The nomination of Kevin Warsh to lead the Federal Reserve will not derail the global “debasement trade,” as mounting public debt makes the monetization of U.S. fiscal deficits inevitable. Fiscal Reality Despite the “bone-jarring” Friday crash that saw silver plunge 26% and gold drop 9%, the fundamental drivers of the precious metals rally remain unchallenged. According to economist Robin Brooks, the market's search for safe havens is fueled by a fiscal trajectory that no single personnel change can fix. ...

Core Insights - Gold has surged to a new record high of over $4,400 an ounce, reflecting the resurgence of the "great debasement trade" as noted by strategist Robin Brooks [1][2] - The increase in gold prices is attributed to the Federal Reserve's recent interest-rate reduction and concerns over debt monetization, which involves central banks purchasing government-issued bonds [2][3] Group 1: Gold and Precious Metals Performance - Gold has delivered a remarkable 68% return in 2025, while silver has seen an even more significant increase of 140%, both reaching new record highs [3] - Geopolitical tensions, particularly regarding Venezuela and recent Ukrainian attacks on Russian ports, have enhanced gold's appeal as a safe-haven asset [3][4] Group 2: Economic Factors Influencing Precious Metals - The breakout in gold prices was triggered by Federal Reserve Chair Jerome Powell's dovish remarks at Jackson Hole and a 25-basis-point easing on December 10 [4] - Commodity traders are anticipating further easing from the Federal Reserve, which is influencing market dynamics [4] Group 3: Currency Correlations - The debasement trade is not limited to precious metals; currencies from low-debt countries like the Swedish krona and Swiss franc are increasingly correlating with gold and silver prices [5][7] - The strength of the Swedish krona is seen as a result of the debasement trade, despite its historical volatility and lack of safe-haven characteristics [7] Group 4: Broader Market Implications - The rise in gold prices is partially linked to the ongoing carry trade in the Japanese yen, where investors short the yen to finance long positions in higher-risk assets, including precious metals [8]

🇺🇸 LATEST: Arthur Hayes argues US banks adopting stablecoins can provide $6.8 trillion of buying power for US Treasuries.He sees this as "debt monetization dressed in Ethereum drag" and advises to go long Bitcoin. https://t.co/xeSJnXclVf ...