Anybody who bought Treasury bonds at the end of 2021 has lost money since, Peter Grandich says, coupon included — and he moved his firm out of them at exactly that point.
The usual bear case is that yields go higher and bonds have a bad decade. Grandich's is narrower and more specific: there is a level on the 10-year, and a number of days above it, after which the selling stops being orderly.
"Now is the time for capital preservation over capital appreciation."
Grandich has been in the business 42 years and works with a planning group he says has close to $2 billion under management, and he calls getting out of Treasuries at the end of 2021 the most important decision of his career.
The full interview is covered here so you can skip it. 45 minutes of audio, 14 minutes of reading.
Here are the 10 calls that matter.
👤 Guest: Peter Grandich, founder of Peter Grandich and Company, a 42-year market veteran who works with a planning group holding close to $2 billion
🎙️ Host: David Lin, who runs The David Lin Report from Vancouver
📰 Published: 14 September 2026 on YouTube (The David Lin Report)
🔴 YouTube | 🟣 Apple Podcasts | ⏱️ 45 min | ✅ Time saved: 31 min
Key Takeaways
The line is 5% on the 10-year, and the trigger is staying above it for more than a couple of days
He expects tremendous additional selling, with the weight then falling on equities
A Fed that does not raise is more dangerous than a Fed that does
A hike tells bond vigilantes the central bank is not taking orders from the White House
Buying Treasuries at the end of 2021 has lost money even counting the coupon
He says gold has doubled the stock market's performance over the same period
Institutions are halving the 40% in a 60/40 portfolio and putting gold in the other half
Ownership of major mining companies against the rest of the market is at its lowest ever
His example of scarcity: the US Army went looking to buy tungsten and could not find any
3% inflation in a slow economy is worse than 5% in a strong one
His advice to clients is capital preservation, not appreciation, for the next couple of years
1. Bessent's Asymmetric Bet
Lin opened with a clip of Treasury Secretary Scott Bessent telling an audience at the Cox School of Business in Dallas that he has asymmetric information on the yen intervention — that he is the house now, and people can bet against him if they want — and asked Grandich what he made of it.
Grandich's first reading is about what the remark admits. "Well, one thing is clear. This administration is not afraid to talk about insider trading then do it," he said, describing the message as: I am using insight you do not have, and beware
His second is that the Treasury has picked a fight in the wrong market. He said the currency market and the bond market are much bigger than the stock market, which this administration has been able to move with well-timed words that trigger algorithmic programs
On the yen carry trade he says the unwind was always coming back on the United States, which has used it as a liquefying event for its own financial markets, and that Japan will not sacrifice itself so the US can have an easier time
He said Japan has been selling its bonds along with the Chinese and others, and expects more selling of US securities
His analogy for the Treasury's debt management is a household one. Issuing more short-term paper to retire long-term debt, he said, is like having a mortgage and deciding to pay it off with a credit card — which solves nothing
The wider claim he draws from it: "The United States has isolated itself on the world stage monetarily, economically, militarily, tradewise, and all," and the dollar is where the bill lands
2. The Yen Cuts Both Ways
Lin pointed out that the yen has strengthened to 153 against the dollar ahead of an expected Bank of Japan rate rise, and asked whether the Treasury has effectively already won.
Grandich said a stronger yen is not the relief it looks like: "There's as much of an issue of the yen strengthening as if it was continually weakening." Either way it turns Japan's attention inward
He put that in the same category as the rest of the country's relationships, arguing that when the United States was the world's largest creditor nation 42 years ago it could afford to alienate people, and now it depends on the same countries to finance its deficits
His summary of the combination is the phrase the episode was titled for — a near-perfect storm forming for the stock market and the bond market
3. The 5% Line in the Sand
The level and the duration are both specific. "What's at risk is the line in the sand and that's the 5% on the 10-year," he said — if the yield gets above 5% and stays there for more than a couple of days, "I just think we have a huge bond crisis"
He is not certain it gets there, saying he still thinks it is questionable whether the market can push through and hold above the level
The transmission to equities runs through funding. He said what has propelled the stock market is the AI enthusiasm at a time when those same companies are raising money in debt instruments, which becomes far more challenging
He offered his own credit call as the tell to watch. At the start of 2025 there was one of the largest spreads between junk bonds and Treasuries; he expected it to narrow, and said that when junk gets close to Treasuries it is time to sell junk too
The scale argument is his reason for caring more about bonds than stocks: the bond market is far bigger than the equity market and matters more to the economy
4. If the Fed Does Not Raise
Lin noted the CME FedWatch tool put the chance of a rate rise at 60%, and asked what happens to markets if the Fed holds instead.
Grandich's answer inverts the usual worry: a hold is worse. If the Fed raises, he said, some bond vigilantes will conclude that at least the person at the central bank is not as reckless as the person in the White House
"But if they don't raise rates and we still see interest rates going higher, that can really start a dramatic sell-off," he said
The political cost falls on the Fed chair either way. "I can't imagine if the Fed does raise interest rates, how fast Trump will throw the Fed chairman under the bus," he said
He thinks the case for raising is about credibility and capital, not demand management. With multi-trillion-dollar deficits and fewer foreign buyers, he argued, the US needs a better interest-rate differential to attract capital
His counter to the objection that the Fed should be cutting into a weak economy is the mix, not the level: 3% inflation in a moderate to slow economy is worse than 5% inflation in a strong one — the word for it, he said, is stagflation
On the near-term data he would not commit. He called the decision a coin toss, and said that even if the inflation prints come in better than feared, prices have moved again since the readings were taken because of oil, gas and diesel
5. Paycheck to Paycheck
Lin read out a CNBC survey: 53% of Americans more stressed about their finances than a year ago, 63% living paycheck to paycheck, 90% of those with less than $500 left each month, and 37% breaking even or running a deficit after expenses. He asked what Grandich tells someone in that position.
The advice is unwelcome and unchanged: "You have to spend less than you make. That's the first order of business," he said, noting the government has not done it for decades
His diagnosis is that the baseline has drifted. He said things treated as necessities were luxuries to previous generations, and that costs have risen far more than the 2 or 3% officially reported for food, clothing, insurance and mortgages
Diesel is the input he keeps returning to. Almost all goods in the United States move by truck, he said, so the diesel price is added into the cost of everything
Asked whether next year is better, he said no, and put a generation on it: "I think we're in for a generation of tougher times."
His image for the problem is a retail category. Public storage is his poster child for a society with too much stuff — homes are bigger than they were and people still rent space to hold the overflow, an industry he pointed out did not exist a generation or two ago
He credited the late comedian George Carlin's routine about stuff for telling the truth about it, and added that Wall Street makes a living off the idea that more stuff equals more happiness
The state-level squeeze is already showing up on utility bills. He said three states in the past year have brought in mandatory benefit programs, and that people in Connecticut and Massachusetts saw electricity bills triple with no change in usage, because of a surcharge to cover households in other zip codes
6. Savings the State Wants
Lin played a clip of European Commission President Ursula von der Leyen saying savings are lazy, that 10 trillion euros sit in bank deposits and that a significant portion of European savings is invested outside the continent.
Grandich's reading is that it is a rescue, not an investment thesis. "She's doing that because people don't want to invest in Europe," he said, arguing Europe has greatly underperformed much of the Western world for decades
He said Germany was the economic engine that pulled the world when he started, not China, and is now basically dismantled
He sees the same maneuver in the United States, citing the push in August to open private equity to ordinary savers: if the professionals are doing so badly that investors want their money back, he asked, why route the general public into it
His word for it: "That's a bailout"
Asked what he would do if the government told him to invest his savings or be taxed on them, the answer was one word: "Revolt."
He said a forced allocation into a government project would lead to a revolution wherever it happened, including in the United States
He does not think it is imminent. Asked whether it was likely any time soon, he said no
It is, he added, the standing argument for gold and for holding money offshore
7. Gold Instead of the 40%
Lin asked what replaces the 40% in a 60/40 portfolio if the bond bear market continues.
It is already happening, in his account. He said financial institutions he never expected to see do it are taking half of the 40% bond allocation and putting gold in its place
The performance comparison he gives is stark. Even after the correction, he said, gold has doubled the stock market's performance since the end of 2021
The bond call itself is what he is proudest of. At the end of 2021 he decided rates could only go up and a lot, meaning losses for Treasuries and outperformance for gold — and, as he put it, anybody who bought Treasuries since then has lost money including the yield
The rule he was taught 42 years ago has broken. "You buy stocks to try to make money and you buy bonds to save your money," he said was the advice given to brokers then — and it has not held
The demand picture he describes is geographic. He said gold is being hoarded outside the United States, and that Chinese citizens are buying physical gold in quantity as an investment, incentivized by their own government, while Americans buy things they do not need
His explanation for official Chinese buying is monetary rather than speculative. They are not buying to sell at a profit, he said, but because gold is going to be incorporated into how they trade
8. Mining's Ownership Low
The claim is about positioning, not price. He said ownership of major producing mining companies — not junior explorers — against the rest of the market is at the lowest level ever recorded
"People own the least amount of relating to mining now versus all other sectors in the modern era at a time when the arguments for metals have never been stronger," he said
His evidence that the shortage is real is a procurement failure. He said the US Army went out to buy tungsten for military use and could not find any it could purchase, and was careful to say he has no tungsten position to promote
He expects the coverage to follow the scarcity, predicting the financial media will be talking about mining in a year or so the way it started talking about technology a few years ago
The permitting comparison he uses is Canada against West Africa: 25 to 28 years from discovery to production in Canada, against two years in West Africa
9. Canada and the Big Stick
Asked whether North America has the raw materials it needs, Grandich said Canada does, and then spent the rest of the segment on the relationship.
He disclosed his own vote before making the criticism. He said he voted for the president three times as the lesser of two evils, thought the first couple of months started well on immigration, and that "it's been all downhill since then"
The mistake he names is the posture. He said he warned a year ago that carrying a big stick instead of an olive branch would not only get the tariffs reversed but push allies away
The prize he says is being given up is self-sufficiency. Canada and the United States working together could be naturally self-sufficient in food, water and energy and need almost nothing from anywhere else, he said — "And what do we do? We got people so upset now they're burning American flags and it's just insanity"
On why Canada has grown slowest in the OECD for a decade, he blamed government and overregulation — a government that spoke for an elite rather than the people, and a permitting regime that made projects uneconomic
He was blunt about the tone coming out of Washington, recounting Bessent's jibe about Canada taking its two submarines out of the Edmonton Mall, and saying the arrogance of it is disgusting. He spent 25 years with Canada as his home away from home, and wrote a newsletter called North of the Border
His political forecast is the most specific thing in the interview. If the House goes, he said, he does not think the president lasts six months into the new year: impeachment proceedings, disclosures about family and friends who have made money, a wave of pardons, a resignation, and a full pardon from the vice president
On China he separated the human-rights question from the economic one. He is not a supporter of how China conducts itself on human rights, he said, but the growing part of the world is Asia, and that is where the mechanisms for wealth are being built
10. Capital Preservation
Lin asked for the investment thesis from here to the midterms, and whether he believed the president's claim that the Iran war ends right after the election.
He does not. He pointed out that the war was declared over two days after it was supposedly won, and that everything since has got worse rather than better
The political read he gives is that the guarantee has stopped working. People are no longer taking the president's word, he said, which is why the polls are falling and why senior Republicans are skipping the party's own convention
The allocation is a single sector. Gold, metals in general, and the companies advancing important deposits — including agricultural ones, because he sees this as a commodities-driven move worldwide
"There's no other sector right now to me that looks anywhere as compelling as that group," he said
It is also the one place he would not be afraid to own something that falls further in price first
The second half of the advice is domestic. Get a budget, spend less than you make, and build the moat before the government comes knocking
The formulation he leaves clients with: "It's not how much you're going to make, it's how much you don't lose, which is going to matter over the next couple of years."
Bonus Insights
Grandich made a point of saying he is not selling the collapse he describes: "I don't have dry food or guns or ammos or log cabins in the woods"
His worry about the industry is inexperience. He said two-thirds of the US financial services business has never lived through a bear market and would not know what to do if stocks and bonds both failed to rise for a year or two — and neither would their clients
On inequality he argued the top 1% own more assets than the entire middle class combined, and that the distance is what creates the opening for socialist politics: people are told their problem is those people, and eventually they believe it
Lin noted that Chrystia Freeland had criticized the current Canadian government on CNBC for trade deals with China; Grandich did not take the bait beyond his own point about where growth now sits
Grandich's forecast for the host was that Lin will be married in the next 12 to 24 months, which he offered as the only certainty he was prepared to give
He describes himself as a registered Republican, and said the advice he would give a Democratic strategist is to say nothing at all and let the president keep talking
Grandich's bottom line is that the bond market, not the stock market, is where this cycle is decided: a 10-year yield that holds above 5% takes equities with it, a Fed that blinks makes it worse, and the only allocation he wants in front of that is gold and the companies that dig things out of the ground.
Products, Companies & Tools Mentioned
Peter Grandich & Company (Grandich's own firm; he says the planning group he works with has close to $2 billion under management)
CME FedWatch (The source of the 60% probability Lin put to him for a rate rise)
Public Storage (His poster child for a society that owns more than it has room for — the industry did not exist a generation ago)
European Commission (Ursula von der Leyen's savings-and-investment union speech, which Grandich reads as a bailout for decades of European underperformance)
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