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  I'm Charlotte Mloud with investingnews.com and here today with me is John Rubino who writes a popular newsletter on Substack. Thank you so much for being here. Always great to have you. >> Hi Charlotte. Happy holidays. >> Happy holidays to you as well. Almost happy new year. We've got so much to get into before we come to the end of 2025. Usually with you, I start off with gold and we'll definitely get over to gold today, but I thought given the recent price action in silver, it would be nice

to begin with silver for a change. I know you've been bullish on the metal, but I'm wondering, did you see the big move in silver coming in 2026? >> Yeah. Well, it's been a long hard wait for silver stackers out there. you know, basically 10 years of underperformance and then finally we're getting um the the kind of move that always seemed likely for silver because the silver story was always awesome. You know, it's a monetary metal, it's an industrial metal, we're running out of it for those

uses and a silver squeeze is inevitable and that that was the 2015 story. So, it took a long time to uh come to fruition, but it is finally happening and silver is finally rocking. So yeah, I think um this is real. It's long overdue and it's nowhere near done yet. I think the u the dynam dynamics in the silver market round right now point to much higher numbers over the next few years. >> I think it would be good to go into some of those dynamics in the market and take a look at what's driving silver right

now. There's obviously all of the underlying factors in terms of supply and demand. I know this recent rise that's kicked off, there's been questions around what was going on with the Culax shutdown when this latest rise began. So, what are you seeing as the key silver drivers at this time? >> Well, silver is in deficit, meaning the world's silver mines don't produce as much metal as industrial users and investors demand. So, we're running through above ground stocks. And a lot

of the uh the kind of discontinuities that we're seeing in the silver market right now are due to the fact that the big exchanges like Comx um may not have enough silver to satisfy the demands of futures contract holders. In other words, there are a lot more people out there with long futures contracts that could come in and demand silver than there is silver to satisfy that demand. And uh you know the number of people who are standing for delivery uh on futures contracts is rising and the amount of

silver in these exchanges is shrinking. So you're seeing you know sometimes games are being played. There was that u when the um silver exchanges went down for a while because there was a quote unquote cooling issue. Just as silver was going up like $3 an ounce and um things like that. And that is kind of normal in squeezes. The exchanges will do a lot of weird things to uh to keep from having to default. Uh but in silver's case, you know, it may not be possible to avoid some kind of a default

where they're just isn't enough silver. And so they have to pay out in cash instead of metal. And a lot of people are looking at that as kind of the inflection point where okay, it's going up, it's going up, and then there's this default, then it goes straight up. And um pe there are people out there who are buying on that um prediction you know that in the not too distant future we get a serious upside discontinuity in silver uh and you want to be there for that and I I think that's that's

certainly possible and not predicting it for the next 6 months or the next two years or or whatever but I think that it's definitely on the list of things that could easily happen given the dynamics in this market. So, um, you know, I'm not selling any of my silver that I've laboriously stacked over the last 10 years cuz I I think the real fun is still to come. And, you know, you don't want to wait a really long time in a dead market and then finally have the market turn around and you get out too

soon and miss the big move that you've been waiting for. So, uh, it's intellectual and emotional right now. um that you should probably stick with your silver positions uh and watch this thing play out. >> Yeah, I think you headed exactly in the direction I was hoping you would go in there. When it comes to silver at the moment, there's there's an inherent volatility with silver and I think people do have maybe a bit of a struggle in terms of what to do. Should they hold on? Should they're not in the market?

When should they buy? Any further thoughts on how to handle these these tricky silver dynamics? Well, you know, it's not too late to add to positions. It'd be much better if you did that in the past 5 or 10 years, but yeah, if you don't have as much as you want or you're excuse me, new to the market, then you can definitely be adding. Just do it um do it a little at a time. Do low ball bids for silver mining stocks or dollar cost averaging with silver ounces, whatever. But don't

jump with both feet because that'll be the day that something happens to cause a correction in silver drop. It'll drop by 30%. You know, just as you buy in big. So, uh all you can do uh and sleep at night in most cases is to continue to accumulate gradually and just look for good deals uh on the expectation that um your target price is, let's say, $200 with silver. So, if you end up buying some at 70 and buying some at 80, uh it might be very painful if there's a correction back down to 50,

but you'll still feel good about what you've done when silver finally reaches that um that real exit point of in the hundreds. So yeah, you know, it's uh it's no longer easy money that the easy money has been made, but this the silver market is probably still a favorable place to be for all the the fundamentals that uh that we could spend an hour just talking about those. >> Yeah. Yeah. We won't spend an hour on silver at this time, but certainly we could. And you mentioned the silver

stocks. I wanted to go in that direction for a moment because when gold started moving, it took a while for the gold stocks to start following on up. And I wondered what dynamics we're seeing among the silver stocks right now. What are you seeing? Are they are they all breaking out at this point or do they still have room? Of course, they still have room to go, but what are you seeing among the silver stocks right now? Oh, silver stocks are having a nice run and and there really aren't that many of

them because um most silver is mined as a byproduct of other kinds of metal mining. You know, if you have a nickel mine or a copper mine, you'll make some silver and you'll sell it, but it's not your main business. Uh so there there aren't that many silver mines. And now that silver is a hot topic, um if you are a mining company with silver in your name, you're attracting some generalist money. uh and you know mining is is a highly leveraged business. In other words, an increase in

the price of silver uh leads to a bigger increase in the operating profits and cash flows of a well-run silver miner. So, you got that operating leverage there, too. You know, the price of silver is going up and then the uh the cash flow of these silver miners should go up even faster. Uh, and that's a really nice um that's a really nice combination of trades which you don't see that often in the world and you certainly don't see them out there right now. There are very few industries where

you've got this kind of upward arc in basically everything good and that's where silver is right now. So, the silver miners, um, there's still some potential 10 baggggers out there in the explorers, and there's still three to five baggers at every level of the the silver mining complex. So, yeah, I think that again, low ball bids, dollar cost averaging. Don't just buy stuff at the market with all your money, you know, buy a little at a time at as at prices that are as favorable as you can get in this kind of

a market. and then just assume you'll spend a few years positioning yourself and uh and hope by that time um the the real parabolic move is ready to happen. >> Right. So still that focus on being strategic with the silver stocks as well. And maybe we move over now and take a look at gold. I'm curious where you see gold in the cycle right now because typically I've been hearing as we go along, you know, gold moves first and then silver follows. So, it feels like we're in the silver following

phase. Where does that put gold at the moment? >> Well, gold has had a really nice run. And um this is different from the previous two gold bull markets because this time around we're kind of repricing the whole world in terms of gold. It's becoming the humanity's money again. And that means that um if we start thinking in terms of what gold prices necessary for the world to go back on a gold standard that is viable then you you get some very high numbers. So gold still has further to run if the bricks are

going to launch their goldbacked currency and the other central banks that are adding to their gold holdings keep it up and and if the crypto guys with their stable coins decide they want to launch a bunch of goldbacked stable coins then the demand for gold is going to be such that uh you know you get up into the into what seems like crazy numbers right now you know 10,000 15,000 $20,000 an ounce uh and Again, that's that's something that looks like it's sounds crazy now, but it's very possible going

forward. So, gold is still a thing to buy, but it it has had a better run than silver up until just lately. And now silver is starting to pick up and outperform gold and uh historically that kind of signals the last year or two of a precious metals bull market. I think this time has different factors animating it. Uh, and I don't think the precious metals bull market ends until governments get their act together. And so right now that's not happening. Every major government is running massive

deficits. In other words, adding massively to its debt, which increases its interest costs dramatically, which increases future debt and deficits. So they're still in the death spiral phase of this. And until they start raising interest rates to, you know, 1980s level, 20% on the Fed funds rate, 16% mortgages, things like that, unless they bite the bullet and do something like that, then we're we're still destroying the world's fiat currencies, and that means that gold when priced in those

currencies will continue to go up. So, so I think we we still have a nice long run in gold and we have a potentially better run in silver, which you're kind of seeing evidence of right now. And again, same thing with gold. You know, you can you can continue to add and there are lots of gold mining stocks out there. There's way more gold mining stocks than silver miners. So, you have more choice out there uh of big solid companies that will just uh you know, g give you the gain in gold with minimal

risk. And then a lot of explorers and and small producers that aren't really well known yet and that still have five or 10 bagger potential out there. So, it depends on how deeply you want to dig into this market. If you really want to get to know how mining works and spend 6 months um developing the judgment to tell one little minor with a good story apart from another, uh there's some serious potential money to be made. >> Yeah, I think that's that's probably the key here. There's so many options when

it comes to gold and silver that people can follow depending on what path they want to take. And in terms of gold drivers, I want to go back to the point you made about the stable coin issuers picking up gold because I think that speaks to how widespread and more generalist the interest in gold is becoming. And it's it's a topic I haven't had a chance to hear a lot about. So if you could talk about the significance of that and how it could continue moving forward, I think that would be a great topic.

>> Okay. Well, a stable coin is basically a financial instrument that is created when um someone buys a bunch of something and stores it and then issues stable coins against that vault full of whatever and then those coins trade on blockchain which means instantaneous transfer of funds. You know, you you just have zero friction in what you do with those instruments. So, it's a very attractive concept technically. You know, the crypto people who have a ton of money still even with Bitcoin getting

smacked lately. Uh there's still a ton of money in the crypto space with which to pursue things like stable coins. And you know, there's even people in the Trump administration who are talking about the the future of finance being stable coins. In other words, everything will be on a blockchain at some point. Okay. But um one of the big stable coin companies, Tether, has been buying a lot of gold and investing in gold mining stocks. Uh and now they have um they have gold bullion on a scale that puts

them in the league of small to medium-sized central banks. So that's just one stable coin company. You know, there could be many more. And uh and that's with gold, which is a much bigger market than silver. So, if they switch to silver stable coins and already we're running out of silver, then uh that might be the thing that gives us tripledigit silver right there. When Tether comes out with a a silver stable coin and it meets with enthusiasm in the market, then boom, you know, you get

that parabolic move. So, uh, yeah. So, it's interesting to see cryptos moving over to precious metals, which was always going to happen because when when you become a um a crypto fan and you start learning about cryptos, it turns you into a gold bug by implication. Because to to understand cryptos, you have to understand money. And once you understand money, you realize that today's monies, today's fiat currencies are just cheap imitations of real money. and that historically gold has been real

money. So you you gain a respect for gold while you're stacking your bitcoins. Uh and so crypto guys and gold bugs are natural allies because they have a common enemy which is governments that uh aren't constrained by any kind of a a link in their money to something real. Um so it's it's not a surprise that crypto money is flowing into precious metals now. And so you're seeing an interesting thing happen where precious metals are still going up while cryptos are having a a monstrous

correction right now. You know, Bitcoin is down from 120,000 to 85,000 right now, which is a big drop for something that is supposed to be digital gold. Um, and meanwhile, gold is up again today and silver is having a really nice day today. So I I think there's um there are capital flows happening here where some of the money that's moving out of cryptos is moving into precious metals. We'll see whether that continues, but so far it's a very encouraging sign. >> Yeah, I I was going to ask you as you're

talking about that, do you think that this downtrend in Bitcoin continues or or how are you looking at that? I don't have the slightest idea where and why Bitcoin does what it does because um you know I'm kind of an old school gold bug and I just do not get the concept of cryptos on a on a scale that would let me you know put a lot of money into them or think of them as the base money of the future financial system just because you know they don't have a physical existence. they literally don't exist.

You know, they're they're bits of code. And that that's not to say that they won't end up being really important parts of the uh of the future financial system. It just means that I don't understand how it's going to work. So, I I don't express opinions about it because u you know, it's just not my wheelhouse at all. And I I wish those guys luck. And I think there's room for um highquality cryptos, which is to say Bitcoin and gold and silver in a future monetary system. You know, that we could

have them all doing different things or complimenting each other in certain ways. And and that would be fine too. Just as long as, you know, it takes gold and silver up to the uh their intrinsic value, which is way higher than today. I'm happy with however else it turns out. I think I think that makes a lot of sense. I also struggle with the the lack of physicality in Bitcoin and other cryptocurrencies. So, we'll leave that there for now. I was going to ask you about the US economy, and we'll go

there, but you had mentioned before we turned the camera on that one key thing to pay attention to is the carry trade in Japan. So, I'm wondering if you could outline what you see going on there and why that's important for investors to pay attention to as we're heading into the new year. >> Yeah. Um the the story behind the yen carry trade is that Japan's government has been borrowing way too much money for way too long. They've got a massive debt that on a on a per capita basis is

the biggest in human history. Um and they've been pushing interest rates down to unnaturally low levels in order to service that debt. And for instance, the uh the 10-year Treasury yield in Japan was zero for a lot of years there. it was you you literally didn't get any kind of a return by owning those bonds. Um and lately the bond market has been starting to rebel against that profleacy you know and interest rates are going up in Japan. Now the reason why that's dangerous is because that while Japan's

interest rates were very low uh that created um basically an arbitrage opportunity. You could go to Japan, buy and borrow um yen for 0%. Take those yen over to the US, cash them in for dollars, and then buy treasury bonds that were yielding two or 3%. Uh and you make that spread. And because you're using borrowed money, you have massive leverage. And it's an incredibly um it's it's a very profitable trade to keep on. And they call it the carry trade because people would set up that

trade and just keep it going for a long time. they just refinance and then reinvest in treasury bonds and they would just carry that trade forward for years and years and make tons of money. Uh well now interest rates are going up in Japan which means that the spread is no longer there to the extent that it used to be and uh and interest rates going up also makes a currency go up in value frequently. So you've got currency risk now. At the same time, you got interest rate spreads shrinking. And so

all of a sudden, the yen carry trade's not a good deal anymore. And there are multiple trillions of dollars around the world. Bet on it continuing. So a lot of these trades have to be unwound. Many of them will be unwound at a loss. And we don't know who those people are out there. What who has what and who who is underwater and who's not. It's like Warren Buffett used to say, you only know who's been swimming naked until the tide goes out. And that's a global phenomenon right now. You know, there

are all kinds of trades out there that are not going to work out and we don't know who's going to go first. We don't know how big it's going to be, but it's, you know, it's multiple trillions of dollars that we're dealing with. Um, and the other aspect of this that is might even be more important going forward is that when there was all this liquidity coming from Japan in the past, that was like a central bank doing QE. It was a massive infusion of liquidity around the

world. So it pushed up the prices of assets everywhere. Real estate is higher than it should be and and most aspects of the tech stock market in the US are higher than they should be. And a lot of that is because of the yen carry trade. Well, if the yen carry trade goes away, then a lot of those assets have to be repriced at considerably lower levels. And so you get, you know, bankruptcies going on here and and bare markets in asset prices over there. And so it could throw the world into chaos just by

itself. And the the wild thing is we don't really have anybody we can point to and say, "Okay, watch this guy and see if he blows up." It's just going to come out of the blue. And because it's, you know, a lot of that stuff is in Asia, it'll happen overnight for people in the US. You know, it'll happen while we're asleep and we'll just wake up to find out that, you know, XYZ corporation is bankrupt because of XY. you know, and there'll be some trade that blew up and

and it's of the first domino knocking down a bunch of other dominoes. So, anyhow, um that's a story of 2026. This will play out in the coming year and we'll see how it goes, but it's potentially a really big deal. >> Yeah, that does sound like it could become a massive deal and essentially we're just waiting for the other shoe to drop there. That that'll be very very significant to watch. If we if we go over to the US, I'm curious what you see coming there. I think the last time we

spoke earlier this year, we were talking about the potential for a recession or something worse. How have you seen that progressing in 2025? Are there adjustments to what you see coming in 2026? >> There are two contending forces in the US right now. One is um consumers are tapped out in a lot of cases. We've got record credit card debt, record student loans out there, record car related debt and and record uh mortgages. Uh and a lot of people just can't carry all the debt that they've taken on. So they're

starting to default. So delinquency rates and default rates are starting to rise for various sectors of US debt. And that means that um consumers are not going to be able to go out and buy new cars and new houses and and just rack up credit card bills on Amazon or anything because they already did that in the past few years. Uh so con consumer spending has to decline from that point of view. But at the same time and and consumer spending when it goes down causes recessions because we are a consumer spending based economy.

Uh but at the same time we're running massive deficits. So we're we're flooding the um the country with liquidity via fiscal policy, not monetary policy, but fiscal policy. And if we're running $2 trillion deficits, that is a lot of money that I mean that's the government borrowing that money and spending it. So it's going somewhere within the US economy. Uh and that's basically why we haven't been in a recession for the past what 15 years now. We haven't had a serious recession

because we've been running massive deficits and that money gets spent. U but of course it blows up the government's balance sheet. So, um, eventually there's a reckoning, but, um, you know, next year is kind of tricky because where we're giving the economy two extra trillion dollars, but the people who are deeply in debt, I don't know what they're going to do with that. You know, are you going to run up a bigger credit card bill now because um, uh, because they they offered you some

special deal, which is how credit card companies get people get even more deeply in debt. But um, I don't know. I don't know how that plays out. But those those are the two big forces to watch. And you know, I think the deficit is basically baked in the cake. And consumer spending uh let's just see if bankruptcies spike in one sector or another then maybe that causes consumers to pull back in a way that overwhelms the deficit and then we get a recession. We'll see. But uh I think that's very

possible. And then a a recession will bring an equities bare market with it or an equities bare market will bring a recession with it. So we've got that out there as a possibility too with tech stocks supporting you know a handful of tech stocks supporting the entire edifice of the the global equities market and and they could blow up at any time. You know this is a clearly a tech bubble and tech bubbles tend to die spectacularly. So, it's completely possible that the AI stocks drop by 50%

in the coming year and are still a little bit overvalued. So, so we'll see. I I there's no real specific bet to put on the economy right now like uh a big short kind of thing is possible, but it's it's not the kind of guarantee that the housing market was back in the day. >> Yeah, it seems very difficult to navigate at this time. And I'll just throw in one other factor. I know we've got Powell finishing his term as Fed chair in 2026. We'll have a new Fed chair who will probably be more

amendable to what Trump would like to see, which is lower interest rates. Any thoughts on how that is fitting into the picture that you're laying out for us there? >> Yeah, Trump is is definitely going to name a new Fed chair and he's definitely going to be an easy money person. And that's that's basically because the president is a real estate guy, you know, and real estate people love low interest rates. And so it's no surprise that Trump doesn't care about the rest

of the world as long as he gets his low interest rates and he'll get them. So we'll have lower interest rates at the short end of the yield curve. And then the question becomes, what does the bond market do about that? Um, so far the Fed has been cutting since September of last year. uh and longerterm interest rates have been going up which means the bond market is not listening to government monetary policy. So if we aggressively cut and interest rates go up because that spooks the bond market then uh that that's like

tightening monetary policy in effect. You know, if long-term interest rates or say the 10-year, which everything else keys off of, if that goes up, then that means mortgages get more expensive and and car loans get more expensive and and so you've actually tightened the monetary policy. We could see that, you know, we're kind of sort of seeing it now. Let let's let's find out if it goes from kind of quiet disrespect to allout panic in the bond market and uh and see where that goes.

>> Yeah. Yeah. I know we've seen some rumblings there this past year, so we'll have to see how it pans out. We're getting close to the end here. I have a question that I've been trying to ask everybody in the last couple of months or so, and that is looking forward to 2026, what would your choice be for top performing asset of the year? Doesn't have to be a commodity, but but it could be. >> You mean a specific stock or asset class? You can I've had people interpret it

both ways, so you can go with what you want. >> Okay. Okay. I I you know, I would go with silver in the year ahead. Um because that story is great and it's kind of sort of working out right now because you you've got the kind of background turmoil going on in the exchanges and then you've got lots of different technologies using lots of silver including, you know, a new thing uh which is a solid state battery that's coming along. car makers are are creating them and apparently

they use lots of silver. They're much better than lithium ion and they use lots of silver. So, um there are lots of catalysts for a next leg in the silver bull market. So, I think it's dec decently possible that we hit $100 an ounce in 2026. >> Yeah, I think that you're not alone in in picking silver for 2026. So, thank you for going into that. And before I let you go, any final thoughts, words of advice you would leave with investors heading into the new year? >> Um, yeah, this is a time when you're

hearing a lot of people say a lot of outrageous things. And you don't want to don't get sucked into talking heads online telling you something is a guarantee and it's, you know, you need to get in right away. anything you get into any anything you choose to do with your money, do it gradually, a little at a time, and then pay attention to what happens and educate yourself. So, so you get smarter as your money gets allocated to various things. Uh, and hopefully um over the next few years it all works

out. >> Hopefully. I think that's great advice. It can be so easy to to panic when things are moving quickly. Well, thank you so much for coming on to go over what's happening in the precious metals markets. This was great as always. >> Thanks, Charlotte. See you, >> of course. And once again, I'm Charlotte Mloud with investingnews.com and this is John Rubino. Thank you for watching. If you like this video, make sure you hit the like button and subscribe to our channel. We'd also love to hear your

thoughts, so leave us a comment below.