Peak Prosperity Generational Wealth Will Be Made and Lost as the Carry Trades Unwind
Jan 29, 2026
Adam Rozencwajg, investment strategist and co-founder of Goehring & Rozencwajg, offers macro-focused views on resources and commodities. He explains carry trades, how financialization favors low-volatility growth, and what could trigger a painful unwind. They trace gold as an early signal of monetary stress and explore chronic underinvestment in energy and its long-term implications.
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How Carry Regimes End
- A carry-to-anti-carry switch typically occurs when monetary policy can no longer suppress volatility, often due to rising inflation.
- Once the Fed is constrained, the system can unwind rapidly and chaotically rather than by orderly policy reversal.
Gold As The Monetary Canary
- Gold often leads as the monetary canary when monetary regimes strain, signalling loss of confidence in fiat norms.
- That signal can precede a later leadership rotation into energy and other real assets.
Derivatives Multiply Systemic Short-Vol
- Massive growth in OTC derivatives and swaps embeds large amounts of short-vol insurance into the system and raises systemic risk if big correlated shocks occur.
- The market can operate fine until a broad unwinding stresses counterparties and liquidity.