The end game

Politicians and global business leaders continue to debate and brainstorm about the world’s destiny in Davos at WEF. Among other big topics, the change of world order, the impact of America first policies, including the potential impact of a conflict on Greenland and AI have filled headlines. It’s also been a year since President Trump took power for his second mandate. Since then, the S&P500 has risen 12.36%, currently at an all time highs. That implies a $7.7tn increase in market cap. But the U.S. debt has also increased by $2.2Tn over the last 12 months, and oficial rates have gone down. The majority of the U.S. population has not felt the market increase, and rates have not gone down enough to help them on those debts. That’s why he’s working on more populists solutions in terms of housing affordability, mortgage rates, credit cards, etc. On top of that, it does look like he’s confronting Russia, China, the EU, the Democratic Party and anyone else that present minimum opposition to his view of the world, where the U.S. is the main player and the judge. He’s using tariffs as a stick, and deals as carrots. It looks like there is an uncontested wind on the U.S. back. But there is something that is flashing danger underneath those headlines. In the chart below, you can see the last 12 months of silver, gold, the S&P500 and th MSCI World index. In real money terms, the main stock markets have not risen, they have stalled. The dollar as a cornerstone of the global fiat system, is weakening, not against other currencies (which it is) but against true money (gold and silver). The monetary system is changing in plain sight, but it’s not clear yet (at least not to me) what’s the end game.

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