Will Rhind, CEO of GraniteShares, joined Cheddar News to discuss Thursday's trading session amid renewed fears over the regional banking crisis as well as concerns over the debt ceiling debate.

Closing Bell

Analyst Discusses Market Trading Amid Renewed Fears Over Banking Sector

Joining me now is Will Ryan Ceo of global ETF issuer credit shares. Will, it's great to have you on set down here on the floor of the exchange. Great to be here. Thank you so much. So, you're a commodities guy. Your expertise is in commodities. Obviously, you talk equities in stocks a lot as well. How do we make sense of the stock market? And does it provide opportunities now for commodities? So I think the stock market is in a very difficult position at the moment, the regional banking crisis clearly shows no end of letting up despite the interventions that we've seen. And so when we look at the failures that have happened and also banks that are now teetering on the edge, I think we see a situation where rates are too high and we need some kind of response. Now, the market obviously is expecting rates to come down the fed to cut, but it just shows that we're in a very precarious position. I think the stock market has been hoping, I think they've been trying to send the fed a message. Please take these rates lower throughout the year. But we'll see if that actually does stick over a longer time frame. So what does this mean for commodities like gold and silver, for instance? Well, gold has almost been flirting again with all time highs, which is kind of remarkable when you think about we have interest rates officially at 5%. So how can we have a situation where typically interest rates being the absolute enemy of gold prices, interest rates, the highest they've been for decades and yet gold is flirting with all time highs. I think the gold market is telling you something is broken and what's broken is the banking system, the market as we are, interest rates are just too high for the market to bear. And I think that's why people are rushing into gold at the moment, the dollar is coming down and this is a drive for the hard commodities. Interesting. How long do you forecast that trend to last? Right. I mean, if you want to trade the stock market, it's a good idea until you're on the wrong side of the trade. Yeah, exactly. I mean, I think with gold, this is a longer term thing because there are a number of things at play. One, the dollar is coming down. Two, we're about to get into potentially another very tricky situation with the debt ceiling negotiations. So those of us to remember back in 2011 when the debt ceiling debacle happened and the USA lost its AAA credit rating. That propelled gold to highs at the time. And so if something breaks down, the debt ceiling is not raised on time, that could happen again with the gold market longer term though I think this is about the US is going into recession. We see this trend of de dollarization. In other words, currencies such as the Chinese Renminbi, other trading partners starting to use not just their paper currencies but gold instead of the dollar. And that's a longer term negative for the and what does that mean for our viewers? The fact that the dollar is decelerating, does that indicate that there might even be better investments in international markets, for instance, that they might be holding up better in what is expected to be a slow growing economy? That's exactly right. So anything that acts in reverse if you will to the dollar, so is the dollar weakened from its high last year in August September of last year, buying almost anything that was in a foreign market would have made you money buying anything in Europe, in the UK, etcetera because of just the currency weakness alone. So that's why the gold market is doing well, prices as well in this market, people looking for alternative assets but hard assets in this time. How long is this expected to last for the end of the year? I think. So, you know, the biggest challenge for me at the moment with rates in the banking situation that's going on. I don't think it's as much that people are nervous or they're worried about losing their deposits because we've already seen the precedent being set by banks being saved and depositors being made whole. What's really happening is why would you put your assets in a regional bank or any bank for that matter that's paying you practically nothing on your deposit when you can put them at the fed directly in t bills or in a money market fund and earn 5%. That's the issue. And until that gets resolved, I think you're going to see more outflows from regional banks and exacerbate the situation. Interesting. Well, let's talk more about commodities, right? So gold obviously has been in focus other commodities like silver and copper. Do they move in a similar pattern to gold typically? Yes. So again, this is about hard assets. Silver prices. You doing? Well, silver is more correlated with the business cycle, more the economy because it's used in industry as well. So silver prices typically move upwards when gold prices are other things like copper tend to be more of a bellwether of the global economy. So copper prices just like oil be affected on fears of recession and this recession narrative at the moment has seen prices for oil and for copper to dip. All right, will we got to leave it there? Great to have you on set. I know you've been a long time markets guest for us. Of course, a long time source of mine as well. Will Ryan Ceo of Granite shares? Thanks. Thank you.