00:00Mark, let me start with precious metals, because we see gold and silver prices both down by around 6%
00:05right now on my Bloomberg screen.
00:08I mean, does this strike you as interesting, a continuation, really, of what we already knew about the role that
00:13gold and silver were playing in this particular war, in this particular crisis?
00:17But I guess it's interesting that this is happening once again, another Monday, where this is the knee-jerk reaction.
00:24Yeah, good morning, Anna. We're certainly seeing some short-term capitulation-type price action in precious metals and some other
00:31assets out there.
00:32I don't think that this is the low, though. You know, as we've discussed a lot over the last couple
00:36of weeks, this should be a very negative environment for gold.
00:40All the marginal factors switched at the start of this month. We got a stronger dollar, we got higher yields.
00:46And if you're buying gold on the risk of a war in the Middle East, well, you got your war
00:51at the start of the month.
00:52And therefore, it's time to pat yourself on the back and take profit. So all those things are playing out
00:56right now.
00:56There's no further escalation that you can reasonably bet on without something that's completely doom-mongering for humanity.
01:03So I think that, you know, gold should continue to decline.
01:07Now, very short-term, this action looks like we've done a lot of the short-term stop losses.
01:11But I wouldn't be surprised if over the coming weeks, if the conflict continues, that we have another 10%
01:16or so downside.
01:18Mark, what about this argument that you could see a comeback for gold when the sell-the-winners phenomenon is
01:24over and done with?
01:27Well, I think gold has been selling off because of that dynamic, because the idea that, you know, it's somewhere
01:34where people have made a lot of money.
01:35You've got to remember that gold, you know, while it's off, whatever, $1,300 or $1,400 from the highs,
01:41it's still up about, you know, $700 or more from where it was a year ago.
01:47I don't have the exact kind of rates in front of me.
01:48So it's still up over the last year, and that's the dynamic which is kind of driving this, that basically
01:53we are seeing just general deleveraging in the market.
01:56People are having to sell down their winners to pay for losers, and I think that's what's been driving gold
02:01at the moment.
02:02You know, probably after we get through the crisis and dollar starts declining again and yield starts off and again,
02:07people will get back on gold.
02:10Ultimately, the long-term desire to seek alternatives to the dollar and fiat currencies is probably still valid.
02:19It's just we may not return, we won't return to that until the conflict is over.
02:25Let me ask you about stocks then, Mark, because we are 12 minutes away here from a European equity session
02:30that looks as if it's going to be pretty negative.
02:32European futures down by 1.8% right now.
02:35The Zetra DAX, as it often does, could take the worst of that.
02:39But that's not necessarily the end of it, because U.S. futures also pointing a little bit lower.
02:43This is starting out to be a negative session, negative week for stocks.
02:49Yeah, look, we're having the worst month for global stocks in three and a half years by some distance now.
02:53It's a pretty bleak month.
02:55Unfortunately, my view hasn't really changed.
02:57The last few weeks, I keep on saying it's bad, it's going to get worse, and I still think that's
03:01the case.
03:01As I said, it does feel like short-term there's been a little bit of capitulation,
03:05so I have no particularly strong view in the next 24 hours.
03:07But the market is still positioned very optimistically, despite the sell-off.
03:11There is still a belief that the conflict will end soon, the strait will open up soon.
03:16I'm not going to tell Bill what's going to happen in the conflict.
03:19I don't think anyone's got a clue, including Donald Trump.
03:21So, therefore, I don't know how anyone has conviction about it.
03:24What I do know is the asymmetric setup is for much more declines to come.
03:27To be contrarian right now is to stay being bearish even after these sell-offs.
03:31I'm not going to tell them to come.
03:31Let's go.
03:31Let's go.
03:31Let's go.
03:31Let's go.
03:31Let's go.
03:31Let's go.
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