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Sell off on everything today, the indices futures are heavily down too, one of those days where everything must go!

Look out for the US Federal Reserve Minutes tonight at 7pm.

That’s not going to happen though is it? The Fed’s Deputy Chair (Clarida) said tonight that they are nowhere near the end of tapering asset purchases (USD$120b a month in treasury and mortgage securities), let alone raising interest rates. In fact nowhere in the Federal Reserve System are any of the Presidents or Governors even remotely suggesting that?

https://www.bloombergquint.com/business/gold-advances-as-investors-weigh-bond-yields-retail-sales

US 10 Year slightly up and the US Dollar Index slightly down, but negligible in both and we are still enjoying a 1%+ rally in AUX, bodes very well if we get a meaningful slump in either!

Look out for the US Federal Reserve Minutes this Wednesday, sooner or later they will signal a shift from buying shorter term maturity treasuries at a clip of USD$120 a month to more medium and longer term ones (10s and 30s) IMO.

And if / when that happens you’ll see AUX rocket IMO as the real long term negative performance on Bonds becomes clear.

Yes, and bounced again this morning, interesting staying power this time round in the face of a rising dollar and US backed debt. Of course, it’s the long shadow of inflation that’s keeping it like that.

Agree, interesting statement and interesting the two previous appointments from a “geology” standpoint. Starting to think New Luika will be much bigger than we think.

Yes, everything is caught in a bit of a downdraught at the moment and everything is going south with it.

Let’s see what tomorrow brings when the dust settles.

I think that’s about right. What is happening is certainly counterintuitive, why anyone in an inflationary environment would be buying long term US Treasuries when they are from Day 1 seriously underwater in terms of a negative real yields is beyond me, it just shows you how hard wired investors are to buying US Dollars and Debt when they get bad news, even though that bad news in itself should be ringing alarm bells on the very US backed products they are buying and are in fact losing money on from Day Dot!

What is happening is straight out of the US Treasury / US Federal Reserve playbook Post WW2 in the US, they got rid of those debts by averaging 6% Inflation for about 7 years in order to get control of it’s Debt to GDP Ratios, that is what will happen now also, of course the US at that point had a <5% retirement population and no Social Welfare System, how that works when the US now has a >15% retirement population and a massive Social Welfare System and multi-trillion dollar budget deficits as far as the eye can see is anyone’s guess.

Short term they may get away with it, long term this gets messy.

Yes, multi-year high read outs on both the Core (CPI) and Non-Core (PPI) Inflation readings, if this “bleeds” wholesale into wages on labour shortages (it is in my field of employment) you can expect multi-decade highs in terms of Core and Non-Core US Inflation before the summer is out. The US Federal Reserve and the Financial Establishment will claim it’s all transitory, because if they were to do otherwise there would be a financial calamity in the US Dollar, US Debt and the Stock Market and the global financial system would follow suit.

Tomorrow at 1:30pm BST. Judging by the wild swings in the markets today, it should be interesting if the numbers come in “hot”.

Freudian slip :-)

Just wait till inflation really starts to sink it’s teeth into the US Economy and the Greenback and the 10 / 30 Year US Treasury go into massive negative yield when inflation is stripped out.

The Fed is now clearly keeping the long maturities (10Y and 30Y) anchored in their current levels to keep Biden’s spending plans / debt repayments credible , when the levy breaks and the market at large realises this, it will be fun to be holding SHG.

Going back to the appointment of the Group Exploration Manager RNS of 5 January this year and his comments about the possibility of New Luika’s orebodies being linked to the one larger single hydrothermal cell and the subsequent Exploration Update of 19 April with larger encountered grades, what is the possibility going forward with seriously increasing our Gold Resources / Grades here? Is this one of these instances where you start to spend the cash on drilling and you realise you have something far bigger than you ever thought you did?

“The deposit depicts relatively higher-grade westerly plunging shoots which have potential to host significant economic mineralization and will be the target of forthcoming phases of exploration drilling.”

Wets the lips for what could come based on the last grades posted on 19 April.

https://asiatimes.com/2021/04/us-inflation-indicators-flashing-red-alarm/

If these numbers are accurate, IMO I think they will be an undershoot, this will herald a return to Inflation not seen since the early 80s in the US and with it a correlation to the 70s and 80s Gold Prices vs Inflation of the same era which saw gold prices multiply.

Everything is approaching multi-year highs in terms of commodity prices, wheat and corn at 9 year highs (arab spring), soybean prices at all-time highs, US housing sales at their best pace since 2006 (cough), lumber, steel and building product prices are rocketing, Trillions more getting launched into the system, we aren’t far away from an inflection point on inflation IMHO.

And we all know at that point there is nowhere for Central Banks to run on interest rates, it will be serious inflation and that will just be the way it is.

The macro and micro picture here looks phenomenal.

This moved quickly, physical gold sales in India rocketing, it will be interesting to see what carnage is left in India after Covid and if this speeds up / decreases gold demand in India. If it leaves them with higher inflation, which I think it may, then you could be looking at high sky physical sales there as a hedge:

https://www.bloomberg.com/news/articles/2021-04-22/india-s-massive-gold-imports-shows-asian-consumer-demand-returns

Been a while. Been topping up after yesterday’s and today’s news. I’ll be very surprised if this isn’t at least in the high 20’s pence by the end of summer, in fact I’m surprised we aren’t there now.

Everything seems to be going our way, new Tanzanian President, Gold Price, inflation outlook, future production, increased reserves and resources, just wait till WK really gets going.

If you think the US Greenback will eventually plunge like I do and inflation will run wild, it doesn’t get much better than SHG.

BTTB,

I know nothing of technical analysis, but I expect a further correction in AUX downwards, to where, I don’t know, but it could be sharp.

The key for any AUX recovery in time will be what the US Federal Reserve does, they can’t let long term dated treasury yields (on the 10 and 30 year) rise too much further or they face an existential crisis on debt repayment at a time when they are borrowing USD$4 Trillion this coming financial year (Congress getting ready to slam Biden’s stimulus through) and they have to roll over some USD$8 Trillion of existing debt in 2021 and 2022. Worth remembering the average maturity on all of the USD$27 Trillion debt held is only 4.5 years long.

If the economy does considerably better in the US in the early Spring, the markets will force the Fed’s hand into crush the yield on the 10 and 30 year, because there is simply no other choice, and that point Inflation will be left to rise and everyone will know the Fed will do nothing about it.

Being taken out for a spin dry on the back of surging yields in the US 10 and 30 year dated treasuries.

It begs the question, how long can the US Federal Reserve let US 10 and 30 year dated treasuries continue to burn higher when you are borrowing USD$3/4 trillion a year and the CBO predicts (and this is the rosy picture) USD$1+ trillion annual budget deficits for infinity? At 2% on the 10 year and 4% on the 30 year they’ll get pretty close to the interest downing them…

Gold probably in for a few rough weeks while this settles down.

Sorry, 2 Billion ounces traded, that is double the yearly production of Silver mined on earth in a whole year, traded in one day!