Axel Merk, CIO and founder of Merk Investments with nearly $3 billion in AUM, shares his perspective on the current macro landscape and gold's surge to record highs. In this episode, Merk explains how "fringe" fiscal sustainability concerns have moved mainstream, driving gold to new highs above $3,700. He provides a gold mining primer, distinguishing between speculative junior miners and established producers, while focusing on developers with proven management teams as the "scarcest resource." Merk criticizes the Fed's evolution into micromanaging the economy through its "toolkit," arguing this creates inefficient capital allocation and enables political irresponsibility. He notes gold's correlation breakdown due to dollar weaponization and sees continued upside potential, though warns against overexposure, emphasizing that the best investment advice is to "invest in yourself" and control spending.
This episode is sponsored by Monetary Metals. Visit https://monetary-metals.com/julia
Links:
https://www.merkinvestments.com/
https://x.com/axelmerk
Timestamps:
0:00 Welcome and introduction - Axel Merk returns after 6 months
0:38 AUM growth from $2B to $3B reflects gold space interest
1:29 Liberation Day framework - tariffs impact financial flows
3:04 Fringe views moving mainstream amid elevated valuations
3:49 Long-term fiscal sustainability concerns driving gold investment
6:08 Fed micromanaging economy enables political irresponsibility
7:47 Gold's parabolic rise - perception vs reality of "barbarous relic"
10:23 Gold mining dynamics - junior miners haven't had explosive rally yet
13:10 Gold Mining 101 - conservative vs speculative investor profiles
15:23 Big miners' over/under-investment cycle post-financial crisis
17:19 Developer focus - scarcest resource is good management
18:31 Junior vs major miners - venture capitalists with hard hats
21:14 Gold correlation breakdown - weaponization changed dynamics
24:37 Fed micromanagement critique - toolkit means intervention
26:48 Inefficient capital allocation favors big companies
27:58 Preventing recessions vs natural business cycles
31:58 Gold as 20-year hedge - glad you had it in hindsight
32:32 Silver complexity - industrial use creates volatility
36:02 Investment advice - invest in yourself first, control spending
