Fed Rate Cuts Will Stoke Inflation, So Invest In Alternative And Non-U.S. assets — JP Morgan's Kelly

08/11/2025

JP Morgan has consistently been telling investors that geographic and currency diversification is the key to successfully navigating today's markets in 2025, and they expect gold to hit $4,000 per ounce by Q1 2026.

The Fed is likely to follow a "dangerous logic" of preemptive rate cuts which will stoke inflation, so investors need to diversify into alternative and international assets — like gold — to protect themselves, according to David Kelly, Chief Global Strategist at J.P. Morgan Asset Management.

"This underscores the need to broaden the diversification of portfolios to include alternative and international assets."

"Given this risk, and the probability of continued, somewhat elevated inflation, it still makes sense for investors to broaden the diversification of their portfolios to include some alternative assets, particularly those that can best offset inflation, as well as international assets denominated in foreign currencies," Kelly concluded.

JP Morgan has consistently been telling investors that geographic and currency diversification is the key to successfully navigating today's markets in 2025, and they expect gold to hit $4,000 per ounce by Q1 2026.

When asked how JP Morgan is looking at gold in this environment, Peters said, "We still like it."

"We came into this year with a price target for gold of $3,500," Peters said. "We've just broken through that [in late April]. So again, looking 12 months forward, north of $4,000, we think, would be a new reasonable price target for gold, with key drivers being still emerging market central banks."

** Information contained within this email should not be construed as Legal, Accounting, Tax or Investment advice. Patriot Gold Group is a Gold & Silver Dealer, representatives are NOT Licensed Financial Planners and do NOT give investing or tax advice.

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WSJ MarketWatch: Almost Every Investor In This Survey Says U.S. Stocks Are Overvalued As 70% Expect Stagflation

Aug. 11, 2025

Fund managers say they expect stagflation

A record number of investors say U.S. stocks are overvalued, as seven in 10 investors say the economy is heading for stagflation — even though their investment choices are not entirely consistent with a mix of higher inflation and low growth.

The latest Bank of America global fund manager released Monday found 70% of those polled said stagflation would be the best way to describe the global economy for the next 12 months, versus 12% who expect stagnation (which would feature below-trend inflation), 7% expecting a boom of higher-trend growth and inflation and 7% predicting a Goldilocks of above-trend growth and below-trend inflation.

A record 91% say U.S. stocks are overvalued, and "long 'Magnificent Seven'" was now described as the most crowded trade, overtaking "short the U.S. dollar."

The S&P 500 has gained 9% this year and sits just a below record-high levels. Magnificent Seven stocks collectively have gained 10% this year.

Another notable finding was that just 9% said they had any crypto exposure, as opposed to the 48% with exposure to gold. The investors who do have crypto exposure, on average, have 3.2% of their portfolio in it.

Bank of America said 197 panelists with $475 billion in assets participated in the August survey.

** Information contained within this email should not be construed as Legal, Accounting, Tax or Investment advice. Patriot Gold Group is a Gold & Silver Dealer, representatives are NOT Licensed Financial Planners and do NOT give investing or tax advice.

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