| Swan Dive — May 6, 2025 Three Gears Jammed: Real Estate, Buybacks, and Gold Addison Wiggin Three disparate news items gave us pause this morning, like a screw getting stuck in the gearbox:
The delinquency rate on U.S. commercial mortgage-backed securities (CMBS) for offices surged to 10.3% in April — near record highs. Multifamily delinquencies jumped to 6.57%, the worst since 2015. CRE isn’t just soft — it’s snapping under pressure.
In the stock market, S&P 500 companies just announced a staggering $192 billion in buybacks, the largest ever, surpassing 2022’s peak. Post-earnings blackout windows are open, and boards are racing to boost EPS through buybacks, not better business.
And gold has exploded $160 in just two days, now trading above $3,400/oz. The surge suggests more than inflation hedging — it signals a broader capital shift. Historical patterns show capital rotating between gold and bitcoin. With gold up 21%, the setup hints bitcoin may be next in line for a sharp leg higher.
🏢 Commercial Real Estate Defaults Hit the Red Zone Office loans are defaulting at their fastest pace since the financial crisis. Remote work was the catalyst, but tight credit and falling asset values are now doing the damage. Multifamily stress — once immune — is rising too.  Investors in REITs or commercial debt need to take a hard look under the hood. This market is no longer passive income; it’s active risk. 💸 Buybacks Inflate, But Don’t Inspire Buybacks are back — with a vengeance.
But this record-setting $192 billion wave is less about confidence and more about accounting. With soft fundamentals and slowing earnings, companies are leaning into financial engineering to prop up share prices – or to offset generous stock option grants to executives.
If you’re investing for long-term income, don’t chase the inflated valuations. Stick with firms returning capital from real profits — not gimmicks.
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🥇 Gold Soars, Bitcoin Stirs Gold ripping through $3,400 is no anomaly. It’s capital moving from trust in policy to trust in permanence. The pattern is familiar: when gold peaks, bitcoin often follows. Since March, gold is up 21% and BTC has lagged. If historical rhythm holds, crypto may be preparing for a major move.
Don’t ignore the rotation — but don’t get swept up either. Size positions wisely. This is a hedge, one that acknowledges the markets are out of whack. They are not a Hail Mary. 📜 Trump’s Trade Deals: First Domino or First Draft? Trump says new trade deals could drop this week, with India, Japan, or South Korea leading the charge. Whether they’re sweeping reforms or light agreements, they’ll act as templates.  The fine print matters: tariffs, non-tariff barriers, and dispute clauses will all shape global capital flows. These won’t end trade war volatility — but they may signal the starting line of a new order. Watch what gets inked — and who stays out.
And given the Trump administration’s insistence that trade deals are on the way, the only thing we know we can expect is the data re-arrange several time on the barge deck image above. 💬 “Schelling Point” and the Dollar’s Burden Treasury Secretary Scott Bessent invoked Nobel economist Thomas Schelling, calling the U.S. dollar the global financial “focal point.”
He’s right — for now.
Despite recent selloffs in stocks, Treasurys, and the greenback, the world still anchors to the dollar. But it’s getting shakier. Asia’s currency moves suggest a reassessment is underway.
The dollar isn’t collapsing — but it is competing. For U.S. investors, that’s a cue to own things priced in real assets, not paper claims. 🌏 Asia Currency Moves, Quietly The Taiwan dollar just posted its biggest gain against the greenback since the 1980s. The Malaysian ringgit reversed course, and Beijing froze the yuan’s movement to prevent a breakout.
After decades of recycling excess savings into U.S. Treasurys, Asian economies are reconsidering.
If they shift away from dollar-denominated assets, it will tighten domestic U.S. liquidity and limit the Fed’s easing options. That creates volatility — but also opens windows abroad.
If you invest globally, hedge the currency. If you don’t, it’s definitely time to start understanding how more balanced trade agreements are going to affect the US.
While markets wobble beneath headlines, one steady signal returned: the U.S. Treasury yield curve has normalized and begun to steepen.
The 10-year yield now sits at 4.35%, above the 2-year at 3.84% — a positive 51-basis-point spread. The longest inversion in history is over. Recession interruptus.
Reversions like this often signal a transition — sometimes to recovery, sometimes to something worse. But investors appear to be betting on “steady as she goes.”
The Fed is widely expected to hold steady this week, with possible cuts later this year. (Although, as expressed, we’re holding out for a 25-point cut manana).
For now, bond investors are shortening duration and favoring safety. For you? This is a time to hold cash, own quality, and keep dry powder ready.
Opportunity is coming — but only for those with clarity, conviction, and capital when it arrives. And it’s clearly not too late for gold – although bitcoin may have the best returns in a shift away from the dollar or a surge in inflation.
– Addison P.S. If you missed last week’s Grey Swan Live, where Mark Jeftovic broke down how gold, bitcoin, and real-world assets fit into a post-fiat investing strategy — the replay’s open for members here.
Details on this week’s live are forthcoming…
As always, your cheerful reader feedback is welcome: feedback@greyswanfraternity.com (We read all emails. Thanks in advance for your contribution.)
How did we get here? Find out in these riveting reads: Demise of the Dollar, Financial Reckoning Day, and Empire of Debt — all three books are now available in their third post-pandemic editions. You might enjoy one or all three. 
(Or… simply pre-order Empire of Debt: We Came, We Saw, We Borrowed, now available at Amazon and Barnes & Noble or if you prefer one of these sites: Bookshop.org, Books-A-Million or Target.)
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