Grant Williams: Massive Once-In-A-Century Change Is Underway. Don't Be Blind To It!

Gold has been Grant's primary hedge since 2003 not because he predicted the price would move from $333 to $3,333, but because if inflation is the long-term problem, gold's purchasing power correlation with prices makes it an effective real purchasing power preserver; the nominal price is irrelevant—the point is that in a true inflationary crisis, gold holders maintain relative wealth while nominal asset holders deteriorate.

“Not because I thought the gold price was going to go from $333 where I first bought it to $3,333 where it is today. That wasn't my case at all. I didn't The price is irrelevant to me. But if inflation is my problem over time, this will mitigate it.”

The U.S. Constitution and Bill of Rights are now under threat in ways they have not been since the Civil War or perhaps ever, as evidenced by Trump publicly saying he may run for a third term and questioning whether he needs to uphold the Constitution; the fact that such statements can be made at all demonstrates institutional weakness and should prompt serious consideration of constitutional vulnerability.

“we've had Donald Trump say, 'Yeah, I'm going to run for a third term.' and he's selling Trump 2028 hats on his merch store, right? And we've also had him say in the last week, I'm not sure if I need to uphold the US Constitution...The point being, uh, the fact that that stuff is being said, whether it's meant as a joke or not, must put in your mind this idea, well, what what if what if he did run for how does that how could he run for a third term? Well, FDR had three terms, so maybe there is a way to do it. Uh, what does it mean if the president of the United States says, I don't know if I need to uphold the US. What does this stuff mean? These are things that would never have been said before.”

The accumulation of deficits, debt, and unfunded liabilities in America is an existential problem that requires dealing with; this is a major driver of the current institutional reassessment.

“In America, there's suddenly a recognition that runaway deficit spending in the accumulating pile of debt and unfunded liabilities is an existential problem that needs dealing with.”

The fourth turning cycle is exponential, not linear, in its development; being halfway through the fourth turning does not mean you are halfway through the damage, because the action has not yet really started and most disruption is compressed into the back half.

“it's important to remember that the developments of a foreturning are exponential. They're not linear. So when you say we're halfway through the foretturning, people are like Yeah. They're like, 'Oh, if we're halfway through, then you know, this isn't so bad so far.' Well, it's like, 'Well, wait a minute. The action hasn't really started yet.'”

The change described in fourth turning theory is a 'clear and present danger' that has been building for some time; it has been small and is getting bigger daily, making now the time to prepare defensively while it is still possible.

“it's a slowm moving change that's that's picking up speed. So, all of the stuff we've talked about has been uh a clear and present danger for some time now, but it's been small and it's getting bigger by the day.”

The era of globalization is being replaced by nationalism and protectionism; this is not temporary policy but a structural shift that reduces international cooperation and increases regional trading blocs.

“The era of globalization is being fast replaced by nationalism, protectionism, and a shift towards regional trading blocks.”

In a bare market (losing market), the winner is the person who loses the least, not the person who makes the most gain; this is a fundamental shift in mindset from the past 40 years and the logic that should guide portfolio construction going forward.

“the late great Richard Russell famously said that, you know, in a bare market, everybody loses and whoever loses the least wins. And that's the mindset. That's the that's the switch, right?”

If you do not know whether something bad will happen, you should at least quantify what the damage would be if it does happen, and if the damage is severe, you should take precautions even if the probability is perceived as low.

“At least don't just say, 'Ah, that's all nonsense.' At least think it through and and work out the damage it could cost you and your or cause to you and your family should it happen. and and and if you can quantify that or at least have a sense that you know there will be a really bad outcome for me and my then it's probably time to do something about it.”

The action and exponential development of a fourth turning has not really started yet; we may be halfway through the cycle, but because the developments are exponential rather than linear, the truly disruptive events are likely still ahead.

“And it's important to remember that the developments of a foreturning are exponential. They're not linear. So when you say we're halfway through the foretturning, people are like Yeah. They're like, 'Oh, if we're halfway through, then you know, this isn't so bad so far.' Well, it's like, 'Well, wait a minute. The action hasn't really started yet.'”

Most people watching financial content were born after the 1970s end of the Bretton Woods era and have cut their teeth and made their fortune in a nearly 50-year bull market, making them extremely likely to be surprised by a regime change.

“the vast majority of those people are highly likely to just slam into the the wall of reality of this this new change of of whatever we're walking into completely surprised by it”

The shift from globalization to nationalism and mercantilism means that countries will now have different strategic priorities than before, affecting everything from trade to investment to corporate strategy in ways that were not relevant in the globalized era.

“The era of globalization is being fast replaced by nationalism, protectionism, and a shift towards regional trading blocks.”

You should not try to time market crashes or 'dance closer to the door' by waiting for warning signals, because by the time you see the signals, you may already be trapped; it is better to preemptively build portfolio resilience rather than wait to be shocked into action.

“There's a danger in that, right? There's a danger in that. And that that's the equivalent of saying, you know, I'm going to I'm going to dance a bit nearer to the door because if there is a fire, um that way I'll be able to I'll be able to get out. And you know, the fire happens behind you when you're not looking. Everybody behind you piles out the door and you're stuck in the room.”

The median house price in the U.S. was approximately $200,000 in 2003, and with one million dollars you could have purchased five median houses; today a millionaire can purchase only about two houses, illustrating severe purchasing power erosion over two decades despite nominal wealth accumulation.

“In 2003, had you been a millionaire, had you had a million dollars in the bank, you could have bought five median houses in the US. It was $200,000 was the median house price. Yeah. Today you're a millionaire. You can buy two.”

The S&P 500 bottomed at 666 in March 2009; if it were still at that level today (16 years later), it would represent a complete lost decade and a half despite all the gains seen, illustrating how difficult such periods are to imagine for those who have only experienced bull markets.

“16 years ago, the S&P and the Dow Jones bottomed in March 2009. And we've all looked at the chart and we've all seen what what those markets have done since then. Imagine if they were exactly where they were. The the S&P was at 666 today, right? Everything that's happened since then, we've gone nowhere.”

Gold purchased in 2003 at $333/oz and held through 2024 at $3,333/oz was never purchased for price appreciation per se, but rather as a hedge against loss of purchasing power from inflation; the metric of success is not the nominal price but the ability to buy other assets (like stocks) with the same amount of gold even when their prices have fallen.

“Not because I thought the gold price was going to go from $333 where I first bought it to $3,333 where it is today. That wasn't my case at all. I didn't The price is irrelevant to me. But if inflation is my problem over time, this will mitigate it.”

The shift from expecting to find easy investment ideas (reading an article, buying an ETF) to actively researching and understanding specific businesses is a 'sea change' for most investors and will be psychologically and intellectually demanding, but necessary for navigating hostile markets.

“It requires work and it requires something a little bit more than than reading an article in Time magazine thinking, "Oh, what a great idea. What's the ETF that expresses that idea for me? I'm buying the ETF, right? That's worked for a long time. It's been a great way to make returns. In the world we've talked about for the last hour, that is no longer the smartest, least risky thing to do. And that's going to be a sea change for an awful lot of people.”

The geopolitical risk from India-Pakistan escalation and nuclear weapons is higher today than it was two days ago; markets are ignoring this risk because they have been trained to believe that geopolitical crises always 'get sorted out' before the end, but this assumption is not guaranteed and markets will eventually revalue once the threat materializes visibly.

“10 years ago the chance was zero of a nuclear war. I don't know what it is today. But yesterday it wasn't zero. Today with India and Pakistan phone each other it's higher still.”

NATO, which was created after World War II as an institution to make the world safer, is now being torn down with the threat of American withdrawal, demonstrating that even institutions that have persisted for 70 years are vulnerable in the current turning.

“we're seeing this institution that's that was born out of the out of the end of World War II. We're seeing it literally being torn down. We're seeing the Americans say, 'We are going to pull out.' And on the back of that, the whole thing crumbles and everyone scrambling around to try and hold it together.”

The risk-reward situation has changed fundamentally: taking large risks was appropriate when central banks had abundant room to help, but that is no longer the case, so investors must take less risk overall and be more selective about the type of risk they take.

“I think the the best advice I can give people for this is take less risk. If you want to survive this, take less risk and take smarter risk. um because the the riskreward situation has changed dramatically and it might not be obvious at the moment but it will become obvious.”

COVID stimulus primed the inflation pump and broke out into actual inflation in the economy, and despite efforts to control it, inflation is still about 50% above the Fed's target rate, indicating the underlying inflationary pressures remain.

“what's happened since CO and since all that stimulus was was injected straight into the beating heart of the system is it has it has primed the inflation pump and we and we've seen it break out and we've seen it come back down to be kind of under control, but it's still 50% above the target rate despite everything that's happened.”

Inflation is the primary long-term threat to purchasing power that investors should plan to mitigate, more so than deflation, because even if deflation occurs, government response will reignite inflation later, and the inflation pump has already been primed by post-COVID stimulus in ways it was not previously.

“It's still the thing that I fear the most. It's still the problem that I think I'm going to have to try and deal with the most. Um, and nothing I've seen in terms of the tariffs, in terms of the port blockages, in terms of all the stuff that's that's going on recently has disavowed me of this idea that inflation is going to be the thing that I need to have a plan to deal with.”

Market valuations as measured by tools like John Husman's metrics are currently at levels that historically predict flat to negative returns over the next 12 years, meaning even without considering fourth-turning risks, purely mechanical valuation analysis suggests a lost-decade scenario.

“John Husman publishes these all the time. I haven't looked at his most recent ones since the markets have have have come down a little bit, but not that much. Um, but I'm pretty confident that they're still predicting um at best a flat, if not a negative annual return for the next 12 years based upon how high valuations are right now.”

The George Walton Williams story illustrates that in major crises, wealth doesn't come from getting rich during the crisis but from being one of the few who maintains it while others lose it; Williams accepted only gold and silver during the Civil War, was no richer after the war than before, but became the richest man in Charleston because everyone else got poor, a mindset modern investors must cultivate.

“he was a gun runner, no relation. And um he he would run guns to both sides. Uh but he would only accept payment in gold and silver coins. He wouldn't accept dollars. He wouldn't accept Confederate dollars...The Civil War came. He made a load more, I'm sure, during the Civil War. Of course, the Civil War ended and the Confederate dollar went away and George Walton Williams became the richest man in Charleston. He bought all the banks. He built this massive house. Um, and he became the richest man in Charleston overnight. Not because he got rich. He wasn't any richer after the end of the Civil War than he was before it. Everybody else got poor.”

George Walton Williams, a gun runner in the 1860s, became the richest man in Charleston not because he got richer but because he accepted payment only in gold and silver (not dollars or Confederate dollars), and so when the Confederacy collapsed and currency failed, his wealth in precious metals preserved his purchasing power while everyone else's nominal wealth was destroyed.

“um he would run guns to both sides. Uh but he would only accept payment in gold and silver coins. He wouldn't accept dollars. He wouldn't accept Confederate dollars... he amassed a ton of gold and silver uh from his exploits. The Civil War came. He made a load more, I'm sure, during the Civil War. Of course, the Civil War ended and the Confederate dollar went away and George Walton Williams became the richest man in Charleston.”

Markets may continue to rise in nominal terms during the death throes of a secular bull market, but these gains are 'dying gasps' driven by momentum and fear of missing out, not by fundamental value expansion, and are often associated with wild volatility and extreme valuations.

“a lot of the things we're seeing in markets with some of the crazy explosions of of prices to the upside and multiples in a period of intense volatility very much look like the kind of dying gasps of a of a of a secular bull market where everybody is jumping into the things that are making money because they feel like well that's that's the next place to to to make big returns”

Boom and bust cycles (boom market rallies) are becoming more frequent and larger in terms of their drawdowns, making them tougher to recover from, which justifies a more defensive posture going forward.

“those boom days um are going to come more often and they will be much bigger in terms of their effect and so they'll be tougher to recover from.”

Fourth turnings are necessarily destructive because institutions become corrupted and unfit for purpose after incremental change accumulates over generations, so institutional teardown is the only mechanism available to rebuild systems that serve new populations, and this cycle is about to happen as Gen Z and millennials begin dismantling the post-WWII institutions that primarily benefited boomers.

“the fourth turning is a point in time where institutions are torn down as he said um institutions in which we've lost faith and we've lost trust and we believe are no longer fit for person are torn down I mean that is by its very definition destructive change and you know unfortunately at the end of these cycles The change has to be destructive because because the the the kind of incremental change that's happened to bring us to this point has gone through those turnings. It it it's it's been from the last tear down. It's been here's how we make things better. Here's how we make things better. And then we get to the point where the system's working. And then we get to the point where the grift and the corruption start happening”

The fourth turning framework predicts that periods of disruption can last 20–25 years, so being 'early' by 5–10 years in preparing for major change does not mean being wrong or sitting in a defensive posture the entire time; it means building frameworks and understanding risks while continuing to invest and participate, but with a different mindset than one had before.

“these cycles are long and this period of upheaval is is is both long and slow but ultimately climactic. And so you you have to be prepared ahead of time...the developments of a foreturning are exponential. They're not linear...And it's important to remember that the developments of a foreturning are exponential. They're not linear. So when you say we're halfway through the foretturning, people are like Yeah. They're like, 'Oh, if we're halfway through, then you know, this isn't so bad so far.' Well, it's like, 'Well, wait a minute. The action hasn't really started yet.'”

Investable wealth has been accumulated over 40-50 years of consistent bull market gains and central bank rescue operations; the question is not how to make the next 5x return, but how to save this accumulated wealth from extinction in the coming bear market.

“if you happen to have been invested in the stock market or the bond market or real estate or any risk asset at all, you got rich. You're a rich person now. What whatever it was you put in, you have significantly more now. And that's terrific. But if you don't change your mindset from, okay, where do I make the next 5x my money and think to yourself, boy, you know, I've had the most extraordinary tailwind that really anyone's had in a 40, 50 year period at any point in the history of investment pretty much in terms of consistent tailwinds that have bailed you out of every problem”

Trump is not the cause of the institutional disruption but rather the inevitable catalyst or agent that emerged because the structural forces demanded it; the forces of history create the leaders needed to execute necessary change, not the other way around—Trump had to be here because the system needed the disruption he can provide.

“Trump just happens to be the agent of chaos at this particular point in the cycle. This isn't all his fault. He didn't do all this. He just happens to be the guy when it all comes to a head. And and I would posit that it's not that Trump's here when this is happening. It was this was happening um and Trump had to be here. It it can only happen now Trump's here because he is the guy that that can bring the disruption that's needed to to reset the system.”

Scott Bessent's experience working with Soros and Druckenmiller during the Bank of England crisis in the early 1990s is often invoked as evidence of his ability to handle current crises, but he is a different person now than he was then (he was young and inexperienced at the time), and the experience he absorbed may not be directly applicable to current circumstances.

“he wasn't the Scott Besson of today and so you you soak that experience in and if you're smart and he clearly is you you file that away and you call on it when you need to. But I think we all do this. we all talk about what so and so did 25 30 years ago um nearly 40 years ago in this case and we imagine them today being in that situation”

The fourth turning, as defined by generational theory, is by definition destructive change because institutions have become corrupted and unfit for purpose after incremental improvements fail to address systemic decay—therefore the destruction is necessary and inevitable, not optional.

“the fourth turning is a point in time where institutions are torn down as he said um institutions in which we've lost faith and we've lost trust and we believe are no longer fit for person are torn down I mean that is by its very definition destructive change”

People mistakenly believe they can use financial market signals (yield curve inversion, credit spreads, etc.) to detect when to exit risk positions, but the real warning signs of systemic crisis will not be financial in nature—they will be geopolitical, political, and social—meaning those waiting for traditional financial smoke alarms may be trapped when the actual crisis hits.

“because we have become immersed in financial markets and we swim in financial waters looking at the world outside them you are there's a high risk that those that what you think is the smoke alarm i.e. Well, whenever I've seen the yield curve invert, it means recession. So, I'm going to keep an eye on the yield curve or or I'm going to look at credit spreads or look at whatever whatever it might be. Whatever your financial metric is, that is your smoke alarm. To my earlier point about not standing far enough back, the kind of signals that that you're going to see that scream get the hell out are not necessarily going to be financial.”

The coming institutional reforms will likely include mechanisms like housing wealth taxes or policies to cut house prices in half, which would still leave boomer homeowners far ahead of their purchase prices but would finally make homes affordable to younger generations—illustrating how wealth redistribution can happen without outright confiscation.

“think about the simple idea of cutting house prices in half. You know, let's say you're a boomer with two or three homes and the price of all of them get cut in half. You know what? you are still a long long way ahead in what you paid for that house, but now suddenly it's affordable for two new generations of of home buyers who haven't thus far been able to get on the ladder. You know, that kind of legislation is the kind of thing we're going to see.”

Scott Bessent told a story in interviews about selling a business for $10 million with the expectation that the interest income (half a million per year in 2007 at 5% treasury rates) would allow him and his wife to retire; by 2012, that same $10 million earned only $13,000 annually due to QE-driven rate suppression, forcing the couple to eat into capital and undermining their retirement plan.

“a guy came up to me afterwards, lovely guy, and we sat there chatting and he said, he said, 'You know, you you've just you've just crystallized something that I have been unable to figure out.' And and he and his wife had had a business which they'd sold and they and they they'd been building this business for years. And they always said, 'If we can ever sell this business for $10 million, that's us out. We'll be separate.' And he said, 'You know, we we did we we sold it and we're having to eat into our capital.'”

The rise of ETFs and index investing has made it easier for ordinary investors to participate in markets but has shifted mindset from business ownership to commodity trading of baskets of stocks, making portfolios more vulnerable to sentiment-driven crashes.

“it requires work and it requires something a little bit more than than reading an article in Time magazine thinking, 'Oh, what a great idea. What's the ETF that expresses that idea for me? I'm buying the ETF, right? That's worked for a long time. It's been a great way to make returns. In the world we've talked about for the last hour, that is no longer the smartest, least risky thing to do.”

Investors need to accept that 'next year won't be the same as last year' and that the 70-year viability of NATO demonstrates that nothing is permanent, even seemingly inviable institutions.

“NATO has been uh inviable for for what 70 years. Um it doesn't always next year isn't always the same as last year. That's all I'm saying. And I think we are now coming into a period where next year isn't going to be the same as last year.”

Even if structural change brings challenges, successful navigation creates opportunity; the outcome of a fourth turning is not only damage mitigation but potential to prosper if positioned correctly, as illustrated by those with dry powder and purchasing power when others are desperate.

“it's not it's not it's not all doom at all... if you navigate this well, there's a lot of opportunity on the other end, right?”

Because these structural cycles are so long and unfamiliar (a one-in-a-hundred-year event for any generation alive), living through a fourth turning is inherently confusing and disruptive because visceral memories of previous turnings are gone—knowledge of how to navigate them exists only in history books, which most people do not seek out unless they are actively curious.

“you got a one in 100 year chance to actually be living and trying to operate in the times we're in now. Um, and because of that, it means that this change is completely unfamiliar to everybody that's going through it. They haven't lived it...the visceral memories of these periods, the periods past is all gone. They live on in the stories. They live on in the history books. And of course, um, you don't have to go searching for stories from your grandparents, but you do have to go searching for stuff in history books that that's not presented to you.”

If readers/listeners are shocked, disturbed, or frightened by the conversation about fourth turnings and systemic disruption, that is actually a sign they need to engage more deeply with the topic, not dismiss it; shock indicates unfamiliarity with something important.

“if you are shell shocked by by what we've just talked about, Adam and I, for the last hour, then that's the the single biggest sign that you need to think about this stuff...If this shocks you, if it feels overly bearish to you, if it feels, you know, like like doom, um then you you you really need to spend some more time thinking about this because...If this seems dark and it seems uh desparing and it seems uh scary, that's the best sign I can give you that you need to understand it better. Because if you understand it better, it won't be that scary.”

Richard Russell, in the last year of his life (approximately 10 years ago), was discussing scenarios where people would need to preserve tangible wealth (sewing gemstones into clothing, similar to historical refugee patterns) to survive major crises and re-enter the market afterward—suggesting that even cautious investors with institutional credibility were anticipating significant systemic disruption.

“I actually have a really poor audio recording of that if you're interested, I'd be happy to send you...And he saw this type of change coming. So, this was I'm trying to remember when this was. It was about 10 years ago...And uh I mean he was he was referencing you know the the exodus of of people out of Europe you know sewing um you know precious gemstones into their clothing and whatnot right”

Valuation-based models (like John Hussman's work) are predicting flat to negative annual returns for the next 12 years based on current market valuations, independent of any fourth turning or macro cycle concerns.

“we could have had a a conversation about the uncomfortable potential for a lost decade ahead. just looking at some of the valuation charts, right? I mean, John Husman publishes these all the time... I'm pretty confident that they're still predicting um at best a flat, if not a negative annual return for the next 12 years based upon how high valuations are right now.”

Each generation repeats the cycle of parenting in reaction to their parents' generation: Boomers rebelled against their parents and raised Gen X with hard responsibility; Gen X overcompensated and became helicopter parents to Millennials; Millennials are raising Gen Z without clear responsibility structure.

“you have a generation that come out of the war, um, the baby boomer generation who were very much, you know, peace, love, the hippie generation, everything was, you know, it was all about we don't want responsibility, we want to be free generations. Yeah. you know, they raised my generation, the Gen X's, who were forced to take personal responsibility because no one was no one look after us. Our parents were all hippies and they were all out there enjoying, you know, free love and God knows what else. Um, so we had to have responsibility and and the, you know, Gen X's out there listening to this will know and and and I don't think any of us would have it any other way.”

If you're going to continue investing in financial markets without fully shifting to private business ownership, you should hedge positions defensively and make your portfolio more resilient rather than trying to profit from the downside or dance near the exit.

“I'm going to make my portfolio more resilient. And that you use that word earlier and it's absolutely the right word. I'm going to make it more defensive. If I'm going to make it more robust, I'm going to give up some of the upside to make sure that I'm robust and more secure than I have been.”

Richard Russell, a well-known market observer who died recently, was warning about potential societal disruption and currency devaluation (e.g., refugees sewing gemstones into clothing) at least 10 years ago; this suggests that the risks Grant is articulating are not new, and even astute observers were concerned about them over a decade ago.

“in the conversation and Grant, I actually have a really poor audio recording of that if you're interested, I'd be happy to send you. I'd love to hear that. Yeah. And he saw this type of change coming. So, this was I'm trying to remember when this was. It was about 10 years ago. Yeah. Yeah. 10 years ago. And uh I mean he was he was referencing you know the the exodus of of people out of Europe you know sewing um you know precious gemstones into their clothing and whatnot right”