In this week’s Money Metals Midweek Memo, host Mike Maharrey draws a sharp parallel between preparing for hurricanes and preparing for financial storms.
Using his own recent investment in hurricane panels as a jumping-off point, he warns that most Americans are dangerously unprepared for economic upheaval—whether it’s inflation, recession, or a currency crisis.
Maharrey explains why gold and silver remain vital safe-haven assets, especially as U.S. Treasuries show signs of losing their traditional role as the world’s financial fallback.
He examines troubling signals from the bond market, persistent inflation pressures, and real-world examples of how nations like Iran and Russia use gold to survive sanctions and economic instability, concluding with a call for individuals to take similar steps to secure their own financial futures.
Hurricane Prep and Financial Readiness
Mike Maharrey opens the episode with a story about installing hurricane panels on his coastal home.
After scrambling for plywood during Hurricane Milton last year, he and his wife decided to take proactive steps. The panels, made from wind-resistant plastic fiber, will turn a full day’s work into an hour’s task during the next storm.
Maharrey uses this as a metaphor for financial preparedness, noting that far too many Americans are unprepared for life’s economic storms.
According to the Federal Reserve, 54% of households have no retirement savings, and U.S. News reports that 42% have no emergency fund. He argues that gold plays the same role in an investment portfolio that hurricane shutters play for a house—it’s protection you buy before disaster strikes. Gold, he reminds listeners, has been money for 5,000+ years and remains a reliable store of value.
The Bond Market’s Fading Safe-Haven Status
For decades, U.S. Treasuries were the default safe haven during financial turmoil, but recent market behavior shows cracks in that reputation. Maharrey points to last week’s 10-year Treasury auction, which produced a 1.1 basis point “tail”—meaning the government had to offer a higher yield than expected to entice buyers.
The bid-to-cover ratio fell sharply compared to the previous auction, and foreign buyers took just 64.2% of the bonds, down from 88% in April.
Mutual funds and individual investors also pulled back, leaving primary dealers—legally required to buy—to absorb the excess.
Even the Federal Reserve stepped in to purchase $14.25 billion despite its stated goal of shrinking its balance sheet.
With the national debt now over $37 trillion and annual interest costs topping $921 billion, Maharrey warns that weak demand for Treasuries will drive yields higher, raising borrowing costs and pressuring the Fed toward more quantitative easing—and more inflation.
Inflation: The Persistent Problem
The latest CPI report for July was hailed as “cooler than expected,” but core inflation remains stuck above 3%—well above the Fed’s 2% target.
Maharrey notes that while core inflation fell from its pandemic highs, it has plateaued for over a year, suggesting the Fed never truly regained control over prices. He argues that underlying inflationary pressures remain in place and that future monetary interventions, such as a return to quantitative easing, will likely reheat price growth.
This persistent inflationary backdrop undermines confidence in fiat currencies and strengthens the case for holding tangible, non-inflationary assets like gold.
Lessons from Iran and Russia: Gold as Economic Lifeline
Maharrey highlights how sanctioned nations have turned to gold as a way to bypass the global financial system.
Iran, for example, imported 43 tons of gold worth $2.5 billion between March and September 2024—a sixfold increase from the previous year.
For all of 2024, imports topped 100 tons, worth $8 billion, and accounted for 11% of the country’s total imports. Gold has been used to settle transactions directly, including a $1.75 billion drone sale to Russia that was partly paid in bullion.
Domestic demand is also surging, with gold coin and bar purchases up 20% and gold jewelry sales up 12% in the second quarter, even as global jewelry demand fell 14%.
In these countries, gold is not merely ornamentation; it is high-purity, investment-grade wealth storage.
Maharrey says these examples demonstrate gold’s resilience when currencies collapse, reserves are frozen, or trust in fiat evaporates.
The Case for Individual Gold Ownership
Just as hurricane panels protect a home before the storm hits, gold and silver protect wealth like an insurance policy before financial crises strike.
Maharrey stresses that Treasuries are losing their safe-haven status, leaving precious metals as “the last safe havens standing.”
He notes that central banks around the world are increasing their gold holdings, and individual investors should take the same lesson to heart.
For those who believe they cannot afford to invest, he points to Money Metals Exchange’s installment plan, which allows customers to start building a gold or silver portfolio for as little as $100 a month, stored securely in the company’s vaults.
By steadily accumulating tangible assets, investors can ensure they are not caught scrambling when the next economic hurricane arrives.
Gold and silver, Maharrey concludes, are not just investments—they are essential financial insurance.
Read the full article here