Chase discusses the energy trade and why it may be getting a bit crowded. It’s probably time to take some profits. Taking the opposite view of Jim Cramer is often a good contrarian play. We’re seeing demand destruction beginning for commodities as we enter into recession. We see that with copper at the moment. It’s important to understand the differences between prices of crude and refined products. Refinery capacity influences prices and the China has been growing its refinery capacities. He expects further declines in fuel prices and a decline in inflation prints. His April newsletter was the most bearish, and it’s clear the Fed wants equity and asset prices to decline. Nominal consumption numbers look acceptable, but people are using up savings. Moving forward, growth will be questionable until things bottom out. Currently, demand destruction is occurring fastest in the housing market. We’re seeing new home supply exploding. There are rapid price drops occurring in the market. Higher rates have an outsized effect on mortgage payments, and therefore fewer people can get loans. We’re likely to see year-over-year declines in housing prices. Lumber is a good indicator of how the economy and housing is performing. Energy prices are likely to remain high for a few years. We’re not seeing much investment into the oil sector, which will continue to add some inflationary pressure. Consumers are finding everything more expensive, and most investors are probably hurting. This will change spending patterns at some point as their bank balance drops. The real pain could be this fall, when everyone realizes just how broke they are. A large news event will be required for the dollar to begin to reverse. We’re seeing a rather dire industry outlook for Europe and Germany in particular. Energy shortages could cause shutdowns of manufacturing. Europe has put themselves in a very difficult position with their energy policies. Gold needs rates to stop moving higher and the Fed to at least pause. We also need the dollar to stop its rampage higher. The macro picture shows that this will all happen. Then the upside potential for gold is significant.