes or you know four generations which is like one long birth to death human lifetime the people that built those institutions are no longer around. A lot of times those institutions have become corrupted over generations. entropy, basically social entropy has taken hold and those institutions for a variety of reasons kind of no longer serve the way that they once did or at least they're no longer perceived to serve the the way that they once did. And so and currently when you look at say polls of you know whether it's organizations, whether it's whole sectors like the media or congress, there's been a major loss of confidence and trust uh in most types of institutions. Uh there's been a gradual kind of building of new institutions. Uh so in addition to the long-term debt cycle rolling over and kind of the whole legal complexity cycle rolling over, you get that institutional birth and death. And so all those things are kind of culminating in this environment. And again, it's not just one year. It's not like what year is the forth turning. It's it's this whole era. It's basically the you know, as as they would, the authors of that book would define it. It basically started with the with the global financial crisis. it continues through this day with this kind of rising series of of crises until uh we kind of hit rock bottom and there's some sort of massive realignment in a particular direction and that could be a better direction or it could be a worse direction but I think that's going to continue to play out over the next 5 or 10 years and that it's it's somewhat quantifiable and observable rather than merely you know woo woo cycle theory and that that really actually does play a role in macro analysis because you do have to take into account these things that are outside of the normal Overton window uh and that can really shake up various investment outcomes. >> Lynn, I think you've done an absolutely brilliant job in this interview of laying out this entire fiscal train that can't be stopped and what eventually stops it and so forth feels like a logical time to wrap up the interview. Wait a minute. can't do that because I think there's something equally important another major secular trend that I see probably playing out in about the same time frame that you're talking about over the next you know quite a few years be probably beyond the investable time frame or well beyond the investable time frame and I'm going to call that broken money meets broken energy what I mean by that is we've got a serious problem with energy and you know some people will say to me on Twitter you know oh what are you talking about we're back down to you know, just above 60 bucks on oil here. It's nothing compared to what it was a few years ago. Forget that. Look, big picture. Big picture. Energy from fossil fuels already costs more than double what it cost when I was a kid, even after adjusting for inflation over all of those years. And it's been a lot of years since I was a kid. Well, Lynn, if we're going to solve that problem, I'm convinced that the fossil fuel source is only going to get more and more expensive compared to what it was when I was a kid. The solution is nuclear energy, except that takes a long time and a huge, huge, huge amount of capex. You got to be in a really good borrowing position in order to fund all of that capex investment in building out nuclear energy. I think you just explained all of the reasons why our borrowing ability is about to start shrinking and maybe eventually collapse. How are we going to solve the energy problem that's really essential to the continuation of humanity and the restoration, I think, of of human prosperity? >> Yeah, good question. that that partially touches on the legal cycle that I mentioned which is for the length of time it takes to build a nuclear facility is much longer and and therefore much more expensive than it used to be in part because the legal situation just became so ownorous to do that and I agree with you that right now fossil fuels uh hydrocarbons are well under control in terms of price I don't expect any kind of near-term catalysts to pop them higher know if you ask me 3 years ago what I thought they would be a little bit higher than they are Now, I would say yes, but you know, they're they're chugging along as they are. I do think that as we look out to the end of this decade and into next decade, kind of long along this kind of a time horizon we talked about, I do think we will have another bull cycle of hydrocarbons, basically another cycle of shortages, high prices, trying to get more supply to come online. As you mentioned, you know, nuclear is a major solution. We had we had an we had a whole episode together of course called broken energy uh that I would suggest listeners check out and you know nuclear is a very powerful solution to that but it does take a long period of time especially in an economy that has burdened itself with uh weaker human capital like basically know how to build them you know the the legal situation that makes it hard and costly to build them. Uh so I do think that we'll have another energy crisis along the way which is solvable. But basically the the longer that that is delayed basically the more that we have energy supply flowing well without disruption that adds runway to the political situation. Whereas I mean you can imagine right now if we had the current political situation but we had oil at $150 or $200 a barrel. Imagine what that would do to the the political climate as it is now and and both domestically in the US as well as uh globally between nations. What would that look like? And I think in the years ahead we could certainly find out. I mean if you look at at US shale oil. So if we kind of back up the various reasons and maybe you have something to add but if you back up the reasons of why energy is cheap there's a bunch of reasons. One is of course the 2010s you know we had a lot of unprofitable drilling combination with low interest rates uh and you know the application of technologies to get you know shale oil out of the ground. So even though we had peak conventional oil uh kind of according to estimated timelines, we had all that unconventional oil come to market and the war in in Eastern Europe hasn't taken barrels totally off the market the way that that some feared that it would partially. That's a that's a political choice. I mean Europe found themselves not really in a position to to really kind of get Russian oil off the market. So it still finds its way to market just through various frictions along the way. Uh and right now at the current time with current prices, US shale production is kind of rolling sideways to over the price is not significant enough to incentivize enough drilling to both offset the depletion rates as well as substantially add more. So so far uh Secretary uh Besson's goal to I believe it was increase production by 3 million barrels uh is not really playing out. were not really directionally going in the way that he expected in large part because you know the prices don't support it and in fact some of the some of the kind of the goals conflict because they wanted cheaper oil but they also wanted more oil production coming to market and really the only way that could work is if you just outright subsidize them which they've not done and so you know basically I think that in the years ahead uh that kind of weaker supply from shale will impact things as well as you know any other geopolitical disruptions that could done. And while there are more unconventional sources that can come to market, that generally requires both high prices and sustained prices. basically some of the some of the deeper water stuff, some of the Arctic stuff, the underwriters of those projects, especially in a in a geopolitically complex world where there's more kinetic risk uh in various parts of the world and sanction risk and geopolitical feuds over places. The the willingness to kind of finance those longerterm operations has to come with pretty high confidence that the energy prices are going to support it profitably. And so I do think that we'll have another cycle of energy shortages, higher energy prices, which you know again is solvable, but then when you have that hot political mix already happening and you're already in fiscal dominance, that's where it's kind of a powder keg. That's where you get things like financial repression like you get another inflation spike, but instead of raising interest rates, central banks are kind of captured and they're just keeping interest rates low and debasing the currency anyway. And that's the I think an example of a mini crisis uh that can happen along the way. And of course a mini crisis poorly handled can become a mega crisis. And so it's hard to predict ahead of time how that would be handled. But I do expect more of those issues along the way. And you know the earlier that people can get ahead of it the better. Like if we have a kind of a general global realignment that nuclear energy is good, then that can alleviate the eventual problem, you know, by starting earlier rather than responding to it as it happens uh or or after it happens. Listeners, you'll find a link in your research roundup email to the broken energy interview which Lynn described as she was speaking. Lynn, you know the the drill here. Before we uh we close, tell us about what you do at Lyn Alden Investment Strategy. What services are on offer and how people can follow your work? >> Uh, sure. So, I have a a lowcost research service that people can uh follow. Um, I'm also a general partner at Egoath Capital where we do venture uh related investments. And so, thank you for having me on and congrats again on having 500 episodes under your belt. What does it feel like? Well, Lynn, as I said earlier, for me, uh, almost 10 years of macro voices, it's mostly been about the people that I've met and, uh, the way that people have challenged my thinking and particularly the the reward for me is in touching a few people's lives. And I I really feel proud of you. I hope that doesn't sound condescending, but I like to think that we played a role in your success. And it's just fantastic to see you uh doing all the things that you're doing. Well, I appreciate that and I'm hope hopefully to be back one day and I wish you continued success uh with everything you're doing. Thank you. >> Patrick Szna and I will be back as macrovoices continues right here at macrovoices.com. [Music] Now back to your hosts, Eric Townsend and Patrick Szna. Eric, it was great to have Lynn back on the show. She's always a listener favorite. Patrick Lynn Alden and quite frankly almost every one of our other genius level macro guests seem to agree that the fundamentals for gold couldn't be better. But let's face it, disciplined investors would be challenged to justify not taking profits on an unhedged gold long after the amazing run that we've just seen. And I don't mind admitting that I'm feeling a little bit challenged myself in that regard. I don't want to abandon or even trim down the size of my long gold futures position. I agree with Lyn Alden and Luke Groman and all the other smartest guys in the room that long gold is the place to be. But this trade has run so far so fast, it needs some kind of hedge or asymmetry to it. And I'm still levered long unhedged. So, how about focusing the trade of the week on how to hedge a big long gold position? Specifically, I want to hedge the risk of a great big downside correction. I think 300 bucks down here could easily happen and it wouldn't even upset the bull story. So, I'd love to hear how to even further lever upside potential as opposed to having to derisk here. But Patrick, obviously, you just can't justify too much leverage here with this much of an overbought market unless you've got some kind of asymmetric downside hedge. Assume for the sake of round numbers in this conversation that I've already got a long position on on a hundred troy ounces of gold. So that's about $390,000 at the price as of recording time. I want to redeploy that $390,000 to express a hedged version of my view that hey look there could easily be a $300 correction here. Could happen at any time. headlines. Who knows what happens? But we could also see $3,000 of upside in the next year if the world really goes to And frankly, we just had two interviews from super smart people not selected by us that seem to be suggesting that's the direction. Okay, Mr. Options Man, what's the trade? Listeners, you're going to find the download link for the postgame trade of the week in your research roundup email. If you don't have a research roundup email, it means that you have not yet registered at macrovoices.com. Just go to our homepage, macrovoices.com, and click on the red button over Lynn's picture saying looking for the downloads. All right, Eric, let's go a little deeper into the gold trade you described. The first thing I have to point out is that some really important parameters have to be nailed down before you even start overlaying option strategies. For example, is the downside risk we're worried about a quick air pocket or a multi-month grind lower? On the upside, while we know the longerterm potential for gold is in the thousands, what's the realistic short-term upside in the next quarter given how overbought the market is right now? Those details matter because they dictate the tenor of the hedge, the strikes you choose, and whether you can use overlays like a risk reversal to reduce the carry costs by selling some of the upside. The key point is whatever these assumptions are, they can lead to creating literally hundreds of different iterations of this hedge. Once you pin down horizon, upside expectations, tolerance for capp gains, and the carry cost, then you can engineer the exact structure. So, let's set the parameters for this illustration. The risk I'm hedging is a fourth quarter correction of 8% or roughly $300 an ounce. On the upside, I think the fourth quarter headroom is maybe another 10% about $400 an ounce from these already lofty levels. And I'll assume the core position is long bullion through the February 2026 gold futures contract on the Culmex. One way to structure the hedge is with a put spread risk reversal. In plain English, that means you buy a put to protect the downside, sell a lower strike put to reduce the cost, and finance the rest by selling an upside call. The result is cheaper carry defined by protection between the two put strikes with respectable upside before it's capped 10% higher. Now, here's the overlay I'd run. Now, if you want to follow along, I clearly broke down the numbers on the trade on page three of the downloadable slide deck. So, step one, we buy the $3,800 put and sell the $3600 put. That put spread costs about $47 an ounce. Now, step two, we finance most of that cost by selling the $4,300 call, which is roughly $400 higher from the current spot prices for a credit of $31 an ounce. The result, the net cost is about $16 an ounce instead of $69 for an outright put. Now, on a $390,000 gold position, like you alluded to, that works out to about a $1,600 premium. Now, what do you get? Well, between the $3,800 down to $3600 level, you've boxed in $200 of downside protection, enough to neutralize most of the likely drawd down. Now below 3600, you're unhedged again, but then you've already softened the volatility pain. On the upside, you are fully long up to $4,300 or 10% higher. And only beyond that do you give up your gains. And remember that the cap only applies to the remainder of the fourth quarter of this year. So, the beauty of this structure is I've meaningfully muted the downside, left plenty of room for the trade to keep working, and I've done it at a fraction of the carry cost of an outright hedge. That's the type of risk controlled overlay highly leveraged traders use to stay in high conviction trades without bleeding premium. Now, if paying about $16 an ounce for peace of mind over the remainder of the year makes sense to you, this certainly is a structure worth considering. At the same time, if the capped upside is a turnoff, you can always just run the $3,800 to $3,600 put spread on its own. It costs about $47 an ounce, but leaves all of the upside open. So, the choice is simple. ultra low cost with a cap or a higher premium with no limits. That explanation worked for the pros and of course our retail audience can get the full briefing by attending Patrick's Monday webinar which always dissects the trade of the week in detail. Macrovoic's listeners can get a free trial at bigpicturetrading.com. Now Patrick warned you last week that Big Picture Trading's prices were going up on October 1st. But when I realized after listening to that show that these guys were more than doubling their prices one day before our 500th episode, um I gave Patrick a call and pushed back a little bit and said, "Patrick, um how about if we extend that through the weekend so you don't screw up the 500th episode?" So, uh after a little bit of pressure, it is now possible to subscribe to Big Picture Trading for less than half of the new price that already took effect on October 1st. But that's only if you go to bigpicturetrading.commacrovoices and that expires Sunday, October 5th. That is the absolute last chance to get the old pricing and they are basically I more than doubling it. So if you like big picture trading and you don't want to miss the trade, now is the time. >> All right, Eric, let's move on to the chart deck. What are your thoughts here on the equity markets? >> Well, everybody who's anybody has been calling for a top. After all, the S&P is now more than 10 times the 666 low that we saw in 2009 in the wake of the great financial crisis. And the market just keeps climbing that wall of worry and shrugging off all those bullish arguments. In my experience, these things always go longer, go higher, last longer, take more time than anyone thought possible, and then they suddenly end when nobody expects it. Look, we're not in the nobody expects it stage. We're still in the most people expecting it or lots of people expecting it. They're hedging because they're hedged. It basically can't happen. So, I think market probably continues higher from here. I definitely think the bare arguments are real. They're going to be proven real someday. Could get really ugly, but who knows? We could go another thousand points higher before we actually get that great big correction or bare market. Now, I know that sounds crazy, but remember, we're at the beginning of a secular inflation. At the beginning of secular inflations, the stock market always overperforms incredibly well. Everybody thinks it's a great sign of the economy improving and everything's going to be wonderful. It's really just inflation and the feedback loops that are really bad for the stock market haven't kicked in yet. So, I think that's most likely what's driving this. As far as what happens next, though, I'm not sure. Well, Eric, there's no denying that the bulls remain decisively in control of this trend. Now, I've been saying episode after episode that this has been uh not only the longest uh rally that we've had with out a 5% correction this decade, but also the largest in magnitude that we've had without a 5% correction. Now, by either of those two metrics, that in itself doesn't guarantee a correction, but this market is definitely in the 100th percentile on that metric. Now, at some point, a correction will happen, but what has been amazing is that this market is completely resilient. so far to bad news. It continues to climb a wall of worry. Inevitably, something will break this market, but there is zero sign of it right now. Not even the government shutdown or anything like this seems to be rattling these markets. Well, it'll be very interesting to see what ultimately will be that news that comes out of left field that kind of surprises the markets to begin a correction, but right now there is zero sign of that. All right, let's move on to the dollar. Well, there's lots of bottom callers emerging saying it's the time to buy the dollar. Surely it can't go lower than this. But all I see on the chart is a perfectly normal sideways consolidation pattern, and it's right in the middle of its trading range. Nothing to see here until we get a breakout below 96 or above 100. Well, Eric, the dollar has clearly found a new fair value zone. We tested this 97 level once in April. We tested it again in June and we've been stuck in this trade range ever since. Now the primary downtrend is intact if just measured by something like a moving average. But the sideways trade range is simply a reflection the fact that there is a lot of confusion in the different crossurrencies. Some of them the US dollar is rallying against others the US dollar is weakening against leaving an index like this to be stuck in this muddle. At some point the US dollar will show its hand and that's going to be an important technical event. Now when I think of it from a pain trade perspective there is a decisive amount of traders that are outright bearish the dollar and rightfully so. There's a lot of macro reasons behind that. But when you think about what have been the best performing assets including emerging markets throughout the 2025 year, thinking of it from a pain trade perspective, a short-term US dollar rally would be incredibly disruptive to so many different trends. So will we see this kind of a pain trade emerge in the dollar or will simply the dollar bears prevail and the macro drivers the next leg down? It is certainly the puzzle to solve. Right now, we are in the dead center of this trade range and there's no real high conviction call to be made here. Now, Eric, let's move on to crude oil. As of recording time, we're still holding the September 5th low print right around 6150, but just barely. Trump wants lower oil prices and isn't afraid to play hard ball to get them. Now, I don't know exactly what's going to happen, but I think there's plenty of room for Trump to uh push his way, at least in the short term. I think ultimately we see much higher oil prices, as Anest Alhaji recently described. I think that that's clearly where we have to get to, but maybe we're going to push the prices down before we start the war or something like that. I'm not sure. Let's see how it plays out. Well, there was a technical attempt to break out and I always like to tell my members that one day doesn't make a new trend. When that breakout towards $66 happened, almost immediately we faded right back down to the bottom end of the range of the summer. Now, this uh in itself signifies that this was a technical false start and really that there is no bull trend to be found here. But at the same time doesn't mean that oil is going to be bearish. Over the summer, oil's been incredibly resilient to bad news and has held the line in the 60s some odd dollar range uh relentlessly for months. This leaves uh oil very similar to the dollar in a big muddle basically with no conviction showing neither a trend to weaken nor a bull breakout. At some stage we're going to get a trend move and technically it will be impossible to miss. We'll we'll definitely make the call when that happens. But right now, once again, you just have to assume that this trade range will continue to prevail, at least over the short term. Now, Eric, let's touch on gold. Well, you basically heard my view embedded in my question for Patrick in the trade of the week. That view is that no professional investor, including me, could possibly justify holding as overweight of a gold position as I currently have uh in the market that's this overbought. You just can't call yourself a responsible, disciplined investor if you're doing that. So, the solution, as far as I'm concerned, is not to derisk because I think this could still have a long way to go. I think it's time to re-risk into an asymmetric hedged position. And I loved Patrick's trade of the week analysis for how to do exactly that. Well, Eric, the measured moves on gold here are still up towards the $4,000 an ounce. So some short-term upside uh remains the path of least resistance and there every single dip has been bought. There is no sign uh that uh there and some sort of profit taking or short-term distribution cycle has begun. So you have to respect that this prevailing trend is intact. Um but the like you were suggesting the asymmetry on the short term over the next few months is at neutral at best where the upside potential is probably equal to the immediate downside correction risk. Uh, and so to me, any new trades put on gold here do need to be done with some sort of an option strategy that creates either convexity and or some sort of a a payoff structure that is asymmetric in the way it's constructed. Now, Eric, that uranium run's been going since April. What's your thoughts here on how this is playing out? I remain uber bullish long-term, medium-term. Of course, short-term is a little bit hard to call when we're this overbought. The thing that's a really, really important signal that most people will miss this week. Don't miss it. The long-term contracting price, the term price, that's the one that counts. Remember, the spot price is not where most of the action is in the uranium market. The problem is the spot price is the one that gets reported every day. Term data only comes out once a month. Term is finally moving higher after a 15-month plateau between $80 and $81. The one big problem is massively overbought technicals. Now, it looks like we'll shake those overbought technicals off with the sideways consolidation again before the next move up. I don't mind waiting. I'm still counting my gains from the last surge. Now, Eric, there's two things I want to highlight. First of all, we want to split up uh uranium versus that of uranium equities because when we're looking at the prices of uranium strengthening here and we look at things like the spat physical trust uh unit, you know, they are in the early stages of turning up and starting to reflect higher demand uh for uranium and the prices are improving. But when we take a look at those uranium equities, they've just had an epic half-year run where almost all of them have doubled in their value. Th this is a little bit more of an overbought condition. We're already seeing a little bit of resistance where as uh we see advances or rallies in these, they're immediately met with a little bit of selling. That in itself is not a reversal pattern nor an indication that this impulse is done. Obviously, the long-term fundamentals remain incredibly strong and a great story, but some profit taking will happen. as we already seen the beginning of it. To me, the primary bull trend is still intact and there could be one or two more bull impulses to the upside. We'll be looking for signs where u there's momentum loss or something that's pivoting the price action or heavy resistance starting to form. But that might take the whole month of October to really start emerging. Now, Eric, copper's been moving. Let's uh let's have a chat about this. Patrick, the glaring pattern on the HGZ5, that's the US copper futures chart, the one that got whipssawed by Trump and Bessant, uh, in all of the back and forth on tariff policy. Uh that that is basically showing an impending 5200 death cross which would be hard to avoid even if market's looking pretty darn strong right now but it would have to be a whole lot stronger in order to prevent the 50 from crossing down below the 200 which of course is known as a death cross. Patrick uh this is above my technical analysis payrade because you know if this chart death crosses the popular wisdom is well that's a super bearish signal. But look, I don't think the LME copper's chart would show any such pattern or anything close to it. The ugly pattern is on the HG chart and it's because that chart is collateral damage from the tariff turmoil. Patrick, how should investors interpret a situation like this when you got two different charts for the same thing showing opposite indications just because one got whipsawed by tariffs and one didn't? Eric, you're absolutely right in observing the Trump tariff turmoil and its impact on the charts. Yeah, usually as a technical analyst, you want to be able to look at a chart that is demonstrating proper flows, something that is showing the way investors are voting with their money. The problem with the copper chart on the ComX is that we went through a substantial gap higher and a devastating gap lower driven by short-term headline news as tariffs on tariffs off scenario which really disrupts the charts price action making it very challenging to uh give any validity to something like a moving average crossover. Therefore, I would put a lot less waiting on it. In general, a death cross, one of the skepticisms is simply that both the 200 and the 50-day moving averages are such lagards that by the time you have a meaningful crossover, the the embedded trend that's been in place to create the crossover is quite oversold and often you can get caught in some violent retracements when the signal arises. Generally, I think it is a good signal that depicts major bull and bare market cycles, but I'm always suspect of using it solely as a market timing tool, like there is some edge in starting to execute your trades when the actual crossovers are happening themselves. The observation I want to really highlight is that when we go to look at the LME futures in copper in London, we have them breaking to a one-year high, very clearly bullish at this moment. So I would be very suspect of this copper signal and I would focus a lot on actually whether or not copper continues to show new signs of accumulation because definitely ever since that Freeport McMoran event, copper has been very well accumulated and making key advances and so I'm actually looking to fade that signal at this point and seeing whether this trend can actually persist. Patrick, before we wrap up, let's hit that 10-year Treasury note chart. What we have literally seen is that at the start of the year in January we peaked out with yields near 480 and since then yields have been deteriorating down to 4% and even this little rally or bump that we saw in the post FOMC that saw almost 20 basis points pop on the upside faded out of Fibonacci zone and is already rolling over. Uh overall, I think the pattern of lower yields on the 10-year is a very clear trend and uh no reason to believe it's uh being disrupted and or having reversed. I would still think that there's a very reasonable chance here that we're going to see a trip under 4% on the 10-year here uh in this fourth quarter. And that's uh what I'm going to be continuing to trade looking uh for that breakdown. Folks, if you enjoy Patrick's chart decks, you can get them every single day of the week with a free trial of Big Picture Trading. The details are on the last pages of the slide deck, or just go to bigpicturetrading.com. But if you want Big Picture Trading for less than half of their new prices, your last chance to sign up is Sunday, October 5th. So, act now or miss the trade. The only way to get the old price is to use the link bigpicturtrading.com/macrovoices. Well, in this week's research roundup, you're going to find the transcript for today's interview and the trade of the week chart book we just discussed here in the postgame, including a link to a number of articles that we found really interesting. You're going to find this link and so much more in this week's research roundup. So, that does it for this week's episode. We appreciate all the feedback and support we get from our listeners, and we're always looking for suggestions on how we can make the program even better. Now, for those of our listeners that write or blog about the markets and would like to share that content with our listeners, send us an email at researchroundup@ macrovoices.com and we will consider it for our weekly distributions. If you have not already, follow our main account on X at macrovoices for all the most recent updates and releases. You can also follow Eric on X at Eric S. Townsen. That's Eric spelled with a K. You can also follow me at Patrick Serzna. 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