Worst Era Since Great Depression Next: ‘Perfect Storm’ Forming Warns Investor | Peter Grandich
Speakers
Peter Grandich
— Founder, Peter Grandich & Co.
Summary
Peter Grandich sees a confluence of monetary, political and trade stresses forming a near-perfect storm for US markets. He argues Treasury losses and a potential break above 5% on the 10-year yield could trigger a bond crisis and hit stocks, while the US dollar weakens. He is most constructive on gold, major mining and critical minerals, and broad commodities including agriculture.
- Grandich views US isolation and foreign selling of Treasuries as bearish for US bonds and the dollar.
- He calls the 10-year Treasury yield's 5% level a line in the sand for a larger bond crisis.
- He expects the stock market to face a near-perfect storm tied to bond stress and midterm history.
- He is bullish on gold as institutions replace part of the traditional 60/40 bond allocation and Asia hoards physical gold.
- He sees major mining companies and critical minerals as under-owned despite rising shortages.
- He favors a broad commodities-driven move including agriculture-related resource companies.
- He is bearish on Europe and cautious on junk bonds as spreads narrow.
Ideas
Gold outperforms stocks and bonds.
Peter argues gold is in the dream scenario gold bugs warned about for decades: the US has isolated itself monetarily, economically, militarily and trade-wise, foreign official buyers are selling Treasuries, China and Asian countries are hoarding gold and will eventually incorporate it into trading systems, and financial institutions are replacing part of the traditional 40% bond allocation with gold. He says gold has already doubled the stock market's performance since 2021 and expects it to continue outperforming stocks and bonds.
US dollar weakens on foreign Treasury selling.
Peter contends the US has isolated itself on the world stage and that Japan and China are reducing Treasury holdings rather than financing US deficits. He expects the dollar to finally pay the price for years of easy access and says the US is likely to lose the contest with the much larger currency and bond markets.
US stocks face a perfect storm.
Peter sees a near-perfect storm forming for the stock market: rising long-term yields threaten the AI-driven equity rally and make debt funding harder, bond market stress would spill over into stocks, and midterm election history points to large stock drawdowns. He says capital preservation matters more than appreciation over the next couple of years.
Sell junk bonds as spreads narrow.
Peter notes that junk bond spreads have narrowed from early 2025 and says if spreads get close to Treasuries, investors will want to sell junk bonds too. He expects substantial losses across the bond market and sees high-yield credit as another vulnerable part of the coming bond stress.
Avoid or short long-dated US Treasuries.
Peter says Treasury bonds have lost money since late 2021 even including yield, and the losses will continue because the US is cheapening its paper, issuing more short-term debt, and facing reduced foreign buying from Japan and China. He identifies 5% on the 10-year Treasury as the line in the sand: if yields break above 5% and stay there for more than a couple of days, he expects a major bond crisis and additional selling. He calls staying out of Treasury bonds one of the best calls of his career.
Europe underperforms; EU beginning of end.
Peter says Europe has underperformed much of the Western world for decades, Germany's economic engine is effectively dismantled, and he believes the EU is at the beginning of the end. He views Ursula von der Leyen's push to channel European savings into European investments as an attempt to bail out poor EU economic decisions.
Major miners and critical minerals surge.
Peter argues critical minerals and metals in general are becoming acutely scarce at a time when ownership of major producing mining companies, whether base metals or precious metals producers, is at the lowest level relative to the rest of the market in the modern era. He expects mining to become a necessity theme and says major producers, not little juniors, are the way to play it.
Asia is the world's growth engine.
Peter says the growing part of the world is Asia, not North America or Europe, and that wealth and the mechanisms for wealth are being built and stored there. He sees Asia and China on an uptrend while the US is viewed in a downtrend, with Asian countries recognizing fiat currencies will not be the answer much longer.
Own commodities and agricultural resource companies.
Peter says the one area he would not be afraid to own even on price declines is gold, metals in general, and companies advancing important deposits across a wide spectrum including agriculture-related resources, because this is a whole commodities-driven move worldwide. He sees no other sector as compelling.
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This The David Lin Report video, published September 09, 2026, features Peter Grandich discussing GLD, USD, SPY, HYG, TLT, VGK, XME, REMX, AAXJ, DBC, DBA. 9 trade ideas extracted by AI with direction and confidence scoring.
Speakers: Peter Grandich · Tickers: GLD, USD, SPY, HYG, TLT, VGK, XME, REMX, AAXJ, DBC, DBA