'These Are ENDING Moves' – GOLD to $10k, Stocks to CRASH 30%+: Edward Dowd
Summary
Market Outlook: Guest argues we are in the end stages of a massive bubble, heavily concentrated in AI-related stocks, with rising crash risk due to narrow leadership and extreme moves.
Precious Metals: Bullish long-term on gold (targets up to $10,000 by 2030) and constructive on silver, viewing current consolidation as healthy amid central bank buying and safe-haven dynamics.
AI/Tech Risks: Sees an AI bubble with circular earnings, data center power constraints, and poor ROI concerns, highlighting semiconductors’ cyclicality and potential double-ordering distortions.
Semiconductors: Notes an 80% surge in nine weeks and heavy index concentration, viewing these as late-cycle signals that raise downside risk for the broader tech complex.
Energy/Oil: Outlines two paths—continued conflict could spike oil to $150–$200 before demand destruction; a rapid peace could send WTI trending back toward $50–$60; regards energy more as a short-term trade.
Bonds Strategy: Suggests a 12-month opportunity in long-duration US Treasuries during a growth scare, while retail investors should keep dry powder in short-duration cash-like instruments.
China Risk: Bearish on China due to deflationary demographics, collapsing residential construction, and export pressure amid tariff pushback, with potential contagion to Japan and South Korea.
Notable Mentions: Companies referenced include NVDA (Nvidia), IBM, XOM (Exxon Mobil), Samsung (005930.KS), and SK Hynix (000660.KS), though no single-name pitches were made.
Transcript
We're in the end stages for a lot of things. Those are the words of my guest today, Edward Dow, as he believes the broad market is in a massive bubble, largely being inflated by AI stocks being priced on a hope and a dream. He also sees major trouble coming for the real estate market, debt markets, and the Chinese economy, which he also thinks is headed for disaster. The silver lining is precious metals. Ed believes gold will eventually climb to $10,000 an ounce. We break all of this down and more in our conversation ahead. Edward Dow, great to have you back on Commodity Culture. I want to start things off today with discussing precious metals markets because since hitting all-time highs near the end of January this year, both gold and silver of course have corrected and are now in a sideways consolidation. Do you think the next move from here is to the upside or to the downside? Obviously, that's the $10 million question. And what are the factors you see currently driving precious metals markets? >> Well, you know, I was bullish precious metals last uh last last year in 2025. Uh had a near-term price target of 4,000 and it exceeded that. And rec, you know, over the last six months, I've been asked a lot about gold and silver. And my long-term viewpoint is that gold is going to 10,000 by 2030. And that's due to a host of factors we all know about central banks buying potential new monetary system coming the the date of which is very uncertain. Gold is going to be a part of that. How do we know that? That's because because commercial banks uh made gold money again by making it tier one capital. Uh we have you know retail investors in China and India voracious appetites for gold and silver. So the fundamentals are there. Um but you know uh I there was a tremendous move over the last two years into the top uh in January of this year and uh I I said then that I expect it to consolidate and uh that's what it's been doing. Um and I and that's healthy. uh you know it it gold is not showing signs of a parabolic top meaning it's it's already down 40%. So this is quite healthy. Silver is a little more volatile. It is an industrial metal. Um so I expect them to continue to consolidate. There might be some uh short-term scares uh if there is a uh you know any kind of credit or liquidity crunch. I don't expect gold and silver to go down. Well, silver is tied to the economic cycle, and I'm I'm bearish on the econ the global economy, but I, you know, I wouldn't I wouldn't worry about gold and silver if you're if you're a long-term holder. If you're trading it, I you know, flip a coin if it's going to go up or down. I just think it continues to go sideways. And that that's actually the healthiest thing. If your long-term target like I have is 10,000 after b a big move like this uh and you consolidate the longer you go sideways the more confident you are you didn't put in the parabolic top. >> I would love to get your thoughts on gold and silver's price action in the midst of this war in Iran because I've spoken to a lot of different analysts and and some have said that this is normal in in a time of global conflict. there's a rush for dollar liquidity and so in in that case you often see um countries uh governments corporations retail investors as well for whatever reason liquidating their physical gold holdings in exchange for US dollars. Is that how you see things the way that they've played out so far? And if this war continues to drag on, do you think that trend could reverse somewhat? we could see that safe haven status for gold in particular kick in and perhaps cause a price move to the upside. >> Yeah. So, you know, there were when the conflict started, people were surprised by the price action in gold. And mind you, it's still consolidating. It didn't drop precipitously. Um, it was due uh to liquidity uh raising. People sold what they what they could, not what they wanted to. And Turkey sold I think 120 tons of gold to raise uh liquidity. So just like you you know some of these top analysts you've talked to that happens. Um right now the market the the the stock market and the oil markets are discounting an a resolution to this war. That that's that's what they're telling you. Um and we put out two scenarios when the war started on the price of oil and what inflation might do at least at least short-term headline inflation. And one scenario was uh $125 oil and 5% inflation by May and then we get a resolution and then inflation starts rolling over and we continue our you know what we what we were seeing was an economic slowdown and and the oil price shock only adds more pain delayed. There will there will be uh problems going forward. If we if we do not get a resolution soon, there are executives from Exxon and and uh uh other oil companies talking about we're approaching in two to three weeks uh the bottom of some reserves around the world and that oil will spike up and and some are predicting $150 oil soon. if that were to occur because there's no resolution to this uh crisis. Um gold may may go up. I again I I don't know but it'll definitely uh shock the yields will spike again temporarily and I think this this equity rally which has been 100% AI uh will falter and uh correct and I I still think the equity markets still have a lot of risk. I I wouldn't I wouldn't touch this market with your money. we're seeing unprecedented uh you know five sigma things going on all sorts of signals uh that we see at tops but again it could go higher uh I I suspect uh the market uh is going to stay kind of elevated until the IPOs come and then we'll see what happens uh a lot of supply is coming and a lot of the mag seven that used to do stock buybacks because of their capex spend won't be doing as many stock buybacks so uh I think we're in the end stages of a lot of things. I actually would prefer to see the Iran war. Uh, you know, look, I'm I'm bearish on on a on the economy, but I don't want to see this dragged out just so that I can be right. So, uh, enough damage has already been done and I want to see this resolved because if it isn't resolved, the oil markets and the stock markets are discounting. It's already resolved. So, it better it better be resolved. >> Yeah, some great thoughts. There's two things I want to follow up on there. uh both the broad market and the energy market. Let's start with energy because in previous conversations before the war started you were fairly bearish due to your bearish overall outlook on the global economy which made a lot of sense. Now that the straight of Hormuz is being closed, we've seen WTI in triple digits. And you know what? Once again, we keep seeing oil rally and then fall based on tweets essentially reports coming out of the Trump administration that okay, peace talks are advancing. Everything's going good. Iran says no, they're not. Oil goes back up. As soon as peace is apparently back on the table, we see it drop again. It's been a bit of a seessaw action for both um oil itself as well as the equities. Are you now getting more bullish on a longer term view if what once again there's one of two scenarios? This conflict continues, the straight of horm continues to be closed or we do eventually get a resolution which of course we're all hoping for. In in both of those scenarios, how would you see oil performing? you know, oil, if if we don't get a resolution, oil could go to 150, maybe 200. And so that that might be a trade in for energy, the energy complex, a trade. But long term it'll given where the consumer is, given where we see the global economy and China rolling over, longer term we think energy complex is going to get hit and then recover massively once, you know, the monetary authorities start printing in the in the teeth of the crisis that we believe is coming. So, uh, it energy if the if the if the the conflict isn't resolved, it's a trade, but it's a quick trade because then the the furious demand destruction will come and uh, you know, oil, you know, the sure sign uh to killing an oil rally is high prices themselves because it causes demand destruction. We've seen that time and time again. Uh, and and we saw it in '08. uh we saw it in the in the 73 oil crisis and there will be demand destruction if if there is no resolution but there could be a trade in energy. I I honestly think that's too tricky uh and tough that that's for professional investors. That's not for you know the average person who's trying to figure out what to do with their 401k. >> So do you think if peace is declared tomorrow we'd see WTI drop back down to the $50 $60 level? Uh, not immediately, but yeah, it it'll be on its way. >> The sponsor of today's episode is Arc Silver Gold Osmium. Owner Ian Everard is praised even by his competitors as one of the most honest and level-headed bullion dealers in the United States. They have some great prices. You can see some of them displayed right now on screen. can take advantage of these specials today by reaching out to Ian at 3072649441 or by email at ianarchsggo.com. Make sure to tell them of course that commodity culture sent you. And now back to the interview. Well, let's talk about the broad market now because you noted recently on X and you just spoke about it a moment ago. 45% of the S&P 500 market cap is AI or AI adjacent. We've got a storm of controversy emerging now over data center buildouts in the US along with some reports that perhaps AI isn't going to completely take over white collar jobs and revolutionize the economy the way that many have been promoting it. How big is the risk here when it comes to the AI segment of the broad market? And what what could the aftermath be assuming this AI bubble pops? You said you feel like we're in the end stages at this point. Yeah, you know, look, I I thought the I thought the bubble was popping quite frankly. Uh prior to the war, uh we were starting to see the the complex wobble private credit was getting hit. Um the war actually, I think, kind of uh gave one last leg of life to it because the only thing that's working right now are AI uh stocks and earnings, but the earnings are all circular. Uh free cash flow is going the wrong way. There's a lot of controversy as you know about the AI complex and Michael Bur's come out and said that you know Nvidia and all these other people are committing you know uh offbalance sheet fraud. It's legal but the risk is being put elsewhere and it all is a house of cards. Um right now what I'm seeing are I've been doing this a long time. what I saw with the semiconductor uh after the the the low put in in early April uh the semiconductors are up 80% in like nine weeks semiconductor index um I I talked to professional investors there there was a there was a reason for it because there was a demand surge and then there was you know people worried and and and pre-ordering for helium shortages and whatnot. Uh and then we of course we have the speculation going on in the Korean market. 50% of their market cap is two stocks high necks and and Samsung. Um we these are ending moves. Uh you you when you see these this kind of speed uh and and people uh chasing and no more uh you we're just getting signals of all sorts of things we haven't seen that are mo most likely ending moves. But again, I'm not calling a top. I'm not telling people to short. I've always been on this on of of the mindset you have dry powder in your portfolio. You can you you know you raise raise some money and that's personal up to you whether you want 20% cash, 25, 50. Uh and then you know when the correction comes and it will come uh and it I I was I was less bearish last year. I thought we might get a slow decline of um 40 to 50% over two years. this now this kind of action is is crash is crashy to me meaning we'll put in a top we'll have a draw down then we'll get a counter trend rally then we could get a crash I'm not calling for a crash but the risk for a crash is a lot higher now because it's so concentrated and you know semiconductors are notoriously cyclical uh it's an industry that you know has booms and busts that you know that hasn't changed and uh and you know it's now 18% of the S&P 500 index, the semiconductor industry. It's 30% of the NASDAQ. And I've I've done this, you know, over and over again. We're starting to hear whispers of double ordering because because purchase managers, you know, need to get get their allocation so they can make their products. So they they you know, about six, seven months ago, they started asking for 500. Let's say you ask for 500,000 units and you say, "Oh, we can only give you 250." Well, then the next time you order, you double your order and say, uh, so the backlogs look way better. Uh, there's a lot of enthusiasm, but when the supply, uh, and demand meet, uh, there's inventory buildups everywhere, and that's what's going to happen. It always happens. So I'm just very cautious on this market and given the global risks and the oil price shock that's working its way through through the economy uh margins are going to get going to get squeezed in in the non AI sector of the economy which is the real economy I mean the stock market is not the real economy 45% of your market cap is AI and there's no profits yet what are what what are you invest you're investing in future hope you're not investing in actual earnings and growth now people We're speculating it's going to turn earnings and growth. And as you mentioned earlier, there's all sorts of questions of uh data center delays because of opposition, not enough power on the grid anyways. And now uh Bloomberg came out with a story today. Bane, a consulting company said there is no ROI, it's a bus. So, you know, the the markets can continue to be irrational and and go up on this, but the the narrative is changing fast in my humble opinion. >> In the aftermath of this bubble popping, I mean, in terms of picking up the pieces, would would you be cautious there as well? You know, many many could imagine that they'd be catching a falling knife in such a scenario. And I've spoken to some people, Dave Colum comes to mind who says we could be in for a decadesl long grind sideways after a precipitous drop in the broad market perhaps similar to what the Nikke did for for several decades. Do you think that's a possibility? What at what point would you start looking for bargains in that type of scenario? >> Well, that's that's difficult. What we don't know is I I do think there'll be a 30 to 50% decline. And I say third I'm hoping for 50. I say 30 because the the policy makers may not uh uh allow the stock markets to fall that far and may come in with bazookas. I don't know because I don't know what the bazookas look like yet. So, you have to kind of call it in real time. So, right now I'm cautious. I would not put any uh new fresh money to work in in the stock market at these all-time historic valuations. Warren Buffett himself is 40% cash. you know, he's his stock has underperformed the uh S&P 500 the last year and a half. That typically happens before major market corrections because he starts accumulating cash into the top and he's got so much money he does doesn't call the top, but he's been cautious like we have been for two years. We've been early and wrong on the stock market, but not wrong on the rest of the real economy. The real economy is in tatters. The housing market is rolling over and uh we've been right on our call on gold. But in the stock market, we bet we were early, but I wouldn't touch it here with your money. And uh very cautious. This I, you know, I've done this a long time. And here's another indication of how crazy it is. An old video of Trump talking about IBM in December, recirculated on Thursday, and IBM's up 30% over the last two days as a result of an old video. >> That is completely insane. Now I I want to talk about the real economy now because David Rosenberg was recently on CNBC where he stated that real incomes are decaying but spending is holding up only because the savings rate dropped from 5.5% to 2.6% in a year. Talk about this disconnect between Wall Street and Main Street and and what the ultimate result of this K-shaped economy will be. Well, so it's gotten so bad now that the top 10% of the consumers are responsible for like 49% of all the consumer spending. So there's a small cadre that are continuing to uh you know go about their lives and very comfortable uh in their lifestyles while the the rest of the uh uh population is struggling mightily. Uh, and we know that because we see credit card delinquencies rising, uh, uh, car loan delinquencies rising, and now we're starting to see mortgage delinquencies rising. So, at some point, uh, that will affect everything, especially credit, and they're they're drawing down their savings and they're putting what they can on their credit card. And that the, you know, you this can't go on forever. And with the oil price shock, this is what happened in '08. Same thing was going on in '08 and the oil there was a small mini oil price shock. People don't remember it. It's all housing and people remember the big short but I remember oil going to 140 uh from like 70 bucks over a fivemonth period. It was a mini oil price shock and that uh that wiped out the consumer in the second half of 2008 and inflation did rise going into that headline inflation. Then it rolled over when the uh when when when the recession hit. How are you viewing the government debt market at the moment? Because we've seen yields rising. Many government uh bonds at levels not seen since the great financial crisis. The US 20 and 30 years sitting at around 5% yield right now, a level some analysts are pointing out could be signaling trouble up ahead. What are your thoughts on the sovereign debt market and could an unwinding there cause the broad market to crack as well? >> Well, the the the sovereign debt market is already in trouble. We've seen Japan yields rise. Yields around and even even our tenure and 30-year. Uh, interestingly enough, the this tenure and the 30-year in the US have started to uh recover uh and yields are heading back down. I think uh this is look, this is for institutional investors. If you're a retail investor having dry powder, which is cash, you know, short end of the curve, no no interest rate risk, that's where you should be. But if you're an institutional investor, I think there's an opportunity for a at least a 12-month trade to get into the the 10, the 20, and the 30-year go out on duration in just the US Treasury market in a credit crisis and a slowing global economy. Uh that's the the that market will discount this the growth scare and there'll be a rally. then the Fed will come in and do what they do and then you're gonna have to, you know, kind of tactically get back out of that into equities depending upon where they are. If they're down 40 50% then you rotate back in. But I think there's an opportunity and I think the scare in the yield market at least in the US uh is is is um we're not going to 10% yields. Uh I I may I may I may be wrong, but I think once the and you got to look at China, too. China is in deep deep trouble. They're the factory of the world and they are now entering the huge phase of their crisis and we know that because their total construction value started to decline in the fourth quarter of 25 and now it's down 8% year-over-year. They they are in deep doodoo and that's going to have contagion effects and uh the oil price shock will kill demand. So we're in a very everything seems great according to the stock market but underneath the surface it it's it's not good at all. >> Let's switch over to China then. Um because I speak to different people who have different opinions. Obviously, you've been pretty consistently bearish on the economy. Louisie Vincent Gav, who I speak to sometime, is very positive. He he has an office in Hong Kong. And Simon Hunt as well, the China specialist, thinks that their economy's got its issues, but perhaps not in as dire straits as as you're painting in terms of the picture you have. You appeared on Steve Bannon's war room recently, where you said their economy continues to face major challenges. Now, one interesting question I have is about their sovereign debt market because their yields have been consistently falling over the over the years, signaling potential strength. Why do you think that is? And and just lay out your scenario for us on why you think China is headed for trouble in a bit more detail. >> Well, they're they're their bonds yields are going lower because they're in a deflationary uh demographic decline. So, that's what happens in a in deflation. Sovereign yields go a lot lower. most of their debt uh is in the private sector and they have a tremendous amount of private sector debt that was used to to build out the factory of the world. Here are the numbers. The they their their demographics plateaued in 2015 went sideways and then in 2020 it started precipitous fall and it goes goes it goes into a low in 2032. They're losing an 150 million people of prime age workers, meaning their spending profile goes from consumer to saving and retirement and hunkering down there. So, they're losing 150 million people over the next seven years. That's it's a 1% decline. Um the real estate market uh is is the residential real estate market is a disaster. Uh permitting is down 70% since um 2020 uh 2020. Uh that's that's permits that starts uh their land uh sales which they discontinued uh the series in 2023 plummeted. So their residential real estate buildout is over effectively. Um their total overall residential real estate construction didn't start dropping uh until like a a year or two later. It's down 20 only down 20%. that's in residential, but that's because they had some long life projects. But the the tell for us that this is getting acute is overall construction is going lower. And so what's going on is basically um uh they're reaching the acute phase of their crisis and their GDP is struggling. Uh it's I think the fourth quarter GDP was one of the weakest on records in a long long time. So it's happening and they did some stimulus in Q1. It didn't really work all that well. Total construction continues to come down. Net net fixed investment uh went negative for the first time in the fourth quarter. Recovered a little bit year-over-year growth in T1, but it's nowhere the trend is down. So, this is this is this is a problem. And so, what what they've done with their so they have deflation and there's no the the internal demand is falling off a cliff. So when you have internal demand falling off a cliff, much like Japan did when their when their demographic decline hit, you need to um export your way out of it. So that's what they've been doing. So they really ramped up exports the last since 2020. Uh you know, EVs, automobiles, their tech sector. So they really have ramped up exports, but now we have the tariff wars and that's put a thrown a wrench into it because they were they're trying to dump their deflation on the rest of the globe. And that that would be a problem for everybody else's, you know, homegrown industries. They'd be bankrupted by the dumping of the of the cheap goods. So that's why Trump has got this tariff situation. It's the right move. Um, you know, how how he executes it, you can you can criticize, but strategically it's the right move and it needs to be done because if if that doesn't happen, they're going to export all their deflation. So, China is internally has big issues that's going to affect their trade partners like Japan and Korea. Those South Korea and Japan are the biggest trading partners in uh not trade deficits overall imports exports. So, and Japan is you know Japan has a sovereign debt crisis potentially blooming right now. So, there's so much risk in Asia that people are just ignoring. They're focusing on on the AI. They're focusing on the Iran war and they don't understand that, you know, the factory of the world is in trouble. >> I want to run another narrative by you that's been pretty persistently coming up, um, which is that China is kind of leading the charge in terms of removing the US dollar as the global world currency. And and the evidence that people point to is some of the trades they've been doing for oil with Iran and Renman B. Some people speculate that a big part of the war in Iran is to stop that from happening. um so the dollar can remain the the global reserve currency status. The other is the fact that China is the number one gold producer in the world and they're you know it's it's widely believed that they are understating the actual gold reserves that they have as a country as well. What are your thoughts there and and even aside from that do you think China having so much gold gives them some sort of cushion when it comes to uh negative economic effects moving forward? uh you know they have a lot of debt so there's going to be a lot of debt destruction and honestly uh we I'm not going to get into it because this is for institutional investors and we sell a report on it. Uh we think the the one is wildly overvalued and is going to is going to need need to depreciate quite a bit. Um and they're trying not to let that happen but they increasingly I think that's going to happen. So this dd dollarariz look are we has the status of the reserve currency been challenged? Yes. Will it die suddenly? No. It dies slowly. And the Biden administration when they threatened to take Russia's assets and and and then use the Swift system to put sanctions on them. We didn't even do that during World War II. So that you know so that is one one of the things that really concerned me about the ddollarization efforts but it takes time because of the the global interlocking and the dollar liquidity that everybody needs currently especially with a lot a lot of these countries there's about 18 20 trillion in uh foreign uh debt denominated in US dollars both from foreign corporations and and and governments. So if the if if if if there is a uh ddollarization effort um that's a problem for them because they would have a if they went off the dollar they would have a deflationary crash overnight. So it's a process. Um and I'm not worried about the the you know the dollarization dollar going to zero talk anytime soon. >> I want to circle back to AI for a moment and talk about Peter Theal. Um he has now relocated to Argentina. I'm going to read a quote from the New Yorker. Mr. Theal has met with the country's president, Javier Malay, and his ministers, purchased a mansion in one of Buenos Aerys's most exclusive neighborhoods, and hosted a dinner with local economists where he discussed the antichrist, one of his favorite conversation topics, according to Argentine officials and people familiar with Mr. Teal's activities. Now, Teal already poured a bunch of money into Trump's campaign along with mentoring and essentially helping put JD Vance in place as the vice president. The the red carpet now rolled out to him by the political elite in Argentina. Shouldn't this be worrying to people, the fact that a tech company CEO heavily focused on AI loves discussing the Antichrist and has this much political power? And if you were to speculate, what do you think his endgame is? You know, again, it's pure speculation. Uh I don't I don't know why he's done this. Um I saw one person speculate, which resonates with me, so I'm going to I'm going to I forget the person's name, so forgive me if you see this video and you think I stole it from you. I just don't remember your name. But um they they posited maybe uh he's worried about the popularity of Trump. He doesn't think Vance can pull it off. and because he uh was a well-known supporter of of the Trump administration in advance, he's worried about um he's he's looking forward to 2028 and and backlash that might come at him from the Democrats. So, I you know, I don't know that that seemed to make the most sense to me. Given everything that we've discussed today, are there any areas of the market that you're seeing opportunity in at present? Or are you in a much more of a defensive posture? As you mentioned, dry powder, um maybe perhaps short-term treasury bills, something like that, or are there areas that you see right now that are being mispriced and that have potential upside opportunity? No, I don't I don't see anything terribly interesting that I'd want to own. When this when this risk is figured out and people figure out that we're in a growth scare, um it's going to happen fast and a lot of things will get mispriced. I'll have more to talk about maybe 6 to 12 months from now. Right now, I don't think there's a lot of bargains out there. I like I like being defensive. And look, I'm not telling people to go to 100% cash. If if you're in your 80s and you got 90% stocks, you might want to you raise some cash. If you're in your 30s and you don't have a lot and you have just a 401k, just a little bit of cash. This is this is this is uh the the older you are and the more you got, the more you got to worry about. >> Some great thoughts. Always love talking with you. Tell us about finance technologies and anywhere else people can follow your work. Yeah. So we have uh Chinese economic reports, real estate reports, US economy report all at finance techchnologies.com available for purchase. Uh ph is the uh beginning rather than f. So phfinance techchnologies.com. Also I'm available uh personal website at dow.com. I um I've been getting some success. I I don't really advertise this, but a lot of people want to talk to me and I do offer consulting services. If you're interested on my website, you can also sign up to my website. Also, uh I'm also uh on Twitter X uh so to speak at Edward DD Edward. >> I'm going to put links to all of that in the description below so people can check it out. Edward, thank you so much once again for coming on the show. >> Thanks, Jesse. Great interview. >> Thank you for joining us today. This episode is brought to you by Arc Silver Gold Osmium. We have some great prices on gold and silver bullion products. They are on your screen right now. These are subject to change and while supplies last. 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'These Are ENDING Moves' – GOLD to $10k, Stocks to CRASH 30%+: Edward Dowd
Summary
Transcript
We're in the end stages for a lot of things. Those are the words of my guest today, Edward Dow, as he believes the broad market is in a massive bubble, largely being inflated by AI stocks being priced on a hope and a dream. He also sees major trouble coming for the real estate market, debt markets, and the Chinese economy, which he also thinks is headed for disaster. The silver lining is precious metals. Ed believes gold will eventually climb to $10,000 an ounce. We break all of this down and more in our conversation ahead. Edward Dow, great to have you back on Commodity Culture. I want to start things off today with discussing precious metals markets because since hitting all-time highs near the end of January this year, both gold and silver of course have corrected and are now in a sideways consolidation. Do you think the next move from here is to the upside or to the downside? Obviously, that's the $10 million question. And what are the factors you see currently driving precious metals markets? >> Well, you know, I was bullish precious metals last uh last last year in 2025. Uh had a near-term price target of 4,000 and it exceeded that. And rec, you know, over the last six months, I've been asked a lot about gold and silver. And my long-term viewpoint is that gold is going to 10,000 by 2030. And that's due to a host of factors we all know about central banks buying potential new monetary system coming the the date of which is very uncertain. Gold is going to be a part of that. How do we know that? That's because because commercial banks uh made gold money again by making it tier one capital. Uh we have you know retail investors in China and India voracious appetites for gold and silver. So the fundamentals are there. Um but you know uh I there was a tremendous move over the last two years into the top uh in January of this year and uh I I said then that I expect it to consolidate and uh that's what it's been doing. Um and I and that's healthy. uh you know it it gold is not showing signs of a parabolic top meaning it's it's already down 40%. So this is quite healthy. Silver is a little more volatile. It is an industrial metal. Um so I expect them to continue to consolidate. There might be some uh short-term scares uh if there is a uh you know any kind of credit or liquidity crunch. I don't expect gold and silver to go down. Well, silver is tied to the economic cycle, and I'm I'm bearish on the econ the global economy, but I, you know, I wouldn't I wouldn't worry about gold and silver if you're if you're a long-term holder. If you're trading it, I you know, flip a coin if it's going to go up or down. I just think it continues to go sideways. And that that's actually the healthiest thing. If your long-term target like I have is 10,000 after b a big move like this uh and you consolidate the longer you go sideways the more confident you are you didn't put in the parabolic top. >> I would love to get your thoughts on gold and silver's price action in the midst of this war in Iran because I've spoken to a lot of different analysts and and some have said that this is normal in in a time of global conflict. there's a rush for dollar liquidity and so in in that case you often see um countries uh governments corporations retail investors as well for whatever reason liquidating their physical gold holdings in exchange for US dollars. Is that how you see things the way that they've played out so far? And if this war continues to drag on, do you think that trend could reverse somewhat? we could see that safe haven status for gold in particular kick in and perhaps cause a price move to the upside. >> Yeah. So, you know, there were when the conflict started, people were surprised by the price action in gold. And mind you, it's still consolidating. It didn't drop precipitously. Um, it was due uh to liquidity uh raising. People sold what they what they could, not what they wanted to. And Turkey sold I think 120 tons of gold to raise uh liquidity. So just like you you know some of these top analysts you've talked to that happens. Um right now the market the the the stock market and the oil markets are discounting an a resolution to this war. That that's that's what they're telling you. Um and we put out two scenarios when the war started on the price of oil and what inflation might do at least at least short-term headline inflation. And one scenario was uh $125 oil and 5% inflation by May and then we get a resolution and then inflation starts rolling over and we continue our you know what we what we were seeing was an economic slowdown and and the oil price shock only adds more pain delayed. There will there will be uh problems going forward. If we if we do not get a resolution soon, there are executives from Exxon and and uh uh other oil companies talking about we're approaching in two to three weeks uh the bottom of some reserves around the world and that oil will spike up and and some are predicting $150 oil soon. if that were to occur because there's no resolution to this uh crisis. Um gold may may go up. I again I I don't know but it'll definitely uh shock the yields will spike again temporarily and I think this this equity rally which has been 100% AI uh will falter and uh correct and I I still think the equity markets still have a lot of risk. I I wouldn't I wouldn't touch this market with your money. we're seeing unprecedented uh you know five sigma things going on all sorts of signals uh that we see at tops but again it could go higher uh I I suspect uh the market uh is going to stay kind of elevated until the IPOs come and then we'll see what happens uh a lot of supply is coming and a lot of the mag seven that used to do stock buybacks because of their capex spend won't be doing as many stock buybacks so uh I think we're in the end stages of a lot of things. I actually would prefer to see the Iran war. Uh, you know, look, I'm I'm bearish on on a on the economy, but I don't want to see this dragged out just so that I can be right. So, uh, enough damage has already been done and I want to see this resolved because if it isn't resolved, the oil markets and the stock markets are discounting. It's already resolved. So, it better it better be resolved. >> Yeah, some great thoughts. There's two things I want to follow up on there. uh both the broad market and the energy market. Let's start with energy because in previous conversations before the war started you were fairly bearish due to your bearish overall outlook on the global economy which made a lot of sense. Now that the straight of Hormuz is being closed, we've seen WTI in triple digits. And you know what? Once again, we keep seeing oil rally and then fall based on tweets essentially reports coming out of the Trump administration that okay, peace talks are advancing. Everything's going good. Iran says no, they're not. Oil goes back up. As soon as peace is apparently back on the table, we see it drop again. It's been a bit of a seessaw action for both um oil itself as well as the equities. Are you now getting more bullish on a longer term view if what once again there's one of two scenarios? This conflict continues, the straight of horm continues to be closed or we do eventually get a resolution which of course we're all hoping for. In in both of those scenarios, how would you see oil performing? you know, oil, if if we don't get a resolution, oil could go to 150, maybe 200. And so that that might be a trade in for energy, the energy complex, a trade. But long term it'll given where the consumer is, given where we see the global economy and China rolling over, longer term we think energy complex is going to get hit and then recover massively once, you know, the monetary authorities start printing in the in the teeth of the crisis that we believe is coming. So, uh, it energy if the if the if the the conflict isn't resolved, it's a trade, but it's a quick trade because then the the furious demand destruction will come and uh, you know, oil, you know, the sure sign uh to killing an oil rally is high prices themselves because it causes demand destruction. We've seen that time and time again. Uh, and and we saw it in '08. uh we saw it in the in the 73 oil crisis and there will be demand destruction if if there is no resolution but there could be a trade in energy. I I honestly think that's too tricky uh and tough that that's for professional investors. That's not for you know the average person who's trying to figure out what to do with their 401k. >> So do you think if peace is declared tomorrow we'd see WTI drop back down to the $50 $60 level? Uh, not immediately, but yeah, it it'll be on its way. >> The sponsor of today's episode is Arc Silver Gold Osmium. Owner Ian Everard is praised even by his competitors as one of the most honest and level-headed bullion dealers in the United States. They have some great prices. You can see some of them displayed right now on screen. can take advantage of these specials today by reaching out to Ian at 3072649441 or by email at ianarchsggo.com. Make sure to tell them of course that commodity culture sent you. And now back to the interview. Well, let's talk about the broad market now because you noted recently on X and you just spoke about it a moment ago. 45% of the S&P 500 market cap is AI or AI adjacent. We've got a storm of controversy emerging now over data center buildouts in the US along with some reports that perhaps AI isn't going to completely take over white collar jobs and revolutionize the economy the way that many have been promoting it. How big is the risk here when it comes to the AI segment of the broad market? And what what could the aftermath be assuming this AI bubble pops? You said you feel like we're in the end stages at this point. Yeah, you know, look, I I thought the I thought the bubble was popping quite frankly. Uh prior to the war, uh we were starting to see the the complex wobble private credit was getting hit. Um the war actually, I think, kind of uh gave one last leg of life to it because the only thing that's working right now are AI uh stocks and earnings, but the earnings are all circular. Uh free cash flow is going the wrong way. There's a lot of controversy as you know about the AI complex and Michael Bur's come out and said that you know Nvidia and all these other people are committing you know uh offbalance sheet fraud. It's legal but the risk is being put elsewhere and it all is a house of cards. Um right now what I'm seeing are I've been doing this a long time. what I saw with the semiconductor uh after the the the low put in in early April uh the semiconductors are up 80% in like nine weeks semiconductor index um I I talked to professional investors there there was a there was a reason for it because there was a demand surge and then there was you know people worried and and and pre-ordering for helium shortages and whatnot. Uh and then we of course we have the speculation going on in the Korean market. 50% of their market cap is two stocks high necks and and Samsung. Um we these are ending moves. Uh you you when you see these this kind of speed uh and and people uh chasing and no more uh you we're just getting signals of all sorts of things we haven't seen that are mo most likely ending moves. But again, I'm not calling a top. I'm not telling people to short. I've always been on this on of of the mindset you have dry powder in your portfolio. You can you you know you raise raise some money and that's personal up to you whether you want 20% cash, 25, 50. Uh and then you know when the correction comes and it will come uh and it I I was I was less bearish last year. I thought we might get a slow decline of um 40 to 50% over two years. this now this kind of action is is crash is crashy to me meaning we'll put in a top we'll have a draw down then we'll get a counter trend rally then we could get a crash I'm not calling for a crash but the risk for a crash is a lot higher now because it's so concentrated and you know semiconductors are notoriously cyclical uh it's an industry that you know has booms and busts that you know that hasn't changed and uh and you know it's now 18% of the S&P 500 index, the semiconductor industry. It's 30% of the NASDAQ. And I've I've done this, you know, over and over again. We're starting to hear whispers of double ordering because because purchase managers, you know, need to get get their allocation so they can make their products. So they they you know, about six, seven months ago, they started asking for 500. Let's say you ask for 500,000 units and you say, "Oh, we can only give you 250." Well, then the next time you order, you double your order and say, uh, so the backlogs look way better. Uh, there's a lot of enthusiasm, but when the supply, uh, and demand meet, uh, there's inventory buildups everywhere, and that's what's going to happen. It always happens. So I'm just very cautious on this market and given the global risks and the oil price shock that's working its way through through the economy uh margins are going to get going to get squeezed in in the non AI sector of the economy which is the real economy I mean the stock market is not the real economy 45% of your market cap is AI and there's no profits yet what are what what are you invest you're investing in future hope you're not investing in actual earnings and growth now people We're speculating it's going to turn earnings and growth. And as you mentioned earlier, there's all sorts of questions of uh data center delays because of opposition, not enough power on the grid anyways. And now uh Bloomberg came out with a story today. Bane, a consulting company said there is no ROI, it's a bus. So, you know, the the markets can continue to be irrational and and go up on this, but the the narrative is changing fast in my humble opinion. >> In the aftermath of this bubble popping, I mean, in terms of picking up the pieces, would would you be cautious there as well? You know, many many could imagine that they'd be catching a falling knife in such a scenario. And I've spoken to some people, Dave Colum comes to mind who says we could be in for a decadesl long grind sideways after a precipitous drop in the broad market perhaps similar to what the Nikke did for for several decades. Do you think that's a possibility? What at what point would you start looking for bargains in that type of scenario? >> Well, that's that's difficult. What we don't know is I I do think there'll be a 30 to 50% decline. And I say third I'm hoping for 50. I say 30 because the the policy makers may not uh uh allow the stock markets to fall that far and may come in with bazookas. I don't know because I don't know what the bazookas look like yet. So, you have to kind of call it in real time. So, right now I'm cautious. I would not put any uh new fresh money to work in in the stock market at these all-time historic valuations. Warren Buffett himself is 40% cash. you know, he's his stock has underperformed the uh S&P 500 the last year and a half. That typically happens before major market corrections because he starts accumulating cash into the top and he's got so much money he does doesn't call the top, but he's been cautious like we have been for two years. We've been early and wrong on the stock market, but not wrong on the rest of the real economy. The real economy is in tatters. The housing market is rolling over and uh we've been right on our call on gold. But in the stock market, we bet we were early, but I wouldn't touch it here with your money. And uh very cautious. This I, you know, I've done this a long time. And here's another indication of how crazy it is. An old video of Trump talking about IBM in December, recirculated on Thursday, and IBM's up 30% over the last two days as a result of an old video. >> That is completely insane. Now I I want to talk about the real economy now because David Rosenberg was recently on CNBC where he stated that real incomes are decaying but spending is holding up only because the savings rate dropped from 5.5% to 2.6% in a year. Talk about this disconnect between Wall Street and Main Street and and what the ultimate result of this K-shaped economy will be. Well, so it's gotten so bad now that the top 10% of the consumers are responsible for like 49% of all the consumer spending. So there's a small cadre that are continuing to uh you know go about their lives and very comfortable uh in their lifestyles while the the rest of the uh uh population is struggling mightily. Uh, and we know that because we see credit card delinquencies rising, uh, uh, car loan delinquencies rising, and now we're starting to see mortgage delinquencies rising. So, at some point, uh, that will affect everything, especially credit, and they're they're drawing down their savings and they're putting what they can on their credit card. And that the, you know, you this can't go on forever. And with the oil price shock, this is what happened in '08. Same thing was going on in '08 and the oil there was a small mini oil price shock. People don't remember it. It's all housing and people remember the big short but I remember oil going to 140 uh from like 70 bucks over a fivemonth period. It was a mini oil price shock and that uh that wiped out the consumer in the second half of 2008 and inflation did rise going into that headline inflation. Then it rolled over when the uh when when when the recession hit. How are you viewing the government debt market at the moment? Because we've seen yields rising. Many government uh bonds at levels not seen since the great financial crisis. The US 20 and 30 years sitting at around 5% yield right now, a level some analysts are pointing out could be signaling trouble up ahead. What are your thoughts on the sovereign debt market and could an unwinding there cause the broad market to crack as well? >> Well, the the the sovereign debt market is already in trouble. We've seen Japan yields rise. Yields around and even even our tenure and 30-year. Uh, interestingly enough, the this tenure and the 30-year in the US have started to uh recover uh and yields are heading back down. I think uh this is look, this is for institutional investors. If you're a retail investor having dry powder, which is cash, you know, short end of the curve, no no interest rate risk, that's where you should be. But if you're an institutional investor, I think there's an opportunity for a at least a 12-month trade to get into the the 10, the 20, and the 30-year go out on duration in just the US Treasury market in a credit crisis and a slowing global economy. Uh that's the the that market will discount this the growth scare and there'll be a rally. then the Fed will come in and do what they do and then you're gonna have to, you know, kind of tactically get back out of that into equities depending upon where they are. If they're down 40 50% then you rotate back in. But I think there's an opportunity and I think the scare in the yield market at least in the US uh is is is um we're not going to 10% yields. Uh I I may I may I may be wrong, but I think once the and you got to look at China, too. China is in deep deep trouble. They're the factory of the world and they are now entering the huge phase of their crisis and we know that because their total construction value started to decline in the fourth quarter of 25 and now it's down 8% year-over-year. They they are in deep doodoo and that's going to have contagion effects and uh the oil price shock will kill demand. So we're in a very everything seems great according to the stock market but underneath the surface it it's it's not good at all. >> Let's switch over to China then. Um because I speak to different people who have different opinions. Obviously, you've been pretty consistently bearish on the economy. Louisie Vincent Gav, who I speak to sometime, is very positive. He he has an office in Hong Kong. And Simon Hunt as well, the China specialist, thinks that their economy's got its issues, but perhaps not in as dire straits as as you're painting in terms of the picture you have. You appeared on Steve Bannon's war room recently, where you said their economy continues to face major challenges. Now, one interesting question I have is about their sovereign debt market because their yields have been consistently falling over the over the years, signaling potential strength. Why do you think that is? And and just lay out your scenario for us on why you think China is headed for trouble in a bit more detail. >> Well, they're they're their bonds yields are going lower because they're in a deflationary uh demographic decline. So, that's what happens in a in deflation. Sovereign yields go a lot lower. most of their debt uh is in the private sector and they have a tremendous amount of private sector debt that was used to to build out the factory of the world. Here are the numbers. The they their their demographics plateaued in 2015 went sideways and then in 2020 it started precipitous fall and it goes goes it goes into a low in 2032. They're losing an 150 million people of prime age workers, meaning their spending profile goes from consumer to saving and retirement and hunkering down there. So, they're losing 150 million people over the next seven years. That's it's a 1% decline. Um the real estate market uh is is the residential real estate market is a disaster. Uh permitting is down 70% since um 2020 uh 2020. Uh that's that's permits that starts uh their land uh sales which they discontinued uh the series in 2023 plummeted. So their residential real estate buildout is over effectively. Um their total overall residential real estate construction didn't start dropping uh until like a a year or two later. It's down 20 only down 20%. that's in residential, but that's because they had some long life projects. But the the tell for us that this is getting acute is overall construction is going lower. And so what's going on is basically um uh they're reaching the acute phase of their crisis and their GDP is struggling. Uh it's I think the fourth quarter GDP was one of the weakest on records in a long long time. So it's happening and they did some stimulus in Q1. It didn't really work all that well. Total construction continues to come down. Net net fixed investment uh went negative for the first time in the fourth quarter. Recovered a little bit year-over-year growth in T1, but it's nowhere the trend is down. So, this is this is this is a problem. And so, what what they've done with their so they have deflation and there's no the the internal demand is falling off a cliff. So when you have internal demand falling off a cliff, much like Japan did when their when their demographic decline hit, you need to um export your way out of it. So that's what they've been doing. So they really ramped up exports the last since 2020. Uh you know, EVs, automobiles, their tech sector. So they really have ramped up exports, but now we have the tariff wars and that's put a thrown a wrench into it because they were they're trying to dump their deflation on the rest of the globe. And that that would be a problem for everybody else's, you know, homegrown industries. They'd be bankrupted by the dumping of the of the cheap goods. So that's why Trump has got this tariff situation. It's the right move. Um, you know, how how he executes it, you can you can criticize, but strategically it's the right move and it needs to be done because if if that doesn't happen, they're going to export all their deflation. So, China is internally has big issues that's going to affect their trade partners like Japan and Korea. Those South Korea and Japan are the biggest trading partners in uh not trade deficits overall imports exports. So, and Japan is you know Japan has a sovereign debt crisis potentially blooming right now. So, there's so much risk in Asia that people are just ignoring. They're focusing on on the AI. They're focusing on the Iran war and they don't understand that, you know, the factory of the world is in trouble. >> I want to run another narrative by you that's been pretty persistently coming up, um, which is that China is kind of leading the charge in terms of removing the US dollar as the global world currency. And and the evidence that people point to is some of the trades they've been doing for oil with Iran and Renman B. Some people speculate that a big part of the war in Iran is to stop that from happening. um so the dollar can remain the the global reserve currency status. The other is the fact that China is the number one gold producer in the world and they're you know it's it's widely believed that they are understating the actual gold reserves that they have as a country as well. What are your thoughts there and and even aside from that do you think China having so much gold gives them some sort of cushion when it comes to uh negative economic effects moving forward? uh you know they have a lot of debt so there's going to be a lot of debt destruction and honestly uh we I'm not going to get into it because this is for institutional investors and we sell a report on it. Uh we think the the one is wildly overvalued and is going to is going to need need to depreciate quite a bit. Um and they're trying not to let that happen but they increasingly I think that's going to happen. So this dd dollarariz look are we has the status of the reserve currency been challenged? Yes. Will it die suddenly? No. It dies slowly. And the Biden administration when they threatened to take Russia's assets and and and then use the Swift system to put sanctions on them. We didn't even do that during World War II. So that you know so that is one one of the things that really concerned me about the ddollarization efforts but it takes time because of the the global interlocking and the dollar liquidity that everybody needs currently especially with a lot a lot of these countries there's about 18 20 trillion in uh foreign uh debt denominated in US dollars both from foreign corporations and and and governments. So if the if if if if there is a uh ddollarization effort um that's a problem for them because they would have a if they went off the dollar they would have a deflationary crash overnight. So it's a process. Um and I'm not worried about the the you know the dollarization dollar going to zero talk anytime soon. >> I want to circle back to AI for a moment and talk about Peter Theal. Um he has now relocated to Argentina. I'm going to read a quote from the New Yorker. Mr. Theal has met with the country's president, Javier Malay, and his ministers, purchased a mansion in one of Buenos Aerys's most exclusive neighborhoods, and hosted a dinner with local economists where he discussed the antichrist, one of his favorite conversation topics, according to Argentine officials and people familiar with Mr. Teal's activities. Now, Teal already poured a bunch of money into Trump's campaign along with mentoring and essentially helping put JD Vance in place as the vice president. The the red carpet now rolled out to him by the political elite in Argentina. Shouldn't this be worrying to people, the fact that a tech company CEO heavily focused on AI loves discussing the Antichrist and has this much political power? And if you were to speculate, what do you think his endgame is? You know, again, it's pure speculation. Uh I don't I don't know why he's done this. Um I saw one person speculate, which resonates with me, so I'm going to I'm going to I forget the person's name, so forgive me if you see this video and you think I stole it from you. I just don't remember your name. But um they they posited maybe uh he's worried about the popularity of Trump. He doesn't think Vance can pull it off. and because he uh was a well-known supporter of of the Trump administration in advance, he's worried about um he's he's looking forward to 2028 and and backlash that might come at him from the Democrats. So, I you know, I don't know that that seemed to make the most sense to me. Given everything that we've discussed today, are there any areas of the market that you're seeing opportunity in at present? Or are you in a much more of a defensive posture? As you mentioned, dry powder, um maybe perhaps short-term treasury bills, something like that, or are there areas that you see right now that are being mispriced and that have potential upside opportunity? No, I don't I don't see anything terribly interesting that I'd want to own. When this when this risk is figured out and people figure out that we're in a growth scare, um it's going to happen fast and a lot of things will get mispriced. I'll have more to talk about maybe 6 to 12 months from now. Right now, I don't think there's a lot of bargains out there. I like I like being defensive. And look, I'm not telling people to go to 100% cash. If if you're in your 80s and you got 90% stocks, you might want to you raise some cash. If you're in your 30s and you don't have a lot and you have just a 401k, just a little bit of cash. This is this is this is uh the the older you are and the more you got, the more you got to worry about. >> Some great thoughts. Always love talking with you. Tell us about finance technologies and anywhere else people can follow your work. Yeah. So we have uh Chinese economic reports, real estate reports, US economy report all at finance techchnologies.com available for purchase. Uh ph is the uh beginning rather than f. So phfinance techchnologies.com. Also I'm available uh personal website at dow.com. I um I've been getting some success. I I don't really advertise this, but a lot of people want to talk to me and I do offer consulting services. If you're interested on my website, you can also sign up to my website. Also, uh I'm also uh on Twitter X uh so to speak at Edward DD Edward. >> I'm going to put links to all of that in the description below so people can check it out. Edward, thank you so much once again for coming on the show. >> Thanks, Jesse. Great interview. >> Thank you for joining us today. This episode is brought to you by Arc Silver Gold Osmium. We have some great prices on gold and silver bullion products. They are on your screen right now. These are subject to change and while supplies last. So reach out to owner Ian Everard today at 3072649441 or by email at ianarchsgo.com. And make sure to tell him that Commodity Culture sent you. And Commodity Culture is hosting our first ever live boot camp on June 27th, Saturday, 100 p.m. Eastern time. I'm going to open up my portfolio a toz. Show you what I own, why I own it, what I've been buying, what I've been selling, and my view on why commodities are the place to be for the years ahead. Join.jessed.ca. The link will be in the description below, and I'll see you guys in the next episode. Commodity Culture is a series on commodities and natural resources. If you would like to see more, be sure to subscribe and hit the bell notification so you're always up todate with the latest episodes.