#385 Chris Whalen: Gold Headed Higher, Goldman $4,900 Target, Silver China Buying Spree

Chris Whalen kicks off the July 4th episode of The Wrap by diving into private credit implosion with BDCs turning unprofitable, using the acronym POOP (Principal on Outstanding Principal) to illustrate how debt is being converted to equity because companies can't pay—essentially turning investors into equity holders in insolvent companies. The June jobs report shocked with only 57K payrolls added (far below expectations) while household employment actually fell by 500K, making the data contradictory and unreliable despite the overall labor market still showing relative steadiness in many markets. Housing shows sharp bifurcation: sales above $1 million hit a record high while overall volume is down, revealing that only luxury properties are moving as the broader market softens. Goldman Sachs projects gold could hit $4,900, and Whalen is holding silver as a hedge against dollar debasement and inflation, noting the Chinese are aggressively buying silver in both futures and spot markets. Trump has profited handsomely from his various crypto ventures while most investors in those same ventures have lost significant money—a familiar pattern from Trump's business history. With the US national debt now at $39.35 trillion on America's 250th birthday, Whalen warns the Democratic Party will split between socialists and Republicans, with policies like New York's rent freezing turning cities into slums while hurting mom-and-pop landlords. He recommends watching interest rates, the Fed under Kevin Warsh, and expects another uptick in gold and silver prices after recent selloffs, while cautioning on BDCs and private credit exposure as the distress signals mount.Thank you to today's episode sponsor, The Entropy Trap by Mickey Maini. Order your copy: https://www.amazon.com/Entropy-Trap-Physics-Knows-Markets/dp/B0H1ZP7NZX/ref=sr_1_1 Links:    The Institutional Risk Analyst: https://www.theinstitutionalriskanalyst.com/The Wrap: https://www.theinstitutionalriskanalyst.com/post/theira864Twitter/X: https://twitter.com/rcwhalen    Use the code TheWrap2026 for 25% off your first year of The Institutional Risk Analyst https://www.theinstitutionalriskanalyst.com/plans-pricingTimestamps:00:00 — Intro and World Cup chat1:09 Gold rebounds, AI stocks slump1:38 Private credit - BDCs turning unprofitable2:40 POOP acronym - Principal on Outstanding Principal, crap debt4:07 POOP emoji Bloomberg article, Victor Hong invented term5:54 AI stocks slumping, pressure on private credit portfolios6:00 Market doesn't like it right now11:23 June non-farm payrolls - 57K added, much worse than expected11:44 May/June comparisons all over place, household employment down 500K12:21 Can't take a lot out of these numbers13:33 Labor market steady to extent we can rely on statistics14:12 Housing costs up, Americans work harder to compensate14:12 Goldman Sachs says gold could hit $4,90015:31 Chinese aggressive buyers of silver, not changing view16:06 Gold/silver hedge against dollar and inflation17:40 US national debt at $39.35 trillion on country's birthday18:12 Democratic Party gonna get torn in half18:50 Rise of democratic socialist candidates19:49 Rent freezing turning NYC into slum, mom and pop landlords hurt20:17 How much money to live in NYC reasonably? Way more than poverty level21:45 Trump crypto - Done well, investors lost a lot23:32 Book - Entropy Trap by Mickey Maini29:33 90% of mortgage market government insured, no systemic bailout needed32:43 Silver good play medium to long term as hedge34:13 Back half of year focused on interest rates35:13 Watching Fed, Kevin Warsh, uptick in gold/silver coming