0:00 Something just happened in the financial markets that's only occurred four times in the last 50 years. 1973, 1978, 2008, and right now. Every single time it happened, what followed wasn't just a recovery. It was a complete repricing of every major asset class. I'm talking about stocks, real estate, commodities, everything. Everything in a specific order. Now, right now, we're at step one. Foreign central banks just dumped 82 billion in US treasuries in a single month, the lowest level of holdings since 2012. And the government is already spending more on debt payments and entitlements than it collects in taxes. And the one the one emergency tool they used last time to buy themselves time, well, it's gone. So, in this video, I'm going to show you the pattern. I'm going to show you the exact
0:47 sequence that plays out across your portfolio when this happens. I'm also going to show you how to position ahead of it before most people even realize what's coming. All right, you ready? Let's go. Okay. So, to start to understand where things are going, first we have to understand the historical patterns. All right. Now, there's one there's one pattern. It's only happened four times in the last 50 years. And and understand that, we have to start with what just happened to gold because this is where the pattern starts. This is where it begins every single time. So, in late February, gold was sitting at all-time highs. It was around $5,600 an ounce. Okay. Then the Iran war starts. Then every analyst, every fund manager, every talking head on TV, they expect gold to rally, right? War breaks out, gold's
1:33 supposed to go up, right? That that's the playbook. But it did the opposite. You see, gold dropped 25% in less than a month. And it went as low as $4,100 on March 23rd. So that's the biggest weekly loss since 1983. Sentiment completely flipped from euphoria to panic, right? Almost overnight. Now the daily sentiment index for gold went from the high8s to 15 in just a matter of weeks. And when that happened, everybody ran. Retail investors, they sold out. Leverage traders, they got liquidated. And the financial media, they all started running headlines about, you know, gold being broken, about the safe haven trade being dead, all of those things. And look, if you just zoom into the 30-day window, it it looks terrifying, right? It does. But here's
2:19 what nobody on TV seems to be talking about, at least not showing you. If you zoom out, and I'm talking about way out, this exact move that we're seeing right now, a 25% drop or greater, a 25% draw down or greater during a major global crisis like we have right now has only happened four times in the last 50 years. Now, every single time it happens, what followed was one of the most explosive rallies in gold's history. 1973, OPEC oil embargo, Yam Kapoor war, uh, gold dropped 29%. Within 15 months, it rallied 117%. 1978, the Iranian revolution, and during that, the Shaj regime collapsed. Gold dropped 22%. Within 12 months, it ripped 300% to its all-time high. In 2008,
3:06 global financial crisis, bare sterns went under, right? The credit markets froze. Gold dropped 34%. Then the Fed launched QE and gold ran 180% over the next 3 years to over 1,900 an ounce. And and right now 2026, I ran war again. Straight of horses is closed, right? Gold dropped 25%. The average draw down across those four episodes was just over 25%. Gold's draw down from February high to March low exactly 25%. And gold's already bouncing. It's back above about 4,700 right now. As of this week, it's starting to move a little bit higher. But the pattern's triggered, right? The snapback has already started. But the thing is is that well, at least the thing that I'm really paying attention to right now is that the gold recovery,
3:53 it's not the real story, right? Gold's the signal in the story, right? Every single time this pattern completes 73, 78,08, gold wasn't the only thing that started moving, right? There's a very specific sequence that plays out across multiple asset classes. Stocks, bonds, real estate, commodities, they all moved, but in a particular order. And the reason they moved in that order is the same every single time. Because every single time gold gave this signal, it was telling you one thing. was the math behind the financial system had broken. The people in charge were about to be forced into a decision that they didn't want to make. And it's that decision, the one that they always make. They don't want to, but they always make it, is what drives the entire sequence. Now, it starts with a piece of math that
4:39 again, nobody seems to be noticing, at least they're not talking about right now. And right now, it's all starting with oil. Now, before the Iran war, about 20 million barrels of oil per day were flowing through the straight of Hormuz. All right, that's about 20% of the world's oil supply moving through one single choke point. Now, when Iran closed the straight, well, the world scrambled to replace those flows. So, we've seen Saudi Arabia, they've ramped up um its pipeline to the Red Sea. Uh we've seen the UAE, they pushed more through um you know, their their pipelines. The IAEA has released emergency reserves. Russia started moving floating storage around. And all of that gets you to about 12 and a half million barrels a day in in replacement supply. About four million of that is temporary. And and right now we're just
5:26 burning through those stock piles. And those stock piles, they're not getting refilled. Now Bloomberg estimates that the real shortfall is over 11 million barrels a day. All right. So what does that actually mean? Well, it means the world is short. Somewhere between 7 to 10% of its oil supply right now. And that number matters a lot because in the last 60 years, a drop that big, it's only happened two times before. In 1980, global oil consumption fell about 4.3% and it caused a recession. During COVID, it fell 9.2% and the Fed had to print $6 trillion. Right? The government had to send out STEMI checks just to keep the system from collapsing. And so, we're in that range right now, right? And this isn't just an oil story. When oil
6:11 spikes, it raises the cost of everything, right? Everything that's downstream from energy. Diesel moves. Diesel moves your groceries. So, your groceries move, right? Jet fuel moves, right? So, your packages move. Natural gas heats your home. It powers factories that make the things that you want to buy. So, all of those things go up, right? That inflation, it's already baked in, but it hasn't shown up yet. It hasn't shown up in the official numbers yet. It takes weeks for the energy spike to filter through supply chains into the prices that you pay. But it's all coming. It's all coming down the pipeline. But here's where maybe it gets a little bit worse. In 2022, when oil prices spiked because of the Russia Ukraine war, the government had a cheat code. Right back then, Biden opened up the strategic petroleum reserve, which is the emergency oil stockpile, and he flooded the market with supply to push
6:58 the prices back down. And it worked, right? It bought some time. The problem is that cheat code's gone. The SPR is at its lowest level in decades. and neither Biden nor Trump refilled it when they had the chance. So now there's this time where we're at right now. There's no buffer, right? The price is going to go wherever the market seems to take it. And there's a line in the sand that matters. There's a line that we're looking at over the last 55 years every single time US oil consumption as a percentage of GDP crossed 3% every time the US went into a recession. Now that threshold kicks in around $120 a barrel. All right. So that's the line we're watching for. Now, we've got an economy that's sliding towards recession, right? With oil prices that guarantee it gets worse. And that brings us to the piece of math that almost nobody's reporting
7:45 on. Well, I'm reporting on it. But the number is called true interest expense. And it sounds boring, and it kind of is, but it's important, right? It's what the government spends on things it literally cannot cut, right? So for example, social security, Medicare and interest payments on the national debt. These things have to be paid. Now as of February, that number hit 104% of the federal tax revenue. What this means is that the government is already spending more on the most essential bills it can't cut, right? It can't avoid. It's spending more on that than it brings in from every tax dollar collected. Every single dollar spent on the military, uh, on infrastructure, on education, on anything else is borrowed
8:30 money, right? So, think of it like think of it like your household. Imagine like your most important bills like your rent, your car payment, and your electricity for example, right? And just those things were more than your entire paycheck. So everything else, right, the food, the gas in your car, things like that, they all had to go on a credit card. Well, that's essentially what the US government is having to do right now. Now, this is happening before a recession even starts. This is a pretty big deal as you could probably imagine because when a recession hits, right, if your income takes a takes a hit, tax revenue drops, right? People earn less, companies make less, capital gains shrink, right? Because asset prices go down, but the obligations, they don't go down, they go up. All right? So, there's three doors. Now, all three doors lead to more
9:18 dollars in the system. The question though that we want to look at is how fast and how messy. Now, if you look at what they chose in 1973, of course they printed. In 2008, yeah, of course they printed. In 2020, uh, yeah, of course they printed, right? The door they choose is always door number two. Always. And it's because, I mean, it's a smart long-term move, right? It's let everything crash and burn or we keep it going. It's the only move that keeps the system running today, tomorrow, and into the future. and and and yeah, it kicks the can down the road. It makes the problem worse next year. And once the printing starts, something specific happens to every major asset class. And it doesn't happen all at once. It happens in a sequence. All right? And it's the same sequence that we want to
10:03 capture because it happens the same sequence every time. And if you know the order, then you can position ahead of each wave instead of having to chase it. Right? Instead of having to chase after the fact, we want to get in front of it. Okay? Okay, so the sequence when the Fed gets cornered and they start printing um and we just showed you why, right? We showed you why this is we're heading here. The money doesn't flow into everything all at once. What happens is that it moves through the economy in waves. Now, like I said, the order happens in the same sequence every single time. And again, by understanding the order, we can get in position before the waves hit. And of course, if you don't, then you end up chasing prices, but unfortunately, they move higher before you get in, right? So, you don't want that to happen. you don't want to buy the top. Okay, so let's break these down. So wave number one is where gold and commodities, they move first, right?
10:49 So we're starting to see this as the earliest signal. Gold, like I said, sold off 25%, but it's starting to make a rebound right now. Gold's sort of the market's smoke detector for monetary debasement. So before the Fed even announces anything, before the printing press officially starts turning on, gold starts moving, right? Because because of the smart money, the smart money understands this, the central banks, the sovereign wealth funds, the institutional allocators, right? They can see the same math that I just walked you through, right? So, they know what's coming. So, they start buying before it's obvious at this point. Now, this is where we are right now. As I said, right? Like gold bottomed March 23rd and it's already coming back. It's already above 4,700 and it's climbing, right? Central banks bought over 700 tons of gold last year. China's been buying now for 15 straight months. So, the wave 1
11:36 move, it's already started. But, of course, that doesn't mean it's over, right? If the historical pattern holds, gold's got a long way to run from here. But the signal, it's already fired off. And it's also it's not just gold, right? Commodities broadly start to move in wave 1. So think energy, think uh industrial metals, think agriculture, commodities, anything that's priced in dollars and has real world scarcity. Okay, that's what we're thinking about. Now, when the market spells inflation and liquidity coming, it moves into things that can't be printed. All right, so that's wave one. wave number two, then the dollar weakens. Now, I know right now I get it, right? The dollar's strong, right? The Dixie is above 108. And that makes sense if you understand the mechanics, right? Because oil is priced in dollars. So, when oil spikes,
12:21 then every country on Earth needs more dollars and they need the dollars to pay for the oil to pay their energy bills. So, they're going to sell whatever they have, the bonds, the equities, the gold, whatever, to raise dollars. Since everyone's trying to get dollars, that pushes the demand, that pushes the dollar up. What comes next then is that that strength is temporary, right? The the strength is driven by desperation, not by confidence in the dollar. So, like I said, foreign central banks, they're not buying dollars because they believe in the US economy. They're buying dollars because they need to keep the lights on. So, every dollar they raise by selling US treasuries makes the US debt math worse, right? which makes the pressure to print more money makes it more intense, which is the thing that ultimately kills the dollar strength. Now, every time the Fed has been forced
13:08 to print, again, back to 2008, 2020, the dollar was strong going into it, but the crisis pushes the dollar up. The policy response is what brings it back down, right? That's the sequence. So, we're in the first half right now, right? the do the the dollar is strong. But in wave two, what happens is the Fed makes its move. Um they start easing and the printing begins. And when the dollar goes to roll over, it amplifies everything that happened in wave 1. So commodities are priced in dollars globally. So a weaker dollar means commodity prices go up even faster at this point. Now the inflation that was already baked in from the oil shock gets accelerated by the currency losing value. Then we go to wave three. Now in wave three we're talking about hard
13:53 assets and they repric. Okay, this is where commodities beyond gold they start to move. Now we're talking about real estate. We're talking about land. We're talking about commodity producing equities. Now once inflation is running and the dollars weakening then investors start looking beyond gold, right? They start looking for things that that hold value. They want assets with real world scarcity that also generate income or have productive value. So think, you know, real estate's the classic example here. So like for example, in the years following 2008 after the Fed started printing, real estate bottomed out and then it ran for a decade, right? Not because the economy was great. It was because the dollars used to price real estate were worth less every year. So the house didn't get more valuable. The currency it was priced in got weaker.
14:40 Now the same thing happened back in the 1970s. Real estate was one of the best performing asset classes of that decade. Not not despite inflation, because of inflation. Right? Wave three is where also maybe mining stocks, energy producers, infrastructure plays where all of that starts to move and it moves aggressively. All right. Now, these are think businesses that own real stuff, right? They own real stuff in the ground. Um they sell it at the prices that are rising with inflation, which means that their revenues go up while their debt stays fixed in the weakening dollar. So that's like a built-in advantage. Then we get to wave four. Now wave four is the liquidity wave and it hits risk assets. So it pushes all the way out of the risk curve and this is the final wave, right? And this is where
15:25 it starts to get really interesting. Once the Fed is actively printing and the dollar is weakening, the liquidity floods the entire financial system. It starts to lift equities broadly, but it doesn't lift them all equally. Right? The assets that benefit the most are the ones that are the hardest to produce, right? The ones that you just can't print more of. You can print more dollars, but you can't print more Bitcoin, right? This is where Bitcoin really starts to enter the conversation here. And not as a speculation tool anymore, not as a not as a tech bet or a tech stock. We're talking about as the logical endpoint of this entire sequence, the four waves. Now, Bitcoin is a fixed supply asset. It exists natively in the digital financial system. So, when liquidity floods in and the dollar weakens, then Bitcoin captures that flow. It's like this
16:11 monetary sponge. And the reason why is it's the hardest money available. We're talking only 21 million. That's it. There will never be any more. No central bank can dilute it. Uh no government can print more of it. Now in 2008, Bitcoin didn't exist yet. But it was literally born out of that exact crisis. Right? Satoshi launched it in January 2009, months after the Fed started printing. And of course, you could look at what happened, right? After the 2020 printing cycle, the Fed expanded its balance sheet by by trillions. Bitcoin went from roughly 6,000 to over 60,000, then to a 100,000. And that's not a coincidence. That's the sequence that plays out. So, let's lay out the timeline of how this has historically played out in the past, and maybe it'll play out again. In 2008,
16:58 gold bottomed in October, right? The S&P bottomed 5 months later in March 2009. Real estate bottomed in 2011. And in 2012, each wave lagged the one before it. Now, the money moved through the system in that order. And right now, again, we're at wave 1. Gold's bottomed and it's bouncing. But the question isn't whether the other waves are coming. The question is whether you're positioned for them before they arrive or hopefully not. Hopefully, it won't be the person reacting, right? Wondering what's going on after it's already happened. So, anyway, that's the pattern, right? You have the mechanism, you have the sequence. The question is, what are we going to do with this information, right? Because like I said, the people who build real wealth through these types of cycles, they're not the ones who make the one big bet. They
17:45 don't, you know, hope and pray that it works out. They're the ones who build a structure that captures value across the entire sequence as it plays out. So, let me ask you something. What does your portfolio actually look like right now? Most people's money is set up for one environment, and that environment right now is slow, steady growth, low inflation, um, you know, a stable dollar, probably a 60/40 stock bond portfolio. Uh, maybe you have like a target date retirement fund, maybe you have some cash in savings, and that setup worked fine for 15 years, but that's not the environment we're in anymore, right? I I just walked you through the math. Oil is spiking. Inflation's coming. The government's spending more on its fixed obligations than it collects in taxes. And the Fed is being forced to print. Doesn't want to, but it's going to have to. And like
18:31 I said, the dollar's strong right now, but the policy response is going to weaken it. And so, there's a specific sequence of asset moves that follow that. Now, if your portfolio is built for the old environment, you're not just going to miss the upside of the sequence, you're going to get hurt by it. Long duration bonds, they get destroyed when inflation runs. Cash of course loses. We know that as the dollar weakens, but the growth stocks with no real assets behind them, they're the ones that are going to get repriced, right? When the capital um the cost of capital rises, all those get repriced down. So, the biggest risk right now isn't a market crash. It's being positioned just for the wrong environment. It's sitting in an allocation that was designed for a world that doesn't exist anymore and then wondering why your account's not keeping up. Now, you might be asking, what does
19:16 the right structure look like? Well, you need exposure across the sequence. All of those, right? Not all at the same time, not equal weight, but intentional. Like, for example, do you own anything that benefits from wave 1? That would be gold, commodities, things that move first when inflation are rising. Do you own anything that benefits from a weakening dollar? Do you have hard assets, real estate, commodity producers? Um, do you have those types of things? Do you have anything that generates income when the currency is losing purchasing power? And then do you have a position in truly scarce assets like Bitcoin that capture liquidity waves at the end of the sequence? Now most people can answer yes to I don't know maybe one of those. Some can't maybe answer yes to any of them. But now that you know the sequence knowing the
20:02 first step, the question is now what am I going to do with the structure and the layers, the allocations, the timing, when to add each position and that's a different skill set. It's the difference between knowing what's going to happen and knowing what to do about it. So, four times in 50 years, we're in the fifth, right? Gold's already signaled. The sequence has started. The only question is whether you're positioned ahead of it or behind it. Now, if you want to know more about how I'm building wealth systems to prepare for this environment, then you should probably go watch this next video right here, and I'll see you over there.
