Macro Observations

Commodities are generally considered a good inflation hedge for a few reasons. Obviously, this hedge won’t work in every situation. The last couple of years have been unique. If we try to go back historically to find something similar, the stagflation ‘70s would be the obvious place to start looking. From there, you really kind of have to search around.

In this market, where the “magnificent 7” have been driving returns for more than a year, who in their right mind is selling mega-cap tech and picking up gold miner stocks? The answer would be someone who thinks something bad is about to happen in the financial markets and is positioning themselves much more defensively. Moving from tech into gold miners might be the ultimate growth-to-value pivot.

Stocks have been in a nearly uninterrupted uptrend for more than a year, which usually only happens when everything is simply clicking and everyone is optimistic again, right? Have the 31% and 61% rallies in the S&P 500 and Nasdaq 100, respectively, been justified? Many market pundits would say yes. I would say no. You have to look at all available data, not just the ones that confirm your own beliefs.