This Week in Barrons: 10.26.2025

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•  Cheaper, Faster and Better … used to be the goals of a typical small business. Today, there’s probably a giant competitor who can be even: cheaper, faster and better than you.  Per S. Godin: The way forward is simple: ‘Be worth the trip, and worth the price.’  Winning a race to the bottom is no longer a viable option.  It’s more exciting, compelling and useful to win a race to the top.

• “The world believes that asset prices are going higher because: (a) governments can’t stop printing money, (b) national debts will continue to accelerate higher, (c) Central Banks around the world must cut interest rates in the coming months, and (d) AI is making companies more profitable with less employees.”  Per A. Pompliano: Investors understand that holding cash and bonds are a losing trade, and owning stocks, bitcoin, gold, real estate, and/or collectibles are the only way forward.  The micro decisions are not as important as the decision to convert fiat dollars into some kind of investment asset.

• The next event in our lives … could be something the world is trying to teach us.  But before being taught, we need to choose to learn.  When we choose to learn, our own active engagement makes a huge difference in the outcome.  Which means, there’s something to be gained from virtually every interaction. 

• The Dollar Debasement Trade:

  - JPMorgan said: “If even one-half of a percent of foreign-held U.S. assets move into gold – we will see $6,000/ounce by March 2026.”  History doesn’t guarantee the future, but in the past 4 gold bull markets, gold prices rose an average of 300% over ~43 months.  If that pattern holds, bullion could be trading near $6,000 an ounce by spring.

  - Foreign Central Banks hold more gold than U.S. Treasuries for the first time in +25 years.

  - Per Deluce: “De-dollarization is happening.  Nations are building a financial system that relies less on Western dominance and uses gold as a foundation.”

  - Texas has formally recognized gold and silver as legal tender.  Texans will be able to use their gold and silver holdings for everyday payments via electronic systems such as mobile apps or debit cards.

  - Gold bars have become one of the hottest items at Costco.

  - Per C. Bilello: “Gold has appreciated ~60% YTD and is now the best performing major asset class over the last 20 years with an annualized return of over 11%.  This is driving Central Bank allocations higher, and gold now accounts for over 20% of global central banking reserves – the highest in ~30 years.”

• Trump pivots quickly …

  o Trump went from threatening 100% tariffs on all Chinese goods to saying the trade war threats are "not sustainable".

  o Trump is formalizing 25% tariffs on foreign trucks starting November 1.

  o Trump ends tariff negotiations with Canada - imposes +10% tariffs.

• US and Australia signed a critical rare earths deal ... that includes plans for projects worth a total of $8.5B and has the U.S. investing in Australia’s rare earths processing as part of the agreement.

• The Department of Energy canceled $720m in … manufacturing grants for startups developing battery materials, recycling tech, and advanced windows – signaling a setback to U.S. clean-tech manufacturers and investors.

• ‘ChatGPT for doctors,’ hits $6B valuation … as it’s being trained by trusted medical sources like JAMA and The New England Journal of Medicine.  Since July, monthly consultations have soared to 15m, as clinicians turn to the tool for faster answers.

• Google announces major quantum breakthrough … as their Quantum Echoes algorithm (running on the Willow quantum chip) has achieved a 13,000-fold speed advantage over classical supercomputers.

• Amazon debuts AI-powered glasses for delivery drivers … that are designed to assist delivery drivers with scanning packages, navigating routes, and spotting hazards hands-free.

• Tesla Q3 revenue +12% YoY to $28.1B … net income DOWN -37% to $1.4B.

• Meta is firing 600 people in their AI group(s).

• The Trump administration is in talks to take equity stakes … in quantum-computing companies: IonQ, Rigetti, and D-Wave – signaling a deeper federal push into next-generation tech ownership.

• Microsoft enters the AI browser wars … with its Edge browser that now includes Copilot Mode, an AI assistant that can see your tabs, summarize pages, and even fill out forms.  Microsoft has also introduced Mico, an expressive orb that talks back and teaches you things in a new “Learn Live” mode.

• OpenAI acquires Sky to bring AI to Macs … Sky is a MacOS assistant that functions as a context-aware intelligent layer.  The software (which has not been released yet) reads screens, automates applications, and helps with writing and coding tasks.

•  Robots:

  o Amazon to replace 600,000 U.S. jobs with robots.

  o Chinese startup drops the world’s cheapest humanoid robot: Noetix Robotics has unveiled Bumi, a humanoid robot priced like an iPhone.  Despite its compact size and wallet-friendly price tag, the robot has impressive walking, balancing, and dancing capabilities.  The Chinese are creating an entirely new consumer category for what was always considered largely exclusive U.S. technology.

  o Unitree unveils its most advanced humanoid robot yet … The new H2 model features a strikingly human-like face and impressive dexterity, as H2 can perform ballet and martial arts moves.  This puts it far ahead of Western competitors like Boston Dynamics with significantly lower price points and more aggressive development timelines.

• The Crypto market cap topped $4T in 2025.

• “We’ve had a 12% annualized growth rate in global M2” … Per L. Lepard: “That’s a far cry from the Fed’s 2% target, and they haven’t even turned on the printers yet.”

• President Trump pardoned Binance founder Changpeng “CZ” Zhao … clearing the way for the crypto exchange’s U.S. return and deepening ties between Trump’s family-backed crypto venture and one of the industry’s most powerful players.

• Grayscale’s CoinDesk Crypto 5 ETF (GDLC) … is the first U.S. crypto exchange-traded product offering investors access to the market cap-weighted performance of the five largest and most liquid crypto assets – covering 90% of the crypto market’s capitalization.

• The FOMC decision is on Oct 29 … and everyone’s watching for a tone shift.  [FYI: If Powell blinks in a dovish direction, risk assets will soar.  If he sniffs hawkish, the algos will joyously liquidate themselves.]

• This week gives us Mega-cap tech earnings like … Microsoft, Google, Meta midweek, and Apple & Amazon.  [FYI: This week will decide whether the “AI rally” still has legs, or if we’re about to see those legs snap like a stale pretzel.]

• Trump meets Xi, Oct 30 … at their ‘friendship summit’.  [FYI: I think that it’s probably more of a reunion between two divorced parents arguing over the global custody of semiconductors.]

• The FED’s favorite inflation gauge (PCE) … drops on Halloween.

• Our FED’s ‘Payment Innovation’ outline is a funeral for bank control … FED Gov. Waller told commercial banks they’re about to lose monopoly power over payments.  Our FED’s now talking about DeFi tech, AI integration, and tokenized money as part of their own system.  Honestly, our FED will soon eliminate banks as the middleman in the payment process.  Accounts will connect directly to our FED’s infrastructure – disintermediating banks that have been skimming off every transaction for the last +60 years.

• Volatility continues to tell the story … Last week VIX futures were trading close to backwardation while markets sat at all-time highs.  Forward volatility refused to compress despite market strength, and that’s a sign that the pros are positioning for explosive moves – hidden from surface indicators.  Factually:

  • VVIX (volatility of volatility) should have gotten crushed, but it remains flat.

  • 3-month volatility futures are refusing to decline – despite the rally.

  • The Skew (PUTs vs CALLs ratio) is near historic highs.

  • Markets are at all-time highs with back-month volatility rising.  These two elements cannot live together.  Either volatility is wrong, or price discovery is wrong.  History suggests that it's usually price.  Look for volatility to get crushed in order for this rally to continue.

• Gold is trading like a tech stock … revealing that the derivative marketplace has taken complete control of price discovery.  This level of options dominance creates environments where moves happen faster than traditional analysis can handle.

• Asset concentration risk … masks real, underlying sector weakness.  The advanced-decline line shows underlying deterioration while the mega-caps hold markets together.  When a handful of stocks are propping up an entire index, and breadth remains negative – you’re watching a dangerous market structure. One coordinated move in those concentrated names triggers systematic pressure that catches retail completely unprepared.

• Pre-Markets are Meaningless … as long as options flow dictates every move.  The entire world waits for US markets to open because options order flow drives every price movement the second real flow kicks in.  Being reactive rather than predictive becomes the only way to survive when derivatives own price discovery.

• Inflation came in LOWER than expectations … Really?  Nothing like being lied to first thing on Friday morning.  My home insurance just went up 13%.  My food, medical, and electricity are all costing more.  But the BLS wizards tossed some ‘eye-of-newt’ into a caldron and conjured up softball numbers to help the markets.  Here are some trading thoughts for the coming week:

  o Commodities like food ‘n energy remain strong.

  o A relief rally in Bonds is likely, and a CPI slowdown helps duration trades.

  o Lower inflation favors Growth Tech, and allows energy sector momentum to continue.

  o The USD is liable to remain range-bound, and consolidation is likely.

  In general, inflation is decelerating but still high. Our FED will be cautious but still cut rates. The market’s risk appetite will remain modest. [FYI: It’s called ‘Stagflation’.]

• Factually: (a) There has been a surge in retail participation since 2020, along with a surge in leverage – especially more recently.  (b) Some leverage indicators are at warning levels.  (c) Small Tech is ticking up vs Big Tech (after 8-years of losing).  (d) Studying the history of markets prompts a pondering of “the path forward”.  Overall, per Callum Thomas: The rise of retail investing and speculation marks a shift and an extremely significant development in modern markets.  If I had to guess I’d say that at least some elements of it are going to end up as ‘the new normal’.  Retail and speculation will stay higher for longer, but that’s also a sign of the times and a marker on the stage of the market cycle.

   

  HODLs: (Hold-On for Dear Life)

  - (+) IBIT – Blackrock’s Spot Bitcoin ETF ($62.8 / in at $24)

  - (+) ETHA – Ethereum ETF ($29.7 / in at $13)

  - (+) Physical Commodities = Gold @ $4,126/oz. & Silver @ $48.4/oz.

  - Bitcoin (BTC = $111,700 / in at $4,310)

  - Ethereum (ETH = 3,900 / in at $310)

  - (+) GLD – Gold ETF ($377.5 / in at $212)

  - (+) ICVT – Convertible Bonds ($102.7 / in at $103.7)

   

  More ‘De-Gen’ Economy holdings:

  - AAVE (crypto) == ($231 / in at $254)

  - GDX (gold miners) == ($72.8 / in at $52)

  - SLV (silver ETF) == ($43.9 / in at $27)

   

  AI / Data-Center basket:

  - (+) NVDA ($186 / in at $168)

  - (+) RXRX ($6 / in at $4)

  - (+) IREN ($62.9 / in at $25)

  - NBIS ($117.2 / in at $114)

  - (+) HUT ($47.6 / in at $30)

  - (+) APLD ($33.4 / in at $20)

   

  Please be safe out there!

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