Peter Grandich: BRICs & Non G7 Planning To Keep Accumulating Gold? DC Will Increase Spending & QE?
Summary
Gold Accumulation: Non-G7 central banks, particularly BRICs nations, are increasingly accumulating gold as a hedge against the US dollar and US treasuries, signaling a shift in global economic power dynamics.
Market Outlook: The current market conditions resemble those leading up to the 1929 crash, with excessive optimism and disregard for traditional economic rules, potentially leading to a significant financial crisis.
US Economic Concerns: The US faces growing budget deficits and political discord, which hinder effective crisis management and exacerbate economic vulnerabilities.
Quantitative Easing: There are indications that the Federal Reserve may end quantitative tightening and resume balance sheet expansion, which could lead to further currency devaluation and inflation.
Global Trade Shifts: Countries are moving away from US treasuries due to geopolitical tensions and economic sanctions, with a focus on de-dollarization and increased reliance on gold.
Stock Market Dynamics: The dominance of passive investments and algorithmic trading has transformed the stock market into a high-tech casino, disconnected from traditional investment principles.
Mining and Resources: Political and environmental challenges are hindering new mining projects, particularly in silver, which could lead to long-term supply shortages and higher prices.
Investment Strategy: Emphasis on capital preservation over appreciation is advised, given the potential for economic instability and market corrections in the coming years.
Transcript
Hi everyone, this is Jason Berk with Wall Street from Main Street. Welcome back for another Wall Street from Main Street podcast interview. We're recording this interview on Tuesday, October 21st, 2025. The US dollar gold price is down a correction a little over 5% today. It's dropped over $200 an ounce, but it's been a in a huge uptrend along with silver prices the last 9 to 12 months. Today's special guest is a returning guest. He accomplished an enormous amount on Wall Street with a limited background. He worked his way up literally from the bottom. Became the youngest, I think, chief investment officer on on major Wall Street firms. He was a hedge fund manager. He wrote the book Confessions of a Wall Street Whiz Kid, which just came out with a new edition. Peter Grandich, thank you for joining me again. >> Thank you, Jason. That was a very long time ago, but it was nice to hear young. >> Well, you have another version of your book coming out. I mean, there's Wall Street documentaries coming out about the hot shot, what 70s and 1980s. I was just watching them on Netflix. They just released some new documentaries. had some episodes on that. So, I'm sure you were living that with like the the Ivan Boowkis and the Gordon Gecko types. >> Yeah, we thought back then that the market was crazy, especially that's what the claim to fame was. You're right. I was only on Wall Street for less than 3 years. I was promoted to head of investment strategy. Made a forecast of a market crash. The firm wanted me to retract it or resign. I didn't. And six weeks later, the market crashed. And then to prove it hopefully wasn't a fluke. The very next day when everybody was in a panic, I felt that the market would get back to a new high within 2 years, which it did. And that's where the moniker the Wall Street Whiz Kid was born from. >> Well, didn't Alan Greenspan, he started playing games back then, right? Didn't he start getting heavily involved and he started like injecting mass amounts of liquidity? I don't know if it was called quantitative easing, but it was similar back then. >> Yeah. The real quantitative easing started with Bernani and Obama when they uh told the world that the money was going to go to main street mostly to infrastructure and it basically stayed in the big banks and Wall Street. Uh but certainly Greenspan was an early addition of quantitative easing. So, I want to get your thoughts on the current macro situation right now because uh the mainstream financial media, the mainstream media, even President Trump and a lot of people in this administration, they're talking about how well oil prices are low, inflation is coming down. It's not an issue. Uh I see like the budget deficits blowing out. I see record amounts of nonG7 central banks accumulating gold. Do you think that inflation is still an issue and what do you think is causing it? Well, I think I began the year, Jason, not looking for a decline in the stock market, nor a rise. I thought it would be basically flat. I thought the early part of the year would seem enthusiasm off of Trump, but that would Wayne. I felt that way to about uh late August, early September. At that point in time, I looked at beneath the carpet, so to speak, of the presentation that this current administration was making, and I found things not so healthy. So, I started to talk about a danger point, not knowing exactly when it would occur, saying that it could take weeks, if not months, but we were getting into a danger zone, which is only more increased since then. In fact, you're to be the first person I'd be sharing this with. But today I began playing with a thought of getting behind a theme of what's called great song that people listen to. It's a great understanding of going back to an era that people forgot about, but it's like party like it's 1929. And uh if you look at 1929 and the leadup to it, most of the then current fundamentals and grounded theories were tossed aside. We were told all the reasons why this time it was different and people just went beyond any reasonable thinking and in a sense party like there would be no tomorrow and of course we knew then a great depression would follow. Right now I find on Wall Street especially since the vast majority of financial advisors were in diapers or weren't even born when I started they have that same type of attitude but for the 21st century. They've tossed aside general economic rules that should apply, but for them now they don't. And they've been mentored on what you've talked about that's been around for decades that the Federal Reserve will always bail you out. So no matter how bad you act, whether as a bank or as an investment person, it'll be solved by the Fed coming in and and fixing whatever the problems were. That doesn't work anymore because the Fed is not the the great wizard behind the curtain as it was in the Wizard of Oz. They've been shown for what they are and what they're not. And therefore, I'm afraid with that and the combination of some really bad economics, worst social uh conditions, but perhaps the worst problem now versus the past three financial crisises that I live through as a financial adviser. There is no political harmony anymore. There is no way if tomorrow for whatever reason caused a crash in the market or the economy that we have two parties that can go in a room to try to fix it. And that's the big difference between the last three. And there was some attempt back then even though it wasn't a great job. They put aside their political wos and went in and try to fix it. I don't believe that's possible now. That's my biggest fear. Well, also to add to your points, um, for decades, really since China joined the World Trade Organization, but a a lot of this started post Bread and Woods for decades because US was the only industrial base and the way the system was set up post Bread and Woods is that all the US's major trade partners that were running trade surpluses on a dollar standard with the dollar as a world reserve currency, they were providing vendor financing to the US government. They were just recycling all their trade surpluses and foreign exchange reserves back into the tra US treasury bond market. So like China when they joined the World Trade Organization, Japan, Germany, all the major trading partners of the US all bought massive amounts of US treasuries. Those days seem over, Peter. And really, especially over the last three and a half years, that trend has accelerated, especially after the Russia sanctions. A lot of these countries outside the G7 in the bricks, they do not want to buy any more US treasuries. I'm just seeing all the comments. I don't know if you've seen some of the comments from some of these central bankers, the Polish central banker, the surveys from central bankers. They're all planning on dollar cost averaging each month gold tonnage and not US treasuries. >> Yeah, you're on to something that actually in 2021 I made perhaps the most important personal decision that would impact still the planning group that I work with if the people that follow us and invest with us chose to follow it. I saw this back in 2021 early on. I'm not patting my back. I'm just speaking of facts. And that was the bricks. I saw that there was clearly a movement in the world to move away from the United States both as a military power, an economic power and its currency. And that the bricks were the formula for how countries were going to do that through. And and it was obvious then that they were choosing gold to be some sort of anchor to whatever they end up coming up with. Not so much to be a world replacement currency or or gold back currency, but to buy it, especially when it was a lot cheaper than it is now, uh, and be prepared to be the alternative. I I I I I still don't believe that they're prepared to come out with it this year or next, but I think they're very very close to uh achieving what I think will be when you say this, I I I'm in the middle when it comes to Trump. So, I get it from both sides. I get MAGA people mad at me and I get Trump haters mad at me. Trump has done some good things. He's tried to do some good things with peace in certain places and all, but his biggest blunder, which I think will be what he'll get most comments about, will be taking in a big stick into this trade war versus an olive branch. He played into the hand of what you and I already were perceiving a few years ago, and that's ddollarization, countries moving away from the United States and all. And I would say right now we have far less true allies today, especially in the last uh 12 months than we had 20 or 30 years ago. And that plays a role that you brought out again, which a very good point. And that is because we're at such a debtor nation and running multi-t trillion dollar deficits. We've been able to get away with financing that because we had people elsewhere outside the United States willing to fund our deficits through our treasuries. That's clearly changed. It's one of the big reasons that gold has risen the way it has. And you're right, many of the central banks are speaking openly now of moving away from the dollar and our treasuries. And two of the biggest holders that held it for quite some time, China and Japan are leading that charge. So yeah, this this is a I I think this party like it's 1929 is a good description of where we're at. It doesn't mean tomorrow at the opening the market collapses, but we're now in that red zone that you see in any thermostat or what have you, which signifies danger. It's only a question of how far it goes into the red zone before we have another financial crisis. >> Yeah, I agree. Or the Fed uh and Eric Trump has been hinting at this and we've had even drone Powell has kind of hinted at this recently in his press conferences. They they're saying they're going to end quantitative tightening, which is the reduction of the Fed's balance sheet. And it sounds like restarting or expanding the Fed's balance sheet is a foregone conclusion. I don't know exactly when, but it could be a couple months. It could be we have a repo crisis coming up in the next couple weeks cuz uh Jeffrey's Bank sounds like they're in a lot of trouble. I don't know how many other counterparties you have problems with French government debt. Who knows how many large investment banks in the US and Europe have uh derivatives tied to the French government debt that has problems. So that could all cause problems here where the Fed has to step in and start doing bailouts and currency swap lines and all those types of shenanigans. >> Well, you know, Jason, you've been around long enough to know that we are in the earliest stage. It's not there yet to per say, but we're in the building up of a banana-like republic which which we used to make fun of these countries in the 60s and 70s and we seem to be heading down that same road. I'll tell you this, what isn't spoken a lot, and I understand why because I, you know, I've said this for years, much of the financial service industry and the Wall Street heads are a don't worry, be happy crowd. You can toss them and much of the financial media that's died to the hips. Off the top of the Empire State Building all the way down, they'll all say the same thing. Hey, so far so good. So, I don't expect them to lead the charge in in these views and all, but I'll tell you the thing that isn't getting spoken about. You just touched on it. You mentioned France. We have a stealth bond market worldwide crisis. Now we have several key countries that are seeing not only a big hiccup back up in interest rates but funding problems and their own. And these were countries that we used to depend on to buy our debt. So it it it's interesting that while that's happening, we have seen a drop somewhat in in in short-term especially short-term interest rates here. But I think that's more of a liquidity uh exercise here at a time also which is not getting news at all. I knew we had a problem two months ago, Jason. I wrote and spoke about this extensively when the Trump administration announced they wanted to see the public buy into private equity. I knew there was a problem in the in the private equity and credit market because that would be the only reason you'd want the public in. If you're making a killing, you do not want the general person to make the killing with you. If you're starting to get killed yourself, you want them to come in and help bail you out. So, I think there's a lot of issues that right now this the US stock market is not focused on because remember this, the top 10% wealthiest people in America own 86% of all the assets. The next 40% own the remaining 14% and a half of America doesn't really have own any of that. Wall Street basically caters to that top 10%. Yeah, they give a little lip service to that other next 40% and some of the smaller maybe inexperienced financial advisors that's their clientele but they don't have a real touch to the real world. Remember Jason, that top 10% is not living life like you and I and many of your listeners are. They're not flying commercial. They're not cooking their own food. They're not driving their own cars and all. They've been the ones who have benefited mostly by this terrible mismanagement economically and politically and now the things that are happening socially. But they're not big enough and wealthy enough to lift up the remaining part. In fact, right now, 25% of all American workers, half of that bottom 50% are using some sort of debit in order to pay for daily necessities, food, clothing, gas, rent. That can't continue. They can't live at that when especially when they're being charged anywhere from 25 to 35% interest on that money they borrow. And so what I find real ironic and I've used in my ex pages to show on weekends Chinese who are taking their discretionary income going into malls to buy gold while we have people going into malls to buy things they don't need with money they don't have. >> Yeah. Buy now pay later which is also those shares were I haven't checked them in the last week or so but those buy now pay later companies those shares were were on fire but they have to have a lot of you know people who aren't paying the debt anymore. So, there's going to be people ending up at collections. I mean, I'm just seeing the stories. I'm sure you see this, too. The real economy is divorced from the asset markets, from the S&P 500, from the gold price, the Bitcoin price. All these asset prices seem to be enormously inflated from uh the Federal Reserve bank policies, policies uh spending out of DC, the cancel law. And now here in the real economy, what you have credit card debt default, you have auto subprime auto loan default. You have um people, you know, searching what mortgage payments. There's people that are that didn't lock in the uh refinancing at a low mortgage cost four or five years ago. They didn't refinance when mortgage rates were a lot lower. They bet on an adjustable right now. They're uh in trouble. >> We call this now a K economy, but it is basically where the upper upper echelon are continuing to do rather well, some doing extremely well, but the bulk of Americans are going sideways to lower. That can only go on so far. you can only borrow against the future so much. They have seen somewhat of a false facade uh like you said uh some perception that things are getting better, inflation is not as high, oil's coming lower. The question you should ask yourself is why is oil prices going lower? It's going lower because economically things aren't as great as it's perceived to be. So I think that the perception is currently being viewed uh that this can somehow get even crazier before it has to uh come down. You even had the head of Black Rockck, this was another thing that really irked me a week ago. The head of Black Rockck who 5 years ago called Bitcoin criminal. Then of course they came out and now make hundreds of millions of dollars trading it and became an advocate of it. He even said in the interview that yeah it's a bubble but you got to learn to live through a bubble. >> I think George Soros says similar comments about like he makes his most money off trading bubbles. Yeah. >> Yeah. So but the problem is this. If it's so good why is he still taking his pay in dollars and not crypto? So, there's a lot of false facads out there. It's a house of cards. I I don't make a living. I don't have uh dry food or ammo or or cabins in the woods to sell anybody. But realistically, these last several weeks, it's been several years since I felt this way. But I'm more probably concerned now than in any other time in my career. For this reason, Jason, we're not socially, politically, and economically in the same boat that we were to get out of the issues from before. We're in far worse shape. And most importantly, we have no political will that'll be there in order to fix the issue. In fact, Jason, we could argue that a lot of those people in that place called Congress have been living getting fat off of this because they're all making all sorts of money in stocks because they're able to know things before we are and they can't even be charged with that. So, it's it's kind of like the the wolf is in hard charge of the hen house and it's just become very very concerning to the point where I became the most conservative ever in my own portfolio. Uh and and and I'm normally uh and I've nicknamed myself this, the riverbo Pete. I'm normally willing to speculate and speculate hard, but I really think right now capital preservation has to tower over trying to make capital appreciation. >> Well, especially if the trade war accelerates and there's export bans on natural resources, tariffs. I mean, the supply chains could be enormously disrupted. Look at what's happening with rare earth. I don't know if Trump had any of this stuff planned. I've been covering rare earth for over a decade now, warning people that um the US should should focus on this policy. The US was thinking about doing stuff like this 10 10 12 years ago. They didn't. Now here we are in even worse shape. The supply chain now has to scramble to find a reliable supply of not only rare earth mining supply but also the value chain which is even hard I would argue is even harder than actually rare earth mining to make the magnets and all the other rare earth products. So they have to scramble and figure out you know non-China supply in that regard. You mentioned um 1929. I think there's a lot of similarities there because post October 1929 crash Peter you had Herbert Hoover you had Congress and then FDR who doubled down on a lot of the same policies as Herbert Hoover because they were implementing what Keynesian policies of central planning there was tons of what subsidies there was tons of tariffs and there was tons of bailouts it was a weird mix and it just caused even worse problems for small business owners and the regular average regular Americans >> well about a third of our planning group that I'm still part of is small to midsize business owners. And every year for at least 10, if not as many as 20, I hear the same thing for them. Peter is harder now to run my business than any other time. And that has not changed for the better. Uh I I will like to say one thing about China. I was a huge buyer, a believer in the Chinese stock market at the beginning of the year. It's documented. It was out there. My advice to anyone that wanted to listen was don't own not own don't own US equities, but own many foreign markets, including especially ch China. The United States is 65th right now in terms of major market returns. The the most markets have done much better than the US this year. But what China has done, and believe me, I'm not rooting for them. I don't want to live under Chinese rule. But they were able to bob and weave with, you know, Trump. Yeah, we're going to do something. We're not. They kind of had him tag along. They were able to reroute their exports. They they were able to soften any blows that were going to come. And then once they've done that, which they clearly have, the numbers have shown that they're still doing pretty well despite all the fears. that they were supposed to collapse six or nine months ago because of Trump. They now use their they pull their ace in the whole card. And that's what you said is the critical minerals. Listen, we have the head well, he's now called the defense of war, whatever you want to call him, the defense secretary. He literally said a couple months ago, the United States has to prepare for war against China, against Taiwan. So you do you think China is going to send us all the stuff that we need these critical minerals for our military in order that we can have a stronger military to eventually fight them? It's kind of silly. So now they know that and it's great that the president has gone out and said, "Hey, listen. This this country screwed up and all, but listen folks, you know how long it's going to take to get that going to to you think Australia just has all this stuff sitting in a warehouse? is going to ship it over to us and we're able to use it tomorrow or the next day. It's years if not a couple of decades before we'll be so-called self-sufficient even if we get to that level and all. And then the other thing that people aren't talking about with all the talk remember 90 trade deals in 90 days and from April, May, June, July we kept hearing Lnik every day we got this deal coming. What major deal has been signed, sealed and delivered with any country? China, South Korea, India, Canada, Europe, a lot of talk, a lot of things were said and now they gone quiet because you know what? They never got those deals. And so there's a big facades out here. And meanwhile, our economy below that top 10% earners is getting beaten up bad. If you take out this AI spending, which is all going to have to be borrowed money, and they resorted to, oh, trickery of vendor financing now in order to keep the game going, but if you take that out, we are in a recession. So, there's just so many dangerous stuff things here. I just think you have to be a live chicken versus a dead duck. >> And the trade deals that you're talking about, I mean, like I don't know if people saw this. I found like actually a South Korean business paper. it was translated to English and they were quoting the trade delegation that flew to DC last week late last week and they were talking about how basically the trade delegates were flying here and they were looking as part of the trade deal negotiations for and it said in the I don't know which sources they cited in the Korean government but said they wanted unlimited an unlimited US dollar currency swap line. So, you know, that's not a good sign here. You mentioned the private credit markets. There's huge issues there. So, it looks like there's going to have to be uh additional bailouts. I don't know if they're going to announce those as balance, but we know in the past after 2008, Peter, that these currency swap lines that were given out to the European Central Bank to save some of the European banks, uh, Brexit, others, they were basic, they were supposed to be what, um, loans with interest that were, uh, paid back. They were never paid back. The Fed just waved the loans. So, they turned into bailouts. >> Well, let's also not forget that while we're speaking, we basically have a government that's shut down. And that you know the the problem with that is by the time we see the economic numbers and you know something bothered me about a month or two ago it it's small but it gives me an indication of where things are going. They announced uh the consumer price index will no longer measure long-term care. And they publicly said the reason is it's gone up so much and is expected to continue to go up so much that it's not going to be worth putting in the in indicator because it's going to throw off the perception of what really inflation is. Well, here's news for Americans. If you're 65 and over, there's a seven out of 10 chance within 1 to three years you're going to need some sort of long-term care. So, most Americans are going to have to pay for it, whether it's expensive or not. And it's just an indication of how they're going to try to massage things. You know, uh he loved the first five months of the BLS employment numbers and as soon as they were bad, you get rid of that guy. And it it concerns me about an old joke that I think some of the people that Trump is going to put into these positions. There used to be a joke about the accountant who got the job because when he was asked, "What is 1 plus one?" His response was, "What do you want it to be?" And I'm afraid as bad as the numbers have been in the past, they're actually going to be worse because they're going to be more massaged than ever. >> Okay. So this part of stack tax life. So you're seeing that like the bureau of labor statistics and the other ones that come up with what GDP the CPI the inflation the official government inflation data which has cost of living adjustments and then also what the jobs report numbers what there was 2 million jobs in the three last three years of the B administration that just were removed like the snap of a finger. Um it's just very frustrating because uh you know it fools the stock market. stock market goes up and then miraculously a month or two months later the numbers are changed like oh by the way those uh 500,000 or 1 million jobs or two million jobs over the last three years they never actually were created stock market's like oh well the QE is coming the dollar's getting devalued we're going to price in more currency debasement and inflation >> well I want to talk about stock market but let me say something real quick when an ADP an independent company that has nothing to gain by massaging was so dramatically different almost monthto month than the employment that was the signal right there much better number but I want to tell you talk to you about something if I may Jason I know you will find this worthy the difference in the stock market from 1984 when I started till now is back in 1984 90% of the trading was individual investors only 10% was institutional and there was no type of computer trading at All now it's estimated based in 2024 figures that almost 60% of the money that's in stocks is in passive investments. People need to understand this. This is in being managed but not uh with discretion. Meaning the manager's only job he or she is to match some sort of performance of an indicy or an index. And the most popular one is the S&P 500. So their job is when money comes in is to buy enough of the certain stocks to to match that performance of the S&P 500 index. The remaining 40% I would argue twothirds of it is now in some sort of algorithm computer trading program may be as simple as soon as there's news stories of certain wording you buy or sell futures to very complicated programs of options futures equities at simultaneously etc etc the smallest part of the stock market now is what the original reason for the stock market was and what it was when I started a place where individuals buy and sell part ownerships of businesses. So why is that more important now than ever? Well, let's first look at that biggest chunk, that passive group. So money comes in, the manager matches up and and buys these stocks. The market goes up because of that. That makes more people want to own stocks and keep repeating that same system of buy, add, buy, add. It's going to be the same way if and when the market reverses and goes out. Those managers are not going to be able to say, "Whoa, wait a minute. We're not going to sell IBM or whatever. It's too good of a stock." They're not going to have any choice. Now, while it's been beneficial this way, let's look at how these algos have played. One of the things if you watch the market closely, especially compared to 30 or 40 years ago, so much of the influence of overnight trading, especially trading up until the the last 2 hours before the market opens, so say from about 7 7:30 to 9:30, it's not been coincidental that Trump has timed certain releases on his social media to coincide with markets opening. And the reason is he knows or at least the people advising him knows this that by saying certain wordings these algo programs are going to pick up on it. So what you've noticed now that never existed 20 or 30 years ago even when we had futures trading overnight is how much future markets are active when the market is closed because the algos are computer trained to just go based on wording. So if the warning story is Trump sees China deal, Trump sees economic growth, they automatically go buy futures. And it kind of comes a self-fulfilling prophecy. The problem will come, Jason. It always does. It's only a question of what at what level. Even Soren, who's normally a Main Street Wall Street guy, basically said on 60 Minutes or Sunday or so ago that we're going to have another crash. It's just at when and at from what level. That's just another of the differences. All we've become, in my opinion, for someone that's in his 42nd year is we are now an extremely high techch casinoike atmosphere in the stock market. We are no longer the mom and pop place to bipart ownerships of businesses. That's a very small part of it. And on top of all of that, the people who are supposedly responsible, half of the financial service advisors have been in the business only since the new millennium started. Well, that's amazing because when you ask them since you started, what's been the best form investment? They'll say the stocks. And you tell them >> seven. Yeah. S&P 500, big tech. Go >> gold has greatly outperformed it. And they go, "No, no way." Until you show them. They've been weaned on a one-way street. Jason, listen, I don't blame them. This is this is what they've been told. And they've been told that if by chance you run into an accident, you just call 1800 Fed. They bring a tow truck, they clear the road, put the pedal to the metal, and go. >> Yeah. Let's Hey, let's just devalue the dollar. I mean, most Americans won't even notice, right? So, we'll just say the CPI is 2% and we'll inflate the stock market again and the tax receipts will hit 4.7 trillion like they did last year, Peter. And um even though the US federal government, I think, spent about eight. So, the Congressional Budget Office and they lie too. I mean, they said the budget deficits were only one only, I'm using air quotes here, 1.9 trillion last year, while the government spent 8 trillion and it only took in 4.7 trillion in tax receipts. That's not 1.9 trillion. It it it it it's really Jason just to sum up about that and I know you want to talk about gold or if we run out of time but I would just tell listeners now there's ever increasing factors that we should be concerned about and there's no margin of error and there's not enough experience out there to understand that there can be a darker side and so like I said my my philosophy clearly to stock planning group if they choose to listen is focus on preserving your capital instead of trying to be capital appreciation because I think that's going to be far more challenging. I really think 2026 and 2027 could be two of the toughest years we've seen in decades. >> Well, let me also add that I think the stock market is not really going up for fundamental reasons for decades, especially since 2008. I think a lot of it's because of devalued currency. I think because of what all these quantitative easing programs, all the uh cheap debt, so margin debt, uh share buybacks with cheap debt, all these things are intentionally juicing the stock market to keep uh the stock market, you know, in a nominal bull market. People aren't paying attention to the loss of purchasing power in the dollar. Look at the gold price, Peter, in all these currencies. Like we you were talking about long lines. I mean, there's long lines in Australia and people like, why are these people buying gold? All our listeners have to do is go and look at a long-term chart of the gold price in the Australian dollar. I mean, it's parabolic now for over five years. The average Australian, I think, finally waking up that that their currency has been intentionally debased, but it's not just, you know, the dollar or the Australian dollar. It's across the board. >> What's interesting about those lines, Jason, you're right. In several countries, they're lining up to buy gold. But what did the New York Magazine report on? How people in New York City were lined up to sell their gold. And the reason they're selling their gold is because it's the only way they can continue living the lifestyle that they grown accustomed to. And it's just the difference here in America. We are we've been robbing Paul Peter to pay Paul and we just been just we're way beyond the fail safe point. You know, I I try to tell everybody I say listen there's 37 trillion. The Congressional Budget Office says we're going to be at 54 trillion in 8 years or less. And that's without in their work a major recession which could lead to the uh faster higher debt level. How do you service 54 trillion even at 5% interest, 2.5 trillion in an interest payment? The most this country's ever done is less than 6 trillion in income. How are we going to how are we going to see a third or half of all the money we take in? And now even Trump, he fell into this Biden uh trap of announcing this widespread forgiveness of student loans. That's great. But I'll tell you why it's bad for two reasons, Jason. First of all, most Americans don't know this. Student loans are the single biggest asset that the United States has on its book. Makes up 27% of all our assets. So if we forgive those loans, we take them off the asset side. We still have to come up with that money to in order to pay the government. So, we're going to tax other people. Most of those people who then were responsible to pay their debt unlike the people that they're forgiving that student loan people, they weren't charged usery. They didn't pay a different rate than somebody and therefore they should be catching a break. They didn't not get what they were supposed to. They just didn't live up to their obligation. Why should someone like me who lived up to the obligation now forgive them? And Jason, where does it stop? How do we not say that the next problem when we have is there's a lot of people that can't pay their car loans. If they can't pay their car loans, they can't go to work. And if they can't go to work, the economy is going to go in the tank. So, let's forgive them, too. That's a very bad precedent that I was surprised to tell you the truth. I was happy when Trump first said he wasn't going to do it, but now his administration caved. I think we're setting up a very bad example on this forgiveness of student loans. And people say, "Well, that sounds cruel." Oh, no. It's not cruel to pay back what you're supposed to. Anybody that's biblical, Jewish or Christian, it's in both the Old Testament and New Testament that if you borrow, you're to pay back. And now we're going to set up a system where you maybe you don't have to. >> Well, this is the problem with with both political parties. They pick and choose winners and losers. The Fed is the great enabler, the Federal Reserve Bank, and then they just do what? They uh they expand the balance sheet. they do quantitative easing or some type of um liquidity program and they do bailouts. They pick and choose winners and losers with student loan debt forgiveness or whichever bank gets in trouble. Uh sounds from talking to some other experts like we could have another repo crisis coming along with the private credit. So I mean we don't get a vote in this. I I think this is the major problem here. They're talk they they're already setting up a bailout for Argentina Peter as a taxpayers. We don't get a vote in this. Congress doesn't even get a vote in this. is the people in power in DC what their friends or a major bank they just decide who's a winner and who's a loser who gets cheap credit or currency who gets a bill out. >> Well, like I said, pick your poison, Jason. That's where I think we're down to. Like I said, it doesn't mean it's going to happen tomorrow, but I do feel that there's so many difficulties out there right now that a combination of them is leading us to a much more difficult crisis than maybe we've ever experienced in the modern era. Well, Peter, I I think as a foreigner, I think foreigners see this and okay, maybe they can earn a quote unquote risk-free what, four and a half% or something on a Treasury bond, but they see like, wait a second, they're going to give out balance for what? For who? They're going to do all these things. They're going to they're going to print money. They're going to fund these parts of the government. It doesn't make any sense. They're going to destroy the purchasing power of the dollar. It was an eventuality that and I think that's why the last three three and a half years after the Russia sanctions, things have accelerated. You've just seen where the subsidies where foreign governments and foreign investors were subsidizing all these budget deficits. They just said enough. It's just getting out of control. They seized what 300 billion of the Russian reserve assets. The budget deficits have gotten even larger. The national debts growing even faster. The Fed raising interest rates. It didn't kill inflation per se. It actually accelerated a lot of people what um it caused a lot of um supply side problems. and a foreigners even though the Fed raised interest rates they just decided they still don't want to buy the debt because in the past right if the Fed's raising interest rates foreigners would want to buy the debt in the past well what we did with Russia I've argued for months is making who's ever in charge of new membership director at bricks a much easier job because what the foreigners are saying to themselves they may not say it right out to Trump because you can't win a war words with him that hey if they did it to them. What's to stop them from doing that to you? And that's just one of the many reasons why I think people are moving away uh from the United States and the and its currency. And and really the thumb that has been over them. And quite frankly, like you said, uh they they feel that they'd be much safer and better off in something like gold than a US Treasury bond right now. Really, you know, think about this, Jason. until just a few days ago, we were having our fourth year in a row where bonds were actually a loss. It was unbelievable when I told people at the end of 2021 that both stocks and bonds can lose money for the next few years. People said to me, Pete, maybe the stocks, but you don't lose money in bonds, but for three straight years, people lost money in the Treasury bonds. And you're right, foreigners see that. And remember this, the only world uh of seven nations whose currency is actually uh down against the dollar is Canada. Everybody else is up. >> Yeah. The math just doesn't work for DC and um the math just doesn't work for foreigners looking at this for supply and demand US treasuries. I mean, I think that's why you're seeing what cap I would call it captain obvious here. what Jeff Gunlock he's a bond fund manager is a small gold fund and then the chief investment officer Morgan Stanley they basically said that that the average institutional investor or hedge fund manager should go from what 0% gold exposure should strongly consider 20% or 25% of vasis under management for gold exposure I didn't think I would see something like that mentioned >> well before we run out of time let me tell you what I never thought we'd see I never thought I'd be saying as we talked today earlier today to people that a gold is down $250, a number that just didn't seem possible for a good chair in my career, all the way down to the terrible number of $4,100. Big deal. You know, you know, I I I been calling for a correction, consolidation, so I I'm happy to see it. I think if you're bullish long term, it's actually healthy. But think about this. when gold was a thousand if it correct if we had a down $50 day. Okay. Well, that's what a $50 day is now with gold at 4,000. And I it's just an amazing thing for people not to appreciate what caused gold to get to this level. Remember the average US investor and probably Canada too, but I don't follow Canada closely like I used to, has not been a net buyer of bullion. they still find portfolios have exposure 1% or less. So this has basically happened outside of this country and you only like you said have to see that people in countries are waiting online to buy gold. They're not waiting online to buy treasury bonds. >> I think you'll see more dip buying. So, the people that had zero or 1% gold exposure, I think you'll see them take advantage of this correction and start new positions start to increase the size of their positions. Uh, I think you'll start to see some of these gold miners take advantage if there is a sizable correction, the the larger ones, the senior ones or the mid-tier gold miners and go and buy some of those juniors. They were waiting, I think, for this type of correction. I think you're going to see more mergers and acquisitions soon. Well, we had it and that thankfully for me, my largest single hole had that happen yesterday. Uh, I am Gold stepped up and and made a bid for a company called Northern Superior Resources. And why I think that's a watershed event is the major gold producers who've been making money hand over foot uh have seen their value of their currency, their stock go up tremendously, but they've also seen their expense side going down. the two biggest costs to them, oil and labor, is going down in cost. Certainly not going anywhere close to how the gold price is rising. It's just been so hectic that they've been so busy in their boardrooms figuring, okay, well, who should we look at? What should we do? And I think if we get a stabilization in the gold price, we're going to see even more of the juniors being gobbled up by the majors because they've not to say that there's still not a few left, but most of the big majors who could merge have merged and most of the upper mid have merged. Now it's going to be reached down to advanced juniors that have projects that can add millions of ounces uh in the coming years uh be acquired. Uh, in terms of like countries that you think are safer with near-term production, are you only looking at the US, Canada, and Australia, or are you willing to take some additional risk in other countries? >> Yeah, I don't have a problem with Australia, even though I'm not invested. I have focused almost exclusively to North America. Not to say that I would want to do anything in California, you know, but uh but I do think what's happened in the mining compared to 20 30 years ago when I managed money in that area and all you used to be able to spin a globe, just point a finger and wherever you landed say we can go there. You can't do that anymore. Look what's happening in West Africa. Thank God I got out eight, nine years ago. I had huge investments there and I said there's just going to be a takeover by these countries. They're not going to let these foreign countries, they have such little assets otherwise, they're going to seize them. And that's what's happening there. So, social and political impacts. Look at the copper. It's it's you you're going to need a much higher than $5 price within the not too distant future in order to get major mining companies to go to certain places of the world and absorb all that risk. Especially when a lot of those countries have lowgrade copper where a lot of money and labor intensity has to be spent in order to get the copper out. They're going to want a much higher price before they go there versus how easy they used to go there 20 or 30 years ago. >> And as we wrap up here, let me just add a point on silver here. So for physical silver supply and the LBMA has physical silver shortage issues, there's not going to be a sizable amount of new physical silver coming online because all the countries that have a lot of potential silver deposits. So like uh Chile, Mexico, Peru, um some of the other Latin American countries, they just have basically huge uh environmental bureaucracy and permitting issues now for these open pit mines. They're literally being blocked or uh denied from restarting. So there's like protest for Escobal, which is a large silver mine in Guatemala, La Navididad, which is a massive silver mine in Argentina that's in the one province where they can't get a permit. So all these potential new sources of silver, uh the ones in Mexico, open pit silver mining. The uh new prime minister or president of Mexico, I think she said it could take years longer to just to get a permit for open pit mining Mexico said the potential new supply, Peter, could take years, many, many years longer than the market thinks. >> I fully agree. >> Yeah. So So it's a mess. So, the people are like, "Oh, the it's only a short-term supply problem. A couple months from now, it'll be fixed." I I'm not so sure because I just don't see like if it was a free market and the governments were more uh promining, I think you would see you would see more of that. But um you know, the opposite the last 5 to seven years, the uh annual silver supply from what Chile, Mexico, Peru is in permanent downtrends. >> No, no question about it. Uh they they are in need of and people should appreciate any correction here. But I still think they will see higher prices when we get into 2026 and beyond. >> Oh, we have to. I mean, if silver if silver corrects back down to $30 or less, there's no incentive to bring on a lot of new supply. So, I think we're going to have to see sustained higher prices way above $35 an ounce and then maybe, just maybe, these governments will change their mind because, you know, some of these mines, Peter, for a country like Guatemala with Escobal mine or Lavi or in Argentina, La Nav'i dot, I mean, that's billions of dollars of cash flow and tax revenues, investment into their local economy, jobs, infrastructure. The government's just blocking all this stuff. It doesn't make any financial sense. Well, part of that also is because they want to take more control of it, the uh the royalties and and that was the typical move that I feared from these foreign countries uh that they're just going to say that or get out. Barrack just seen that in in Mali and also it there's like I said for for mining and exploration for me clearly most of my focus would be on North America uh you know countries where I don't expect that day Australia is very promining and all and maybe a special special some place like a Finland or an Ireland but realistically the places we used to look a lot Africa South America Latin America you won't get me there anyway. Yeah, I mean, well, they have great geology, so they there are deposits there. It's just it's not free market and there's so many rules, regulations, bureaucracy, there's corruption, you have to pay bribes. Um, in certain parts of Mexico, there's potentially drug cartels dealing with. I mean, there's like situations that were covered up. I heard like off the record, I didn't hear um I'm not going to talk about it all the specific miners where like literally there was like thefts from certain mines in Mexico where like gold and silver was literally taken like armed robbery and stuff like that and the mining company covered it up over the years. Yes. >> Well, thank you so much for your time today, Peter. I look forward to speaking to you again. I I think we're going to see for sure we're going to see, unfortunately, I don't have a vote in this. I people in Congress, I don't even think have a vote in this. We're going to see a devalued dollar. We're going to see more inflation. I call it stackfl tax lie. The stock market may go up, but I I think for sure we're going to see the average American hurt, more distortions, and we're going to see, you know, more problems in the real economy with tariffs and small business getting hurt. And then we're going to see much much higher gold and silver prices a couple years from now. >> All right, Jason.
Peter Grandich: BRICs & Non G7 Planning To Keep Accumulating Gold? DC Will Increase Spending & QE?
Summary
Transcript
Hi everyone, this is Jason Berk with Wall Street from Main Street. Welcome back for another Wall Street from Main Street podcast interview. We're recording this interview on Tuesday, October 21st, 2025. The US dollar gold price is down a correction a little over 5% today. It's dropped over $200 an ounce, but it's been a in a huge uptrend along with silver prices the last 9 to 12 months. Today's special guest is a returning guest. He accomplished an enormous amount on Wall Street with a limited background. He worked his way up literally from the bottom. Became the youngest, I think, chief investment officer on on major Wall Street firms. He was a hedge fund manager. He wrote the book Confessions of a Wall Street Whiz Kid, which just came out with a new edition. Peter Grandich, thank you for joining me again. >> Thank you, Jason. That was a very long time ago, but it was nice to hear young. >> Well, you have another version of your book coming out. I mean, there's Wall Street documentaries coming out about the hot shot, what 70s and 1980s. I was just watching them on Netflix. They just released some new documentaries. had some episodes on that. So, I'm sure you were living that with like the the Ivan Boowkis and the Gordon Gecko types. >> Yeah, we thought back then that the market was crazy, especially that's what the claim to fame was. You're right. I was only on Wall Street for less than 3 years. I was promoted to head of investment strategy. Made a forecast of a market crash. The firm wanted me to retract it or resign. I didn't. And six weeks later, the market crashed. And then to prove it hopefully wasn't a fluke. The very next day when everybody was in a panic, I felt that the market would get back to a new high within 2 years, which it did. And that's where the moniker the Wall Street Whiz Kid was born from. >> Well, didn't Alan Greenspan, he started playing games back then, right? Didn't he start getting heavily involved and he started like injecting mass amounts of liquidity? I don't know if it was called quantitative easing, but it was similar back then. >> Yeah. The real quantitative easing started with Bernani and Obama when they uh told the world that the money was going to go to main street mostly to infrastructure and it basically stayed in the big banks and Wall Street. Uh but certainly Greenspan was an early addition of quantitative easing. So, I want to get your thoughts on the current macro situation right now because uh the mainstream financial media, the mainstream media, even President Trump and a lot of people in this administration, they're talking about how well oil prices are low, inflation is coming down. It's not an issue. Uh I see like the budget deficits blowing out. I see record amounts of nonG7 central banks accumulating gold. Do you think that inflation is still an issue and what do you think is causing it? Well, I think I began the year, Jason, not looking for a decline in the stock market, nor a rise. I thought it would be basically flat. I thought the early part of the year would seem enthusiasm off of Trump, but that would Wayne. I felt that way to about uh late August, early September. At that point in time, I looked at beneath the carpet, so to speak, of the presentation that this current administration was making, and I found things not so healthy. So, I started to talk about a danger point, not knowing exactly when it would occur, saying that it could take weeks, if not months, but we were getting into a danger zone, which is only more increased since then. In fact, you're to be the first person I'd be sharing this with. But today I began playing with a thought of getting behind a theme of what's called great song that people listen to. It's a great understanding of going back to an era that people forgot about, but it's like party like it's 1929. And uh if you look at 1929 and the leadup to it, most of the then current fundamentals and grounded theories were tossed aside. We were told all the reasons why this time it was different and people just went beyond any reasonable thinking and in a sense party like there would be no tomorrow and of course we knew then a great depression would follow. Right now I find on Wall Street especially since the vast majority of financial advisors were in diapers or weren't even born when I started they have that same type of attitude but for the 21st century. They've tossed aside general economic rules that should apply, but for them now they don't. And they've been mentored on what you've talked about that's been around for decades that the Federal Reserve will always bail you out. So no matter how bad you act, whether as a bank or as an investment person, it'll be solved by the Fed coming in and and fixing whatever the problems were. That doesn't work anymore because the Fed is not the the great wizard behind the curtain as it was in the Wizard of Oz. They've been shown for what they are and what they're not. And therefore, I'm afraid with that and the combination of some really bad economics, worst social uh conditions, but perhaps the worst problem now versus the past three financial crisises that I live through as a financial adviser. There is no political harmony anymore. There is no way if tomorrow for whatever reason caused a crash in the market or the economy that we have two parties that can go in a room to try to fix it. And that's the big difference between the last three. And there was some attempt back then even though it wasn't a great job. They put aside their political wos and went in and try to fix it. I don't believe that's possible now. That's my biggest fear. Well, also to add to your points, um, for decades, really since China joined the World Trade Organization, but a a lot of this started post Bread and Woods for decades because US was the only industrial base and the way the system was set up post Bread and Woods is that all the US's major trade partners that were running trade surpluses on a dollar standard with the dollar as a world reserve currency, they were providing vendor financing to the US government. They were just recycling all their trade surpluses and foreign exchange reserves back into the tra US treasury bond market. So like China when they joined the World Trade Organization, Japan, Germany, all the major trading partners of the US all bought massive amounts of US treasuries. Those days seem over, Peter. And really, especially over the last three and a half years, that trend has accelerated, especially after the Russia sanctions. A lot of these countries outside the G7 in the bricks, they do not want to buy any more US treasuries. I'm just seeing all the comments. I don't know if you've seen some of the comments from some of these central bankers, the Polish central banker, the surveys from central bankers. They're all planning on dollar cost averaging each month gold tonnage and not US treasuries. >> Yeah, you're on to something that actually in 2021 I made perhaps the most important personal decision that would impact still the planning group that I work with if the people that follow us and invest with us chose to follow it. I saw this back in 2021 early on. I'm not patting my back. I'm just speaking of facts. And that was the bricks. I saw that there was clearly a movement in the world to move away from the United States both as a military power, an economic power and its currency. And that the bricks were the formula for how countries were going to do that through. And and it was obvious then that they were choosing gold to be some sort of anchor to whatever they end up coming up with. Not so much to be a world replacement currency or or gold back currency, but to buy it, especially when it was a lot cheaper than it is now, uh, and be prepared to be the alternative. I I I I I still don't believe that they're prepared to come out with it this year or next, but I think they're very very close to uh achieving what I think will be when you say this, I I I'm in the middle when it comes to Trump. So, I get it from both sides. I get MAGA people mad at me and I get Trump haters mad at me. Trump has done some good things. He's tried to do some good things with peace in certain places and all, but his biggest blunder, which I think will be what he'll get most comments about, will be taking in a big stick into this trade war versus an olive branch. He played into the hand of what you and I already were perceiving a few years ago, and that's ddollarization, countries moving away from the United States and all. And I would say right now we have far less true allies today, especially in the last uh 12 months than we had 20 or 30 years ago. And that plays a role that you brought out again, which a very good point. And that is because we're at such a debtor nation and running multi-t trillion dollar deficits. We've been able to get away with financing that because we had people elsewhere outside the United States willing to fund our deficits through our treasuries. That's clearly changed. It's one of the big reasons that gold has risen the way it has. And you're right, many of the central banks are speaking openly now of moving away from the dollar and our treasuries. And two of the biggest holders that held it for quite some time, China and Japan are leading that charge. So yeah, this this is a I I think this party like it's 1929 is a good description of where we're at. It doesn't mean tomorrow at the opening the market collapses, but we're now in that red zone that you see in any thermostat or what have you, which signifies danger. It's only a question of how far it goes into the red zone before we have another financial crisis. >> Yeah, I agree. Or the Fed uh and Eric Trump has been hinting at this and we've had even drone Powell has kind of hinted at this recently in his press conferences. They they're saying they're going to end quantitative tightening, which is the reduction of the Fed's balance sheet. And it sounds like restarting or expanding the Fed's balance sheet is a foregone conclusion. I don't know exactly when, but it could be a couple months. It could be we have a repo crisis coming up in the next couple weeks cuz uh Jeffrey's Bank sounds like they're in a lot of trouble. I don't know how many other counterparties you have problems with French government debt. Who knows how many large investment banks in the US and Europe have uh derivatives tied to the French government debt that has problems. So that could all cause problems here where the Fed has to step in and start doing bailouts and currency swap lines and all those types of shenanigans. >> Well, you know, Jason, you've been around long enough to know that we are in the earliest stage. It's not there yet to per say, but we're in the building up of a banana-like republic which which we used to make fun of these countries in the 60s and 70s and we seem to be heading down that same road. I'll tell you this, what isn't spoken a lot, and I understand why because I, you know, I've said this for years, much of the financial service industry and the Wall Street heads are a don't worry, be happy crowd. You can toss them and much of the financial media that's died to the hips. Off the top of the Empire State Building all the way down, they'll all say the same thing. Hey, so far so good. So, I don't expect them to lead the charge in in these views and all, but I'll tell you the thing that isn't getting spoken about. You just touched on it. You mentioned France. We have a stealth bond market worldwide crisis. Now we have several key countries that are seeing not only a big hiccup back up in interest rates but funding problems and their own. And these were countries that we used to depend on to buy our debt. So it it it's interesting that while that's happening, we have seen a drop somewhat in in in short-term especially short-term interest rates here. But I think that's more of a liquidity uh exercise here at a time also which is not getting news at all. I knew we had a problem two months ago, Jason. I wrote and spoke about this extensively when the Trump administration announced they wanted to see the public buy into private equity. I knew there was a problem in the in the private equity and credit market because that would be the only reason you'd want the public in. If you're making a killing, you do not want the general person to make the killing with you. If you're starting to get killed yourself, you want them to come in and help bail you out. So, I think there's a lot of issues that right now this the US stock market is not focused on because remember this, the top 10% wealthiest people in America own 86% of all the assets. The next 40% own the remaining 14% and a half of America doesn't really have own any of that. Wall Street basically caters to that top 10%. Yeah, they give a little lip service to that other next 40% and some of the smaller maybe inexperienced financial advisors that's their clientele but they don't have a real touch to the real world. Remember Jason, that top 10% is not living life like you and I and many of your listeners are. They're not flying commercial. They're not cooking their own food. They're not driving their own cars and all. They've been the ones who have benefited mostly by this terrible mismanagement economically and politically and now the things that are happening socially. But they're not big enough and wealthy enough to lift up the remaining part. In fact, right now, 25% of all American workers, half of that bottom 50% are using some sort of debit in order to pay for daily necessities, food, clothing, gas, rent. That can't continue. They can't live at that when especially when they're being charged anywhere from 25 to 35% interest on that money they borrow. And so what I find real ironic and I've used in my ex pages to show on weekends Chinese who are taking their discretionary income going into malls to buy gold while we have people going into malls to buy things they don't need with money they don't have. >> Yeah. Buy now pay later which is also those shares were I haven't checked them in the last week or so but those buy now pay later companies those shares were were on fire but they have to have a lot of you know people who aren't paying the debt anymore. So, there's going to be people ending up at collections. I mean, I'm just seeing the stories. I'm sure you see this, too. The real economy is divorced from the asset markets, from the S&P 500, from the gold price, the Bitcoin price. All these asset prices seem to be enormously inflated from uh the Federal Reserve bank policies, policies uh spending out of DC, the cancel law. And now here in the real economy, what you have credit card debt default, you have auto subprime auto loan default. You have um people, you know, searching what mortgage payments. There's people that are that didn't lock in the uh refinancing at a low mortgage cost four or five years ago. They didn't refinance when mortgage rates were a lot lower. They bet on an adjustable right now. They're uh in trouble. >> We call this now a K economy, but it is basically where the upper upper echelon are continuing to do rather well, some doing extremely well, but the bulk of Americans are going sideways to lower. That can only go on so far. you can only borrow against the future so much. They have seen somewhat of a false facade uh like you said uh some perception that things are getting better, inflation is not as high, oil's coming lower. The question you should ask yourself is why is oil prices going lower? It's going lower because economically things aren't as great as it's perceived to be. So I think that the perception is currently being viewed uh that this can somehow get even crazier before it has to uh come down. You even had the head of Black Rockck, this was another thing that really irked me a week ago. The head of Black Rockck who 5 years ago called Bitcoin criminal. Then of course they came out and now make hundreds of millions of dollars trading it and became an advocate of it. He even said in the interview that yeah it's a bubble but you got to learn to live through a bubble. >> I think George Soros says similar comments about like he makes his most money off trading bubbles. Yeah. >> Yeah. So but the problem is this. If it's so good why is he still taking his pay in dollars and not crypto? So, there's a lot of false facads out there. It's a house of cards. I I don't make a living. I don't have uh dry food or ammo or or cabins in the woods to sell anybody. But realistically, these last several weeks, it's been several years since I felt this way. But I'm more probably concerned now than in any other time in my career. For this reason, Jason, we're not socially, politically, and economically in the same boat that we were to get out of the issues from before. We're in far worse shape. And most importantly, we have no political will that'll be there in order to fix the issue. In fact, Jason, we could argue that a lot of those people in that place called Congress have been living getting fat off of this because they're all making all sorts of money in stocks because they're able to know things before we are and they can't even be charged with that. So, it's it's kind of like the the wolf is in hard charge of the hen house and it's just become very very concerning to the point where I became the most conservative ever in my own portfolio. Uh and and and I'm normally uh and I've nicknamed myself this, the riverbo Pete. I'm normally willing to speculate and speculate hard, but I really think right now capital preservation has to tower over trying to make capital appreciation. >> Well, especially if the trade war accelerates and there's export bans on natural resources, tariffs. I mean, the supply chains could be enormously disrupted. Look at what's happening with rare earth. I don't know if Trump had any of this stuff planned. I've been covering rare earth for over a decade now, warning people that um the US should should focus on this policy. The US was thinking about doing stuff like this 10 10 12 years ago. They didn't. Now here we are in even worse shape. The supply chain now has to scramble to find a reliable supply of not only rare earth mining supply but also the value chain which is even hard I would argue is even harder than actually rare earth mining to make the magnets and all the other rare earth products. So they have to scramble and figure out you know non-China supply in that regard. You mentioned um 1929. I think there's a lot of similarities there because post October 1929 crash Peter you had Herbert Hoover you had Congress and then FDR who doubled down on a lot of the same policies as Herbert Hoover because they were implementing what Keynesian policies of central planning there was tons of what subsidies there was tons of tariffs and there was tons of bailouts it was a weird mix and it just caused even worse problems for small business owners and the regular average regular Americans >> well about a third of our planning group that I'm still part of is small to midsize business owners. And every year for at least 10, if not as many as 20, I hear the same thing for them. Peter is harder now to run my business than any other time. And that has not changed for the better. Uh I I will like to say one thing about China. I was a huge buyer, a believer in the Chinese stock market at the beginning of the year. It's documented. It was out there. My advice to anyone that wanted to listen was don't own not own don't own US equities, but own many foreign markets, including especially ch China. The United States is 65th right now in terms of major market returns. The the most markets have done much better than the US this year. But what China has done, and believe me, I'm not rooting for them. I don't want to live under Chinese rule. But they were able to bob and weave with, you know, Trump. Yeah, we're going to do something. We're not. They kind of had him tag along. They were able to reroute their exports. They they were able to soften any blows that were going to come. And then once they've done that, which they clearly have, the numbers have shown that they're still doing pretty well despite all the fears. that they were supposed to collapse six or nine months ago because of Trump. They now use their they pull their ace in the whole card. And that's what you said is the critical minerals. Listen, we have the head well, he's now called the defense of war, whatever you want to call him, the defense secretary. He literally said a couple months ago, the United States has to prepare for war against China, against Taiwan. So you do you think China is going to send us all the stuff that we need these critical minerals for our military in order that we can have a stronger military to eventually fight them? It's kind of silly. So now they know that and it's great that the president has gone out and said, "Hey, listen. This this country screwed up and all, but listen folks, you know how long it's going to take to get that going to to you think Australia just has all this stuff sitting in a warehouse? is going to ship it over to us and we're able to use it tomorrow or the next day. It's years if not a couple of decades before we'll be so-called self-sufficient even if we get to that level and all. And then the other thing that people aren't talking about with all the talk remember 90 trade deals in 90 days and from April, May, June, July we kept hearing Lnik every day we got this deal coming. What major deal has been signed, sealed and delivered with any country? China, South Korea, India, Canada, Europe, a lot of talk, a lot of things were said and now they gone quiet because you know what? They never got those deals. And so there's a big facades out here. And meanwhile, our economy below that top 10% earners is getting beaten up bad. If you take out this AI spending, which is all going to have to be borrowed money, and they resorted to, oh, trickery of vendor financing now in order to keep the game going, but if you take that out, we are in a recession. So, there's just so many dangerous stuff things here. I just think you have to be a live chicken versus a dead duck. >> And the trade deals that you're talking about, I mean, like I don't know if people saw this. I found like actually a South Korean business paper. it was translated to English and they were quoting the trade delegation that flew to DC last week late last week and they were talking about how basically the trade delegates were flying here and they were looking as part of the trade deal negotiations for and it said in the I don't know which sources they cited in the Korean government but said they wanted unlimited an unlimited US dollar currency swap line. So, you know, that's not a good sign here. You mentioned the private credit markets. There's huge issues there. So, it looks like there's going to have to be uh additional bailouts. I don't know if they're going to announce those as balance, but we know in the past after 2008, Peter, that these currency swap lines that were given out to the European Central Bank to save some of the European banks, uh, Brexit, others, they were basic, they were supposed to be what, um, loans with interest that were, uh, paid back. They were never paid back. The Fed just waved the loans. So, they turned into bailouts. >> Well, let's also not forget that while we're speaking, we basically have a government that's shut down. And that you know the the problem with that is by the time we see the economic numbers and you know something bothered me about a month or two ago it it's small but it gives me an indication of where things are going. They announced uh the consumer price index will no longer measure long-term care. And they publicly said the reason is it's gone up so much and is expected to continue to go up so much that it's not going to be worth putting in the in indicator because it's going to throw off the perception of what really inflation is. Well, here's news for Americans. If you're 65 and over, there's a seven out of 10 chance within 1 to three years you're going to need some sort of long-term care. So, most Americans are going to have to pay for it, whether it's expensive or not. And it's just an indication of how they're going to try to massage things. You know, uh he loved the first five months of the BLS employment numbers and as soon as they were bad, you get rid of that guy. And it it concerns me about an old joke that I think some of the people that Trump is going to put into these positions. There used to be a joke about the accountant who got the job because when he was asked, "What is 1 plus one?" His response was, "What do you want it to be?" And I'm afraid as bad as the numbers have been in the past, they're actually going to be worse because they're going to be more massaged than ever. >> Okay. So this part of stack tax life. So you're seeing that like the bureau of labor statistics and the other ones that come up with what GDP the CPI the inflation the official government inflation data which has cost of living adjustments and then also what the jobs report numbers what there was 2 million jobs in the three last three years of the B administration that just were removed like the snap of a finger. Um it's just very frustrating because uh you know it fools the stock market. stock market goes up and then miraculously a month or two months later the numbers are changed like oh by the way those uh 500,000 or 1 million jobs or two million jobs over the last three years they never actually were created stock market's like oh well the QE is coming the dollar's getting devalued we're going to price in more currency debasement and inflation >> well I want to talk about stock market but let me say something real quick when an ADP an independent company that has nothing to gain by massaging was so dramatically different almost monthto month than the employment that was the signal right there much better number but I want to tell you talk to you about something if I may Jason I know you will find this worthy the difference in the stock market from 1984 when I started till now is back in 1984 90% of the trading was individual investors only 10% was institutional and there was no type of computer trading at All now it's estimated based in 2024 figures that almost 60% of the money that's in stocks is in passive investments. People need to understand this. This is in being managed but not uh with discretion. Meaning the manager's only job he or she is to match some sort of performance of an indicy or an index. And the most popular one is the S&P 500. So their job is when money comes in is to buy enough of the certain stocks to to match that performance of the S&P 500 index. The remaining 40% I would argue twothirds of it is now in some sort of algorithm computer trading program may be as simple as soon as there's news stories of certain wording you buy or sell futures to very complicated programs of options futures equities at simultaneously etc etc the smallest part of the stock market now is what the original reason for the stock market was and what it was when I started a place where individuals buy and sell part ownerships of businesses. So why is that more important now than ever? Well, let's first look at that biggest chunk, that passive group. So money comes in, the manager matches up and and buys these stocks. The market goes up because of that. That makes more people want to own stocks and keep repeating that same system of buy, add, buy, add. It's going to be the same way if and when the market reverses and goes out. Those managers are not going to be able to say, "Whoa, wait a minute. We're not going to sell IBM or whatever. It's too good of a stock." They're not going to have any choice. Now, while it's been beneficial this way, let's look at how these algos have played. One of the things if you watch the market closely, especially compared to 30 or 40 years ago, so much of the influence of overnight trading, especially trading up until the the last 2 hours before the market opens, so say from about 7 7:30 to 9:30, it's not been coincidental that Trump has timed certain releases on his social media to coincide with markets opening. And the reason is he knows or at least the people advising him knows this that by saying certain wordings these algo programs are going to pick up on it. So what you've noticed now that never existed 20 or 30 years ago even when we had futures trading overnight is how much future markets are active when the market is closed because the algos are computer trained to just go based on wording. So if the warning story is Trump sees China deal, Trump sees economic growth, they automatically go buy futures. And it kind of comes a self-fulfilling prophecy. The problem will come, Jason. It always does. It's only a question of what at what level. Even Soren, who's normally a Main Street Wall Street guy, basically said on 60 Minutes or Sunday or so ago that we're going to have another crash. It's just at when and at from what level. That's just another of the differences. All we've become, in my opinion, for someone that's in his 42nd year is we are now an extremely high techch casinoike atmosphere in the stock market. We are no longer the mom and pop place to bipart ownerships of businesses. That's a very small part of it. And on top of all of that, the people who are supposedly responsible, half of the financial service advisors have been in the business only since the new millennium started. Well, that's amazing because when you ask them since you started, what's been the best form investment? They'll say the stocks. And you tell them >> seven. Yeah. S&P 500, big tech. Go >> gold has greatly outperformed it. And they go, "No, no way." Until you show them. They've been weaned on a one-way street. Jason, listen, I don't blame them. This is this is what they've been told. And they've been told that if by chance you run into an accident, you just call 1800 Fed. They bring a tow truck, they clear the road, put the pedal to the metal, and go. >> Yeah. Let's Hey, let's just devalue the dollar. I mean, most Americans won't even notice, right? So, we'll just say the CPI is 2% and we'll inflate the stock market again and the tax receipts will hit 4.7 trillion like they did last year, Peter. And um even though the US federal government, I think, spent about eight. So, the Congressional Budget Office and they lie too. I mean, they said the budget deficits were only one only, I'm using air quotes here, 1.9 trillion last year, while the government spent 8 trillion and it only took in 4.7 trillion in tax receipts. That's not 1.9 trillion. It it it it it's really Jason just to sum up about that and I know you want to talk about gold or if we run out of time but I would just tell listeners now there's ever increasing factors that we should be concerned about and there's no margin of error and there's not enough experience out there to understand that there can be a darker side and so like I said my my philosophy clearly to stock planning group if they choose to listen is focus on preserving your capital instead of trying to be capital appreciation because I think that's going to be far more challenging. I really think 2026 and 2027 could be two of the toughest years we've seen in decades. >> Well, let me also add that I think the stock market is not really going up for fundamental reasons for decades, especially since 2008. I think a lot of it's because of devalued currency. I think because of what all these quantitative easing programs, all the uh cheap debt, so margin debt, uh share buybacks with cheap debt, all these things are intentionally juicing the stock market to keep uh the stock market, you know, in a nominal bull market. People aren't paying attention to the loss of purchasing power in the dollar. Look at the gold price, Peter, in all these currencies. Like we you were talking about long lines. I mean, there's long lines in Australia and people like, why are these people buying gold? All our listeners have to do is go and look at a long-term chart of the gold price in the Australian dollar. I mean, it's parabolic now for over five years. The average Australian, I think, finally waking up that that their currency has been intentionally debased, but it's not just, you know, the dollar or the Australian dollar. It's across the board. >> What's interesting about those lines, Jason, you're right. In several countries, they're lining up to buy gold. But what did the New York Magazine report on? How people in New York City were lined up to sell their gold. And the reason they're selling their gold is because it's the only way they can continue living the lifestyle that they grown accustomed to. And it's just the difference here in America. We are we've been robbing Paul Peter to pay Paul and we just been just we're way beyond the fail safe point. You know, I I try to tell everybody I say listen there's 37 trillion. The Congressional Budget Office says we're going to be at 54 trillion in 8 years or less. And that's without in their work a major recession which could lead to the uh faster higher debt level. How do you service 54 trillion even at 5% interest, 2.5 trillion in an interest payment? The most this country's ever done is less than 6 trillion in income. How are we going to how are we going to see a third or half of all the money we take in? And now even Trump, he fell into this Biden uh trap of announcing this widespread forgiveness of student loans. That's great. But I'll tell you why it's bad for two reasons, Jason. First of all, most Americans don't know this. Student loans are the single biggest asset that the United States has on its book. Makes up 27% of all our assets. So if we forgive those loans, we take them off the asset side. We still have to come up with that money to in order to pay the government. So, we're going to tax other people. Most of those people who then were responsible to pay their debt unlike the people that they're forgiving that student loan people, they weren't charged usery. They didn't pay a different rate than somebody and therefore they should be catching a break. They didn't not get what they were supposed to. They just didn't live up to their obligation. Why should someone like me who lived up to the obligation now forgive them? And Jason, where does it stop? How do we not say that the next problem when we have is there's a lot of people that can't pay their car loans. If they can't pay their car loans, they can't go to work. And if they can't go to work, the economy is going to go in the tank. So, let's forgive them, too. That's a very bad precedent that I was surprised to tell you the truth. I was happy when Trump first said he wasn't going to do it, but now his administration caved. I think we're setting up a very bad example on this forgiveness of student loans. And people say, "Well, that sounds cruel." Oh, no. It's not cruel to pay back what you're supposed to. Anybody that's biblical, Jewish or Christian, it's in both the Old Testament and New Testament that if you borrow, you're to pay back. And now we're going to set up a system where you maybe you don't have to. >> Well, this is the problem with with both political parties. They pick and choose winners and losers. The Fed is the great enabler, the Federal Reserve Bank, and then they just do what? They uh they expand the balance sheet. they do quantitative easing or some type of um liquidity program and they do bailouts. They pick and choose winners and losers with student loan debt forgiveness or whichever bank gets in trouble. Uh sounds from talking to some other experts like we could have another repo crisis coming along with the private credit. So I mean we don't get a vote in this. I I think this is the major problem here. They're talk they they're already setting up a bailout for Argentina Peter as a taxpayers. We don't get a vote in this. Congress doesn't even get a vote in this. is the people in power in DC what their friends or a major bank they just decide who's a winner and who's a loser who gets cheap credit or currency who gets a bill out. >> Well, like I said, pick your poison, Jason. That's where I think we're down to. Like I said, it doesn't mean it's going to happen tomorrow, but I do feel that there's so many difficulties out there right now that a combination of them is leading us to a much more difficult crisis than maybe we've ever experienced in the modern era. Well, Peter, I I think as a foreigner, I think foreigners see this and okay, maybe they can earn a quote unquote risk-free what, four and a half% or something on a Treasury bond, but they see like, wait a second, they're going to give out balance for what? For who? They're going to do all these things. They're going to they're going to print money. They're going to fund these parts of the government. It doesn't make any sense. They're going to destroy the purchasing power of the dollar. It was an eventuality that and I think that's why the last three three and a half years after the Russia sanctions, things have accelerated. You've just seen where the subsidies where foreign governments and foreign investors were subsidizing all these budget deficits. They just said enough. It's just getting out of control. They seized what 300 billion of the Russian reserve assets. The budget deficits have gotten even larger. The national debts growing even faster. The Fed raising interest rates. It didn't kill inflation per se. It actually accelerated a lot of people what um it caused a lot of um supply side problems. and a foreigners even though the Fed raised interest rates they just decided they still don't want to buy the debt because in the past right if the Fed's raising interest rates foreigners would want to buy the debt in the past well what we did with Russia I've argued for months is making who's ever in charge of new membership director at bricks a much easier job because what the foreigners are saying to themselves they may not say it right out to Trump because you can't win a war words with him that hey if they did it to them. What's to stop them from doing that to you? And that's just one of the many reasons why I think people are moving away uh from the United States and the and its currency. And and really the thumb that has been over them. And quite frankly, like you said, uh they they feel that they'd be much safer and better off in something like gold than a US Treasury bond right now. Really, you know, think about this, Jason. until just a few days ago, we were having our fourth year in a row where bonds were actually a loss. It was unbelievable when I told people at the end of 2021 that both stocks and bonds can lose money for the next few years. People said to me, Pete, maybe the stocks, but you don't lose money in bonds, but for three straight years, people lost money in the Treasury bonds. And you're right, foreigners see that. And remember this, the only world uh of seven nations whose currency is actually uh down against the dollar is Canada. Everybody else is up. >> Yeah. The math just doesn't work for DC and um the math just doesn't work for foreigners looking at this for supply and demand US treasuries. I mean, I think that's why you're seeing what cap I would call it captain obvious here. what Jeff Gunlock he's a bond fund manager is a small gold fund and then the chief investment officer Morgan Stanley they basically said that that the average institutional investor or hedge fund manager should go from what 0% gold exposure should strongly consider 20% or 25% of vasis under management for gold exposure I didn't think I would see something like that mentioned >> well before we run out of time let me tell you what I never thought we'd see I never thought I'd be saying as we talked today earlier today to people that a gold is down $250, a number that just didn't seem possible for a good chair in my career, all the way down to the terrible number of $4,100. Big deal. You know, you know, I I I been calling for a correction, consolidation, so I I'm happy to see it. I think if you're bullish long term, it's actually healthy. But think about this. when gold was a thousand if it correct if we had a down $50 day. Okay. Well, that's what a $50 day is now with gold at 4,000. And I it's just an amazing thing for people not to appreciate what caused gold to get to this level. Remember the average US investor and probably Canada too, but I don't follow Canada closely like I used to, has not been a net buyer of bullion. they still find portfolios have exposure 1% or less. So this has basically happened outside of this country and you only like you said have to see that people in countries are waiting online to buy gold. They're not waiting online to buy treasury bonds. >> I think you'll see more dip buying. So, the people that had zero or 1% gold exposure, I think you'll see them take advantage of this correction and start new positions start to increase the size of their positions. Uh, I think you'll start to see some of these gold miners take advantage if there is a sizable correction, the the larger ones, the senior ones or the mid-tier gold miners and go and buy some of those juniors. They were waiting, I think, for this type of correction. I think you're going to see more mergers and acquisitions soon. Well, we had it and that thankfully for me, my largest single hole had that happen yesterday. Uh, I am Gold stepped up and and made a bid for a company called Northern Superior Resources. And why I think that's a watershed event is the major gold producers who've been making money hand over foot uh have seen their value of their currency, their stock go up tremendously, but they've also seen their expense side going down. the two biggest costs to them, oil and labor, is going down in cost. Certainly not going anywhere close to how the gold price is rising. It's just been so hectic that they've been so busy in their boardrooms figuring, okay, well, who should we look at? What should we do? And I think if we get a stabilization in the gold price, we're going to see even more of the juniors being gobbled up by the majors because they've not to say that there's still not a few left, but most of the big majors who could merge have merged and most of the upper mid have merged. Now it's going to be reached down to advanced juniors that have projects that can add millions of ounces uh in the coming years uh be acquired. Uh, in terms of like countries that you think are safer with near-term production, are you only looking at the US, Canada, and Australia, or are you willing to take some additional risk in other countries? >> Yeah, I don't have a problem with Australia, even though I'm not invested. I have focused almost exclusively to North America. Not to say that I would want to do anything in California, you know, but uh but I do think what's happened in the mining compared to 20 30 years ago when I managed money in that area and all you used to be able to spin a globe, just point a finger and wherever you landed say we can go there. You can't do that anymore. Look what's happening in West Africa. Thank God I got out eight, nine years ago. I had huge investments there and I said there's just going to be a takeover by these countries. They're not going to let these foreign countries, they have such little assets otherwise, they're going to seize them. And that's what's happening there. So, social and political impacts. Look at the copper. It's it's you you're going to need a much higher than $5 price within the not too distant future in order to get major mining companies to go to certain places of the world and absorb all that risk. Especially when a lot of those countries have lowgrade copper where a lot of money and labor intensity has to be spent in order to get the copper out. They're going to want a much higher price before they go there versus how easy they used to go there 20 or 30 years ago. >> And as we wrap up here, let me just add a point on silver here. So for physical silver supply and the LBMA has physical silver shortage issues, there's not going to be a sizable amount of new physical silver coming online because all the countries that have a lot of potential silver deposits. So like uh Chile, Mexico, Peru, um some of the other Latin American countries, they just have basically huge uh environmental bureaucracy and permitting issues now for these open pit mines. They're literally being blocked or uh denied from restarting. So there's like protest for Escobal, which is a large silver mine in Guatemala, La Navididad, which is a massive silver mine in Argentina that's in the one province where they can't get a permit. So all these potential new sources of silver, uh the ones in Mexico, open pit silver mining. The uh new prime minister or president of Mexico, I think she said it could take years longer to just to get a permit for open pit mining Mexico said the potential new supply, Peter, could take years, many, many years longer than the market thinks. >> I fully agree. >> Yeah. So So it's a mess. So, the people are like, "Oh, the it's only a short-term supply problem. A couple months from now, it'll be fixed." I I'm not so sure because I just don't see like if it was a free market and the governments were more uh promining, I think you would see you would see more of that. But um you know, the opposite the last 5 to seven years, the uh annual silver supply from what Chile, Mexico, Peru is in permanent downtrends. >> No, no question about it. Uh they they are in need of and people should appreciate any correction here. But I still think they will see higher prices when we get into 2026 and beyond. >> Oh, we have to. I mean, if silver if silver corrects back down to $30 or less, there's no incentive to bring on a lot of new supply. So, I think we're going to have to see sustained higher prices way above $35 an ounce and then maybe, just maybe, these governments will change their mind because, you know, some of these mines, Peter, for a country like Guatemala with Escobal mine or Lavi or in Argentina, La Nav'i dot, I mean, that's billions of dollars of cash flow and tax revenues, investment into their local economy, jobs, infrastructure. The government's just blocking all this stuff. It doesn't make any financial sense. Well, part of that also is because they want to take more control of it, the uh the royalties and and that was the typical move that I feared from these foreign countries uh that they're just going to say that or get out. Barrack just seen that in in Mali and also it there's like I said for for mining and exploration for me clearly most of my focus would be on North America uh you know countries where I don't expect that day Australia is very promining and all and maybe a special special some place like a Finland or an Ireland but realistically the places we used to look a lot Africa South America Latin America you won't get me there anyway. Yeah, I mean, well, they have great geology, so they there are deposits there. It's just it's not free market and there's so many rules, regulations, bureaucracy, there's corruption, you have to pay bribes. Um, in certain parts of Mexico, there's potentially drug cartels dealing with. I mean, there's like situations that were covered up. I heard like off the record, I didn't hear um I'm not going to talk about it all the specific miners where like literally there was like thefts from certain mines in Mexico where like gold and silver was literally taken like armed robbery and stuff like that and the mining company covered it up over the years. Yes. >> Well, thank you so much for your time today, Peter. I look forward to speaking to you again. I I think we're going to see for sure we're going to see, unfortunately, I don't have a vote in this. I people in Congress, I don't even think have a vote in this. We're going to see a devalued dollar. We're going to see more inflation. I call it stackfl tax lie. The stock market may go up, but I I think for sure we're going to see the average American hurt, more distortions, and we're going to see, you know, more problems in the real economy with tariffs and small business getting hurt. And then we're going to see much much higher gold and silver prices a couple years from now. >> All right, Jason.