Chance Finucane — 40% "Deeper Correction" Ahead?

0:00 Cold open — a deeper decline in 2027

• Momentum this year is even crazier than 2025 — it just shifted (precious metals unwinding, then the AI/semiconductor trade unwinding in the last few weeks). Since 2020, long-bond yields (10s/30s) are structurally headed higher — poor for bond prices.

1:03 Rotating back into energy & precious metals

• In the high-income book, re-adding to energy and precious metals trimmed in Q1 (metals on the Jan spike; energy on the Iran-war oil spike). Stock book stays ~60% equities / ~40% short Treasuries — market "fully valued," so the focus is the unloved, non-AI areas.

2:42 How to decide to buy the dip

• Most trading is momentum (retail + quants) chasing the hottest trade and dumping everything else. Oxbow's edge is buying the sell-offs those players ignore — sticking to valuation principles, not the trend.

3:39 Gold $4,000 / silver $60 targets

• Gold peaked ~$5,500, silver ~116; his re-entry range was gold back to ~$4,000 and silver back to ~$60 (roughly a halving) — about where they are now. Precious-metals allocation runs ~10% on average (split metal / miners+royalties); took it from ~15% late last year to mid-single-digits, now rebuilding toward 10%.

5:23 The market has split — AI vs non-AI; the 40% semi downside

• ~Half the market cap (just 50–60 companies) is AI beneficiaries and has driven almost all of this year's return — overvalued by and large. The 12–15 highest-quality semis screen to ~40% downside in a normal 20–25% index bear market; Oxbow wants ≤20% downside on any new buy, so the group fails.

6:41 Didn't buy SpaceX; the first-year IPO decline

• Passed on SpaceX (and will pass on OpenAI/Anthropic). Hot IPOs almost always trade cheaper than their first-day close within a year — SpaceX already down ~16%. There's time to wait.

7:45 [Sponsor break — not the guest's view]

• The host reads a paid ad for Brixton Metals (BBB.V / BBBXF) at (7:45)–(8:45). Not attributable to Finucane and not tabled as a holding.

9:09 Being nimble after the commodity spike

• When the war spiked energy/agriculture commodities, Oxbow trimmed the winners, and now adds back on the pullback to restore its start-of-year exposure — react to the shift in valuations, not the headline.

11:19 A new, more volatile era; long bonds are a structural avoid

• The 2020s differ from the 2010s: more geopolitical shocks, higher and more volatile inflation, and — since 2020 — a structural regime of higher long-term yields. Owning 20–30yr Treasuries is "not a great place to be" looking out five years.

12:34 Travel holdings hit at the war's onset

• Owns Booking, Airbnb and Expedia; they sold off on international-travel fears when the war began. The discipline is watching that new-event downside stays within a reasonable range — you only act when something gets truly extended (as the energy names did at their spike).

14:34 Oil overbought overnight; raising the floor

• Brent gapped over $120 overnight on thin liquidity — a speculative move that won't hold, so recalibrate. Still bullish oil for the long term, but you can't keep gains from moves that fast.

15:40 As bullish oil stocks at $80 as at pre-war $60

• More geopolitical activity "raises the floor" on oil — a durable premium per barrel from supply risk. At a reasonable $70–$80, the E&Ps still generate lots of cash flow, so the stocks are about as attractive as in January.

16:15 Own oil through businesses, not the commodity

• Unlike gold/silver, they express oil through companies: E&Ps, integrateds with a refining tailwind, pipelines, and — a newer addition Ted has built — oil-service names, betting parts of the world will need repair/more drilling in years to come.

18:25 Fed hikes hinge on oil

• Won't call one hike vs none — too fluid. If the ceasefire holds, base effects off the March oil spike could bring inflation to ~2% by next spring; if oil stays high, it's stickier and trickier for Chair Warsh. The 10yr/30yr price geopolitics + sticky inflation; the 2yr is getting ahead of eventual cuts.

21:03 How to play extreme AI valuations — stay away

• Not momentum riders and don't short, so they just wait. At 20–70× revenue (vs Google's 8.5×) the best case is priced in. Semis trading down on great earnings shows the market debating normalized earnings 2–4 years out.

23:30 SpaceX — the too-hard pile

• On "worth more than the entire Earth": a Buffett too-hard pass. Chanos flagged a bullish sell-side report admitting no free cash flow until at least 2035 — Oxbow wants businesses that generate FCF and return it, so it's not a fit.

24:52 Momentum didn't wane — it shifted

• ~60% of trading is momentum players who push a trend then rotate (out of gold/silver and the mag seven, into and now out of semis). Oxbow front-runs the destination by already owning the forgotten names.

27:00 Mapping the rotation destination

• Fully-invested sellers of semis must redeploy — the flows have gone to financials, healthcare, utilities and staples. Oxbow adds incrementally to liked names there so it's "already there" when momentum flips.

28:11 What looks cheap; the growth book

• Energy and precious metals look attractive on an absolute basis. The long-term-growth stock book isn't cheap but isn't expensive — a >5% free-cash-flow yield with ~10%/yr expected earnings growth, and dry powder to add on any bigger sell-off.

29:18 Bonds — short Treasuries only; locked 2-yr >4%

• Long bonds could be a poor place for multiple decades (outside a short-term trade). Fixed income stays ≤3yr; as the 2yr jumped back above 4%, they locked more client money there to keep a >4% yield if the Fed later cuts.

31:14 2027 — the deeper-decline call

• The AI correction may resume or greed may push higher into year-end, but 2027 risks a deeper decline: cycling against this year's high-growth/high-inflation first half will make growth look decelerating and inflation falling — a poor backdrop for risk assets.