A quick preview of next year
Gold is approaching its record high again, but this time at a more sustainable pace. Silver is breaking new records practically daily. Rotation continues in stocks. Synthetic Systems indicates an elevated probability of significant downside in 2026 Q1. As a whole, I expect 2026 to be a better than average year for cash and bonds.
Non-gold-silver commodities also deserve a closer look in 2026. Gold and silver still look good long term but have run up a lot and are historically expensive. Other commodities not so much. Oil especially is historically cheap and broad commodity indices like the SPGSCI, heavy in energy, could be the sleepers that awake in the coming year. The iShares ETF COMT would be one way to play it. And although I generally avoid mentioning individual stocks that I own, TPL would be another. It is not an “energy stock”, but a land stock … it just happens that the land is in the Permian Basin.
XS stocks have begun to pull away from US stocks in 2025, and I expect that trend to continue in 2026, as valuation finally matters. With the Rotation under way, dividends, quality and value, featured in our Model Portfolios, are outperforming.
Trump’s ‘cute’ tiny car plan could spark radical change in US auto industry. But do Americans want Japan-style compacts?
You can’t get the right answer by asking the wrong question.
Some Americans want tiny cars. Absolutely. But if the industry expects one size to fit all it will be sorely disappointed.
What’s the matter with making small cars, big cars, and everything in between? Everybody can be happy!
“What’s the matter with making small cars, big cars, and everything in between? Everybody can be happy!”
Because they want to sell debt & its tough to sell debt if its a small car. Car manufacturing is a rather unfortunate side to selling debt. Here in blighty i see SUV’s (Stupid unless vehicles) parked outside peoples homes because they cant fit up their (1970’s) size driveways.
More than plausible. Most Americans lean towards large and mid sized vehicles anyway, but definitely not all. One of those pint sized EVs would be perfect for my driving habits … almost all short trips around (a small) town.
Mega’s look into 2026:- Much of the same, but different.
Trump will carry on being unreadable, FED will keep on printing.
European union has backed away from stealing Russian assets but are about to all club together to “Loan” Ukraine 90 Billion Euro’s.
Russia will keep chipping away, now a dead cert they will want Odessa. Ukraine heading to becoming a land locked nation. Meantime in Blighty the loon in charge (PM) has decided that he will “Delay” more local elections due for May. Freedom denied!
The economy has flatlined, growth now turning negative, borrowing rocketting. Meantime those “Disability” number are climbing fast, by 2030 1 in 8 will be on this “Benefit”. However i am delighted to report a somewhat negative response to “War with Russia” appeal.
The powers to be have said that war is very likely, indeed the head of Mi6 herself said that “sacrifices will have to be made by everyone”…….(interesting titbit her Grandfather was a Ukraine Nazi war criminal…….just saying).
In Germany the SOB running the job (Merz) after overseeing the implosion of Germany industrial output has now said that he intends to draft the young men of armed services if he cant get enough volunteers.
The Young men are already on the streets telling them to piss off.
Here in Blighty the push back has been eye opening!…….you see, these Bastards have spent the last 30+ years trying to do-a-way with the idea of nationhood or any identity that would slow down their MAD immigration policy. White British & proud of your forefathers? your a Racist!
Now said Bastards are trying to pull the national heartstrings……….& getting told to pull the other one! As for the “New arrivals” they have expressed a preference NOT TO FIGHT, indeed they will ship out to another national to avoid this sh1t, i mean that’s why they did a runner from their old nation!
Nope, things are influx…………”May you live in interesting times”
>Synthetic Systems indicates an elevated probability of significant downside in 2026 Q1.
What would you consider “significant downside”? 10%? 20%? Even more than that?
I had been expecting at least a 20% correction (that stayed down more than a few days or weeks) for years and held a slug of Treasury bonds in anticipation of that scenario. I finally gave up this year and dumped almost all my Treasury bonds and invested the proceeds elsewhere.
If only my crystal ball were so clear! By “significant” I mean enough to warrant preparation. Check out the latest of the Quarterly Charts for context … there you can visually see the forecast selloff and compare to previous events. But bear in mind SS tends to be more timing than magnitude oriented … the vertical axis isn’t even calibrated in dollars … it’s each asset in terms of the average … so what you see is always relative performance.
For what it’s worth, I’m going into next year with a bit more treasuries and commodities than usual (SHV-GOVT & COMT) and correspondingly less stocks, but as always, am prepared to change my mind when the facts change;-)