Summary
Phil Anderson argues that simultaneous breakouts in copper, silver, and Bitcoin during the same week signal a potential second wave of rising inflation, consistent with patterns seen in prior real estate cycle second halves. He draws on historical CPI data from the 1965–70, 1986–90, and 2002–08 cycles to position the current environment as mid-to-late cycle, where inflation characteristically accelerates. The email warns that rising inflation could put the Federal Reserve in a difficult position as political pressure mounts to cut interest rates.
Key Claims
- US CPI rose to 2.7% YoY in June 2025, up from 2.4% the prior month — confidence: high
- Core CPI rose to 2.9% in June 2025 vs 2.8% in May 2025 — confidence: high
- Rising inflation characterises the second half of the real estate cycle, supported by three prior cycle examples (1965–70, 1986–90, 2002–08) — confidence: high
- CPI peaked at 9.0% in mid-2022 post-pandemic; a disinflationary trend has followed but may now be reversing — confidence: high
- Copper prices in the US broke to record highs above $5 per pound — confidence: high
- Silver recently moved to its highest level since 2011 — confidence: high
- Bitcoin broke to record highs above $120,000 — confidence: high
- Copper prices are highly correlated with long-term inflation expectations — confidence: medium
- Simultaneous breakouts in scarce assets (copper, Bitcoin, silver occurring in the same week) signal the next wave of inflation may be beginning — confidence: medium
- Trump’s tariff threat (50% on copper imports) is acknowledged but framed as secondary to the underlying chart pattern and cycle dynamic — confidence: medium
- The Fed faces a difficult position: political pressure to cut rates vs. inflation signals suggesting it should not — confidence: medium
Mex Pete References
- Copper: A “Mexican Pete-style” ascending triangle pattern (shown with dashed lines on chart) was being tracked in copper prices ahead of the breakout above $5/pound. Anderson references page 369 of The Secret Life of Real Estate and Banking as additional context for copper’s tendency to see large gains in the second half of the cycle. Chart sourced from Optuma.
Stock Picks / Signals
None.
Predictions / Forecasts
- A second wave of CPI inflation is likely underway or imminent, consistent with second-half real estate cycle behaviour — no specific price level or date target given
- Precious metals (gold, silver) expected to outperform during the rising inflation period ahead — no specific price targets given
- Copper expected to continue seeing large gains through the second half of the cycle (supported by prior cycle data and current chart breakout) — no specific price target given
Notable Quotes
“A breakout in scarce assets all happening around the same time (copper, Bitcoin, and silver made their recent jumps during the same week) could be the market’s way of warning us that inflation is about to start rising again…as you would expect in the second half of the real estate cycle.”
“President Trump is demanding that the Federal Reserve slash interest rates. But the recent breakouts in scarce assets show that inflation could put the Fed in a tough spot.”