Any qualms about the politics or the approach itself aside, there is a benefit to regaining skin in the game, the US once had in Venezuela, with its integrated oil majors producing from the world’s largest proven supply. Having the most productive and innovative private companies make the most of such a valuable resource for the world is undeniably better than a poorly run state solution in that regard. That mismanagement politically and economically over the past 30+ years has been an utter disgrace to the Venezuelan people and resulted in one of the largest mass emigration catastrophes the world has seen as a result. Something like that is simply unrecoverable economically unless there is a large-scale and permanent paradigm shift. Maybe what the US has done to change leadership, along with massive investment, will do that, but time will tell. To be fair, opposing political views and the tactical mechanism used, along with whatever unintended consequences may arise, can also be understood. As important in all of this is the statement this makes to the influence of China, and to a lesser degree, Russia, with whatever former interests existed in the country. Now it comes down to what a successful offramp will look like for the US to return sovereignty and what, if any, either deterrence effect or perceived normalization of deviance may manifest itself in other areas of world order.

What we know so far is that the U.S. is reportedly going to purchase 30-50mm barrels of Venezuela. It will require significant refining before being resold to other Western countries (or used domestically). The refiners are the beneficiaries at this stage. But there is a sense where some of this is zero-sum, as more coming from Venezuela does not necessarily mean more total net output, if it simply means less being imported from Canada (and the Canadian energy stock action would indicate that is the market’s expectation). Supply is a major ingredient in setting prices, but demand is the other side of that coin. The intersection of the two is where a market is made. We should teach that in school. =)

I cannot think of a time I have ever had a bearish view on gold or a bullish view on gold.  Like any asset without an internal rate of return, I find valuing it or even having an opinion in a one-year time period rather arbitrary (and usually, very disingenuous).  Some would say, “Well, as long as central banks are doing this or doing that, you can expect gold to do really well,” and to that I just say, “ummmm, history?”  The truth is that DECADES can go by where gold is down or from point A to point B, not doing well when central banks are at peak insanity.  It can also have periods (like 2025) where it enjoys extraordinary price returns.  We are not gold investors, but that is not because we are bearish on it.  We philosophically believe in value creation via human action, and not an underlying commodity price.  2026 may be a year where the commodity price goes higher or lower, but what it does will not be for the reason(s) so many say.  I can’t imagine taking anyone seriously who even has a point of view as to why gold may go up or go down in a given year, like 2026.  If one believes in a long-term strategic allocation, I wouldn’t argue about it (I just don’t). If they believe “it will go up this year, for this reason,” I would say that is someone likely selling something.

There are a few different problems here:
1) It assumes all equities are in a bubble (they are not)
2) It assumes one can time their way in and out of bubbles (they cannot, X 2)
3) It assumes gold/metals are not in a bubble (I would not make that assumption)
4) It assumes that gold and equities perform counter-cyclically (they sometimes do, and sometimes do not)
5) It assumes that gold and metals are a hedge against inflation (they most certainly are often not anything of the sort)
6) It ignores where dividend growth equities are a superior remedy to all of the above!