Today's number, 500,000.

That is roughly how many dollars Alex

Honold was reportedly paid to free climb

a 1,600 ft tower in Taiwan last week. On

a riskadjusted basis, that makes it the

lowest ROI decision in history.

Welcome to Profy Markets. I'm Edson. It

is January 27th. Let's check in on

yesterday's market vitals.

Major indices rose heading into a key

earnings week. Treasury yields declined,

the dollar tumbled, and finally, silver

gained the most since the financial

crisis, and gold breached a new

milestone. More on that in a minute.

Okay, what's happening?

Stocks carried their rally into the new

week following President Trump's

Greenland taco, but global tensions are

still gripping markets. President Trump

threatened Canada with a 100% tariff

over a potential trade deal with China

on Saturday. Meanwhile, the dollar sank

to its lowest level since 2022. That

slide came amid fears of a government

shutdown and talk of US intervention to

stabilize the Japanese yen. And of

course, the metals rally rages on. The

price of gold just hit $5,000 per ounce

for the first time ever. Joining us to

break down what is moving markets right

now. A lot in there. We're speaking with

Robert Armstrong. Rob is the author of

the Unhedged newsletter and co-host of

the Unhedged podcast. You all know him.

He's a regular at this point. Rob,

thanks for joining us.

>> Nice to be back.

>> A lot we want to get into here. I think

I would love to start with your

reactions to last week's taco. It feels

like years ago because

>> so much has happened in the past several

days. Not really markets news, but we

can just set that aside for now. Let's

just focus on the taco. We want to get

your reaction because as I remind

everyone, you invented the term taco.

We're now seeing another taco uh this

time with Greenland. Uh he decided to

pull those Europe tariffs after I don't

know if nuclear is the right word, but

people were pretty riled up about what

was happening with Greenland. What do

you make of last week's taco? What does

it tell us going forward? Well, the

first thing I would note is that the

markets didn't move very much on this

crazy plan of Trump's this crazy saber

rattling on Greenland. So, you know, the

S&P was down a couple of percent, the

dollar was a percent weaker or maybe a

little more. So, he didn't seem like he

was scared off by markets. Exactly. So

in and that's kind of a theme that the

market's

uh reaction function to crazy Trump

stuff does seem to be getting blunted

over time. But maybe, you know, it's the

politics. He just realized at some point

that he was holding a losing hand

against Europe and he folded. I mean, I

think, you know, and maybe we ought to

be glad this is a guy who cuts his

losses when he realizes the other team

isn't gonna just shrivel. He also

threatened these tariffs on Canada if

they go ahead with this China deal. My

instinct here is we'll probably see a

taco again. I mean, I'm just trying to

figure out if there's any rubric or

formula that you can follow as an

investor or even as just an a market

observer when Trump comes out and makes

these statements about tariffs, like do

you just not believe them or are there

certain situations where you do believe

them? I think in this case with the

Canada tariffs, you can be pretty

confident not believing them that

they're going to end up anywhere near

100%.

Trump has shown no a appetite for

outright trade embargos, which is what a

100% tariff amounts to. If we cut off

all trade with Canada,

there would be howls of pain in the US

economy as well as the Canadian economy

and it would just be more than the

president could take. So I I would 100%

bet on a taco in this case. There's just

no way. It's not predictable. It it was

just an expression of rage, I think, not

a policy proposal. I've had a thought

recently after this after last week's

taco.

I wonder if investors would be better

off never ever listening to anything

that he says. I I would love to put that

question forward to you. Like there's an

argument to be made that if you just

turn it off, you just press the mute

button, you might perhaps make better

investment decisions or at the very

least just don't really take anything

that he says that seriously. I mean,

this is a delicate game to play because

he's the president and, you know, he

does have a lot of power. But I do

wonder if if that would be the case. I

guess I wonder what you make of it. I

think you'd have to be careful to

distinguish the cases where it's

straight out of the truth social account

and the cases where there's more voices

echoing the policy, right? So, because

of course there have been highly market

relevant Trump policies, you know, the

tax cuts, you know, whatever. But uh I

you know I wonder if

just pretending he didn't have a truth

social account, limiting your your

intake that way. I think that might work

pretty well. But again, there's another

question

which is how much does this guy change

over time?

I think I I wonder if as his term wears

on, second term, lame duck president, 79

going on 80, whatever, uh you have to

take seriously

the possibility that his risk appetite,

his just sheer bloody mindedness is

becoming more extreme over time, you

know, and we saw that in the case of

Venezuela, you know, I mean, so I don't

know, turn it off but clearly a more

cautious attitude is warranted. Yeah. I

mean a more I should say uh not the

opposite of cautious a more skeptical

attitude is uh is warranted here.

>> Yes. There should be some filter between

what is a truth social post and what is

a policy proposal. The line is very it's

very blurry. It's not totally clear. But

I think you're right. I think there

probably is a line. And if someone could

figure out exactly what that line is,

maybe it's when Scott Besson said says

something. I doubt it. Maybe when a

plurality of officials get together and

agree that this, yes, this is the plan.

Again, I'm not sure about that either,

but it does seem very relevant if we're

trying to pass out what is taco and what

isn't. I guess taco versus fo as you've

pointed out before. I do want to get

your reactions to what's happening with

the price of gold right now. Gold has

now surpassed $5,000. It's up more than

50% over the past 6 months. It is

coinciding

with murmurss of a sell America trade

coming back. Perhaps those are related,

perhaps they aren't. But yeah, I'd like

to get your views. I mean, gold has had

this unbelievable year. They keep on

setting these price targets, or at least

I keep on seeing these price targets

that seem absurd, and then it just keeps

on hitting them. What do you make of

what's happened with gold over the past

few weeks and the past few months?

>> First of all, I should note for the

benefit of your listeners that the uh

association of financial pundits and

forecasters

ought to erect a monument to how wrong I

have been about gold for the last couple

of years. I mean, I was a skeptic at

$2500, right, 100% ago. So, uh, I I

don't like it as an asset class. I don't

think it's been great over time. I've

articulated again and again my

skepticism and I have been wrong as it

is literally possible to be. So, with

that said, that's your health warning to

everyone listening to me. I think that

there are two theories here. One is

that, and they can both be true. One,

well, actually three theories. one this

what this shows you is about the

debasement trade right that the dollar

and is going to weaken over time and

there's going to be inflation etc etc US

assets in particular and paper assets in

general that's bad for them there's

another theory that gold always goes up

on political instability it's not so

much the inflation stuff it's the

politics third theory is that it's a

meme stock now and people are just

piling in uh all three of these can be

true to different degrees. I don't like

the debasement theory because we just

don't see it in the bond market. People

love to huff and puff about how the

dollar is so weak now, but if you look

at a 10-year chart, sort of average uh

inflation expectations, however you

measure them, any market-based measure

of inflation expectations, 100% fine.

So, how could you have massive

debasement that gold is picking up on

and the bond market just doesn't see it

at all? That strikes me as crazy. That

leaves us with uh then we go to the

politics.

Yeah, the world does seem a bit insecure

right now,

but again, how would why would that why

wouldn't that express itself in

sovereign bond yields somewhere?

same argument. That leaves us with meme

stock, which has been my

favored theory. You know, it's like

people are chasing the momentum. But the

the longer you're wrong, the more you

start to doubt yourself. So, you've

you've caught me at a moment of

self-doubt. And I'm I'm actually writing

today trying to look again at the

politics theory, the debasement theory,

and see what can be salvaged there.

>> Yes, it is very interesting. It's like

gold has turned out to be everything

that Bitcoin wanted to be. And it's

>> remarkable how Bitcoin has not

performed. I It's just while they have

the Bitcoin president in office, while

the world appears to be going

politically to in various ways.

This is Bitcoin's year, but it isn't.

It's gold's year instead. There is a

theory, by the way. I mean, I think

there there there are people out there

saying that crypto people are realizing

that crypto is actually correlated to

the stock market. So, it's not a hedge

against your other assets. And so,

they're switching to gold, right?

They're like, "Oh, oh, you know, there's

there's no diversification benefit to

crypto. It's just an amplifier of the

returns on the rest of my portfolio."

But I can't find anyone who says they

see that happening that they see out of

crypto and into gold trades. So yes, I

would love to see I would love for

someone to come forward if that is

really happening. You will lose all of

your pride and reputation having loudly

talked about why crypto is exactly the

investment for this situation, but still

it would be very it would be very good

for us or at least for me as a crypto

skeptic. Final final uh thing I'd like

to get your reaction to. We are the the

contenders for the Fed chair has been an

ongoing race. Last week we learn I

learned on Cali actually on one of these

prediction markets that there is a new

contender. This guy Rick Reer his

chances have soared to nearly 50% after

Trump had a call with him. He called him

very impressive. They had a meeting at

the Oval Office. He is very much in

favor of cutting rates. He is a former

Black Rockck executive. He's expressed

concerns about the labor market, etc. I

haven't looked into him very much yet,

but any reactions or thoughts on the

possibility? I've not Kevin Hasset, not

Kevin Walsh, but Rick Reer as Fed check.

Uh, I've spoken him to a lot. I've

interviewed him for the newsletter. He's

an extremely clever man with a very deep

knowledge of markets. I mean, he's

arguably the most important bond trader

in the world given the sheer amount of

assets he manages at BlackRock. So, he

knows the market as well as anyone you

can possibly imagine.

Uh, and I think he's a very smart guy.

Does that mean he has the temperament to

be the chair of the Fed? Uh, or that

Trump will pick him? I have no idea. It

is important to note however that on

several occasions quite consistently

reader has said he doesn't think

rates at you know call them 5% now or

whatever they are or win rates were at

5% now the base rate is a little lower

that you know whatever he's consistently

said actually I don't think these

highish rates are doing very much to

control inflation

and in that context he's used the

example example in the past of the

housing market, right? Where if you

brought the cost of mortgages down,

houses would get cheaper. So that would

actually be anti-inflationary.

So he says these kinds of things, you

can understand why the president would

be interested interested in at least

talking to him. He has also said on at

least one occasion that maybe the Fed

should or at suggest I emphasize the

word suggest here. He suggested that

maybe the Fed should help the Treasury

control interest costs costs. Maybe he

was misconstrued. That is a left fieldy

idea. I'm not sure if he really meant

that or whatever, but it's out there.

So, I think

he is a guy who might naturally appeal

to the president.

I mean, it's clear what the president is

afraid of, right? which is that he'll

appoint somebody who will give him a lot

of sweet talk in the appointment process

and then turn out to be his own person

or her own person which is of course the

whole point of the structure of the Fed

chair's job and my sense of Rick Reer is

that

he's he's a market vet who's going to

have his own views and I wonder if Trump

might not get that sense from him too

and back off. He's a really serious

person. Rick Reer is not a toad.

>> Yeah.

>> Which is it's very interesting because

it's hard to see the the right fit for

the job as anyone but a toad and a sick

fan. I mean, it appears that the best

person would not be uh a seasoned Wall

Street executive. It seems like the best

person would just be a guy who doesn't

have many thoughts and just is willing

to say yes and bring things down.

>> With a small number of exceptions, Trump

has appointed for loyalty rather than

competence.

>> Yes,

>> you could argue with in the case of

Rubio or possibly Bent that's not true.

But as a general rule, the main thing

about getting appointed to something

important in the Trump administration is

saying yes, you know, as loud as you

can.

>> So, I guess I'm hopeful for Rick Rita

based on your explanation, but I have to

say the fact that he's taking the

meeting, the fact that Trump really

likes him for the job, it just naturally

makes me skeptical. I think that would

be reasonable to most people. Rob, uh,

we'll we'll have to have you back very

soon. Thank you very much. Rob is the

author of the Unhedged newsletter and

co-host of the Unhedged podcast. Thanks

for joining us as always.

>> Thanks, guys. We'll be right back. And

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We're back with Propy Markets.

Tik Tok's fate in America is finally

settled. After years of legal battles,

the US and China have approved a deal

that sells Tik Tok's US business to a

group of non-Chinese investors. Under

the agreement by Danc's ownership will

fall to 20% of the US business with the

remaining ownership spread across

primarily American investors. Oracle,

Silverlake, and Abu Dhabi based MGX will

each take 15% stakes in the company.

Okay, here to help us unpack the terms

of this Tik Tok deal, we are joined by

one of the reporters who actually broke

the news, Reed Albagotti, technology

editor at Semaphore. Reed, thank you for

joining us on Profy Markets.

>> Absolutely. Good to be here.

>> So, Tik Tok has closed the deal. It's

official. You actually reported that

this was going to close before it

actually closed. I'd be interested to

know how you got that uh that scoop. But

before we get there, what do we know

about the deal? What are the terms?

Where are we on TikTok?

>> Yeah, I mean, you know, well, it's

basically a joint venture, you know,

with with Oracle and Silverlake in the

US. they're going to basically take over

the US version of Tik Tok. Um I think

the really interesting part honestly

less than the the business deal itself

is is like what's going to happen with

the algorithm in the US and from what I

understand I mean this is and this is

something I you know reported on back in

December is that you know there's

they're going to retrain the algorithm

on US customers and this way they'll be

able the Oracle will sort of administer

this they'll actually be able to tell

you know if if there's any manip ulation

from the Chinese government essentially

uh on the algorithms. I I thought that

was sort of fascinating.

>> Yeah. I mean the the reason this is

happening is there was a national

security concern that dates back many

many years. Uh the idea was to not have

China influencing the algorithm, the Tik

Tok algorithm that millions of Americans

use.

Have they solved that actually? like do

we know that this new Tik Tok is free of

Chinese influence?

>> Well, I think this is actually the big

question, right? I mean, we've gone

through all this, you know, Congress and

now this this huge complicated deal

which, you know, the US and China had to

sign off on all for, you know, event

essentially for China to still kind of

have a a a hand on this right now. If

you talk to people at Oracle, they say

no. I mean, they're they literally are

going to be able to oversee this and

make sure that there's, you know, that

there there's no manipulation. But I've

seen, you know, there's been chatter

since December when this deal, you know,

was originally sort of came out and in

most of the terms came out like a month

ago. Um, from critics who think that no,

actually, you know, unless there's a

complete break between China and the US

version of Tik Tok, there's always some

danger that there's going to be

manipulation. Now like the technical

feasibility of that or you know whether

whether that's actually the case I don't

know but I mean to some extent

perception is reality right if if people

are worried about it then I think it may

it may continue to be a big question

mark

>> just looking at the the new uh owners so

we've got Oracle it sounds like Oracle

is really the one who's dealing with the

technological side of the whole thing to

hear more about that also Silverlake

American uh investment firm MGX X based

out of Abu Dhabi. So that's not an

American owner. I think some people

would maybe say, "Well, why are we

having non-Americans

come in, these Middle Easterns come in

and control the algorithm?" What do you

make of the owner the ownership? Uh

who's really in control here?

>> Yeah, I mean that's that's another

interest. I think that's going to

definitely raise some questions. Now, if

you've been following the Gulf region,

which you know, 74 has, there have been

a bunch of deals between US tech

companies and, you know, MGX and and G42

and other Abu Dhabi entities um UAE

entities really. So, this is and this

has been what the the Chinese

relationship with the UAE has been this

big sort of question mark around there.

Should we even allow for instance Nvidia

chips to be shipped there? the US

government now, you know, has it's been

it's it's sort of under Trump has been a

bit more open to dealing with with those

entities. But I think the question is

like, well, you know, how much how much

are they, like you said, Oracle is

actually going to be administering this

on the technical side. So, how much is

is this just a a monetary investment? Do

they actually have any influence? I

think if you talk to Oracle, they'd say

no. if if someone from MGX calls us up

and says, "Can you make a little tweak

to the algorithm here?" um it's not like

they have the power to do that. But

again, you know, these are just even

just, you know, the original ownership,

right, of of Bite Dance owning Tik Tok

was enough. I mean, Bite Dance always

claimed that they were not manipulating

the algorithm as well. So, I think

there's just always going to be some

suspicion around uh Tik Tok and and you

know, the algorithm, so to speak.

>> Yeah. I mean, this is an algorithm that

has been wildly successful. I mean, just

thinking back to when Tik Tok first came

on the scene, and it seemed as though

there are all these potential social

media companies that came and went, but

no algorithm really cracked it. It was

always basically Facebook that was the

winner or Instagram, whichever algorithm

you were on, and then Tik Tok wins. It's

it's been so successful for so long. It

seems as though now it's about to change

in a big way for the first time ever,

which I think begs the question like how

will it change? What will it do to the

social media market? And one thing that

we found kind of interesting is that on

news of the deal closing, Meta Stock

jumped 1%. Now maybe that's not large

enough to attribute that this is because

of the Tik Tok deal, but I'm certain

that there's definitely a question that

investors are asking like what does this

actually mean for Tik Tok the product

and perhaps could it be you know

worsening something that's already

already working very well? What do you

think?

>> No, I you know I don't think the

algorithm itself is um is something

that's a secret anymore. In other words,

like the technical aspect of it is not I

mean everybody kind of I think knows how

this works. There's not you know there

there isn't at this point I mean look

look at just you know frontier AI

companies right? I mean it's hard to

keep even that stuff secret. So I think

everybody generally knows how this

works. The thing is what what's valuable

now in this in this you know US Tik Tok

entity is the fact that they have all

this data on the users. They know what

people like already. So that's why

Oracle can't just come in and say we'll

just like wipe this thing clean and

we'll just we'll completely start over

um develop you know our cuz they because

they'd basically be starting from

scratch. So you'd log on to Tik Tok and

it wouldn't know anything about what you

want to watch and they'd have to start

that process over again. So I think

it's, you know, it's not the algorithm

now. It's just that it's the there's all

this, you know, institutional knowledge,

I guess, and they need to find a way to

retain that while also, you know, making

sure that there's no kind of like undue

influence, you know, behind the scenes.

>> All right, Reed Alagotti, technology

editor at Samore. Reed, appreciate your

time. Thank you.

>> Thanks for having me. We'll be right

back. And if you're enjoying the show so

far, be sure to like and subscribe to

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Well, it's quite telling that gold, the

asset that is known across the world as

the safe haven asset, the thing you buy

when things are looking really bad. It's

quite telling that that asset hit

another record high this week. $5,000

per troy ounce up more than 50% in the

past 6 months, up more than 80% in the

past 12 months. What that tells you is

that investors are looking around.

They're seeing what is happening,

especially in America, and they're

getting quite frightened. Whether that

is our unsustainable fiscal deficit,

which is set to explode again under

Trump, or our escalating geopolitical

tensions from Greenland to Venezuela to

Iran, or even what is happening

domestically, most recently, armed

federal agents raiding cities and

shooting people in the middle of the

street. All of this is working in tandem

to make investors feel anxious, very

anxious. And let's be real, they

probably should be. You know, we could

talk about earnings and we could talk

about profits, but when Masked agents

are on the ground shooting people in the

head, suddenly the story changes a

little bit. It's not about headwinds and

tailwinds anymore. It becomes bigger

than that. It becomes about violence. It

becomes about democracy. It potentially

becomes about war. And what do you do

when you're worried about all of these

things? What do you do when you're

worried about the future of America?

What do you do when you're worried about

America's place in the world? Perhaps a

new global order. What do you do? You

buy gold. Now, again, I'm not

questioning the anxieties. Again, I

think these anxieties are reasonable.

However, I would question investors

conclusions. And in this case, the

conclusion is that if America falls

apart for whatever reason, if that

happens, the answer to your problems is

gold. And to that, I would ask the

question, why? Why specifically?

Because gold is a hard asset. Okay.

Well, there are lots of hard assets

because gold is uncorrelated from the

dollar. Okay. Well, there are plenty of

non-doll denominated assets, too. or

maybe because it is universally

recognized as valuable, a store of

value. Again, I could present to you a

laundry list of other assets that fit

the description. We could talk about

many of the other metals, metals that

are more useful than gold, metals like

copper and lithium and aluminum. We

could talk about other commodities as

well. We could talk about food, oil. We

could talk about maybe even Bitcoin. We

could even talk about international

stocks. If you think the US is going to

for whatever reason, well, there

are 194 other nations that you could

invest in, many of which have far lower

debt loads than the US, countries like

Norway or Denmark or Switzerland. And if

you're a real doomer, you could just

invest in weapons manufacturers and

defense contractors. I'm not endorsing

any of these, but my point is when times

get bad, there are plenty of things you

could invest in besides gold, but the

market doesn't seem to be fully

recognizing that. It seems that gold is

rallying not because of its intrinsic

value, but because of a story that

investors are instinctively telling

themselves. When things look bad, this

is what you do. You buy gold. Everyone

knows that. That is not an investment

thesis. That is a story. In fact, it is

often the story of a bubble. A bubble is

when the price of an asset becomes so

untethered from its fundamentals that it

no longer reflects its actual intrinsic

value in the real world. Gold is

supposedly almost twice as valuable

today as it was 12 months ago. But

again, why? And be specific. What can it

do for you that it didn't do last year?

How can it improve your life relative to

anything else? What makes it such a safe

haven? These are the questions that

investors need to ask themselves very

honestly. And saying it's worth it

because everyone else says it's worth it

isn't an answer. You have to have your

own answer. It has to be a real genuine

answer. This is what investing is about.

Now, to be clear, I think gold could

rally tomorrow. I think it could rally

the next day. I think it could keep

rallying for the rest of the year. But

at a certain point, you do have to start

asking questions. And in every rally

like this and in every bubble

potentially like this, the most

important question is also the simplest

one. And that question is why.

Thanks for listening to Profy Markets

from Profy Media. If you liked what you

heard, subscribe to our YouTube channel

and tune in tomorrow for more.