Mike McGlone

Copper is struggling near $6 and Crude Oil is oversupplied. McGlone states, "If you're bullish copper, you have to expect the stock market to keep going up." Industrial commodities are now financialized assets linked to the S&P 500. If the S&P drops 10%, McGlone estimates Copper will drop 20% (down toward $5). Additionally, China (the biggest consumer) is exporting deflation, which is historically bearish for commodities. SHORT. Supply shocks (e.g., war in the Middle East impacting oil) or a massive Chinese stimulus package that reignites real demand.

Gold is trading >$5,000 and Silver >$80. McGlone states, "I've never seen what's happening in the precious metals... The high price cure is kicking in." He compares the current metals chart to the 2011 top and the recent crypto peak. Markets that go parabolic (2x the 60-month average) detach from fundamentals. The "invisible hand" will force supply to increase (e.g., "thrifting" silver from drawers) and demand to vanish. Furthermore, if the stock market corrects, liquidity needs will force investors to sell winners (Gold/Silver) to cover margin calls, dragging metals down with equities. SHORT. He targets a reversion to $4,000 for Gold and $50 for Silver. Geopolitical escalation (e.g., Ukraine/Russia) could cause a knee-jerk spike higher before the correction.

The S&P 500 is pushing 7,000 with volatility (VIX) at 8-year lows (~11%). McGlone states, "I think we're going to get a 10% down year at least." The market is priced for perfection (no recession, continued growth). However, the "wealth effect" is the only thing propping up the economy. Once volatility mean-reverts to its average (17-18%), the passive bid disappears, and the market "implodes" to correct the over-valuation relative to GDP. SHORT. He views the market as "broken" and overdue for a flush. Continued "melt-up" driven by fiscal stimulus or irrational exuberance (the "silly stage" lasts longer than rational analysis suggests).

McGlone calls the crypto market a "broken market" and a "purge." He notes that despite the S&P hitting highs, Bitcoin has failed to make new highs relative to the Nasdaq and is underperforming high-beta assets. Crypto is a "leveraged speculative risk asset." It requires a rising stock market and falling volatility to thrive. Since McGlone predicts falling stocks and rising volatility, the liquidity fueling crypto will dry up. He expects Bitcoin to head toward 10,000 and Dogecoin to "steer" (drop significantly) as the "silliness" is purged. SHORT / AVOID. A sudden return of "risk-on" mania or Bitcoin decoupling from the Nasdaq to act as a sovereign store of value (which McGlone currently doubts).

Gold is trading >$5,000 and Silver >$80. McGlone states, "I've never seen what's happening in the precious metals... The high price cure is kicking in." He compares the current metals chart to the 2011 top and the recent crypto peak. Markets that go parabolic (2x the 60-month average) detach from fundamentals. The "invisible hand" will force supply to increase (e.g., "thrifting" silver from drawers) and demand to vanish. Furthermore, if the stock market corrects, liquidity needs will force investors to sell winners (Gold/Silver) to cover margin calls, dragging metals down with equities. SHORT. He targets a reversion to $4,000 for Gold and $50 for Silver. Geopolitical escalation (e.g., Ukraine/Russia) could cause a knee-jerk spike higher before the correction.

"For us, the US, natural gas prices are down. We have a major glut even after a cold winter." While European gas prices are spiking due to regional fears, the US market remains oversupplied. The war does not solve the domestic inventory glut in the US. The divergence between US and EU gas prices will widen, but US prices (Henry Hub) will remain depressed. SHORT US Natural Gas. A massive increase in LNG export capacity or attacks on US export terminals (though Qatar's facility was the one mentioned as hit).

Copper is struggling near $6 and Crude Oil is oversupplied. McGlone states, "If you're bullish copper, you have to expect the stock market to keep going up." Industrial commodities are now financialized assets linked to the S&P 500. If the S&P drops 10%, McGlone estimates Copper will drop 20% (down toward $5). Additionally, China (the biggest consumer) is exporting deflation, which is historically bearish for commodities. SHORT. Supply shocks (e.g., war in the Middle East impacting oil) or a massive Chinese stimulus package that reignites real demand.

Agricultural commodities like corn and soybeans are peaking and are set to decline, as part of a broader 'pump that's ready to dump' pattern predicated on the wealth effect in the US waning.

Agricultural commodities like corn and soybeans are peaking and are set to decline, as part of a broader 'pump that's ready to dump' pattern predicated on the wealth effect in the US waning.

"It's the rest of the world, most notably China. China is the number one place where that Gulf oil goes and they're kind of bottlenecked by Strait of Hormuz." Unlike the US (net exporter), China is a net importer heavily reliant on Gulf oil. A blockade or high prices acts as a tax on the Chinese economy, squeezing margins and industrial output. SHORT. China bears the brunt of the economic damage from the Strait closure. Rapid reopening of the Strait of Hormuz alleviates the bottleneck immediately.

"The US is a massive net producer... So this actually benefits US producers... I can almost guarantee you what the US producers are saying is, oh, boy, we can lock in profits for a year or two out at much higher prices." While the commodity price may eventually fall, US producers are currently capitalizing on the spike to hedge their production at $90+ levels. This secures high future cash flows regardless of where spot prices go later, distinguishing them from the commodity itself. LONG. Producers are the structural winners of this geopolitical setup. Immediate crash in oil prices before producers can execute hedges/futures contracts.

"Bitcoin is a good example of that relief... it's pumped up to 68,000... people are glad that the risks of the initial invasion are over." Bitcoin is trading as a "risk-on" liquidity proxy. The market interprets the swift geopolitical resolution as a "relief" signal, prompting capital to flow back into liquid, high-beta assets. Long Bitcoin as a leading indicator of geopolitical relief and risk appetite. A sudden reversal in global liquidity or unexpected regulatory crackdowns.

McGlone explicitly calls US Treasury Long Bonds the "trade of a lifetime." He notes yields are bumping against a 5% ceiling and failing to break through, while the S&P 500 is historically overextended. He anticipates a "reversion" in the stock market (10% drop). When stocks fall, the "wealth effect" evaporates, leading to deflation. In a deflationary risk-off environment, capital flees to safety. Yields will drop from ~5% to ~3%, causing long-duration bond prices (TLT) to surge from current support levels (~113-115) toward 140. LONG. This is his highest conviction trade ("I don't see anything else worthy of buying"). Inflation re-accelerates significantly, or the Fed refuses to cut rates despite economic weakness (though McGlone believes the Fed will eventually be forced to cut).

"Last year gold had its best year since 1979. It was front running this event... It is tilting that way, this might be the beginning of a post inflation, deflationary period." As the oil shock threatens to trigger a global recession and equity market volatility, investors will flee risk assets and rotate into traditional safe-haven assets to preserve capital. LONG. Gold serves as a dual hedge against both the immediate geopolitical chaos in the Middle East and the subsequent deflationary recession risk caused by the energy spike. The conflict is resolved quickly, leading to a risk-on rally in equities, a drop in oil prices, and a selloff in safe-haven assets.

"The Strait being closed is a shocker... When it spikes like this, it can be its own worst enemy. It can bring on a global energy crisis..." The physical blockage of one of the world's most critical energy chokepoints removes millions of barrels from the global market daily, forcing a sustained premium on crude prices and directly benefiting domestic energy producers who are insulated from the blockade. LONG. Until military intervention successfully clears the Strait, the structural supply deficit will keep oil prices and energy sector margins elevated. The high price of oil causes demand destruction faster than expected, leading to a global recession that ultimately crashes energy prices (similar to the 2008 cycle).