The Stagflation Signal Everyone's Missing
| | | Hey there, Blake here. | Copper versus gold just hit levels we haven't seen since the worst of the 2008 financial crisis. While everyone's celebrating "good" economic data this week, the charts are screaming a different story - we're approaching stagflation territory. | The copper-to-gold ratio sits at 0.13 - near the lowest levels in decades. During the 2020 lockdowns, this ratio spiked to 2.2 as stimulus drove copper demand. | Now it's collapsing toward 2008 crisis levels. | | | | Copper measures real demand. Gold measures inflation fear. When copper trades at just 13 cents for every dollar of gold, you have inflation without growth. | THE MATH BEHIND THE PANIC | Here's the calculation: if the dollar loses 1% purchasing power (coming in September based on my analysis), equities historically move 2.5% higher from currency debasement alone. Your purchasing power evaporates while asset prices inflate. | Jerome Powell's Jackson Hole nervousness about labor markets tells me next Friday's jobs data will be ugly. Bad jobs + stagflation signals = Fed forced to cut rates into inflation. | THE TRADES THAT MAKE SENSE | Gold: Targeting $3,730. If gold breaks $3,533, expect it to duplicate recent patterns for a $200 move. | Metals Mining: Buy miners, not gold directly. Their margins expand with gold prices and they pay dividends. | Consumer Staples: Kroger pays 3% just to own it. In stagflation, people still need groceries. | Bonds: Rate cuts mean bond prices rise. IEF is my play. | THE UNCOMFORTABLE REALITY | Consumer sentiment confirms what the copper-gold ratio shows: people feel inflation reality despite "good" headlines. Energy deflation since 2022 has masked the underlying stagflation picture. | Either copper spikes dramatically (showing real demand growth), or we're heading deeper into stagflation than most realize. | The Fed meeting in two weeks will confirm what charts already scream. Position accordingly. | If you want to trade alongside me next week, you can find me in the TheoTrade Main Chatroom. | Have a great Labor Day! | Blake Young | | | | Stagflation Plays | Stagflation Plays: | Newmont (NEM): Mining play on gold strength, dividend paying Metals & Mining sector: 8-10% opportunity, margins expanding with gold Consumer Staples: Costco $940 puts (2.5% premium), Walmart defensive rotation Bonds (IEF): Rate cut positioning
|
|
| | | Reader Question of the Week | Q: Does the dollar index have to go up with gold weakness? | A: No - dollar index is dollar vs other currencies, not vs gold. The dollar could be weakest of all currencies so the index doesn't move, but gold could fade. Generally 85-90% correlated but not always. Global disinflation can bring gold down without the dollar index rising. |
|
| | | Don't Miss It… | Don Kaufman just spotted the setup that killed portfolios in September 2022. He's seeing the same warning signs flashing now - and this time, we only get 3 trading days to position before the damage hits. | His video drops at market close today. He's calling out the specific levels that break everything, plus the 3 trades he's making while everyone else is still celebrating last week's "recovery." | The shortened Labor Day week isn't random timing - it's when institutions dump positions they don't want to babysit. Don's positioning for exactly that scenario. | Watch here before Tuesday's open. |
|
| | |
|
| | | | | Update your email preferences or unsubscribe here © 2025 Disclaimer: Neither TheoTrade or any of its officers, directors, employees, other personnel, representatives, agents or independent contractors is, in such capacities, a licensed financial adviser, registered investment adviser, registered broker-dealer or FINRA|SIPC|NFA-member firm. TheoTrade does not provide investment or financial advice or make investment recommendations. TheoTrade is not in the business of transacting trades, nor does TheoTrade agree to direct your brokerage accounts or give trading advice tailored to your particular situation. Nothing contained in our content constitutes a solicitation, recommendation, promotion, or endorsement of any particular security, other investment product, transaction or investment.Trading Futures, Options on Futures, and retail off-exchange foreign currency transactions involves substantial risk of loss and is not suitable for all investors. You should carefully consider whether trading is suitable for you in light of your circumstances, knowledge, and financial resources. You may lose all or more of your initial investment. Opinions, market data, and recommendations are subject to change at any time. Past Performance is not necessarily indicative of future results. PO Box 24790
Christiansted, Virgin Islands 00824, United States of America | | Terms of Service |
|
|
|
|
|
0 Response to "3 Stagflation Trades While Everyone Celebrates 'Recovery’"
Post a Comment