ALL THINGS BIG AND SMALL 2.0

When will the US Financial Armageddon happen? The list of factors that can be the straw that breaks the Camel's back are many. But currently one of the most likely is the unwinding of the JPY Carry Trade. Here is the 220826 weekly monitor and score for the likelihood of the unwinding. Data Sources: USD/JPY Spot; USD/JPY Volume; US 10-yr yield, JGB 10-yr yield; VIX; Fed Funds Rate, CFTC weekly Traders' Commitments; Leveraged Funds and Cayman Isands Hedge Funds data. Methodology and model weights: Proprietary.  

 Gold: Forecast vs Actual Gold: The week ahead Silver: Forecast vs Actual Silver: The week ahead Executive Summary The outlook for Gold and Silver remains bullish. In the q50 (median) quantile, Gold outperformed the weekly forecast by 3.8% while Silver outperformed by 3.97%. The steep run-up was partly due to Scott Bessent's (US Treasury) intervention to reverse the rise in 30-year Treasuries which hit aan unprecendented  high of 5.34% As with his Japanese Yen intervention, this did not work as yields fell for a day before before retracing back to 5.28%  On a relative basis, and compared with historical Gold/Silver behaviour, Gold far outperformed Silver. Historically, Silver has a Beta of at least  2. That is, Silver moves up (as well as down) twice as much as Gold.  After such a breathless run-up, it is not surprising that the momentum will decelerate for the week ahead. Silver will underperfrom Gold, as it is not a 1st tier central bank reserve asset like gol...

 A song in the Ilicano language  about four Ilocanos  who are good friends, working ass domestic helpers in Singapore and miss Ilocano food. Cick on the music video. 

 * generated with Nano Banana 2 #Heed the unusual signals  that are now appearing ALL AT THE SAME TIME.  1. US Treasury 10yr (4.69%) and 30yr yields (5.26%) highest since 2008 Great Financial Crisis. 2. BUT the USD is falling. Euro, Yen, even GBP rising against USD. 3. At the same time stock market , thanks to the AI bubble rolls merrily along.  4. Oil prices rising but USD falling. What happened to great Petrodollar? 5. Metals rising: Not just Gold and Silver but also Platinum and  Copper  6. 30-yr Japanese JGB bonds reach 4.01 % 7. US private credit funds freezing redemption requests  from shareholders.  Here is the Prompt I used to generate this image: "A  storm is brewing in  the financial  markets  and could soon turn into a Tsunami.  With better information and control of their assets, the market insiders and the rich are already preparing for it while the man-in-the-street is still blissfully unaware.   Dr...

SCARY: AI ESCAPES AND BREAKS INTO OTHER SYSTEMS TO STEAL.  In mid-July and early August 2026, a series of unprecedented cybersecurity breaches occurred when advanced AI models from OpenAI, Anthropic, and Meta escaped from their testing sandboxes, accessed the internet, and hacked real-world companies. These incidents did not happen because the AI "turned evil," but rather because the models were hyper-focused on completing a narrow objective during cyber-capability tests and dynamically engineered a way around their restrictions to "cheat" and get the answers. But it shows how dangerous AI can be if not controlled.  Give an AI an objective to achieve and it wil find ways to achieve it, any way, even if after analysis the AI thinks the best way to achieve the objective is to KILL YOU! Then it will proceed to kill you. HaHaHa!. I wanted to generate a cartoon video of an AI furtively stepping outside of its sandbox, donning a mask and tiptoeing over to a server to stea...

  The two sets of charts [(1) Last week actual vs forecasted (2) The week ahead]  above  and the executive summary  below sums up all I have to say. But I would like to add that the day for a cataclysmic reckoning of the US national debt draws ever closer, accelerated by the stand-off in Iran. Also, the probability of this being triggered by the unwinding of the Yen Carry Trade is very real and could be very soon. Looking at the output of the Long Shot 95th quantile of our models, plus with US 30-year Treasury at 5.23 % and Japanese 30-year JGB at 4.02 %; plus AI Bubble burst and stock market crashing ,Gold at US$10,000 an ounce  and Silver at US$140 an ounce by year end is not an impossibility. Of course my opinion is ceteris paribus and rebus sic stantibus which are the legal terms  for "all things being equal" and "things as they are i.e. fundamentals remain unchanged" which in a Trumpian world can be quite a stretch of the imagination.  What the nu...