Markets In Crisis As Middle East War Breaks Out
Energy Stocks Set To Explode, Gold and Dollar Safe Haven?
TABLE OF CONTENTS
MARKET RECAP
MARKETS: 'Aggressive Plays' That Signal Market Top; How Much Upside Before Crash?
COMMODITIES: Will Gold Price Crash 50%? Silver Explosion Not Yet Over
CRYPTO: U.S. Is 'Broke', Dollar Is Crumbling; Jack Mallers Doubles Down On $1 Million Bitcoin
CRYPTO: Peter Schiff: This Is 'Peak Of The Mania', 'Big Bubble' To Burst As Dollar Dies
ECONOMY: Economist Called 1987 Crash, Issues Dire Warning For 'Danger Zone'
MARKET RECAP
June 9-13.
Recent News.
U.S. markets experienced significant volatility this week as investors navigated geopolitical tensions and mixed economic signals. The week began positively with all three major indices posting gains on Monday amid optimism about U.S.-China trade negotiations and better-than-expected employment data, with the S&P 500 climbing above the crucial 6,000 level for the first time since February. However, sentiment shifted dramatically on Friday as Israel launched "Operation Rising Lion," a large-scale military strike against Iranian nuclear facilities and military leadership, killing top commanders including Revolutionary Guards chief Hossein Salami and nuclear scientists.
The escalating Middle East conflict sent markets tumbling, with the Dow Jones, the Nasdaq, and the S&P 500 all dropping negative on Friday. Despite the week's volatile finish, all three indices maintained positive year-to-date returns, with the S&P 500 up 2.34% and the Nasdaq gaining 1.38% for 2025. Oil prices surged as investors fled to safe-haven assets amid fears of broader regional conflict.
Michael Gayed predicted heightened volatility as Israel launched multi-day strikes against Iranian Revolutionary Guard headquarters, sending energy prices higher and triggering defensive positioning across asset classes. The Lead Lag Report publisher warned that market complacency regarding geopolitical risks could create painful adjustments ahead.
"We're going to go from tariffs to war," Gayed said, referencing his May prediction that conflicts would replace trade disputes as the primary market catalyst. Energy stocks emerged as clear beneficiaries, with uranium names gaining particular traction as investors rotated toward defensive sectors. Oil prices spiked partly due to mechanical short covering ahead of the attacks.
Bitcoin initially declined 2% but Gayed expected eventual divergence from technology correlation patterns if credit events materialize. Gold reached $3,450 per ounce following the strikes, though Gayed cautioned the precious metal had transitioned "from a flight to safety asset to a FOMO momentum trade" in recent months. He noted potential distribution patterns developing despite continued safe-haven demand.
Gayed launched the Free Markets ETF ($FMKT) to capitalize on Trump's deregulation agenda, predicting massive sector rotation benefits for mid-cap and small-cap companies. The fund incorporates artificial intelligence screening for regulatory impact analysis across highly-regulated industries.
Market Movements
The following assets experienced dramatic swings in price this past week. Data are up-to-date as of June 6 at approximately 4pm EST.
ORCL - up 23.74%
PLTR - up 14.47%
TSLA - up 13.95%
XOM - up 10.35%
CVNA - down 13.82%
APP - down 12.06%
BABA - down 6.24%
DXY - down 1.10%
Bitcoin - down 1.09%
Gold - up 3.46%
10-year Treasury Yield - down 2.29%
S&P 500 [SPX] - down .46%
Russell 2000 [RUT] - down 2.18%
MARKETS: 'Aggressive Plays' That Signal Market Top; How Much Upside Before Crash?
Chris Vermeulen cautioned that heightened investor appetite for volatile assets suggests an impending market reversal. He observed sentiment shifts as traders pile into silver miners, uranium stocks, and small-cap securities while abandoning dividend plays.
"Typically, when people are most bullish and taking the most risk is usually when the stock market actually wants to go in the opposite direction," Vermeulen explained during technical analysis. He noted silver's breakout above $36 represents classic late-cycle behavior as investors chase leveraged precious metals positions after gold's consolidation.
He classified current conditions as "stage three topping phase," characterized by increased volatility and sector rotation away from defensive positions. Most concerning was the shift toward speculative plays while underlying market breadth deteriorated. "When people get really bullish even though the market is struggling, people are moving into the aggressive plays," Vermeulen said.
He maintained a defensive 70% cash allocation despite acknowledging the prevailing uptrend. Ten-year yields approaching 5 percent present additional headwinds, with Vermeulen predicting either sideways consolidation or a sharp breakout higher that would "wreak havoc on a lot of sectors."
The strategist warned against dividend stocks during this cycle, noting retirees' concentrated holdings create selling pressure during market stress. Bitcoin continues tracking equity movements, suggesting technology correlation persists.
COMMODITIES: Will Gold Price Crash 50%? Silver Explosion Not Yet Over
Precious metals analyst Gary Wagner identified a notable divergence as silver climbed over 10% within ten days while gold remained range-bound near $3,374 per ounce. The silver breakout reached levels unseen since 2012, with prices approaching $37 per ounce as traders rotated from sideways gold positions into the more volatile metal.
Technical analysis revealed gold trading within a compression triangle formation after its parabolic April surge from $3,000 to $3,500. Wagner explained that gold maintains bullish momentum above its 50-day moving average around $3,310, with major resistance at $3,440 and support at $3,200. "We had a $500 move in a short period of time," Wagner noted, describing the unsustainable rally that preceded the current consolidation.
Trade uncertainty continues driving precious metals demand despite tentative China-US negotiations. Dollar weakness from 110 to below 100 on the index provided additional tailwinds, creating what Wagner termed a "100% relationship" with gold pricing. Recent Consumer Price Index data showed inflation at 2.4% annually, slightly above Federal Reserve targets.
Wagner cautioned against aggressive accumulation at current elevated levels, recommending dollar-cost averaging for new investors. Silver faces resistance near $42, while gold could correct $300-700 if fundamental conditions shift regarding tariffs or dollar strength.
CRYPTO: U.S. Is 'Broke', Dollar Is Crumbling; Jack Mallers Doubles Down On $1 Million Bitcoin
Jack Mallers articulated a provocative monetary thesis during the Bitcoin Las Vegas conference, predicting extraordinary price appreciation should traditional bond markets experience extreme dislocations. When questioned about double-digit Treasury yields, Mallers responded that "if the 10-year yield went to 80 percent, I think Bitcoin would probably be worth like a million."
His analysis centered on structural dollar weakness stemming from unsustainable fiscal dynamics. Mallers characterized the federal government as "broke" and requiring continuous foreign financing to maintain operations. The traditional arrangement whereby China recycled trade surpluses into Treasury purchases has deteriorated, forcing unconventional monetary accommodations through mechanisms like supplemental leverage ratios for banks.
Mallers described his personal Bitcoin standard, explaining he receives compensation directly in cryptocurrency and borrows against holdings rather than selling. "I don't own any dollars," he explained, detailing a lending strategy that exploits Bitcoin's superior compound annual growth rates relative to borrowing costs. Strike announced single-digit interest rate loans against Bitcoin collateral, positioning the service as competition for traditional banking products.
The entrepreneur criticized conventional financial establishment culture, arguing that "nobody wants another old white bald guy in a blue suit and Louis Vuitton sneakers trying to convince you of a version of the world that you know in your heart is wrong."
CRYPTO: Peter Schiff: This Is 'Peak Of The Mania', 'Big Bubble' To Burst As Dollar Dies
Peter Schiff delivered a contrarian thesis at the Bitcoin Las Vegas conference, arguing that the cryptocurrency represents speculative mania rather than monetary innovation. He compared the event's lavish exhibitions to 2006 mortgage banking conferences that preceded the financial crisis.
"Is this conference going to get to 50,000, 100,000? This might be the peak of the mania," Schiff explained during the interview. He noted the conference's scale, with 30,000 attendees and expensive technology booths, suggested late-cycle behavior rather than early adoption. Central to his argument was Bitcoin's correlation with risk assets rather than gold, despite being marketed as "digital gold."
Schiff predicted government Bitcoin purchases would create inflationary pressures. The proposed Lummis bill would revalue federal gold holdings and use proceeds to purchase Bitcoin, effectively printing money to fund the strategic reserve. "That's massive inflation," he said. "You are inflating the money supply to buy Bitcoin."
Historical precedent supported his skepticism. Schiff referenced the 1970s dollar devaluation, when Nixon abandoned gold convertibility and prices surged accordingly. He advocated returning to commodity-backed currency systems, arguing politicians abandoned gold discipline to finance deficit spending without fiscal restraint.
ECONOMY: Economist Called 1987 Crash, Issues Dire Warning For 'Danger Zone'
Mark Skousen predicted America faces stagflation as Trump's trade policies disrupt established supply chains. The designated "America's Economist" warned that protectionist measures represent economic self-sabotage after decades of global integration progress.
"The rising costs of these tariffs that are being imposed by Trump, it's a self-inflicted wound to the economy," Skousen explained during market analysis. He noted that even American automobiles contain 40% foreign components, making comprehensive tariff protection economically destructive rather than beneficial.
Skousen's Gross Output metric, which includes supply chain activity excluded from GDP calculations, revealed business-to-business spending contracted while consumer expenditures remained robust. This divergence suggests underlying economic weakness despite headline growth figures. "We had a recession but it was a business recession, not a consumption recession," he said.
The professor favored gold over Bitcoin during periods of uncertainty, arguing that precious metals provide superior crisis hedging compared to technology-correlated digital assets. He recommended Kinross Gold for its expanding margins and production capacity.
Drawing parallels to Benjamin Franklin's diplomatic approach, Skousen criticized Trump's confrontational negotiation style. Franklin's maxim that "no nation was ever ruined by trade" offers historical wisdom for contemporary policy debates regarding international commerce.
WHAT TO WATCH
Tuesday, June 17:
US retail sales report
Import price index
Industrial production
Home builder confidence index
Wednesday, June 18:
Initial jobless claims
FOMC meeting and announcements
Friday, June 20:
US leading economic indicators
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