REMEMBER! --
To get all my specific portfolio recommendations...sector allocations..."story stocks" and more...you need to be a paid Member.
If you aren't, GO HERE.
From the desk of Chris Temple -- Monday, May 19, 2025
Greetings Investors! I've arrived in The Big Apple for two conferences: the 10th Annual Critical Trends in Mining Finance Conference hosted by the NY Section of the S.M.E. and then Thursday's OTC Markets Group conference.
You can click on each of the respective graphics above for that particular event's agenda.
And in the case of Thursday's, it's one you can attend virtually (registration is free.) The ability to do so is contained in that link.
At CTMF, I'll be immersed in a variety of subjects and public policy discussions as most of you already know: where I'm concerned especially, leading one panel on the future of nuclear energy's re-emergence and some key moving parts...as well as throwing (sorry, folks) some cold water on the idea that it's "Mission Accomplished" already to resurrect mining in North America.
I'll be sharing more once these conferences are concluded beyond what I already have in recent days; especially from some of the more "macro" topics to be covered in a PACKED agenda!
______________________________
The downgrade late Friday by Moody's of the U.S. Treasury's credit rating (see THIS ANALYSIS for the details) appears set to short-circuit a recent Wall Street rally that was already well over its skis (though I don't necessarily expect a quick debacle to the downside right yet.)
Biden-era government spending is the culprit, according to weekend interviews of Treasury Sec. Scott Bessent. So Moody's action is in fact a "lagging indicator" of the damage already done to America's finances by Sleepy Joe who led a COVID-juiced blowout in the deficit to about 7% of G.D.P.
That's partly true, of course.
But as I have been covering ad nauseum for a while now, as big an issue today is that markets simply don't believe that The Trump Administration and the G.O.P. leadership in Congress are going to materially change this.
And when one looks at the budget flim-flam going on in the House right now especially, it's hard not to share this view; and realize that the Bond Vigilantes have the better of the argument here.
I predicted all of this, of course, in part by my ongoing discussion of my 2025 theme, "Let's do the Math." And where the bloated market for Uncle Sam's I.O.U.'s is especially concerned, my 2024 theme of "Supply, Supply and SUPPLY!" is clearly still quite operative.
For THAT'S the issue with the Treasury market more than anything now.
Some of the best summations of all this I've seen anywhere--and very succinct ones, too--have come from one "EndGameMacro" poster on X. An especially instructive thread is RIGHT HERE regarding Moody's downgrade specifically...and another RIGHT HERE that is from several days ago, stressing that it's a global phenomenon to a great extent, too, that long-duration sovereign debt simply can't (as a matter of that SIMPLE MATH) be sold even at current still-elevated rates.
It's basic supply and demand.
If I've said it once the last several months I've said it 1,000 times: President Trump came into office with a lot of political capital to meaningfully change all this, but so far is FAILING on the issue of the budget and the overall ongoing supply of DEBT.
And appropriately, the bond market is calling everyone out.
For the president, by not calling out the Congressional Republican leadership for--among other things--throwing away all of those D.O.G.E. savings and the rest, he even is properly not being taken seriously himself by the bond market.
And all this, as I'll be discussing further in the coming days, is adding to the prospect that market yields will stay high and move higher still. (And this is even as the Fed has been engaging in some stealth Q.E. recently, as I've already been telling you.)
It's not because inflation is moving back up (though that may well be a further aggravating factor.)
It's not because markets think America will "default."
It's simply because when the U.S. (and others) have, simply, so much supply to sell, the price (interest rate) has to go higher.
The trouble is, most everyone continues to place their market bets as if inflation and interest rates will move lower...and few if any are prepared for the alternative. Most markets and even most commodities are not pricing for reality.
To be continued...
All the best,
Chris Temple
Editor/Publisher
Monday, May 19, 2025
Don't forget that you can follow my thoughts, focus and all pretty much daily ! ! !
* On Twitter, at https://twitter.com/
* On Facebook at https://www.facebook.com/
* On Linked In at https://www.linkedin.com/
* On my You Tube channel, at https://www.youtube.com/c/