Fed hawkishness as a catalyst for gold (with Jeremy Saffron)

A hawkish Fed under Kevin Warsh maintaining 'higher for longer' could trigger a blowup in private credit and private equity markets, creating a financial crisis where gold becomes the safe haven. The inflation print itself is secondary to the systemic risk.

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Danielle DiMartino Booth 8.5

Fed hawkishness as a catalyst for gold (with Jeremy Saffron)

metals

this was a great buying opportunity for gold

yields

Higher for longer implies yields remain elevated or rise further in the near term.

Jeremy Saffron

The Fed has a new chair, Kevin Warsh, who made a hard turn to 'higher for longer' with unanimous committee support. Former Fed insider Danielle DiMartino Booth says this shift matters more for gold than any single inflation print.
Danielle DiMartino Booth

If Warsh maintains higher for longer, it helps facilitate a blowup in private credit that bleeds into private equity. That makes this a great buying opportunity for gold because in times of financial crisis, gold is where to hide.
Jeremy Saffron

The crisis she's watching is in private credit markets, not in the stocks everyone stares at.
Danielle DiMartino Booth

We're seeing serious pain points in the economy that would be exacerbated if rates stay where they are. Private credit is already blowing up, private equity is following. The market may force the Fed's hand.

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