The Treasury Market Is Sending a Warning Almost Nobody Understands

The Treasury Market Is Sending a Warning Almost Nobody Understands

For decades, Wall Street laughed at anyone who warned that the debt machine had an endpoint.

Luke Lovett
Luke Lovett
Silver Is Ripping Without Retail Mania: $70 Metal, Weak U.S. Coin Premiums and Persistent Asian Physical Demand

Silver Is Ripping Without Retail Mania: $70 Metal, Weak U.S. Coin Premiums and Persistent Asian Physical Demand

Asian physical demand: strong. U.S. retail coin demand: weak. Western silver price: breaking out anyway.

Luke Lovett
Luke Lovett
The Great Euphemism: “Calling Back and Reissuing Debt” While the Aggregate Burden Expands, Bond-Market Supply and Demand Get Distorted, and Metals Wake Up

The Great Euphemism: “Calling Back and Reissuing Debt” While the Aggregate Burden Expands, Bond-Market Supply and Demand Get Distorted, and Metals Wake Up

The Bond Market Asked for 5.34%. Treasury Answered With Bigger Buybacks. Gold and Silver Answered Even Louder.

Luke Lovett
Luke Lovett
No Backwardation. No Lease-Rate Crisis. No COMEX Drain. So Why Did Gold-Miner Breadth Just Explode From <5% to 62%?

No Backwardation. No Lease-Rate Crisis. No COMEX Drain. So Why Did Gold-Miner Breadth Just Explode From <5% to 62%?

GDX has risen roughly 22% in three weeks, while the percentage of constituents above their 200-day moving average exploded from under 5% to roughly 62%.

Luke Lovett
Luke Lovett
Expensive Stocks. Extreme Leverage. Expensive Money. Cheap Commodities. One of These Prices May Be Very Wrong.

Expensive Stocks. Extreme Leverage. Expensive Money. Cheap Commodities. One of These Prices May Be Very Wrong.

Extreme valuation + extreme leverage + rising cost of capital = shrinking margin for error.

Luke Lovett
Luke Lovett
Private-Credit Stress Hits 2017 Levels as Japan’s 10-Year Reaches a 30-Year High—While Gold, Silver, Oil and Copper Rise Together

Private-Credit Stress Hits 2017 Levels as Japan’s 10-Year Reaches a 30-Year High—While Gold, Silver, Oil and Copper Rise Together

The common thread is not “everything is crashing.” It’s that the price of balance-sheet capacity is rising, while the market still behaves as though liquidity can always be summoned cheaply.

Luke Lovett
Luke Lovett
Jane Street Lost $15 Billion. Japan’s Yields Are Exploding. Gold Is Above $4,400. Connect the Dots.

Jane Street Lost $15 Billion. Japan’s Yields Are Exploding. Gold Is Above $4,400. Connect the Dots.

There are three separate stories here, and the mistake would be to collapse them into one giant “everything is manipulated / everything is breaking” narrative.

Luke Lovett
Luke Lovett
42.9 Million Ounces Just Piled Into Shanghai — So Why Is Silver Still 11% More Expensive There?

42.9 Million Ounces Just Piled Into Shanghai — So Why Is Silver Still 11% More Expensive There?

China is pulling hard. Western plumbing is still functioning. New physical supply is slow. The market hasn't reached the point where promises for future silver are being rejected in favor of immediate metal. Yet. The regime-change signal is incredibly specific now...

Luke Lovett
Luke Lovett
What constitutes pristine collateral when the issuer of the supposedly pristine collateral is itself increasingly leveraged?

What constitutes pristine collateral when the issuer of the supposedly pristine collateral is itself increasingly leveraged?

Who understands that bond yields and debt levels going up together with this will end with massive rotations into genuinely pristine collateral?

Luke Lovett
Luke Lovett
The Abundance Illusion Is Breaking: Oil and Silver Are Two Pressure Gauges on the Most Leveraged Machine in History

The Abundance Illusion Is Breaking: Oil and Silver Are Two Pressure Gauges on the Most Leveraged Machine in History

Two of the physical inputs the modern world has the greatest difficulty replacing are beginning to behave as though the financial system has badly mispriced their scarcity.

Luke Lovett
Luke Lovett
History's Largest Expansion of Financial Claims Is Quietly Colliding With a Surprisingly Small Inventory of Reality.

History's Largest Expansion of Financial Claims Is Quietly Colliding With a Surprisingly Small Inventory of Reality.

If the world’s most important energy commodity can sit near ordinary-looking prices while America’s strategic buffer is back at 1983 levels, what else is being priced off today’s extreme leverage while ignoring tomorrow’s real world constraints?

Luke Lovett
Luke Lovett
The World's Most Leveraged Financial System Is Running Out of Good Choices—and Precious Metals Know It

The World's Most Leveraged Financial System Is Running Out of Good Choices—and Precious Metals Know It

The precious-metals bull market looks like it has reasserted itself, and the important part is why.

Luke Lovett
Luke Lovett
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