Housekeeping: Good Morning.
[EDIT- As we finish writing this, Jobs numbers hit up scorching hot, blowing the doors off bearish bank estimates. The dollar strengthened, which is to be expected. Stocks sold off which is supposed to happen but rarely does. But Gold and Silver are up, even with the puke on data release. Reaction chart at bottom- VBL]
“The Gold reset is a process, not an event”
Today
Discussion: Gold ETF Outflows Set to Reverse in 2025
Premium: Gold ETF Outflows Set to Reverse in 2025
Discussion: Gold ETF Outflows Set to Reverse in 2025
Consensus is for gold to rise in 2025, but risks may be leaning toward a lot vs. a little if ETFs are a guide. A top force for the metal's rally to accelerate is if the US stock market and Treasury yields decline, and Bitcoin could lead the way. Four years of gold ETF outflows may be as bad as it gets
A top question for 2025 is what might keep the US stock market on a tear and interest rates relatively high for investors to continue shunning gold? Topics Discussed
Gold ETFs Outflows May Shift to Inflows in 2025
Are Gold Investors Sniffing Out Peak SPX vs. Gold?
Global Deflation Contagion Risks and Gold
Bitcoin May Have to Go Up vs. Gold in 2025, or Else
The correlation between Dogecoin and Bitcoin/gold
The extreme juxtaposition to the S&P 500 vs. gold ratio bottoming around 0.6x vs. a world bond-yield premium near 160 bps to the US in 2011
Gold ETFs Outflows May Shift to Inflows in 2025
Mark Notes: Gold ETFs haven't had a year of net inflows since 2020, but that may change in 2025, with price implications
Are Gold Investors Sniffing Out Peak SPX vs. Gold?
A bottoming in gold ETF holdings from the high about 12 years ago appears consistent with some normalization in the SPX/gold ratio toward its 20-year average of 1.8x.
Global Deflation Contagion Risks and Gold
Led by China, central banks are accumulating gold for a reason, and a bit of downward reversion in SPX/gold could fuel ETF investors, adding tailwinds to the metal.
Bitcoin May Have to Go Up vs. Gold in 2025, or Else
Limited supply, ease of storage and monetization have favored gold vs. commodities, but Bitcoin is edging the metal with a big difference -- the unlimited supply of crypto competitors.
Dogecoin and Bitcoin/Gold
At about $120 billion on Jan. 3, ETFs tracking Bitcoin are rapidly approaching gold's holdings, but are well above on a risk-adjusted basis. What we find disconcerting from the graphic is the high correlation between Dogecoin and Bitcoin/gold.
News/Analysis:
Markets Recap:
Stocks ended little changed as investors analyzed two conflicting sets of jobs data. Benchmark Treasury yield hit a more than eight-month high and the dollar rose after a report said Trump was mulling a national economic emergency declaration on inflation. Oil prices fell, while gold edged up
Market News:
Constellation Energy nearing $30 billion deal to acquire Calpine, sources say Constellation
Chevron targets $6-8 billion in free cash flow growth next year, CEO says
Wall Street cuts Exxon earnings views after fourth-quarter snapshot
Yellen says CFIUS made thorough analysis of blocked US Steel-Nippon Steel
Workers at Ford joint venture plant in Kentucky file to hold union election
Geopolitics/ Politics
MIDDLE EAST
Israeli Defence Minister Katz says he has ordered the IDF to present him with a plan "for the complete defeat of Hamas in Gaza," if there is no hostage deal by the time incoming US president Trump takes office (Jan 20th), according to ToI journalist.
US President Biden said they are making progress on a Gaza deal and he is still hopeful there will be a prisoner exchange.
RUSSIA-UKRAINE
US President-elect Trump said Russian President Putin wants to meet and 'we' are setting it up.
Japan is to impose additional sanctions against Russia-related individuals and entities.
French President Macron said he and UK PM Starmer reaffirmed commitment to supporting Ukraine, while they also discussed the situation in the Middle East and the UK-EU relationship.
OTHER
Venezuelan opposition leader Maria Corina Machado was arrested after leaving a march in her first public appearance in months but was later freed after a brief detention, while a White House spokesperson said the US calls for the right of Venezuela’s Machado to speak freely and for President Maduro and representatives to cease harassment of the opposition.
via Newssquawk
Data on Deck: Unemployment Rate
MONDAY, JAN. 6 S&P final PMI
TUESDAY, JAN. 7 Speakers, ISM
WEDNESDAY, JAN. 8 Minutes of Fed's December FOMC meeting
THURSDAY, JAN. 9 Wholesale inventories
FRIDAY, JAN. 10 U.S. unemployment rate1
Final Market Check
