MARKET NEWS / MCALVANY RECAP

It Ain’t Over Till It’s Over

MARKET NEWS / MCALVANY RECAP
McAlvany Recap • Mar 31 2025
It Ain’t Over Till It’s Over
MPM Posted on March 31, 2025

It Ain’t Over Till It’s Over

Exhibit A in the battle for America is that “where you stand depends on where you sit.” Many Americans believe Donald J. Trump is the devil incarnate. Others think he is the best thing to happen to the country since George Washington.

So what’s the truth? Trump’s history is still in the making, so it’s hard to tell–which takes us back to Exhibit A. But Exhibit B is also important: America’s founding is a product of white, Northern European (predominantly British), Protestant Europe. Lots of things have happened since 1776, and many other influences have entered the equation, but that’s where things were when the Constitution was adopted in 1789.

Rightly or wrongly, those founding influences have come under severe attack over the past several decades. In fact, Exhibit C is that America’s culture war could accurately be stated as a war over that founding character. Democrats have made it their mission to eradicate all traces of it in current national makeup and conduct. Conservatives, including some Republicans and along with some libertarians and independents, think there are important elements of that founding character that should be preserved.

Given that tens of millions of people moved into the West from the Middle East, South America, and other locations when border restraints were lifted, it’s been hard for Democrats to prove that Western culture is the scourge of the world. Too, in America, many non-whites and people of other religions have joined the conservative cause, and many atheists and other non-believers have recognized the importance of Christianity in forming and maintaining cultures worth living in. These are tough times for destroyers of the past.

Still, the radical left is a formidable adversary. It has taken over and destroyed many large and small nations, and still has immense power within the US. It might well have the power to thwart many of Trump’s policies through lawfare and terrorism. Even if it doesn’t, it could well deform Trump’s agenda and channel it into more forceful actions in order to fight the leftists (as communists say, the action is in the reaction).

And even if Trump is largely on the right track, as this author believes him to be, he is one man. He’s a powerful and charismatic man, but one man nonetheless. This author is reminded of a king of ancient Israel who was described as the wisest man ever to live. He brought incredible peace and prosperity to Israel–to the degree that gold was so plentiful that silver had little value in the kingdom. But that same king got sidetracked by his own agenda. His ensuing folly resulted in the permanent division of his kingdom.

No one is immune. The same power that allows Trump to fight the destroyers will also be a temptation to him. He has developed his character in the midst of power, privilege, and money, so he is better suited than most to resist their siren song. But so was Solomon.

What’s the upshot for you? Keep your powder dry, and make sure you and yours are prepared for hard times should they arrive. And remember that when he was wise and doing well, Solomon had plenty of gold.

Key Takeaways:

  • The US enters rehab
  • When irrationality is normalized, bubbles are invisible
  • Things look glum to some; to others, opportunity beckons
  • Is copper leading the way?

The McAlvany Weekly Commentary: Gold Signals A Reset

David and Kevin began the program this week with a discussion about the differing effects of our economic situation on the rich and the rest. Inflation continues to bedevil most Americans. However, this was the case before Trump took office. The choice facing the nation today is whether to address the problem or continue on as usual. Treasury Secretary Bessent calls addressing the problem detoxing, and says it’s absolutely necessary if we’re going to avoid a total meltdown. The hosts then turned to the tools that are useful in determining when and how to invest. David mentions several tools that are useful, stating that all must be used with discretion. What works in one situation might not work in another. From there, the hosts discuss responses to change. Gold does well in times of uncertainty, but uncertainty also reveals character in people. The hosts discuss personality and constructive ways to deal with it as we see people’s polarized responses to Trump’s policies. David likens Trump to a turnaround specialist in the corporate world, someone who tightens the corporate belt and focuses on what the company does best. They are not loved by the company, but they are necessary.

Credit Bubble Bulletin: Critical Market Juncture

Doug begins his weekly summary by noting greatly increased pressure in the markets. “The longer the Trump administration ignores mounting market distress, the clearer it becomes that moving full speed ahead with agenda priorities takes precedence. In short, shock and consternation have begun to set in that the mighty stock market somehow might not be at the epicenter of the White House’s grandiose ambitions.” He then discusses the way bubbles are dismissed because participation in them is regarded as the height of “rationality.” This happens time and again, and is happening in private credit as well as other, more visible, areas. Doug also discusses the leveraged investing community and the way it has misjudged Trump. Thinking he would continue supporting their activities, they have kept their bets in place–which potentially sets them up for a big fall.

Hard Asset Insights: Where the Puck is Going

Drawing on FDR’s “fear of fear itself” comment, Morgan provides evidence that Americans are at least somewhat afraid of what’s coming–or at least pessimistic. Surveys of confidence regarding economic and employment strength among various groups by various agencies show sentiment turning down significantly. Some of these sentiment indicators have high historical correlation with the onset of recession, so they are not just snapshots of feelings. Still, these indicators are not the whole story: “while most are still paralyzed by fear of uncertainty, not all are. There are indications that some corners of Wall Street and some elements of the all-important Western institutional investment community are waking up to what is potentially the bigger secular opportunity at hand.” In that light, Morgan cites Wayne Gretzky’s recipe for success, “I skate to where the puck is going to be, not where it has been.” In that very positive light, Morgan describes a way investors can get ahead of the doom and gloom developments and go “where the puck is going.”

Golden Rule Radio: Debt Crisis Looms

Miles’s weekly recap shows the precious metals and equities markets mostly flat, while the dollar was up slightly. The standout for the week was copper–often called Dr. Copper because it tends to lead some of the industrial metals and even the precious metals to a slight degree. Copper hit a new all-time high, and the hosts discuss the possible reasons for its strength. The new high is certainly inflationary given copper’s centrality to the economy, but there are other factors that are deflationary. Tory describes demographic differences in optimism between age groups that he posits are due to differences in news sources. The hosts discuss national spending with Treasury Secretary Bessent’s “detox” comment in view. They dissect the administration’s efforts to reduce spending, concluding that although the efforts being made are substantial, the detox is not overwhelming. Lots of government spending is still being done.

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