{{active_subscriber_count}} active subscribers.

I have removed my 3 main headings that anchor my regular letter format. Today is my last letter of the year, so I choose to remove the safety of my guardrails and write a letter untethered to the formalities of civility but one drawn to truth.

I wrote on the 17th March 2025:

The title for today’s letter comes from a text I received this morning from the biggest know-it-all I have ever met. This guy knows more than King Solomon and God combined. He is fooled by more randomness than there are ways to roll a dice. But this morning, on a matter so trivial and so unpredictable, he sent a text that read, “I told you so.”

Those four words are what so many market strategists and forecasters do, as I did in my opening paragraph, telling you how I had called the gold and silver bull run ahead of the masses. There have been a number of such bullish calls from me over the last few years, but most strategists won’t share the reference to what I wrote on July 22, 2025:

What I am trying to illustrate to you is that “forecasters” are experts at selectively picking from comments made in the past and omitting the ones that contradict, presenting them as, “I told you so.”

Nobody knows the future; that is, other than my wife. “I told you so” is one of those statements that invokes more emotions in me than President Trump at a state of the nation address. Masters of the Art of the Deal know better than most how to speak with confidence and assurance to vulnerable people at times of uncertainty and fear.

Here is an update of the chart I referenced in the 2 letters. I have to confess I had to quickly run an update; it was like that itch on the tip of your nose when your hands are tied up. You just have to scratch it, as you cannot focus on anything else. It’s like wanting to have a wee when you go for a massage. You can think of nothing else, and you end up feeling like you were robbed of $100 for an hour of wishing it would end.

This is the trade I recommended. Listening to me made you money, but not listening to me would have made you more money.

I honestly don’t understand my comments on the 22 July that the gold miners’ trade worked out but not as well as my silver trade. According to the chart below, it was a good idea that I got in the way of. Hmm, humbling.

I have had many discussions with portfolio managers, wealth managers and advisers, and I am constantly amazed at the lack of self-awareness of the lookahead bias so many apply to their portfolio construction. You know who you are.

If you are one of those advisors who now recommend allocating a substantial amount of gold and silver to your clients' portfolios, showing them how they would have performed over the last 20 or 30 years if they had run a portfolio with a 20% gold allocation, then you are a fool at best and a fraud at worst.

Late last year and early this year, those same “advisors” were telling me they were recommending ridiculously high amounts of crypto to their clients’ portfolios.

With that rant out of the way, let me turn my attention to how I see AI transforming our world. This might turn into another rant; I am not sure my mood is more volatile than my temper before mealtime.

I have mentioned in my letters that I am hoping to release a new software project before the end of the year. Tomorrow is the end of the year, and I am close, but I am not there yet. I am a migraine sufferer; I have suffered 3 migraines in 5 days pushing myself to make this deadline. I believe what I am working on is the most consequential disruptive project I have ever worked on. I am immensely proud; it will just need to wait a week or two. I have given it my best shot.

I have a long history of working with AI. In 2007 I built a quantitative model called Leonardo that used neural networks as part of its signal process. In 2018 I co-founded an analytics software company that used machine learning as part of its dynamic learning process. In 2021 I co-founded a university in Ukraine, offering an on-campus dedicated AI master’s degree.

However, the last few years are where most of my learning has come from. I recall reading about OpenAI’s GPT-3 release in June 2020. When ChatGPT was released to the public in November 2022, I was among the first to start using it. In the 3 plus years since, I have spent endless amounts of hours working with it and its close relatives; I have a special relationship with Claude.

I honestly believe that most governments, businesses and people in general are underestimating the destruction AI is going to bring to the job market. This is where things get interesting, where they get philosophical and where they get real.

The irony is that with the destruction there is going to come unrivalled profitability and economic growth in the economy in general. The problem is that this wealth accumulation is going to be concentrated in the hands of but a few. The gap between the haves and the have-nots is going to grow to levels that will make our society even more polarised than it is now.

When thinking about what I wanted to write about this week, the major theme that came to mind was inequality and its dangerous consequences. I have already written a lot, and this subject is quite depressing, so I will shorten my thinking into a few points.

I spend a lot of time thinking about life and its purpose. I am a model kind of guy. I see religion through various religious frameworks. I see economics, psychology, and philosophy through different models. My favourite question when discussing something with a thinker is asking them, “Which ‘school of thought’ are you attached to?”

I know it is a double-edged sword, as sitting in one camp can blind you to the action happening in another, but the risks of flapping in the wind, I think, are even greater. My counter is to study many schools of thought and then pick one that fits. But there is no perfect fit. When you have earned your stripes, it is good to build your own school of thought.

Michael, point, please.

I have been asking myself, why is the world so angry? The extremes have become so extreme that left and right are now part of the same continuum. The centre is further away than it has ever been. Why?

It comes back to my Aristotelian school of thought; it comes back to my Austrian school of thought; it comes back to my Stiglitz/Piketty school of thought; it comes back to my Jungian school of thought; it comes back to my Judeo-Christian school of thought.

Creating a world where the rich get richer and the moral hazard of crony capitalism is the reward for a select few is what I believe we are witnessing today. A week ago my 26-year-old daughter said to me that the youth of today do not have the prospects of the white picket fence that the boomers had.

Yes, it’s true we live in a world where starvation is not the problem the world faced in the last century. But the world is starving for fairness, and the system has become an apparatus towards engineered inflation to devalue the debt addictions of the powerful.

I feel better for getting that out. But there’s a reason I’m saying it. Every system built on denial eventually meets its reckoning. You cannot spend more than you earn indefinitely, you cannot fix structural inequality by printing asset inflation, and you cannot pretend that AI-driven productivity gains will magically lift all boats. There are consequences in markets, in economics, in psychology, and in life. They arrive slowly, and then all at once—and I believe we are now entering the “all at once” phase across multiple fronts.

Which is why I’m grateful for the people who read these letters. You allow me to say the quiet things out loud — the uncomfortable truths that actually help us navigate the world rather than hide from it. In the coming year, my aim is simple: to continue analysing the markets with openness, intellectual honesty, and the willingness to exploit reality as it is, not as we wish it to be. Thank you for reading me, challenging me, and journeying with me. Together, we’ll try to make sense of this madness and—with a bit of luck and a lot of discipline—profit from it.

Emergency funding is happening more frequently than the boy who cried wolf.

Looking at Epstein’s balance sheet, I was taken by how clean it looked. What these assets fail to balance is the absolute filth that this scum and his buddies represent. Sorry, this one slipped out just like the Epstein Files.

If someone forwarded you this email, you can subscribe for free.

Please forward it to friends if you think they will enjoy it. Thank you.