GOLD/SILVER WEEKLY UPDATE 05 0826

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This week, I won't bother you with tables and analysis that nobody understands. Just 1 table and I explain it like this:

You have a probabilistic forecast for gold, and silver, 20 days ahead and 60 days ahead. q10 is akin to losing money e.g. Nvidia went down in the stock market. q90 is like striking 4-D. q95 is like striking Toto. My opinion: q90 is likely within 60 days. And q95 is not impossible. Why I say this: (1) Modern financial markets are mostly traded by automated algorithms driven by momentum. My GBDT model captures this characteristic. (2) I think the unwinding of the Japanese Carry Trade has a high probability of happening soon. With Japanese corporations (including insurance companies, banls, blue chips) and even the giant Japanese pension funds selling their USD assets and repatriating the money to buy JGB bonds with attractive yields. To the Japanese this is also the right thing to do, to be patriotic. (3) Scott Bessant will side-step Kevin Warsh by buying back longer-date Treasuries by issuing short term 1-month to 6-month bills and notes. In fact he already did that yesterday 4 Sep  which was not announced. $12 billion . Not $4b wgich was supposed to start only on 9 Sep. (4) Money will have to be printed. Lots and lots of it to keep the US economy running. The USD will fall as proxied by the DXY Index.. So will other fiat currenices like the EUR, and the GBP.  Gold and Silver will rise (4) Not only will Kevin Warsh not raise rates on 16 Sep. He will be printing lots of money for 'liquidity management, a euphemism for quantitative easing.

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