ALL THINGS BIG AND SMALL 2.0

There are nascent signals that the worst for over for gold/silver, and a base is being built that should take gold and silver much higher from now to April 2027. The most important  driver is the Hong Kong Gold Exchange event which will take place in in 1Q 2027. Please read about it at https://ngtiankhean.blogspot.com/2026/11/1st-quarter-2027-seismic-event-for-gold.html. It is really important The 'which barrier breaks first chart ' show that the most likely variable to break will be the S&P500, followed by KRE, the index for small regional US banks whose balance sheets are not as resilient as the big banks'. When people can't pay their credit card bills, car loans and mortgages, the small banks are very vulnerable. The S&P500 is most likely to break because of high exposure to AI, semiconductor and data centre stocks. As compared to last week, the probability of nothing breaks within 12 months has now declined from 40% to 33%. Or to put it another way, the prob...

In Q1 2027 Hong Kong plans to complete the core of a new international gold market. Trading, central clearing, settlement, vaulting, insurance, delivery, hedging and refining will sit in one jurisdiction, all built around actual physical delivery. For the first time, the fast-growing economies of Asia and the Global South will have a credible venue for setting the gold price outside New York (Comex futures) and London (LBMA Cash-settled OTC )  It arrives just as many of them are trying to reduce their reliance on the US dollar and on US Treasuries. WHY IT MATTERS: DE-DOLLARISATION AND US TREASURIES  A globally accessible market built on physical delivery competes directly with today’s structure, where prices are set mostly by paper contracts that are only fractionally backed by metal. Rising US debt and the global drift towards non-dollar settlement put pressure on US Treasuries’ standing as the top-tier central-bank reserve asset. To protect that standing, Washington may need...

Gold is priced in USD. But the chart below shows gold price  rise is  not just against the USD but against all major fiat currencies.. In other words, paper money which monetary authorities can print with a tap on the computer keyboard is getting increasingly worthless. Therefore its a good reason to have gold as a hedge against inflation and as a safe store of value. The chart below shows gold has risen most against the INR, PHP and IDR.  I don't have sufficient knowledege of the reasons for the structural weaknesses of the Indian, Indonesian and Philippines economy but  this new era of (1) extremely high sovereign debt levels in the US, EU and Japan (2) war in the middle east leading to crude oil and natural gas shortages leading to high prices in energy and  commodities. (3) a deeply polarized and unpredictable USA (4) natural disasters from a Super El Nino.  All these factors make gold (and silver, its much cheaper but more volatile  sister preciou...

The chart below shows the sectors of the US financial markets that our model has identified as more likely to break down:  1. S&P500: the stock market 2. KRE: the index of US small/regional banks 3. HY OAS: the option adjusted spread for high yield/junk corporate bonds. 4. USD/JPY currency cross The probability that none of the four will break down within 3 months is 92.9 % as of 31 Oct 2026 . However, the probabilty that none of the four will break down within 12 months  drops to 40%. Now we have the mid-term election on 3 Nov, Scott Bessent's Treasury re-funding estimates on 4 Nov, possible good/bad news on US-Iran war after the mid-term elections.  All this can drastically reduce the probability of none of the four breaking down within 3 months. Come back on 7 November to see.  --------------------------------------------------------------------- Real yields as meaured by TIPS is still positive but falling rapidly. See chart. What will be the impact on gold an...

China's history show periods of 200-400 years when China was united under a ruling dynasty (although some dynasties such a Qin and Sui lasted less than 50 years) But interspersed between these  dynastic periods were the periods when war and famine ruled the land with China breaking up into small states and kingdoms controlled by warlords and even non-Han Chinese rulers. Examples: Spring and Autumn Period, Warring States Period,  Three Kingdoms Period, 5 Dynasties and 10 Kingdoms Period and so on.  For those interested in China's history these intervening periods can be very confusing. Particularly when all these small states and kingdoms try to inherit legitimacy by adopting the names of past glorious dynasties. So you get Western Xia, Later Tang, Later Liang, Eastern Jin and many others.  The two full-color .png in the form of a table   shows the dynasties and  intervening periods with information on the years they existed, the Founder of the dynastie...

Silver is extremely volatile. But there is an arguable case for having a small amount of Silver in your Gold portfolio to enhance its financial performance. (all numbers in USD) 1. The correlation of Silver with Gold is always positive, never negative. In other words when Gold goes up, Silver follows. Historically, R ranges from 0.5 to 0.8 2. Silver has a Beta of 1.2 to 1.6 against Gold. i.e. theoretically when Gold goes up by 1.00 Silver goes up by 1.20 to 1.60. 3. Silver’s reward/risk ratio (RRR). Its no use to apply statistical RRR like Sharpe or Sortino as Silver will be penalized for its volatility. But here,  here we are actually exploiting Silver’s volatility for our objective. 4. A common-sense way to estimate RRR for Silver is to take 50.00 as the downside (Silver has been above 50.00 since it broke through this level on 9 October 2025- that’s 55 weeks.) For upside we take the January 2026 all-time high of 120.00. So, the RRR is 120/50=240% 5. The affordability f...