DC Lite #523

1. Central banks vs. gold. "Central bank gold buying is NOT driving the rise in gold prices ... The fact that this is a broad bubble across all precious metals argues against central banks being a key driver. Occam’s razor is that we’re seeing a speculative bubble, which - as in all past bubbles - is driven by retail investors, not some official actor."

2. Gold ETF flows. "Another strong week for global gold ETFs last week: net inflows of close to US$5bn (~34 tonnes), with all regions contributing. YTD net inflows now total over US$11bn (~75 tonnes), with AUM now above US$650bn."

3. Retail flows. Since late 2025 retail investor have shown a preference for the Other 493 over the Mag 7.

4. Cash on the sidelines. "Our proprietary measure of cash-on-the-sidelines for the US shows it is at a record low as % of the US equity market cap. And yes, it includes retail and institutional money market funds!"

5. Stocks vs. global optimism. "The equity market has rapidly priced a positive expected growth outlook ... after similar levels were breached: The bottom line is the broader market was soggier in the short term, but held up well on a longer horizon. On the flip side, assets like RTY and our cyclical vs defensives pair (GSPUCYDE) did not fare so well."

ICYMI