Month: January 2026

The Canvas Bag Theory of Markets

If you want to understand why gold just hit an All-Time High of $5,500, don’t look at the Federal Reserve’s balance sheet. Look at a $4.99 (IDR 83,000) canvas bag.

Last year, Trader Joe’s released a mini canvas tote bag. It was functional, simple, and cheap. It also caused grown adults to line up at 5:00 AM, fight in aisles, and resell them on eBay for $500. In London, Tokyo, and even close to home here in Jakarta, the bag became a status symbol. Why?

FOMO (Fear Of Missing Out).

It wasn’t about the canvas. It was about the crowd. When everyone else is running toward something, it’s very much human instinct to feel we should probably run that way too.

Even the normal tote bags are being sold upwards of $950. Now that’s a 200x return!

From Aisle 4 to Asset Class

This same psychological contagion is now bleeding into the gold market.

A few months ago, buying gold was for central banks and “doomsday preppers.” Today? It’s the topic that no one could stop talking about all day even during your most mundane routines. One of our team members shared his badminton buddies started asking if they should pile in. My grandpa who comes to visit every weekend also started asking if gold could go higher instead of what to eat for Sunday brunch.

We saw the preview of this last year in Asia and Australia. In Sydney, buyers at ABC Bullion were sleeping overnight on the pavement just to be first through the door when the shop opened. In China, young Gen Z buyers started buying “gold beans” (tiny gram-sized nuggets) because they stopped trusting savings accounts.

The gold beans that went viral in China. Very demure, Very cutesy, and Very Gen Z

Image source: Bloomberg

Here in Jakarta, there are recounts of people staying overnight in front of gold shops since 9pm to place their names in an queue honor system piece of paper

Image source: CNA

When people who have never owned an ounce of metal suddenly feel the itch to buy at all-time highs, it signals a shift. But it also signals danger. When you buy on emotion, you sell on panic.

Navigating the Vertigo

The question on everyone’s mind has shifted from “Should I buy?” to “Is it crashing?” now that we’ve seen a sharp correction.

Buying or holding at these heights feels unnatural. It feels dangerous. It gives you vertigo.

But let’s look at another feat of vertigo. Just this week, Alex Honnold (the climber from Free Solo) free-soloed the Taipei 101 building. No ropes. No safety net. Just him, 508 meters of glass and steel, and a crazy short 90-minute climb that the world watched with sweaty palms.

 

 

 

 

 

 

 

 

 

 

Images source: Netflix

To the average person, looking up at the 101st floor looks insane. It looks like a death wish. But to Honnold? It was just math, physics, and preparation. He didn’t climb it because he was reckless. He climbed it because he had studied the “bamboo boxes” of the structure. He knew exactly where the holds were, and more importantly, he knew what to do if he slipped.

Navigating this gold market requires that same “Honnold Preparation.”

The chart looks intimidating. The drop looks scary. But if you have done the homework, you realize that the fundamental structure hasn’t changed. You aren’t just reacting to a price tick; you are looking at a repricing of the dollar itself. As we wrote in our previous reports, when the currency is being debased, the price of real things has to go up even if the path there is bumpy.

If the Metal Scares You, Look at the Dirt

If buying the metal at these levels still gives you too much vertigo, there is another door open: the miners.

Think of gold mining like a neglected apple orchard. For years, investors ignored it, so no new trees were planted. Since 2018, production largely flatlined, but the high prices are finally acting as fertilizer. The latest data shows Q3 2025 mine production hit a quarterly record of 977 tonnes (up 2% year-on-year), putting 2025 on track to set a new all-time high for annual output.

Source: Heyokha Research

The orchard is waking up.

1. The Margin Explosion: The Average All-In Sustaining Costs (AISC) for miners hover around $2,250/oz, making the math undeniable. With gold at $5,500, miners are pocketing a record spread of nearly $3,000 per ounce. A 1% rise in gold can now drive a 2–3% jump in miner valuations.
2. The Hidden “Option” Value: Higher prices turn “waste rock” into “wealth.” Take Barrick Gold—their latest report showed a 23% jump in gold reserves (adding ~17 million ounces). They didn’t magically find new deposits; the higher price just made the old rock profitable to dig up.

While the crowd fights for physical bars, the smart money is quietly buying the companies that own the dirt.

Preparation Over Panic

The old safety net of the 60/40 portfolio of stocks and bond is fraying. With U.S. interest payments now exceeding defense spending, bonds aren’t the safety rope they used to be.

If you are feeling that itch to buy or the urge to panic-sell because of the correction, don’t just follow the crowd with the tote bags. Do the prep.

Alex Honnold didn’t start climbing until he had mapped every inch of the route. You shouldn’t allocate capital until you’ve done the same.

• Read our deep dive: Gold: The Return of Real Money

You can access and browse all our past reports here:

• Think Pieces
• Reports

The climb might look high, but the view from the top is worth it. Just don’t forget to bring your own bag.

 

Tara Mulia

For more blogs like these, subscribe to our newsletter here!

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The Opening: A Musical Flop and a Geopolitical Stage

In 1986, ABBA’s Benny Andersson and Björn Ulvaeus teamed up to write Chess, a musical about the Cold War where the board served as a metaphor for superpower rivalry. Despite the catchy score, the production was a flop. It struggled to balance human drama with the cold machinery of global politics.

Caught the Broadway production in December. Full house. It seems American audiences can feel the geopolitical temperature rising. Suddenly, this musical feels less like history and more like a preview

Fast forward to 2026, and we are watching a new production on the global stage that is anything but a song and dance. President Trump has officially signed the charter for the “Board of Peace” at Davos. While it was initially pitched as a mechanism for Gaza’s reconstruction, the charter signed this January reveals a much broader mandate: to “promote stability” and resolve international conflicts.

While the name sounds diplomatic, the mechanics are novel. Permanent membership on the board reportedly requires a $1 billion contribution, and the charter grants “Chairman Trump” sweeping authority, including veto power over resolutions. It is a bold attempt to create a “nimble” alternative to the United Nations. However, in a game of chess, you need players willing to sit at the table. While over 20 nations like Saudi Arabia, Turkey, and Indonesia have signed on, heavyweights like France and Germany have declined, citing concerns over undermining the UN. Right now, much of the world is busy building their own boards.

The Thesis: The Empire Strikes Back

It is easy to dismiss Trump’s headlines: buying Greenland, slapping 25% tariffs on neighbors, proposing grand peace boards: as eccentric noise. But what if they aren’t random at all?

At Heyokha, we see these moves as a coherent strategy to build a resource-based American empire in a de-globalizing world. Trump isn’t just making deals; he is attempting to lock down the hard assets: land, energy, and minerals: required to survive the end of the “just-in-time” global order.

Remember this post that the White House did last year?

Why Greenland Was the Opening Move

In 2019, the world laughed when Trump suggested the U.S. buy Greenland. But as Trump wrote in The Art of the Deal, “Location is everything.”

Maybe we should brush up and read the “Art of the Deal”. Cover image is from our blog – “Art of the Deal” Tops Amazon as Tariffs Stirs Comedy and Chaos

 

Even though the Greenland talks have now subsided into a formal framework for cooperation, the underlying intent of the original ‘buy’ offer to secure resources remain.

Greenland isn’t just ice; it is a fortress of strategic necessity:

• Critical Minerals: The island holds massive reserves of rare earth minerals (estimated at 1.5 million metric tons, with some deposits reaching 28 million metric tons). These are the vitamins of modern defense and technology, and China currently dominates roughly 90% of global processing.
• Arctic Shipping Lanes: As sea ice declines, the Northern Sea Route offers up to 40% savings in time and cost for shipping between Asia and Europe. Controlling this “Polar Silk Road” is a generational prize.
• The AI Power Race: As we explored in our AI Curveball blog, the bottleneck for AI is no longer just code; it is energy and cooling. Greenland’s massive hydro potential and Arctic climate make it a “sovereign heat sink” for the data centers of the future.

 

This isn’t real estate speculation; it is Monroe Doctrine 2.0. It is a move to secure the Western Hemisphere’s physical supply chain. As we noted in The Price of Sovereignty, in 2026, safety isn’t measured just in missiles, but in who owns the warehouses of food, fuel, and the resources needed to win the AI race.

The “Board of Peace” vs. The Board of Reality

Trump’s “Board of Peace” pitch fits this empire-building mold: a transactional attempt to manage global stability from a position of top-down strength. But the board has changed since 1945.

We aren’t in a unipolar world anymore. As highlighted in our report on De-dollarization, nations like the BRICS bloc are actively building parallel financial rails to bypass the dollar. They’ve seen the U.S. weaponize the dollar against Russia, and they are opting out of the game entirely. You can set up a “Board of Peace,” but it’s hard to play when half the grandmasters are leaving the tournament to start their own league.

The Bill for the Empire

This brings us to the most uncomfortable truth. Empires are expensive.

While the strategy to secure hard assets like Greenland makes geopolitical sense, the balance sheet tells a different story. In FY 2025, the U.S. federal government spent $970 billion on net interest alone. This exceeded national defense spending ($917 billion). When you combine interest payments with mandatory entitlements (Social Security and Medicare), these costs are essentially consuming the vast majority of federal revenue, around 92%.

How is this sustainable?

 

Think about that. Nearly every dollar the government collects is swallowed up just to service past debt and keep the lights on for mandatory programs. That leaves almost nothing for defense, infrastructure, or buying massive islands. The U.S. is effectively trying to finance a 19th-century style expansion with a balance sheet that looks like a distressed tech startup.

The Investor Takeaway

We have been writing about this shift for years: from our Gold: The Return of Real Money report predicting the flight to hard assets, to our analysis of the debt spiral from the report. The “Trump Trade” isn’t just about lower taxes; it’s about a turbulent transition from a paper-based global order to one backed by hard resources.

When a superpower tries to reassert control while drowning in debt, the currency is usually the casualty. That is why central banks are hoarding gold at record rates. They know the cost of maintaining this empire is likely to be paid in inflation.

The End Game

As the U.S. races to lock down Arctic shipping lanes and mineral deposits, the picture is becoming clear. Trump may be playing a winning hand on the geopolitical chessboard, but the financial clock is ticking louder than anyone admits.

The real question isn’t whether America is building a new empire: it’s whether the American people realize they are financing one they can no longer afford.

 

Tara Mulia

For more blogs like these, subscribe to our newsletter here!

 

Admin heyokha

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Something big happened. And no, we’re not talking about the dramatic military footage from Caracas. That was the trailer. The real story is about systems: who runs them, who controls access, and how trust in those systems is unraveling in real-time.

For decades, the petrodollar system anchored U.S. financial dominance. It was never about just oil, it was about trust. Trust that global trade would run through U.S. dollars. Trust that national borders would be respected. Trust that rule of law, not rule of force, governed the world’s financial plumbing.

That trust just took a direct hit.

If you need a refresher of the events that transpired

Source: Al Jazeera

Venezuela Was Never About Venezuela

Let’s get one thing out of the way: Venezuela’s importance isn’t about what it produces now, it’s about what it could produce and who controls it.

Officially, Venezuela sits on the world’s largest proven oil reserves, an estimated 300 billion barrels. To put that in perspective, that is more than Saudi Arabia that holds an estimate of 267 billion barrels. Yet, the nation’s actual output has cratered:

• Peak (Early 2000s): ~3 million barrels per day (bpd).
• Today: Struggling to stay above 800,000–900,000 bpd.

Infrastructure is decaying. Expertise has fled. Most foreign players, save Chevron, were kicked out long ago. And yet, the U.S. is back.

Why?

Because even if Venezuela’s current output is minimal, it possesses the specific “heavy sour” crude needed by U.S. Gulf Coast refineries to optimize margins. However, the narrative that the U.S. can simply “turn on the taps” is a logistical fantasy.

The Dollar’s Soft Power Turns Hard

For years, the game plan was “isolation through paperwork.” Washington used sanctions to lock Venezuela out of Western banks and U.S. capital markets. It didn’t work.

Caracas simply built a “parallel plumbing” system to bypass the dollar. They rerouted trade through shadow fleets and leaned on Beijing for survival.

The China Play: Between 2007 and 2015, China funneled $60 billion into Venezuela. But Beijing isn’t a charity—they’ve spent the last decade quietly de-risking. By halting new loans and focusing on “extraction-for-repayment,” they have recouped roughly $50 billion, leaving a manageable $10–12 billion on the books.

This operation was never about a “war for oil” in the traditional sense. While the U.S. Strategic Petroleum Reserve (SPR) is low (currently holding 413 million barrels, near 1980s benchmarks) the U.S. could be worried about a war higher than just oil.

U.S emergency stockpile is as low as it was in the 1980s. This gives the U.S. less flexibility in a crisis and weaker leverage against OPEC+ adversaries

Source: U.S. Energy Information Administration

 

This is a war for primacy. If a nation in the Western Hemisphere can successfully decouple from the dollar system using Chinese financial rails, the precedent is dangerous.

So, Washington pulled the emergency brake.

Maduro was taken. The military operation was swift and surgical, closer to a “decapitation strike” rather than a full invasion. But what followed wasn’t a puppet installation, but a bizarre cohabitation. With Delcy Rodríguez now sworn in as Acting President, the U.S. has proven it can remove a leader, but it hasn’t proven it can easily govern the aftermath.

Empire by Other Means

This is not a new doctrine—it’s the Monroe Doctrine, version 2.0.

We’ve talked about the Munroe Doctrine before in our Gold Report, here’s a sneak peak

But Venezuela is not a “banana republic” of the 1950s; it is a fragmented state with 20–30 million people and over 20 different armed groups controlling the interior.

And here’s the kicker: even if you stabilize the country, reactivating Venezuela’s oil machine will require more than $100 billion in capex and over a decade of patient rebuilding. That is a staggering sum for a nation that is effectively insolvent.

To put the scale of this challenge in perspective, consider the mountain of debt already on the books:

• Total External Debt: Estimated between $150–$170 billion.
• Economic Output: The International Monetary Fund (IMF) estimates Venezuela’s nominal GDP at about $82.8 billion for 2025.
• The Debt Trap: This implies a debt-to-GDP ratio of between 180%–200%.

In short: the cost to simply fix the oil fields is larger than the country’s entire annual economic output, and the debt they already owe is double that. This isn’t just a recovery project; it’s a multi-generational financial restructuring.

A Catalyst for Hard Assets

But what does all of this mean for investors?

Wars are inflationary. Always have been. Resources are hoarded. Supply chains are weaponized. Deficits explode. And trust, especially trust in the currency used to finance these deteriorates.

War has always been inflationary

Source: RSM US

At Heyokha, we’ve been writing about this for years:

• In our Q2 2020 report History: A Better Guide than Good Intentions, we’ve argued that Modern Monetary Theory would eventually unleash inflation. With today’s ballooning war budgets and rising debt service, that forecast is aging well.”
• In “Gold: The Return of Real Money”, we mapped the declining credibility of fiat currencies and why gold is re-emerging as a store of trust in a fractured world.
• In “The Stablecoin that Bought a Central Bank’s Worth of Gold”, we showed how even crypto-native companies are seeking shelter in gold, echoing the behavior of central banks.

War also kicks off commodity prices to surge

Venezuela fits squarely into this narrative.

The show of force may have delivered a short-term win. But the long-term effect is clear: if you’re a resource-rich nation thinking of pricing oil or metals outside the dollar, this operation was a warning. The message? Don’t even try.

But the world is watching and taking notes. BRICS members are already settling trades in local currencies. China’s Cross-Border Interbank Payment System (CIPS) now links over 1,400 financial institutions across 109 countries. Gold purchases by central banks hit multi-decade highs last year.

In other words: trust is shifting.

Final Thoughts: A Wake-Up Call for the Financial System

The aircraft have left Caracas. Maduro is in New York facing trial. But the damage to the “rules-based order” is permanent.

This wasn’t just a regime change—it was a message to the rest of the world: U.S. access to resources comes first. Financial autonomy comes second.

That message will echo far beyond Latin America.

It will accelerate the move away from dollar-based systems. It will deepen skepticism of U.S. financial assets. And it will push more capital into real stores of value—like gold, silver, and the infrastructure tied to energy sovereignty.

Up 73% since October 2025. How much higher can it go with increased political uncertainty?

At Heyokha, we see this moment not as an isolated geopolitical event, but as part of the broader endgame of the fiat era. When trust erodes, when power shifts, when the military becomes the backstop of monetary policy—it’s time to think hard about what you own.

Gold isn’t just a hedge anymore. It’s a protest vote. A way to opt out of systems that break their own rules. And the story of Venezuela might be the loudest signal yet.

 

Tara Mulia

For more blogs like these, subscribe to our newsletter here!

Admin heyokha

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