In today’s issue:

• Weekly Wisdom - Dailo’s macro playbook for markets…

• Market Musings - Exploring the long-end of the bond market…

• Opportunity Alert - Dimon’s quiet warning and how to play it…

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WISDOM

MARKET MUSINGS

Price don’t lie.

I often find myself saying this in discussions with friends who have been reading their financial social media feeds too frequently or (even worse) listening to CNBC.

What do these platforms have in common?

Their entire business model is based upon increasing viewership.

What’s the best way to increase viewers?

FEAR!

So, they cover the financial markets like a sporting event with up to the minute information, but without any real context.

So, let’s zoom out and see what the price action shows us…

The Good

✅ The S&P 500 recently broke through the bull market support at the 200-day moving average

✅ The S&P 500 recently broke through the bull market support at the 200-day moving average

✅ The Nasdaq has moved similarly, which can be seen as confirmation of the trend change

✅ The market never broke below the Secular Bull Market support at the 200-week moving average (S&P or Nasdaq)

✅ Price has not continued to fall after the recent death cross (discussed in #0026)

✅ Bitcoin remains high signaling increased risk appetite from investors

The Bad

👎 Death cross is still in effect and market could move back below those levels.

The Ugly

❌ Read below on Jamie Dimon’s warning about the bond market

❌ If the fed loses control of the long-end of the bond market, especially the 10-year, the economic ramifications could crush the economy as borrowing cost balloon

❌ Real estate remains troubled due to higher interest rates, especially commercial real estate that suffered during COVID

Ultimately, there is never a time when all the news is good.

We can always create a narrative for why the market should move one way or another, but that’s a bad game to play.

Better to pay more attention to price than to media pundits and social media influencers.

Because price don’t lie…

INVESTMENT OPPORTUNITY

Dimon’s Quiet Warning…

When Jamie Dimon says the bond market is going to crack… he’s not warning you. He’s warning the regulators—because he knows JPMorgan will make money when it happens.

So here’s the question every Shrewd Investor should be asking:

Why are the institutions preparing to profit—while the average investor sits frozen?

You don’t need to be George Soros to see what’s coming.

But you do need to know how to spot the setup…

And how to pull the trigger when the first cracks appear.

Other Times Bond and Currency Markets Broke—and Fortunes Were Made

Cracks in sovereign debt and currency pegs have always been where the bold get rich:

• 📉 Black Wednesday, 1992: George Soros bet against the British pound’s peg to the Deutsche Mark. The Bank of England blinked. Soros made $1B in a single day.

• 💥 Asian Financial Crisis, 1997: The Thai baht collapsed. Hedge funds shorted pegs across Asia. Soros again? Another $2B win.

• 🔥 Latin America, 1980s: Rates rose, and debt-laden countries crumbled. Those who scooped up distressed debt became legends.

How Soros Did It

Soros saw something most missed:

1. The pound was overvalued—propped up by politics, not reality.

2. The UK was burning reserves trying to defend it.

3. Interest rates were crushing the real economy.

4. He shorted the pound using 15x leverage.

5. When the peg broke, he repurchased pounds at a steep discount.

➡️ Net: $1 billion profit in 24 hours.

➡️ Risk: Limited downside (he bought high-quality assets like Treasuries on the other side).

➡️ Result: “The Man Who Broke the Bank of England.”

Why It Matters Now

• Bond Market “Crack” = Sovereign Debt Crisis in slow motion.

• Debt-to-GDP in the U.S.? Over 120%.

• QE, deficits, rate hikes? Unsustainable combo.

• Dimon’s take? Regulators will panic.

• Translation? The real money will be made during the chaos.

How Individual Investors Could Play This

You don’t need to short currencies or call up Deutsche Bank.

Instruments to Watch

How Will You Know It’s Time to Move?

Watch for the “Soros Signals”:

1. 📉 Yields spike suddenly on long-dated Treasuries—signaling loss of faith.

2. 💸 Fed steps in with emergency buying (stealth QE = panic).

3. 📰 Media frenzy about “bond vigilantes” or “disorderly markets.”

4. 📈 TBT or TBF volume spikes—institutions are positioning.

5. 🧠 Gut check: if regulators are on CNBC saying “Don’t worry,” start worrying.

When you hear “orderly markets” but see disorder, it’s time to act.

The Shrewd Takeaway

Jamie Dimon isn’t making a prediction.

He’s issuing a calendar-less warning.

The smart money isn’t waiting to time the exact day.

They’re building optionality now—getting the tools in place, so when the first domino wobbles, they’re already in position.

Be ready before the panic—not after.

Shrewd Investor Move of the Week

📉 Move: Add TBF to your watchlist.

📊 Why: If rates rise and long bonds break, it could be your most asymmetric trade this year.

P.S. If you’d like us to break down your portfolio or ask a question, submit yours here: https://shrewdinvestor.com/roastme

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The content provided in this newsletter is for informational purposes only and should not be considered as specific advice for any specific individual. The information is prepared by knowledgeable individuals and is not written by certified tax professionals or investment advisors. For personalized advice tailored to your unique financial situation, consult with a qualified tax professional, financial advisor, or attorney.

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