This isn’t a sell everything message. It’s closer to them saying stay invested, but understand the terrain has changed. On the surface, they talk about policy support into 2026, but read carefully and it’s less confidence than constraint. They’re not betting on growth reaccelerating; they’re betting that policymakers will lean against slowdown. In a world where deflationary pressure creeps in with softer demand, tighter credit and margin compressions equities don’t collapse outright, but they stop forgiving mistakes. That’s why the emphasis shifts to market weight large caps, quality small caps only, and moving away from crowded stories. It’s survival investing, not a victory lap.

On the bond side, the signal is even clearer. Tight spreads and a mature credit cycle demand selectivity. Shorter duration, structured credit, buy and hold income: that’s how you position when growth grinds lower and defaults rise gradually, not all at once. This is a grind and the classic deflationary setup where cash flow matters more than upside.

Why The Metals Allocation Is The Tell

This is where the real signal lives. Metals don’t usually shine in pure deflation…the first phase is liquidation and a rush to cash. But today’s risk isn’t clean deflation; it’s deflation layered on top of geopolitical fracture and policy strain. Once deflation forces policymakers to cut aggressively, expand balance sheets, and print to stabilize the system and often while governments are also spending for security, energy, and industrial resilience the regime shifts. Real rates compress, money supply grows, and confidence in clean exits fades. That’s when metals start to work, not as a growth bet, but as insurance.

So when they float up to 20% in precious metals, it’s not a call on runaway inflation. It’s an admission that disinflation could slide into deflation, and that rate cuts and QE may not reliably lift risk assets or make bonds the hedge they used to be. Metals hedge that uncomfortable middle ground: policy works, but imperfectly; liquidity rises, but trust doesn’t fully return. Prices drift lower, debts feel heavier, and correlations behave badly.

Geopolitics amplifies this. Sanctions, trade fragmentation, and energy and supply chain insecurity keep trust premiums elevated and supply elasticity low, even as demand weakens. That’s how metals can stay bid in a deflationary world, not because growth is strong, but because neutrality, scarcity, and credibility matter more than cyclical demand.

What They’re Really Foreshadowing

Strip it down and the message is that returns may still exist, but the path will be uneven, confidence driven, and prone to sudden correlation spikes. The old playbook of stocks going up and bonds save you becomes unreliable when deflation pressure collides with geopolitical stress and policy limits. A larger metals sleeve isn’t a crash call. It’s a quiet acknowledgment that economic gravity may return faster than policy can counter it and that preservation, optionality, and trust matter as much as growth.