Tariff-Driven Inflation!

Check out my latest YouTube interview for a quick take on where things are headed.

Gold is trading near an all-time high of $3,250/oz as central banks continue to build reserves and inflation shows no signs of fading. I’ve added a 15% position in a physical gold ETF, anticipating further upside in the precious metals space.

Since April 4, 2025, we’ve seen some dramatic moves:

• 20-year Treasury Bonds have dropped 6.4%
• The U.S. dollar is down 2.9%
• The Swiss Franc is up 8.4%
• The Euro has gained 5.2%

These are significant moves, especially for currencies typically known for their stability. This may indicate that China is selling U.S. debt in response to the 145% Trump tariffs. If that’s the case, big money is shifting away from America, seeking new trade partners for their goods.

If these tariffs remain in place, prices in the U.S. could continue to rise, contributing to tariff-driven inflation. That means Trump may need to find ways to stimulate economic growth to offset rising costs.

The Federal Reserve is in a tough spot. If they lower rates or increase the money supply, it could worsen inflation. Between September 16, 2024, and January 13, 2025—just 81 market days—the Fed cut the Fed Funds Rate by 100bps (18.6%), but the 10-year Treasury yield rose 110bps (32%). That’s a clear message from the bond market: don’t fight inflation with rate cuts.

The bond market is massive, and it’s signaling concerns. With $9 trillion of the $37 trillion U.S. national debt due for refinancing this year, bond investors are demanding higher yields. Currently, interest payments on our debt are around $3 billion/day, but tariff revenue only brings in about $2 billion—a big gap to close. Maybe Trump will start looking at creative options like privatizing national parks to raise cash.

On the bright side, key tech items—smartphones, servers, chips, solar panels, and TVs—were exempted from the 145% Chinese tariffs. That could offer some relief for markets in the short term.

I’m watching for a Follow-Through Day (FTD), a 1% index gain on higher volume, at least four days after a rally attempt. While not a green light to go all in, it’s a strong signal that institutional investors may be returning to growth stocks. Once we get that, I’ll turn to my watch list (below) for potential buys.

Despite all the uncertainty, we’re on the verge of a great opportunity. When the time is right, I’ll be ready.      Grace & Peace to You and Your Loved Ones!

Watch List: ADMA, BOW, BRBR, EAT, EHC, GEV, IBN, LOAR, LRN, PAAS, PLMR, PLTR, ROL, RYAN, SFM, SKWD, TGTX, TKO, WGS.

Those who trust in the Lord will renew their strength; they will soar on wings like eagles; they will run and not become weary; they will walk and not faint. Isaiah 40:31

If you know anyone who would like to receive these updates or invest with me, please Email or call me. 

Dexter Lyons, Portfolio Manager
337-983-0676, ChristianMoneyBlog.net
100% BRI, Honoring God with Our Investments!
Actively Managing Risk Since 1990!    

Cash is King!

Check out this brief YouTube interview for my latest insights on the market!

Last week, I sold my gold (15%) and silver (10%) ETFs. The market wasn’t rewarding me for taking risk, so I moved to 100% cash and await a Follow-Through Day (FTD). An FTD typically occurs four days after a market bottom when the S&P 500 or NASDAQ jumps by at least 1.2% on higher volume. This is often a sign that institutional money is moving back in, which could signal the start of an uptrend. Institutions and hedge funds have the resources to hire top analysts, so I prefer to follow smart money as they create trends with their consistent buying. While it may take some time for bases and trends to form, I remain disciplined and patient.

The S&P 500 is down 13.4% YTD, and the NASDAQ has dropped 19.2%. I anticipate more capitulation selling this week, as investors trying to “buy the dip” may catch a falling knife. However, a substantial buying opportunity will emerge once the selling pressure subsides. We must wait for the dust to settle before re-entering the market.

The market is still grappling with the economic effects of the retaliatory tariff war, and it seems the Fed is considering a rate cut in June. However, the Fed knows this could spark inflation without encouraging growth, leading to stagflation. With limited tools to handle a stagflationary environment, we could be stuck in a high-risk, low-reward environment longer than anticipated.

Last Friday’s jobs report showed the economy added 228,000 new jobs, nearly double the expected 130,000. While that’s positive news, it might not be enough to ease concerns about the US’s financial strategy and its attempts to alter global trade. Meanwhile, Congress hasn’t yet passed a measure to keep the government running. Could we be facing a US debt downgrade soon?

If tariffs continue to escalate, we might witness a global economic restructuring as international trade is redefined. Interestingly, $100 in gold is more efficient than $100 in cash, as gold is a better way to transfer value physically—especially considering the US no longer issues bills larger than $100.

Trump’s “Liberation Day” of reciprocal tariffs ended up being an obliteration for many stocks, which were hammered by tariff uncertainty and widespread selling. Consumer confidence took a hit, and investor sentiment plummeted. The market could see more selling Monday as futures point to a 5% drop. Grace & Peace to You and Your Loved Ones!

Watch List: ADMA, ATGE, BOW, CALM, CBOE, CPRX, CVCO, EAT, HMY, IBN, LRN, MRX, OPCH, PHYS, PFSI, PLMR, PRMB, RGLD, SFM, TGTX.

So that being justified by his grace, we might become heirs according to the hope of eternal life. Titus 3:7

If you know anyone who would like to receive these updates or invest with me, please Email or call me.

Dexter Lyons, Portfolio Manager
337-983-0676, ChristianMoneyBlog.net
100% BRI, Honoring God with Our Investments!
Actively Managing Risk Since 1990!