I believe that we are witnessing a MAJOR turning point in the global economy. It appears to me that this war is not at all about nuclear weapons but about trying to subdue the global south and the BRICS. Iran is in a critical position for China’s Belt and Road- an economic alliance that will allow for trade among Asia and the Middle East. Iran is important because the rail lines that will allow for FAR quicker transport of goods runs right through there. This allows trade to happen MUCH quicker but also allows for far less interference from outside forces because it is land-based versus sea-based where the USA is enforcing their “rules” that they alone make up.

Iran is also important because of their oil and natural resources. I would not be surprised that if Iran really starts to struggle that Russia and China could come to their aid. I believe that America is trying to bully the rest of the world into accepting their terms for trade- not in a win-win situation but in my way or the highway situation. China gets 20% of their oil imports from Iran.

While the war is obviously going to change a lot of our assumptions about various assets there are a few things that stand out right now.

Historically, at least as far back as I can remember (that is getting longer all the time) when you have a selloff in risk assets (stocks in particular) the US dollar generally rallies and yields on treasuries drop. The yields drop because people buy them for stability and the dollar rallies, because as assets are sold, they settle in dollars. While this- along with a lot of short-covering for those short the dollar, led to a rally that should be VERY short-lived. The gravity of the spending that will be necessary going forward will become known. What appeared to many was a flight to safety was, to me, a settlement into dollars until the dust settles and assets can be bought.

While the “markets” were tanking on March 2nd. the dollar DID strengthen- as expected. The substantial change came in the bond market where yields- instead of falling, imply BUYING, were RISING, which means they were being sold. At the same time gold was rallying. This tells me that the world is voting with their cash and looking at GOLD as the ultimate safe haven asset- NOT treasuries any longer. Central banks have made that clear with 5 years of record gold buying, which has led to central banks holding more gold than treasuries for the first time since 1996. ALWAYS watch what they do- not what they say.

I believe that this war will be the final nail in the coffin for the US dollar as the world’s reserve currency. It has been firmly established that the dollar is not only a means of exchange but also a global economic weapon. It has also been proven to most that the USA cannot be trusted and the confidence that the dollar will retain its perceived value is collapsing. Running $2 TRILLION in deficits while conjuring up cash (OFF THE BOOKS) to fight these unending- and in my opinion TOTALLY ILLEGAL wars will only hasten our demise.

We have lost credibility and I cannot see how anyone will negotiate with this crew in office anymore when they have shown they have no regard for any rules of any kind.

Another major change I am seeing is that paper “markets” in precious metals are getting ready to either capitulate or collapse. I do not believe they will collapse because each time a critical event takes place, they either change the rules or just shut down. The playbook is getting old. Raise margin requirements (forced selling), algorithms see and there is more selling and have a system outage so nobody can buy and the price collapses. We have seen this twice this year at the end of January and the beginning of March.

This causes a massive drop in price, which, in my opinion, is a last-ditch effort to keep the price-particularly of silver-down. There are MANY signs including:

· Major banks which were historically short (JP Morgan, Citigroup, Bank of America, etc.) still may have short positions but are demanding PHYSICAL delivery which they have not done anywhere near the size they are now. This implies that there is either client demand for physical and not paper, proprietary accumulation for themselves or they are hedging their short bets. This is leading to even LESS supply as demand continues to escalate. Physical deliveries at the COMEX are running 25 TIMES the historical norm. That is NOT 25% more, it is 25 X more. This was an exchange not built for physical delivery but to have paper give the illusion of FAR more supply than actually exists.

· The supply deficit from 2021-2025 in silver was 820 MILLION OUNCES. This is almost a full year of mine production and 2026 is shaping up to be the same if not worse.

· In China, where physical delivery is mandatory the premium over the paper price is $10.00 now and has been higher recently. In addition, there are reports that $120.00 is the going price in China and many will still not sell at that price.

· Lease rates are exploding to over 6% while it is typically less than ½%.

· While the west’s “markets” are closed the metals have been rallying. Once they open, they are hit. This is obvious manipulation which will only make the ultimate reconning that much more explosive.

· Metals do not change. It is the amount of dollars or whatever currency you are buying in losing its purchasing power. Deficits here are skyrocketing which will lead to more “printing and buying” which in turn will weaken the currency further. Just think about it. WAR, VA benefits, SS, Medicare Payments-All off the books and not part of the nearly $39 TRILLION already owed. Over 1 MILLION layoffs in 2025 and a report by Challenger Gray and Christmas in February that shows companies hiring expectations are DOWN 56%. What will that do to tax collections? How much extra “printing” will it take to plug the tax gap, social spending, etc.?

There is a lot of volatility in ALL assets right now but in my opinion the most vulnerable of assets are those that include a promise to repay- whether that be bonds, overleveraged stocks or even cash- which we know you can always get back but the question is what will it buy when you need to spend it.

John Williams of Shadow Government Statistics reports the US government’s own numbers without the financial trickery used to support a narrative that says inflation is indeed down from a high in 2023 of 15% and is now running 12%. I am expecting we will run past that 15% sometime in the near future.

Be Prepared!

Any opinions are those of Mike Savage and not necessarily of those of RJFS or Raymond James. Expressions of opinion are as of this date and are subject to change without notice. The information in this report does not prove to be a complete description of securities, markets or developments referred to in this material. The information has been obtained from sources deemed to be reliable, but we do not guarantee that the foregoing material is accurate or complete. Any information is not a complete summary or statement of all available data necessary for making an investment decision and does not constitute a recommendation. There is no guarantee that these statements, opinions, or forecasts provided herein will prove to be correct.

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