In partnership with
Happy Monday, investors. At some point today we’re supposed to hear an update from the White House on new economic retaliations against Iran.
President Trump said his team is preparing “the most crushing economic operation ever,” and while geopolitics-watchers will be eager to react, the bond market will surely have the more weighty say in what comes next.
Rising hard assets
Scott Bessent had planned to talk the bond market down but instead juiced up bitcoin, gold, silver and platinum.
When the US Treasury signals that bond yields present a policy problem, it also implies that the currency will be the release valve, which in turn pushes investors toward hard assets that operate beyond government money printing.
The 30-year last week touched its 5.3% for the first time since 2007, and it’s shorter-dated counterparts have also turned sharply higher in August.
Between how bond traders have been positioning and what Treasury Secretary Bessent has been communicating, the debasement trade has found its moment of revival, as I wrote last week.
Gold jumped more than 5% last week while bitcoin notched a 23% gain for its best week since 2023.
Silver and platinum, similarly, have rallied and all signs point to these two — as well as bitcoin — joining gold with positive year-to-date returns soon.
Meanwhile, the US dollar has weakened 2.4% over the last month for its softest close since May.
While White House officials’ jawboning provide some catalyst for the market action, longstanding macro variables have flashed the same warnings for years:
US federal debt hovers near $40 trillion, and interest costs now run higher than $1 trillion a year
The US deficit is near 6% of GDP, well above the 50-year historical average of 3.8%
The US dollar has lost about 53% of its purchasing power since 1990
And this math extends beyond Washington to London, Tokyo and other developed economies around the world.
Bessent said investors are trading on “bad information,” and while it may be true that he has a fuller picture across global markets, more context would not change any of the numbers above.
Even if investors choose to ignore the debasement trade now and then, it’s a forever theme that will never lose its bid in the market because governments will never stop devaluing their currencies.
Great content starts with a story. Learn to tell it.
Every brand that wins online has one thing in common: a content strategy that's built to last, not just a blog that gets updated when someone has time.
HubSpot Academy's free Content Marketing Certification covers the full picture — from crafting a compelling brand story, optimizing for search, creating videos that convert, and measuring performance in a way leadership actually understands.
14 lessons. Practical frameworks trusted by marketers around the world.
Whether you're building your content strategy from scratch or formalizing a structure around existing actions you're taking today — this is the course that makes it click.
Start the course free — and finish with a strategy that scales.
Market snapshot
Elsewhere
🚢 Canada is preparing for a trade war with the US that could last past the midterms. Officials said Ottawa will match Washington's 50% tariffs dollar for dollar and that Canada is designing a domestic aid package to ride out the balance of Trump's term. (Yahoo Finance)
🎯 The US will soon unveil the toughest US sanctions in history on Iran. Iran has threatened to seize vessels in the Strait of Hormuz and warned it could neutralize financial pressure, but White House officials have signaled “endgame” is coming. (CNBC)
📉 Alibaba fell 10% after pricing a $10.2 billion Hong Kong share placement to fund AI. The Chinese giant slashed buybacks 80% year-over-year while capex surged 75%. Its CEO called AI the company's "most certain growth engine." (CNBC)
Rapid-fire
Equal-weight S&P 500 funds just crossed $100 billion in assets this year (CNBC)
Nvidia notified server partners of AI chip price hikes above 15% ahead of its latest earnings (CNBC)
Minneapolis Fed's Kashkari says the Treasury market is still functioning normally despite rising yields (Yahoo Finance)
This tiny industrial stock could more than triple as it capitalizes on its SpaceX exposure for 3D printing (Best Ideas Club)
Bitcoin is set for a comeback as liquidity conditions inflect heading into year-end (Pomp Letter)
Full Signal
Bob Elliott is the founder and chief investment officer of Unlimited Funds. He has a more bearish, cautious view on the AI boom and infrastructure buildout, and while this conversation is from earlier in August it is worth revisiting ahead of Nvidia’s earnings this week.
Tune in on Spotify, Apple Podcasts, or YouTube.
On this day
🗓 August 24, 1857: The New York branch of Ohio Life Insurance and Trust failed with $7 million in liabilities after a cashier embezzled most of the firm's assets, triggering the Panic of 1857. This became the first true worldwide economic crisis.
Last thing
📩 Want to get in front of 207,000+ investors who get this newsletter and the 350,000 finance professionals who can access it on Bloomberg Terminals? Fill out this form and we will get in touch with you.
💡If you find this newsletter valuable, you can help shape its future by taking our 2-minute reader survey. Your feedback directly influences our content.
*Distributor: Foreside Fund Services. An investment in JEDI is not a direct investment in Shield AI.