Peace between the U.S. and Iran. Yes — no — yes — no — maybe… Hopefully we will see an end to the madness soon, even if it looks like it will take a little longer. Peace negotiations tend to lead to compromises, but ones where both sides can still go home and declare themselves the winner — the so-called “save face” outcome. That, however, requires statesmen, not strongmen. This is the only thing we see as a real risk to weaker market performance: that the war flares up again and spreads to more countries and regions. A regime change in Iran no longer seems to be on the table, and President Trump is doing everything he can to avoid looking like someone who has failed. On the contrary — he wants to be the savior of the world.
One of the two big new trends that have dominated 2026 is the defense and arms race, which will require huge volumes of metals and push prices upward. The other is AI and the companies leading that race. Once again, metals will play a decisive role in all the data centers and the infrastructure around them. The potential bubble lies among the extremely highly valued and hyped AI companies, while the safer play — the “picks and shovels” of the AI trend — can be found in the companies mining the metals.
The amount of money continues to grow — now even faster. Monetary inflation is a function of both the quantity of money and the velocity of money, i.e., how many times money changes hands during a given period. As the velocity of money has slowed sharply throughout the 21st century, central banks have been forced to inject ever more money into the financial system.
If money velocity now continues its new upward trend, it will lead to exactly the economy President Trump wants to see — “run it hot.” Both equities and real assets will be the winners — and at the very front, we are likely to see the companies (equities) that produce real assets.
Fiat currencies — often called paper currencies — which today can be created at the press of a digital button, are exactly what Thomas Jefferson described back in 1788: “Paper is poverty … it is only the ghost of money, and not money itself.”
Just how rapidly the money supply is now expanding is illustrated in the chart below.
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And here you can see how the velocity of money has now turned upward again after a long downtrend.
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2026 has proven particularly difficult to navigate, which makes it all the more important to zoom out and see where it all leads in the end. What we are seeing is that everything is reinforcing our case in new ways. Not that any reinforcement was needed — but we are loaded for the journey ahead, when, hopefully, the noise from all the talking power-players fades and reality can take over.