Marc Chandler – Capital Outflows, Gold’s Surge, and the Growing US Risk Premium
US markets are under pressure as capital continues to exit the country. Marc Chandler sees this as the fourth major shock in recent years – after COVID, the war in Ukraine, and US-China decoupling – with a new “US shock” centered around rising tariffs and geopolitical unpredictability.
European investors are unwinding heavy US exposure from 2023, rotating capital into bonds or back into home markets. Meanwhile, gold’s breakout reflects a global search for safety and trend momentum, while the dollar is not benefiting from its usual safe haven role.
Marc believes we’re headed for a pronounced slowdown, not stagflation. The Fed may begin cutting rates mid-year but not because inflation is back at 2%, rather due to a weakening labor market. Until then, risk aversion is high, capital is sitting on the sidelines, and preservation, not growth, is the priority.
The tariffs are just starting to take ahold, tariffs are always disastrous for any country’s economy, whether on the receiving or the sending. DT
There seems to be a lot of fever about the move up in copper. If we have a recession look-out the copper market will be affected and not in the way that the copper bulls, see it. I keep hearing copper this and copper but copper as a metal is very sensitive to the economy. Gold is as well but one is negative and the other is positive. DT LOL! 🤣🤣🤣