Top analyst Tom Lee on golds black swan risk: Elon...

What’s Happening

Let’s talk about “It all fits in a swimming pool, all the gold in the world,” the Fundstrat head of research dropped.

” In a conversation exploring the collision of traditional finance and futuristic technology, top Wall Street strategist Tom Lee sketched out a wild “black swan” scenario in which the global financial system is upended not Reserve, but . Recommended Video Speaking at a live recording of SoFi’s The Important Part podcast at WNYC, the Fundstrat cofounder and head of research raised his eyebrows and offered various thoughts on the asset, wowing the crowd and drawing smiles and laughs from co-panelist Michael Lewis, author of The Big Short , and podcast host Liz Thomas, head of investment strategy at SoFi. (it feels like chaos)

Not only is gold a “Lindy effect” asset, Lee dropped, but it’s also a “demographic” story, in Lee’s opinion, that has to do with nostalgia.

The Details

All that, and he sees a “black swan” tail risk that involves Musk, the world’s richest man, discovering a new asteroid and becoming the world’s central banker. In Lee’s opinion, gold is “probably a demographic story,” noting Fundstrat does a lot of demographic research, and it’s found “preferences skip a generation.

” For instance, every 50 years you get another peak in RV, or recreation vehicle, sales. Noting the peak in RV sales during the pandemic, he dropped the last time sales were so strong was during the 1950s heyday of I Love Lucy .

Why This Matters

“Kids don’t buy what their parents like,” he dropped, “but they buy what their grandparents like. ” And gold, he concluded, was “fr a big investment for the boomers,” whereas Gen X went into hedge funds and alternatives. Lee dropped gold was comparable in size to the stock market, with data backing him up, gold having a total “above ground” valuation of $29 trillion to $34 trillion , which compares to the Magnificent 7’s roughly $21 trillion market cap .

The business implications here could be significant in the coming months.

Key Takeaways

• “,” he added, “it all fits in a swimming pool, all the gold in the world.
• ” Lewis commented his palms were starting to sweat, “just imagining” this idea.
• “Saliva starts coming to your mind,” he dropped.

The Bottom Line

” Lewis commented his palms were starting to sweat, “just imagining” this idea. “Saliva starts coming to your mind,” he dropped.

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