Since the plunge has already involved gold, silver, and resources, I have a very extreme risk inference: a super financial crisis is right around the corner.

It's March 3rd, and the Middle East war shows no sign of stopping.

After yesterday's optimistic sentiment pricing, the stock market today saw an almost global circuit breaker situation. Everyone has begun stampede-style selling of all assets in hand, including gold, US stock futures, and all stock markets in Japan, South Korea, and Europe. However, the US Dollar Index broke through, and US Treasury yields soared, which is usually a precursor to a super financial crisis.

The logic I'm worried about is starting to explode today:

1. The US government (as of March 3rd) is already mobilizing more troops to the Middle East, has already evacuated citizens from surrounding countries, and is building an information wall domestically to prevent terrorist attacks. This is the beginning of a full-scale war.

2. A full-scale war necessitates printing money and issuing bonds to fill the deficit (unless Donald Trump pays for it himself?). However, with oil prices high, the Fed is stubbornly refusing to cut interest rates, and even Janet Yellen has talked about issuing bonds at high interest rates. Coupled with the global action of dumping all assets for US dollars, US Treasuries are not just precarious; liquidity has instantly tightened to the point of being invisible, and the price of the US dollar will rapidly skyrocket, shattering all asset prices.

This situation has only happened three times in history: World War II, Paul Volcker (20% interest rates), and COVID-19. This time, it's more like the first two.

3. Iran might declare it possesses nuclear weapons. This is the biggest risk flashpoint. Even if it does nothing and just says a word, the global financial markets would explode. And you can't expect religious figures in a state of jihad to remain rational 💣

4. Gulf countries might weaponize US Treasuries (the EU seems to have done this), declaring that if the US doesn't provide protection, they will dump all their US Treasuries.

Oil is the foundation of the US dollar. If Gulf countries do this, they directly shatter the underlying credit of the US dollar.

The most likely points of de-escalation:

1. The Democrats suppress Donald Trump and fully withdraw troops (the useless Blue party has no chance).

2. After receiving news of possible nuclear possession, Chinese and Russian fleets directly enter the Strait of Hormuz, blocking both sides.

3. All of Iran's launchable things are destroyed (also no chance, the Natanz nuclear facility was fine after being bombed).

In summary, I choose to close all positions. If the worst-case scenario happens, precious metals will experience a violent surge after 1~2 weeks of volatility. So, even if not selling, I suggest everyone with leverage unload it all. Don't touch anything except life-saving supplies for now. When tail risk hits, it might wipe you out completely.

Consulting the opinions of the two big shots I'm most familiar with.

🥲🥲 Now I'm really panicking.

@Miracle Trader cola

@Mr. Z from Beijing

$ZIJIN MINING(02899.HK)

$Invesco QQQ Trust(QQQ.US)

$ISHRS MSCI S Korea Capped(EWY.US)