The Alchemist's Ledger — September 2026
September 2026 — Issue No. 2
A monthly Distillation.
Read this first. The Alchemist's Ledger is published for entertainment purposes only. We do not provide investment advice, and nothing in this letter is a recommendation to buy or sell anything. We are dealers. Alchemy Trading Co. trades in every category covered here and holds positions in most of them. We publish our thinking after we've acted on it, not before. Do your own work.
Scoring Last Month
We said we'd put the calls in writing so they could be scored later. Here's the scoring.
Crypto was right, and early. We said start a DCA into a market nobody wanted. We quoted Bitcoin near $63,000 and XRP at about a dollar. Within two weeks XRP was $1.70. Bitcoin ran back over $81,000. We thought that would take months. It took days. Being right early is still being right, but it cost anyone who was waiting around for a better entry.
Metals were right on direction and wrong on timing. We said silver pushes through $80 and fails. Silver never got near $80. It went the other way, down to $63 on the 14th, and it's $64.64 as of this writing. Gold is $4,348, about where we left it. The spike we described hasn't happened. Metals didn't break down either. They went flat and started basing.
Put those together and we had the rotation backwards on the clock. We said it was crypto's turn while metals spent a long time digesting. What actually happened is crypto took its turn immediately and is already cooling, and metals look like they're finishing a base rather than starting a multi-year one. The direction of both calls is intact. The sequence got compressed into about four weeks instead of a year.
On diamonds, the floor call is holding. We're changing how we cover that category, and we'll get to it.
The Print
August CPI came in at 3.4% year over year, same as July. Core was 2.4%. On paper that reads like inflation that's stalled out but stayed contained.
That print doesn't describe what's happening to the consumer.
CPI lags. It's a backward-looking average and it isn't capturing the two things actually squeezing household budgets, which are fuel and tariffs. Gasoline was up 3.9% on the month and 27.4% on the year. Here in Washington, 87 octane is averaging $5.44 and diesel is $6.61. That's the state average, not the bad corners. None of that is sustainable for a household, and none of it has finished working its way into the price of everything that has to be trucked somewhere.
The Strait of Hormuz has been closed for more than six months. Oil is above $100 and it finally lost some steam on the Fed print, which is the first encouraging thing on that front in a while. The market needs that move to keep slowing. If it doesn't, the pain lands on a consumer who's already stretched, and it lands late, which means it shows up in the data after it's already done the damage.
What the Fed Is Actually Watching
The Fed hiked on the 16th. A quarter point, to 3.75% to 4%, unanimous at 12 to 0, the first increase since July 2023. Warsh said inflation is too high and has been for too long. The projections carry one more hike this year and another in 2027, and 16 of 18 officials say they aren't done.
Our read is that the Fed has stopped following CPI. It's following the Treasury market and the price of energy.
Look at what happened in the same two weeks. Treasury announced it was increasing its long-end buybacks starting September 9, up to $6 billion, specifically to take pressure off borrowing costs. Yields rose anyway. The 10-year touched 5.04% on Tuesday, the highest since 2007. Mortgages followed it up. Freddie Mac had the 30-year at 6.76% for the week ending September 10, up from 6.71% the week before and 6.35% a year ago.
So the Treasury moved to support its own paper and the market ignored it. When a government starts buying its own debt to hold its borrowing costs down and the debt keeps selling off anyway, history doesn't offer many encouraging examples of what happens to the currency next. It isn't good for housing either. That market was already stale. Add a 5% ten-year and you get fewer transactions and worse affordability without much give in prices.
Our hypothesis hasn't changed. Continued inflation, continued destabilization of the government's finances and eventually the wider economy, and a rise in precious metals and hard assets out the other side of it.
Over the next five years we think metals outpace everything. The only thing we think might beat them is crypto.
Metals
Gold is $4,348. Silver is $64.64. Platinum is $1,794. The gold-silver ratio is sitting around 67.
Both metals have gone roughly nowhere since we last wrote, and the way they went nowhere is the interesting part. They took a hike from a hawkish Fed and neither one was down a full percent on the day. Since then silver is up better than 4% and gold about 2%. Gold also printed a six-week low near $4,263 on the 15th and took it straight back.
An asset that's genuinely vulnerable to policy puts in its worst print on the day of the announcement. These didn't. They absorbed it and turned up.
That's basing. It doesn't make for good headlines and it's boring to sit through, but it's what the end of a consolidation looks like from the inside.
Our position from August stands. If you were planning to sell, higher prices are probably coming and you don't need to be in a hurry. On the long horizon we still think silver trades in three digits and gold gets near $10,000.
Crypto
Bitcoin is $76,424. Ethereum is $2,452. XRP is $1.30.
Crypto pumped within days of our last letter. XRP went from about a dollar to $1.70. It's given back 40 cents of that since. Bitcoin ran over $81,000 and has come back to $76,000.
The cooling has a cause. The Senate voted down the CLARITY Act on the 15th, 49 to 50. That bill was the milestone this market has been waiting on, real regulatory clarity, and with it the possibility of banks engaging directly rather than at arm's length. It died over insider trading rules for federal officials and a disagreement about how stablecoin yield gets treated.
Plenty of people will look at that vote and say crypto is a dead market. We look at it and hear the insiders saying "not yet."
Think about what a bottom has to do to be useful to a large buyer. It has to last. Size can't be built in a week. If price runs away the moment the good news lands, institutions never get filled and end up chasing. A delay in legislation keeps prices suppressed for exactly as long as that capital needs to get placed. We think this is a manipulation to keep prices low for accumulation, and we think it's a favor to anyone with patience.
A clear bottom is forming in some of the ISO 20022 names. Those are the ones built to speak the messaging standard the banking system is actually moving toward, and that's a thesis that gets paid when the legislation passes rather than if.
What we wrote in August about AI hasn't changed and it's still the piece nobody prices. Traditional banking rails are too slow and too human-shaped for what agentic software needs to do. That isn't an opinion about crypto, it's an observation about settlement windows and who has to click approve.
So the call for a rise was correct and it arrived sooner than we expected. What we see now is a cooling off, with accumulation available in October and possibly November. Closer to the lows would be better. Legislation is the driver from here.
Gemstones
We're changing how we cover this category and we'd rather explain it than do it quietly.
In August we published per-carat reference ranges for colored stones and leaned on index numbers for diamonds. We're walking that back. We won't be publishing price guidance on colored stones or diamonds going forward.
Two reasons. The first is conflict of interest. We trade this material. A dealer publishing price ranges for the things he buys and sells has his thumb on the scale whether he intends it or not, and there's no public index to check him against. Metals have spot. Diamonds have something like an index. Colored stones have auction records and opinions, which we said ourselves last month.
The second is that the numbers weren't good enough to print. Two stones of the same origin, same color, same treatment and same size can be worth wildly different money. We flagged that in August and then published ranges anyway. Those ranges were honest and they were still misleading, because a range without the stone in your hand isn't information.
From here you'll get direction and relative performance from us. What's moving, what's stuck, where the interest is going. No numbers.
On that basis, here's the month.
Spinel is picking up steam. Interest is growing in stones over a carat, including material carrying more greywash than this market would have taken a year ago. Buyers reaching for the less perfect examples is usually what early strength in a category looks like.
Tourmaline is split. Anything that isn't top quality is struggling. Strong, good-clarity blues, teals, pinks and bicolors are holding up fine.
Commercial material in general had a down to sideways month against last month. There's a lack of heat in the market and we suspect that's seasonal rather than structural.
Fine quality continues to do well, with one wrinkle. Margins across the trade are compressing, because capital is hunting for material it can actually sell and it's willing to pay up to find it.
On diamonds, demand and marketing keep growing. We'll say plainly that this is a category where we don't currently hold a position, so take our view as an outsider's. Our August call that natural is finding a floor is holding up, and it's holding from the small end of the size range rather than the top, which is not the way we said it would happen.
Rare Coins
Nothing has changed in the structure and we still like it. Supply is finite, the collector base is aging and keeps feeding estates into the market, and sourcing on good material stays tight.
Fall and winter are the strong season in this trade. That isn't a prediction, it's a pattern, and it's lining up with a market that already has demand behind it.
The August argument still applies. If metals spend time basing, a coin priced on metal content is dead money while a coin priced on rarity keeps working.
Bank Notes
We don't have anything new this month. What we wrote in August stands. Good material, cheap next to comparable rarity in coins, and thin below the census level.
What We Expect in October
We'll label these by how strongly we hold them so you can weigh them properly.
Strong conviction. Metals continue to rally.
Strong conviction. Crypto keeps cooling off. If it gets back near the lows, that's a buying opportunity.
Strong conviction. Rare coin demand continues, with the fall and winter season behind it.
Light conviction, and mostly a guess. Commercial colored stones rebound.
We also expect higher interest rates, and high energy costs continuing to get baked into the price of consumer goods. Broadly, we think this is a calm fall setting up a quiet and possibly rough winter.
The next CPI print is October 14. That's what scores this letter.
Spot figures as of publication, September 17, 2026. We put them in writing so these calls can be scored later.
The Alchemist's Ledger is published monthly by Alchemy Trading Co. for entertainment purposes only. We do not provide investment advice and nothing here is a recommendation to buy or sell any asset. We are dealers, we hold what we cover, and we say so at the top of every issue. Verify independently, buy certified, and take delivery.