If the war is resolved as markets expect (nothing happens), I'll be wrong and chase with cash. More likely in 2-3 weeks we get a Suez 1956 outcome, which is really good for gold.

Based on what I'm hearing and reading, the odds of me being wrong relative to market expectations are low.

Gold tanking 10-15% tells you that if this war is not resolved ASAP, stocks and bonds will go down a multiple of that.

Gold is liquid and can be sold. Bonds have also been hit, with the 10-year yield moving from 3.94% to 4.4%.

Every day the Strait of Hormuz stays closed, Iran gains more leverage and global supply chains break down further.

The financialized system and supply chains will continue to break down until a catastrophic break or resolution, which will be aligned with multi-polarity, not US control.

We are in a moment of desperate liquidity selling. The market will shift from 'gold is down on liquidity' to the real reason to own gold: when central banks must print money to prevent sovereign defaults into an oil spike.

This shift will happen in the next 2-4 weeks if Hormuz stays closed. It is a certainty.

I think gold ends the year at least with a six in front of it, maybe a seven.

When they have to print money to keep sovereign debt from defaulting into an energy shock and supply chain collapse, gold will surge.

Steelman against gold: The US would need to establish a new petrodollar by taking control of Iran and Venezuela, which would require hollowing out the US industrial base to China. This is fantasy and won't happen.

The US military does not want China to make all its weapons. The alternative is a neutral reserve asset: gold.

To be bearish on gold, you'd need China and Russia to collapse back to the 1990s and the US to rebuild its industrial base faster than China built theirs, without inflation that blows up the bond market. This is fantasy land.

If you think that's fantasy, then gold is a buy here, not a sell.

Bitcoin is up, but it's charting with Nasdaq and IGV (software index). It's still trading like a risk-on/risk-off asset, not decoupling.

I'd fade Bitcoin's outperformance. With supply chains breaking down, Bitcoin's unseizability is good, but it's not yet acting as the ultimate safe haven.

It's too late for a quick resolution (Taco). Iran gets a say and wants its pound of flesh. The US situation in the Middle East is worse than reported.

New York Times reported most US bases in the Middle East are nearly uninhabitable due to attacks.

I don't see a way out of this crisis beyond a perfectly timed productivity miracle that doesn't cause unemployment, which isn't happening. This is the worst crisis I've seen in 30 years.

I steelman scenarios all day, and this one is uniquely cornered and multi-layered.

The only thing that matters is whether Hormuz is open or not. Physical shortages and supply chain breakdowns will dictate the market reality.

It's collective delusion. Everyone knows it's closed but makes excuses. Iran's stated strategy is to collapse the global economy.

The Suez 1956 analogy is flawed because there's no clear successor hegemon today. We may be looking at a vacuum like Rome 476, leading to decades of instability.

Investors need to think about robustness in their personal lives—where their oil comes from, can they evacuate if supply stops.

China may not want to be world policeman, but it is demonstrating power. Chinese tankers carrying Iranian oil in yuan sail through Hormuz unmolested, while the US Navy is stood off.

Power is factory output. China has it. Power is also demonstrated, not shouted. Land powers with missiles, drones, and satellites are taking control of choke points from naval assets.

The Nash equilibrium good outcome is gold as the world's neutral reserve asset, with net settlement in gold. The bad outcome is nuclear war.

A gold-based system is a good outcome for the US, China, and Russia.