Founder & President, Forest for the Trees (FFTT). Author of "The Mr. X Interviews, Volumes I & II.” I never solicit via DM's. RT not endorsements.
Joined December 2014
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The signals lined up before — they’re lining up again.
Here’s what we forecasted, and what happened next.
Get “What we said and how it played out”, Vol. II here. 👉 fftt-treerings.com/what-we-s…
Last week a chart made the rounds showing "US Job Openings (JOLTS) v. SPX" chart with a vertical line for when ChatGPT launched in late 2022.
Overlaying "SPX priced in gold" onto that chart shows SPX in gold tracks with JOLTS, visually confirming the "K-shaped" economy story:
In early 2024, Consumer Sentiment (blue, RS) completely diverged from the S&P 500 (red, LS) for the first time in 25+ years .
They moved in same direction until early 2024. Important macro signpost...yuge.
Let's watch.
EU: "We are ready to take pain."
[Pain arrives...a couple weeks pass.]
EU: "Please, just make the pain stop!"
Exhibit A of "Who has escalation dominance with the Europeans - the US or China" 👇
2/ The nice thing is everyone can take this into their own hands.
Store your surpluses in gold and BTC instead of USTs, and capitalism will over time work for you as the anti-capitalists print money over time to maintain the nominal value of USTs.
You cannot have capitalism when banking system "capital" is the IOU of a hopelessly insolvent sovereign (USTs.)
Capitalism requires the banking system hold a neutral reserve asset that floats in all currencies as its capital (gold).
Capitalism is dead unless we fix the money.
BANNON: These kids don’t hate capitalism. They’ve never had a shot at it. They’re at the receiving end of corporatism, just like Russian serfs before the Bolsheviks. We need more capitalists. One way to give them capital is not just better wages, that’s income. Let’s get them a little buy-in to the financial structure of the country. You can do that by reallocation.
...& yet a Democratic Socialist just got elected mayor of NYC - ie voters just expressed a message 180-degrees opposite of that of the chart below.
What explains the difference? Record wealth & income inequality. Adjust this chart by income & wealth decile.
@mattyglesias
4/ Star Wars pop culture reference to the same problem (h/t @freegolds):
2/ Here's a hint at part of the answer from the book "The Raven of Zurich: The Memoirs of Felix Somary"
If "USD dominance" is still a strategic asset, why would the US govt be adding copper, silver, uranium, met coal, potash, lead & other minerals to a list of critical minerals?
Why not just print the USDs & buy the minerals as we need them like we did for the prior 50+ yrs?
We have often heard "ultimately, the US military backs the USD."
In 2025, we have learned that what ultimately backs the US military are Chinese rare earths and German food banks.
...and yet some traders think gold & BTC have topped? 🤔
via @thesiriusreport
Wow…only 5 days elapsed from the time I speculated this would happen eventually (reposted at bottom):
2/ US 10y Term Premiums not falling as much as expected in response to weak DXY in 1H25 makes sense b/c it is akin to "burning your furniture to stay warm":
Weaker USD puts downward pressure on TP near term, but ultimately weaker DXY leads to higher inflation & higher future TP.
Since the BOJ removed YCC ceiling on 10y JGB's in July 2023, US 10y Term Premiums (blue, RS) have closely followed DXY (red, LS)
Aided by DXY having its weakest 1H in 50 yrs in 1H25, US 10y TP's fell...but not as much as would've been expected given the size of the DXY decline.
Since Inauguration Day, market pundits and so-called “experts” have continually attempted to undermine the Administration through negative rhetoric and fearmongering, pushing narratives like “Sell America.” And since that day, they have been dead wrong.
Thanks to the One Big Beautiful Bill, tariff revenue, and lower inflation, the S&P 500 sits near all-time highs. And just as importantly, the U.S. Treasury market’s total returns year to date are 6% (its best year since 2020 and the best of all developed bond markets this year). In fact, U.S. borrowing costs across the curve (from 2-year notes all the way to 30-year bonds) are down year to date.
Other developed bond markets cannot say the same. The U.S. 10-year term premium is basically unchanged while term premiums in other bond markets are rising. Lower Treasury borrowing costs mean lower corporate borrowing costs, lower mortgage rates, and lower car payments for Americans. The U.S. Treasury market is the world’s deepest and most liquid market, and it shows.
Luke Gromen retweeted
CNY-denominated commodities changes the release valve of commodity inflation from "commodities priced in USD" to "gold priced in commodities".
See the Gold/GS Commodity Index below from early 2022-present👇, up >3x in 3.5 yrs. @Geo_papic
Will Mamdani thank Bernanke, Paulson, and Geithner in his victory speech?
“Without Ben Bernanke, Hank Paulson, & Tim Geithner rolling out their ‘socialism for the rich’ programs to NYC in 2008, we never could have convinced New Yorkers that ‘socialism for all’ could work!”
Reminder that BTC is simply "one of the last functioning smoke alarms" of liquidity.
What BTC has done since October 6 is simply warning that another 3q22, 1q23, & 3q23 has begun (DXY up, stocks down, bonds down, until more liquidity comes once UST market dysfunctions again.)
Luke Gromen retweeted
The TGA hit 1 trillion at end of day on 10/30. Why did this happen?
Treasury's risk policy combined with Treasury's desire for stable/predictable bill issuance forced it this high. Its a mechanical effect that has nothing nefarious associated with it nor has anything to do with the Fed's ending of QT in December.
While Treasury did not need the TGA that high on 10/30, they did need it in the 950b range 10/27-10/29 to have enough to cover the expected week ahead gross debt redemptions + net spending less receipts (the real TGA "target"). The image is from my treasury model output I sent to stack subscribers early this month in my Fall QRA projection piece.
Note the area in yellow. Ends of months have high week ahead gross debt redemptions because you have 2 bill redemption days (every week has 2) + the end of month maturities. High debt redemptions combine with high week ahead net fiscal outflow because of the big medical outlays (medicare etc.) that happen on the 1st of the month (or previous business day when 1st on a weekend.
I had the TGA modeled to be at 964b pm 10/30. I was a little light which likely reflects 20-25b of missing spending because of the shutdown, though Ill confirm that when I tru-up the model vs. actuals this weekend. Treasury likely has also not taken that shutdown missing expense into account in their modelling/issuance either given its very uncertain nature (shutdown could end tomorrow conceivably)
So Treasury needed to be in 950b+ range 10/27-10/30 and the already built in net bill/coupon issuance over those days combined with no days with a ton of spending overwhelming receipts means the TGA floats up those days until 10/31 happens which has the medical spend for November because today is Saturday.
So 1T will be the high water mark for a while, probably until next Aprils tax receipts roll in.
Bottom line:
1. Its mechanical. Treasury doesnt want to issue huge cash management bills to cover the end of month "humps" in the TGA target level and they dont want to wildly vary bill issuance amounts. So the TGA is usually quite a bit above the risk policy target earlier in the month so it can just be a little/cushion above it at the end of the month
2. If my words cant convince you of this. Please compare my detailed model output in the image below vs. actual Daily Treasury Statements for October. I published this in early October. Its not perfect but it has a very good handle on where the TGA will go and why. I regularly provide these projections 3-12 months out for my s/s subscribers.
@dampedspring @FedGuy12 @BlacklionCTA
The Chinese did say in 2002 that they had a “20-year window of opportunity while the U.S. was distracted by the Global War on Terror”, per “The Longer Telegram.”
Even if that was the only instance in modern history of Chinese strategic thinking, it was a pretty prescient call.
STOP SAYING THE CHINESE PLAY THE LONG GAME. It's Orientalist foolishness that has to leave our discourse with China.
--Read a Five Year Plan from five years ago and see how different China has become than the leaders predicted.
--Chinese people are human beings, who think, like the rest of the people around the world, mostly about the challenges they're facing today and will face in the coming years.
--I've had plenty of serious people tell me, with a straight face, that the Chinese think in centuries. I've seen no evidence of that, anywhere, ever. The famous quote from Zhou Enlai to Kissinger, supposedly about the French Revolution - "too early to tell" -- is actually about the French student protests of 1968. When Chinese leaders make projections about what will happen decades off, they're doing that to kick the can down the road, or to imply that the Communists will be in power decades later, not because they're planning to be, say, carbon neutral in 2060.