The Flying Frisby - money, markets and more

This is a free preview of a paid episode. To hear more, visit www.theflyingfrisby.com [https://www.theflyingfrisby.com?utm_medium=podcast&utm_campaign=CTA_7] I spoke about gold this week to ABC Australia [https://www.abc.net.au/listen/programs/the-radio-national-hour/the-metal-of-the-sun-the-myth-and-mystique-around-gold/105226520?utm_content=link&utm_medium=content_shared]. This little interview may be of some interest. Here it is. [https://www.abc.net.au/listen/programs/the-radio-national-hour/the-metal-of-the-sun-the-myth-and-mystique-around-gold/105226520?utm_content=link&utm_medium=content_shared] Meanwhile … It’s as though the whole tariff thing never happened, the way stock markets are rallying. I think it’s seven green days in a row now. Everybody is getting very excited about a rare technical signal we got last Thursday - - there have only been 16 of them since the S&P500 was created in 1957, including the latest on April 24, 2025. But this signal has a 100% reliability record, and has been followed by average 6-month returns of 15% and a 12-month returns of 23%. That’s a pretty stellar record. So I just wanted to offer my 2p. The indicator - the Zweig Breadth Thrust Indicator (ZBT) - was first observed in the 1986 Martin Zweig book, Winning on Wall Street (which I confess to not having read). It occurs when a market swings from an oversold to an overbought reading within 10 trading days. Eight of them have occurred since the book was published: in 2004, in 2009 (shortly after the March lows at 666), in 2011 after the taper tantrum, in 2013, 2015, 2018 and in 2023 twice. Now we have one coming off the “tariff tantrum”, as I’ve just dubbed it. However, before you go out and gamble your entire life savings, note that back in 2015 technical analyst Tom McClellan published a detailed study [https://www.mcoscillator.com/learning_center/weekly_chart/zweig_breadth_thrust_signal/] of ZBT signals, which went back much further than the 1957 formation of the S&P500 - all the way to 1928. During the bear market of the 1930s Great Depression, there were multiple occurrences of the signal - 14 of them - and it was horribly unreliable: 10 led to losses or negligible gains, 2 preceded strong rallies, and 2 were flat. It was useless, in other words. So, in short, it’s been good since 1957, but was rubbish before. A bit like stereos. There are plenty of reasons to remain cautious. The high levels of volatility we are witnessing are consistent with a bear market not a bull market. There are also high levels of uncertainty: what is actually going to happen with tariffs? Nobody quite knows. I’m not sure even the President. Plus we are going into May, usually a weak time of year for the stock market. And it may be that the consequences of Trump’s tariff talk have not yet been felt in the US on the ground. One argument is that there has been a huge drop off in container ships leaving China. A container would typically take 30 days to reach LA, and another 10-20 days to get to the major cities - Houston, Chicago, New York et al. So the drop-off in container ships leaving China after Liberation Day won’t be felt until mid-May. If there is a pick up in shipments, that wouldn’t be felt till another month after that. Some are saying [https://x.com/Molson_Hart/status/1915248938753392642] supply shortages are coming to the US. Have a read of this and see what you think. [https://x.com/Molson_Hart/status/1915248938753392642] Markets usually price this kind of stuff in, but you never know. Cui bono? Among the sectors that should benefit from Trump’s America first policies are US domestic mining and manufacturing. Here the regulatory environment is changing fast. Trump signed an executive order on March 20 with the aim of accelerating production of critical minerals. Federal agencies have actually been mandated to look to the US for priority metals - copper, gold [https://thepuregoldcompany.co.uk/dominic-frisby/?utm_source=affiliate&utm_medium=referral&utm_campaign=dominic-frisby], nickel, uranium and so - when they previously looked abroad. We are already seeing faster permitting. I hear that formerly dormant projects are seeing activity for the first time in years. Emails are being answered promptly, applications are being processed, even in states like California. This new environment is positive for oil and gas producers, miners, explorers and developers in the US. The problem is that commodity prices have dropped off a cliff. There’s always a catch. Even so, one company that should benefit from this new macro environment is this potential multi-bagger [https://www.theflyingfrisby.com/p/a-60-million-punt-on-a-potential?r=1o6vt&utm_campaign=post&utm_medium=web]. On which, note I wanted to give you a related heads up.

We have a video for your Sunday thought piece today, in which I walk round my local supermarket and identify all the foods which have seed oils (spoiler - almost all of them). Ever wondered which foods in your supermarket are packed with seed oils? Join me on a clandestine mission around my local shop to unveil some hard truths about pizzas, hummus, sausage rolls, and even granola. Seed oils infiltrate nearly every packaged item—and you should care. By the way, my original piece on seed oils [https://www.theflyingfrisby.com/p/why-are-we-so-fat-and-unhealthy-seed?r=1o6vt&utm_campaign=post&utm_medium=web&showWelcomeOnShare=false] is one of the most read articles on this substack, interestingly enough. Here is is, if you haven’t already read it: I hope you find it useful and/or entertaining. Have a lovely Sunday. Dominic PS ICYMI, here’s my midweek commentary: [https://www.theflyingfrisby.com/p/things-are-getting-frothy-here-are?r=1o6vt&utm_campaign=post&utm_medium=web&showWelcomeOnShare=false] As always, if you are looking to buy gold, the bullion dealer I use and recommend is the Pure Gold Company [https://thepuregoldcompany.co.uk/dominic-frisby/?utm_source=affiliate&utm_medium=referral&utm_campaign=dominic-frisby]. Pricing is competitive, quality of service is high. They deliver to the UK, the US, Canada and Europe or you can store your gold with them. Find out more here. [https://thepuregoldcompany.co.uk/dominic-frisby/?utm_source=affiliate&utm_medium=referral&utm_campaign=dominic-frisby] This is a public episode. If you'd like to discuss this with other subscribers or get access to bonus episodes, visit www.theflyingfrisby.com/subscribe [https://www.theflyingfrisby.com/subscribe?utm_medium=podcast&utm_campaign=CTA_2]

This is a free preview of a paid episode. To hear more, visit www.theflyingfrisby.com [https://www.theflyingfrisby.com?utm_medium=podcast&utm_campaign=CTA_7] Gold [https://www.theflyingfrisby.com/p/your-definitive-guide-to-buying-and] again today. I just can’t stop writing about it. Another day. Another new high. We touched $3,500 in the early hours of yesterday morning. That’s 27 new highs in the gold [https://www.theflyingfrisby.com/p/your-definitive-guide-to-buying-and] price so far this year. Yet there is still something about this bull market that doesn’t feel right or complete: it’s not confirmed by silver, which should be trading north of $50. Instead it’s mired around $32. Nor is this bull market confirmed by the miners, which, in most cases, are nowhere near all-time highs. Nevertheless, on the basis of gold’s price relative to equities, commodities and houses, as outlined last week [https://www.theflyingfrisby.com/p/when-should-you-sell-your-gold?r=1o6vt&utm_campaign=post&utm_medium=web&showWelcomeOnShare=false], gold is starting to look expensive. Is it time to have an eye on the exit? In the short term, maybe. It’s overbought. We are going into a weak time of year for gold (May to August). But that’s why I like physical. It stops you trading! How about this for a chart? It now takes more work than at any time in the last 100 years to buy an ounce of gold. [https://www.theflyingfrisby.com/p/your-definitive-guide-to-buying-and] This is as much a function of declining wages in real terms, and the erosion in value of fiat, as it is the price of gold, but all the same it’s pretty incredible: how we’ve all been lied to! There are, though, many signs that gold is now fully valued [https://www.theflyingfrisby.com/p/when-should-you-sell-your-gold?r=1o6vt&utm_campaign=post&utm_medium=web&showWelcomeOnShare=false]. But these are not normal times. And a “proper” bull market will see blow-off tops in silver and the miners. We don’t have that yet. Let me give you six more reasons (ie largely previously unmentioned reasons) not to be selling your gold [https://www.theflyingfrisby.com/p/your-definitive-guide-to-buying-and]. 1. You live in the UK. (This is one I have mentioned before). Do not be fooled by the fact that the pound has been performing relatively well in the foreign exchange markets this year. It has lost 37% of its purchasing power since 2020 [https://truflation.com/marketplace/truflation-uk-aggregated] and has repeatedly proven to be a rotten store of value. The interest on UK gilts is rising, meaning it is getting increasingly expensive for the government to pay for its own debt. We’re above Liz Truss levels and the trend is rising [https://markets.ft.com/data/bonds/tearsheet/charts?s=UK10YG&chartParams=%7B%22backfill%22%3Atrue%2C%22apiPath%22%3A%22%2F%2Fmarkets.ft.com%2Fdata%2F%22%2C%22apiSeries%22%3A%22chartapi%2Fseries%22%2C%22realtime%22%3Afalse%2C%22useProxyAction%22%3Afalse%2C%22localeId%22%3A%22en_GB%22%2C%22crosshairEnabled%22%3Atrue%2C%22crosshairFlagEnabled%22%3Atrue%2C%22showCrosshairXAxisLabel%22%3Atrue%2C%22panelXAxis%22%3A%22all%22%2C%22symbol%22%3A%2221213187%22%2C%22interval%22%3A%22OneWeek%22%2C%22dataInterval%22%3A1%2C%22dataPeriod%22%3A%22Week%22%2C%22style%22%3A%22fill%22%2C%22dataNormalized%22%3Afalse%2C%22upperIndicators%22%3A%5B%5D%2C%22lowerIndicators%22%3A%5B%5D%2C%22overlays%22%3A%5B%5D%2C%22comparisons%22%3A%5B%5D%2C%22notes%22%3A%5B%5D%2C%22trendlines%22%3A%5B%5D%2C%22days%22%3A1817%2C%22dateStart%22%3A%222020-05-01%22%2C%22dateStop%22%3A%222025-04-21%22%2C%22scale%22%3A%22linear%22%2C%22BaseXid%22%3A%2221213187%22%7D]. We’ve got high energy costs too. What this government is actually doing to rein in its spending is one thing. What needs to be done is something else. There is no Elon Musk taking the guillotine to it all. The scale of our government inefficiency, waste, corruption, misallocation of capital is both larger, relative to GDP, and more entrenched than in the US. At the level of government we are not even having a conversation about what needs to be done, let alone actually doing anything. Nor is there any likelihood of this country re-industriali sing. We’ll just have to hope people buy our services, what few we offer. In the meantime we’ll keep borrowing to pay for stuff. The only way is currency debasement. There has never been a Labour government that did not devalue sterling. Think this one will be any different? Do not store your wealth in sterling. They take enough from you in taxes as it is. Don’t let them take any more. As always, if you are looking to buy gold, the bullion dealer I use and recommend is the Pure Gold Company [https://thepuregoldcompany.co.uk/dominic-frisby/?utm_source=affiliate&utm_medium=referral&utm_campaign=dominic-frisby]. Pricing is competitive, quality of service is high. They deliver to the UK, the US, Canada and Europe or you can store your gold with them. Find out more here. [https://thepuregoldcompany.co.uk/dominic-frisby/?utm_source=affiliate&utm_medium=referral&utm_campaign=dominic-frisby] 2. Chinese retail I’m endlessly wittering on about China’s central bank buying gold [https://www.theflyingfrisby.com/p/the-great-gold-rush-central-banks?utm_source=publication-search], but one thing I confess I’ve overlooked is Chinese retail buying. Its real estate and stock markets have both been rubbish, the former especially, so they are buying gold [https://www.theflyingfrisby.com/p/your-definitive-guide-to-buying-and] instead. Then think about the sheer size of China’s retail market: over a billion potential buyers. Never mind central bank buying, the potential scale of this thing is enormous. What if they al buy an ounce each? When do they stop buying and start selling? When their real estate and stock markets pick up … Meanwhile, China’s central bank [https://www.theflyingfrisby.com/p/the-truth-about-chinas-gold?r=1o6vt&utm_campaign=post&utm_medium=web&showWelcomeOnShare=false], the PBOC, which says it bought 5 tonnes last month, actually bought ten times that. [https://x.com/zerohedge/status/1911452478320627766] (De-dollarisation [https://www.theflyingfrisby.com/p/golds-meteoric-rise-is-signalling?r=1o6vt&utm_campaign=post&utm_medium=web&showWelcomeOnShare=false], which is perhaps the biggest factor of the lot, except re-monetisation, does not even make it onto this list as I‘ve covered it [https://www.theflyingfrisby.com/p/golds-meteoric-rise-is-signalling?r=1o6vt&utm_campaign=post&utm_medium=web&showWelcomeOnShare=false]so many times before). 3. What about Western retail? What about Western institutions? Western retail and institutional investors have been slow to this bull market and are under-allocated. As my buddy Ross Norman says [https://www.metalsdaily.com/archive/ross-norman-gold-nudges-$3500-are-we-in-a-bubble-/367229], “this gold rally has not, to date, been driven by retail investors buying coins and bars, high net clients clamouring for physical, nor institutions buying the gold ETF, not even speculative flows to any great extent. This has been an incredibly low participation rally. A stealth run even”. Portfolios are roughly 2% allocated to gold at present. They were four times that at the peak of the last bull market in 2011. That means a lot of room for more Western buying. Since the confiscation of Russian assets, central banks have bought every pullback to the 50-day moving average. But it’s not just central banks now, retail and institutional investors the world over are coming to the party. And if you think they’re underweight gold, wait until you see how underweight they are gold miners [https://www.theflyingfrisby.com/p/mtl-acquires-condor-gold-enhancing?r=1o6vt&utm_campaign=post&utm_medium=web&showWelcomeOnShare=false]. (Even these are slowly starting to move - MTL anyone :) [https://www.theflyingfrisby.com/p/mtl-acquires-condor-gold-enhancing?r=1o6vt&utm_campaign=post&utm_medium=web&showWelcomeOnShare=false]?) 4. Gold vs the Nasdaq - OMG Trends in this ratio tend to go on for a long time, like ten years or more. How about this for a chart?

This is a free preview of a paid episode. To hear more, visit www.theflyingfrisby.com [https://www.theflyingfrisby.com?utm_medium=podcast&utm_campaign=CTA_7] Congratulations to all who bought. Gold is now trading above $3,300. Goldman Sachs has raised its target to $4,000/oz. It’s all going swimmingly. But nothing lasts forever. (Actually gold does, but you know what I mean). So, today, I want to ask: when do we sell our gold? To answer that question, I am going to look at some long-term ratios. How is gold looking relative to stocks, to other commodities and against house prices? (We’ll look at gold versus house prices in the US, the UK and Australia). There is a strong argument, by the way, for never selling your gold, especially if you’re in a country such as the UK with an unreliable national currency. If you don’t need the money, keep the gold [https://www.theflyingfrisby.com/p/your-definitive-guide-to-buying-and?r=1o6vt&utm_campaign=post&utm_medium=web&showWelcomeOnShare=false] and pass it on to your heirs - and tell them to do the same. But macro conditions are not always as gold-friendly as they are now. See the 1980s and 90s for more details. What’s more, given how these trade wars are unfolding, with unpayable levels of debt across the western world and China’s extraordinary accumulation of gold [https://www.theflyingfrisby.com/p/the-truth-about-chinas-gold?r=1o6vt&utm_campaign=post&utm_medium=web&showWelcomeOnShare=false], there is a significant chance - say, 25% - that gold ends up being remonetized somehow. (If China wants global reserve status for its yuan, it’ll almost certainly have to make it exchangeable for gold - meaning higher gold prices. But even if not, all China has to do is declare it’s real gold holdings [https://www.theflyingfrisby.com/p/the-truth-about-chinas-gold?r=1o6vt&utm_campaign=post&utm_medium=web&showWelcomeOnShare=false], and the price will rocket). In the event of remonetisation, which also means some kind of crisis, gold prices will be dramatically higher. However, it’s also likely that your gold [https://www.theflyingfrisby.com/p/your-definitive-guide-to-buying-and?r=1o6vt&utm_campaign=post&utm_medium=web&showWelcomeOnShare=false]would either be confiscated or heavily taxed, so that the gains from the revaluation (aka fiat devaluation) pass to the state rather than the citizen, as happened in the US under Roosevelt in 1933. But let us leave such speculation for another day. As always, if you are looking to buy gold, the bullion dealer I use and recommend is the Pure Gold Company [https://thepuregoldcompany.co.uk/dominic-frisby/?utm_source=affiliate&utm_medium=referral&utm_campaign=dominic-frisby]. Pricing is competitive, quality of service is high. They deliver to the UK, the US, Canada and Europe or you can store your gold with them. Find out more here. [https://thepuregoldcompany.co.uk/dominic-frisby/?utm_source=affiliate&utm_medium=referral&utm_campaign=dominic-frisby] Gold vs Stocks I want to start with the Dow-to-Gold ratio: how many ounces of gold does it take to buy the Dow? There is much history in this chart. It’s quite something. You can see how, most of the time, the ratio stays within that green band. It is only at points of maximum extremity that it goes beyond, such as: * The peak of the stock market in 1929 * The Great Depression in 1932 * The suppression of gold in the 1960s, ending with the collapse of the gold standard in 1971 * The peak of 1970s gold mania, inflation, and the Soviet invasion of Afghanistan * The end of the gold bear market in 2000 and the peak of Dotcom Today, with gold at $3,300 and the Dow at 40,000, it takes 12 ounces of gold to buy the Dow - and we are in the low- to mid-range of that green prediction band. At the peak of the last gold bull market in September 2011, the ratio reached 5.7. To reach such a level again, either the gold price would have to double (possible) or the Dow would have to halve (unlikely, I would have thought). Most probable is something along the lines of the Dow falling 25% and gold rising another 50%. Would this ratio ever go to 1:1, as it did in 1980? If so, we would be looking at a gold price in the tens of thousands. It’s possible, I suppose. I think a ratio of 5-8 is a reasonable possible target. Here’s a similar history of gold against the S&P 500: Today, we are at 1.7. It takes 1.7 oz to buy the S&P. The ratio reached 0.2 in the 1930s and 1940s. It went to 0.13 in 1980. I doubt we’ll see that again. But that 2011 level of 0.6, or perhaps even a little below if things get really spicy, is not an unreasonable target, I suppose. That could mean the S&P500 at 4,200 and gold at $7,000/oz. Something like that. So that’s some bull food for you. In the interests of balance, let’s now put some bearish fodder on the menu. We’ll start with gold versus oil - and the bad news. Then we’ll look at gold and house prices.

I’m excited to share a brand-new video diving into one of the most gripping questions in finance and geopolitics: How much gold does America actually have? You may have read my piece on this from a few weeks back [https://www.theflyingfrisby.com/p/the-mystery-of-americas-gold?r=1o6vt&utm_campaign=post&utm_medium=web&showWelcomeOnShare=false]. Here it is in video form: a deep dive into the rumours, history, and high stakes surrounding US gold reserves—and what the upcoming audit might reveal. My thanks go to Will Freeman for all his hard work crafting this. Whether you’re revisiting the mystery or uncovering it for the first time, this is a story that matters in today’s world. Please let me know what you think in the comments. Given everything that is going on in the world, we recommend people to own some gold in the portfolio. Our recommended bullion dealer I recommend is the Pure Gold Company [https://thepuregoldcompany.co.uk/dominic-frisby/?utm_source=affiliate&utm_medium=referral&utm_campaign=dominic-frisby]. Pricing is competitive, quality of service is high. They deliver to the UK, the US, Canada and Europe or you can store your gold with them. More here. [https://thepuregoldcompany.co.uk/dominic-frisby/?utm_source=affiliate&utm_medium=referral&utm_campaign=dominic-frisby] And if you missed yesterday’s piece - also on gold [https://www.theflyingfrisby.com/p/your-definitive-guide-to-buying-and]- here it is. This is a public episode. If you'd like to discuss this with other subscribers or get access to bonus episodes, visit www.theflyingfrisby.com/subscribe [https://www.theflyingfrisby.com/subscribe?utm_medium=podcast&utm_campaign=CTA_2]