"Chaos" Is Coming In 2026, Says Gold Guru Who Returned 174% In 2025
"The Big Print" is on its way.
Friend of Fringe Finance Lawrence Lepard released his most recent investor letter this week, wrapping up 2025 where his fund was up more than 170%.
Larry gets little coverage in the mainstream media, which, in my opinion, makes him someone worth listening to twice as closely. He is part of a small cohort that has been deadass right on gold and silver over the last few years and was able to see this stratospheric move in metals ahead of time.
Larry was kind enough to allow me to share his thoughts heading into 2026. His letter has been edited slightly for brevity and for visuals.
QUARTERLY OVERVIEW
The fourth quarter was a great quarter as gold and silver bullion increased 12% and 54%, respectively. Interestingly, while gold and silver miners were also up in Q4, the miners still have not taken off as gold miners were only up “in-line” with the gold bullion move and the silver miners were up only one third of the silver bullion price. Typically, the miners leverage the underlying metal price increases, often by 2–3x percentage wise.
While our Fund’s performance was good, what excites us is these miners should outperform going forward as markets get used to seeing many “beat and raise” earnings and cash flow announcements in the coming quarters given the bullion price increase. The skepticism is a good thing because the market does not believe the higher metals prices will last. Classic climbing a wall of worry behavior.
In our opinion, what is occurring is that investors do not believe that these higher metals prices are sustainable. When we combine that with the fact that all the stocks have gone vertical in the past year, investors are afraid to chase the miners or to buy them. As we will show in this letter, we believe the metals are going much higher and that at some point the miners will reprice and catch up.
Silver was the big story as it was up 54% in Q4. We’ve discussed silver a lot over the past few years and pointed out the supply demand mismatch. We believed it would eventually matter. Well, finally in late 2025, the world realized there are global shortages of silver and the paper market for silver (futures contracts) has been faced with unprecedented demands for delivery. More on that later.
The most notable thing about 2025 is how the precious metals miners stock performance absolutely crushed the S&P and the Nasdaq which were up 18% and 21%, respectively. A very good year by most measures, but pitiful when compared to the gold and silver mining indices which were all up 150%+. Investors who are aware of this have to be asking their brokers: do we own any gold mining stocks?
What we see is a change in stock leadership. From 2001–2011, gold bullion grew at a CAGR of 20.7%/year on average, while the S&P was essentially FLAT for that entire 10-year period. The same thing is happening again as people abandon the frenzied NASDAQ stocks in favor of sound money assets.
WHAT A YEAR FOR GOLD & SILVER
In last years’ Q4 2025 letter, we pointed out the following two quotes which foreshadowed what we’ve experienced in the past year:
“I think we are in a long-term bull market for gold. We’re seeing reserve accumulation by central banks. I follow it closely. It is my biggest position. Even I was surprised when the central bank of Poland said they want to take their gold reserves to 20%.”
— Scott Bessent, Secretary Nominee, U.S. Treasury, 11/2/24“I believe there will likely be a pending [sovereign] debt money problem....I want to steer away from from debt assets like bonds and debt, and have some hard money like gold and bitcoin.....it is impossible for these [major] countries to be able to not have a debt crisis in the years ahead that will lead to a great decline of [money] value.”
— Ray Dalio, Bridgewater, 12/10/24
Bessent and Dalio were prophetic. Well beyond just Poland’s Central Bank jumped on the Bullion accumulation train, and so did many western investors who finally followed the BRICS nations. And our current situation is a far cry from past headlines like this from 10 years ago.
By the way, that 2015 WSJ headline occurred with the gold price at $1,134 just a few months before it bottomed at $1,071 later that year. It aged in the same way as the famous Is Inflation Dead? 2019 magazine cover which came out one year before COVID carried inflation to 9%.
FEDERAL RESERVE WATCH: TRAPPED
The fourth quarter was very historic in one important respect: the money printer got turned on once again.
Recall in May of 2022, the Fed announced that it would begin quantitative tightening in an attempt to control inflation and soak up all the Covid stimulus’ excess liquidity. They began this tightening with balance sheet reductions of $47.5 Billion per month and ramped it up to $95 Billion per month soon thereafter.
This helped to shrink the Federal Reserve Balance Sheet and, for a while, the Money Supply (M2) in order to reduce inflation from its peak of 9%. Isn’t it interesting that the printer got turned back on in December 2025 and yet gold was strong throughout the year, particularly in September when it became clear that DOGE had failed and deficits would persist?
We have often said that gold is really good at sniffing out future monetary debasement.
The following chart by our friend, Dan Oliver does a nice job of showing the path of the Fed’s Balance Sheet which is a good proxy for bank reserve growth which, in turn, then drives global liquidity and M2 growth.
Note the last two Big Prints occurred in 2008 and 2020. Also note how they compare to the lighter colored line which shows an exponential growth curve.