Friday Recap (7/4/2025)

AU: $3334 ($3271- Last Week Spot)

AG: $36.85 (35.86)

HUI: 426 (406)

DXY: 96.9 (97.2)

S&P: 6279 (6173)

10-Yr: 4.32% (4.27%)

Oil: $66 (65)

The S&P 500 ripped higher, reaching another ATH at 6284 on Thursday. Gold and silver followed, with gold up $63 and silver up $1 for the week. The miners were forced to rally, with the HUI up 20 points to 426. The 10-Year rate, DXY, and Oil were all flat. So, what's next? Ah, the Trump Tariffs! Today, Trump announced that letters are going out next week and our trading partners are getting at least a 10% tariff, with some at 20%, 60% and 70%. So much for Mr Taco.

I'm expecting a significant correction in the S&P 500 in July as a result of Mr TT (Tariff Tantrum). So, this run in silver and the miners is a bull trap. Gold has been higher in recent weeks and is lagging. I always look for non-confirmation, and gold is the signal to be careful. The S&P is at an ATH, but gold isn't. Why not? Correction time. Get ready, although it will be shallow and won't last long for gold/silver/miners (there is no reason to fear a deep, extended correction in gold/silver/miners).

If you pay attention to the MSM, Wall Street, or Washington, then you probably think the economy is strong and all is rosy. It's not. The sky is full of dark clouds. The BBB was passed yesterday, which was a spending bill. Of course it was. That is all Washington knows how to do. The deficit isn't going down. It remains massive. Trump has adopted Biden's fiscal dominance strategy: spend to stimulate. We have a Potemkin economy that is only breathing from debt expansion. Behind the scenes, the patient (economy) is in the ICU on a respirator.

Trump's tariffs are an act of desperation (because of our budget deficit problem). Tariffs are never good. They are a tax, and taxes create economic drag. Lower taxes create economic stimulus. Higher taxes create economic drag. Trump is using them because he doesn't have anything else that will change the direction we are heading toward: bankruptcy. Everyone is ignoring the elephant in the room: we have a debt problem, and it's rapidly getting worse. Trump is trying to address it, and nearly everyone is screaming at him to stop. He won't, and the result is going to be a recession, and soon.