The FED speaks:

THE 25-BASIS-POINT HIKE IS NOT THE STORY

The Federal Reserve has raised interest rates by 0.25 percentage point, taking the federal-funds target range to 3.75%–4.00%.

The immediate effect is largely psychological. Markets react to the headline, algorithms react to the headline, commentators react to the headline, then we discover that the real questions are somewhere else.

• The Fed controls the short end of the interest-rate curve.

• The market controls the long end, which is where we should be looking.

What happens to the 10-year Treasury yield? What happens to Treasury auction demand? Which foreign countries increase their Treasury holdings, which reduce them, and which simply hold steady? How much Treasury debt can be absorbed without continually increasing the yield demanded by investors? How large do Treasury buybacks become? What happens to oil and diesel prices? What happens to the dollar? What happens to bank credit, liquidity and refinancing costs?

Those are the questions that matter.

The 25-basis-point increase is, in my view, largely palliative if the underlying fiscal problem remains untouched.

The elephant in the room is spending

The United States continues to run an enormous fiscal deficit.

The Congressional Budget Office estimated that the federal deficit had already reached approximately $2.0 trillion during the first 11 months of fiscal year 2026. The Treasury is continuing to borrow on an extraordinary scale.

Its latest estimates call for approximately $739 billion of privately held net marketable borrowing during July–September, followed by another $628 billion during October–December. That is approximately $1.37 trillion in two quarters.

So we have a rather peculiar situation. The Fed raises the cost of short-term money while the government continues to require enormous quantities of borrowed money. That creates a conflict. The government needs the bond market to absorb huge amounts of Treasury issuance. But if investors demand materially higher yields to absorb that supply, the cost of servicing the existing debt rises.

Higher yields then feed into mortgages, corporate borrowing, commercial real estate, consumer credit and equity valuations. Eventually the higher cost of money feeds back into the Treasury itself.

Watch the 10-year Treasury

This is why I am much more interested in the 10-year Treasury yield than the 0.25% increase in the Fed funds rate. The 10-year yield recently approached and briefly exceeded 5%, while the 30-year Treasury yield moved above 5.3%. That is significant.

A central bank can dictate the overnight rate. It cannot simply dictate the price at which the world is willing to finance the United States for ten or thirty years. That price is determined by the interaction of:

Supply, demand, inflation expectations, fiscal credibility, foreign demand, and term premium.

The Treasury itself is now intervening more actively in the long end of the market.

Treasury has increased the size of its long-duration liquidity-support buybacks, with operations in the 10–20-year and 20–30-year sectors increasing to at least $4 billion per operation.

But here is the problem:

Buybacks can influence the market. They cannot make the underlying debt disappear. They can alter the composition and liquidity of Treasury securities. They cannot eliminate the fiscal deficit.

And then there is foreign demand

This is another number I will be watching closely. Foreign investors are enormously important to the Treasury market.

The latest Treasury TIC data showed $83.7 billion of net foreign capital inflow in July, including $44.4 billion of net purchases of long-term U.S. securities by foreign official institutions.

That is supportive. But the important question isn’t what happened in one month. It is what happens over time.

Are foreign central banks increasing their Treasury exposure? Are they maintaining it? Or are they gradually diversifying toward other assets, including gold and some silver?

The answer will tell us considerably more about the changing architecture of the international monetary system than another quarter-point movement in the Fed funds rate.

Tariffs are another piece of the puzzle

Tariffs are effectively a transfer mechanism. Money that would otherwise remain with consumers or businesses is collected by the government. At the same time, tariffs can increase the cost of imported goods and intermediate inputs.

Then come the second-order effects:

higher input costs contribute to higher production costs. Higher transportation costs lead to higher consumer prices. Add energy costs, wages, supply constraints and shortages, and we have a very different inflationary environment from the one implied by simply looking at the headline policy rate.

The Fed can raise the overnight rate. It cannot manufacture oil. It cannot manufacture diesel. It cannot eliminate tariffs. It cannot create additional physical goods.

What happens to the dollar?

This is where I think gold and silver become particularly interesting. The dollar can remain relatively stable against the euro, yen or pound even while losing purchasing power.

Why? Because those currencies are themselves backed by heavily indebted economies. Relative FX performance does not necessarily tell us whether currencies are preserving purchasing power.

Gold provides a different measuring stick.

If the dollar buys fewer ounces of gold over time, the market is telling us something about the purchasing power of the currency that conventional foreign-exchange charts can obscure. The same applies to silver.

Gold and silver are not somebody else’s liability.

A Treasury bond is. A bank deposit is. A currency note ultimately represents a claim on the monetary system. Physical gold and silver do not require another party to remain solvent in order to exist.

This is why I continue to watch liquidity

The critical transmission mechanism is credit. If banks continue lending and liquidity remains abundant, financial assets can continue to rise even while consumer prices remain elevated.

That is one reason I would not automatically expect inflation to produce an immediate collapse in equity prices. Nominal asset prices can rise because the currency in which those assets are measured is losing purchasing power.

Stocks can therefore appreciate in nominal terms while providing considerably less real purchasing-power protection than the headline index suggests.

This is particularly relevant if inflationary pressures come from:

• tariffs
• energy
• transportation
• wages
• supply shortages
• infrastructure costs
• and continued fiscal expansion

I don’t expect fiscal restraint to arrive quickly

The obvious question is:

Why aren’t we seeing serious measures to reduce spending?

That is the fundamental issue. A 25-basis-point rate increase doesn’t solve a multi-trillion-dollar fiscal deficit. Nor does a Treasury buyback. Nor does moving debt from one maturity bucket to another.

Those measures can influence market mechanics. They do not solve the underlying arithmetic. With the midterm elections approaching, I would be particularly cautious about assuming that policymakers will voluntarily take measures that cause a significant and immediate contraction in economic activity.

The market will tell us whether that assumption is correct.

What does this mean for precious metals?

This is where my thinking remains unchanged. I don’t need gold to rise every day. I don’t need silver to rise every day. I expect substantial corrections along the way. What matters to me is the direction of the underlying monetary architecture.

If government debt continues expanding. If fiscal deficits remain enormous. If the Treasury continues issuing massive quantities of debt. If tariffs and energy costs remain inflationary. If liquidity remains substantial and if central banks continue accumulating physical gold, then the long-term monetary argument for physical precious metals remains intact.

The price can correct while the thesis remains intact.

Mining stocks: greater potential, greater risk

As precious metals move into what I believe could become another phase of monetary revaluation, mining shares have the potential to provide greater percentage exposure to changes in the underlying metal price. But leverage works both ways. The same operating leverage that can make a profitable mine highly attractive when gold rises can work violently in reverse when gold falls. There are therefore several risks that need to be considered.

1. Beta and operating leverage

Mining companies can behave like leveraged plays on the metal price.

A relatively small change in the underlying commodity price can produce a disproportionately large change in a miner’s profitability, in either direction.

2. The cost curve

Higher gold and silver prices do not necessarily translate directly into higher margins. Mining companies face rising costs for:

• labour
• diesel
• electricity
• explosives
• equipment
• transportation
• steel
• reagents
• and other inputs

Inflation can therefore eat into the benefit of higher metal prices.

3. Resource depletion

A mine is fundamentally a depleting asset. The ore body diminishes over time, and the quality of the remaining ore can decline. Replacing depleted reserves requires additional exploration and capital.

4. Dilution

Junior miners frequently have little or no meaningful revenue during development. They need capital to fund exploration, permitting, feasibility studies, construction and mine development. That capital often comes through the issuance of additional shares.

The investor can therefore be correct about the underlying resource and still suffer substantial dilution.

5. Weather

Mining is a physical business.

Heavy rain, flooding, extreme temperatures, storms and other weather events can interrupt production or damage infrastructure.

6. Labour

Strikes, wage disputes and shortages of skilled workers can interrupt production and increase costs.

7. Accidents

Mining remains inherently hazardous.

A serious accident can stop production, damage equipment, create regulatory consequences and generate substantial additional costs.

8. Courts and communities

Mining companies don’t operate in a vacuum.

Local communities, indigenous groups, environmental organizations and courts can delay or prevent projects from proceeding.

9. Governments and permits

Mining is particularly exposed to political and regulatory risk.

Governments can delay permits, impose additional conditions, increase royalties or taxes, restrict exports, or in extreme circumstances revoke or suspend operating rights.

Physical metal remains the foundation

For all of these reasons, I see mining shares and physical metal as different instruments, not substitutes.

A mining share represents ownership in a company operating a business. That business has management risk, geological risk, political risk, financing risk, operating risk and dilution risk.

Physical gold has none of those corporate risks. It simply exists.

That is why I would never regard mining shares as a replacement for physical bullion.

The stocks may offer greater upside during a strong precious-metals revaluation.

They can also fall much faster when sentiment turns.

Leverage is a two-edged sword.

So what are we watching now?

Not the 25 basis points.

We are watching:

• The 10-year Treasury yield

• The 30-year Treasury yield

• Treasury auction bid-to-cover ratios and indirect bidding

• Foreign Treasury holdings

• Treasury buyback volumes

• Bank credit creation

• Liquidity and money-market conditions

• Oil and diesel.

• The dollar measured against gold and silver

• Central-bank gold purchases

• Physical premiums and availability

And above all:

whether the fiscal trajectory changes.

Because if the spending continues, the borrowing continues. If the borrowing continues, the debt continues.

If the debt continues to expand faster than the productive economy can comfortably support, the temptation to manage the problem through monetary and financial engineering becomes greater.

That is the environment in which I want to own some assets that are not somebody else’s promise to pay.

So for now, I am happy to watch patiently.

The market will tell us when we need to act.

And when it does, I would rather be holding the physical metal than merely holding a promise that says I own it.

PLATINUM

SELL: On the Daily chart (29 August 2026).

URANIUM

SELL (29 August 2026) URA. 

BITCOIN AND GOLD

Gold outperforms Bitcoin  (09 September 2026).  17.84 One ounce gold coins buys one bitcoin, this was over 41 ounces August 2025.

ETHUSD: SELL: ( 29 August 2026)

BTCUSD: SELL: 29 August 2026.  NASDAQ (Cyan).

GOLD AND SILVER STOCKS

02 September 2026 Gold outperforms gold stocks.

Silver outperforms silver stocks (09 September 2026).

GOLD AND SILVER

Silver to Gold Ratio

Silver outperforming Gold. (22 July 2026)  Silver is coming out of the ground at about 8:1 and the Gold: Silver ratio is 67.72:1.

GOLD TO USD

USD outperforms Gold, (29 August 2026).

Copper (SELL: 30 August  2026)

GOLD AND SILVER CHARTS

Gold’s low of the week was $4,234.00, and the high was $4,381.00, now trading at around $4,367.00.

• Gold Monthly:  is an OUT. (25 March 2026). Looking more positive. Signals turning positive.

• Gold Weekly:  (HOLD: 13 August 2026)  A very early buy signal.

• Gold Daily: (OUT 02 September 2026). Almost a buy.

The low for Silver this week was $62.30 and the high $66.15, trading around $65.94 at present. 

• Silver Monthly: (OUT: 20260430.  ( Buy $24.00 March 2024 to Sell May 2026 $73.13 = 204% Gain in 2 years 2 months). A couple of indicators pointing up. No buy yet.

• Silver Weekly: (HOLD: 20 August 2026). A little weaker. No sell signals.

• Silver Daily: SELL (01 September 2026). Some indicators are turning up.

Clients who request an introduction to an independent precious metals supplier may contact our preferred partners by clicking here.

Any purchase or sale is conducted solely between the client and the selected supplier.

A video by Mike Adams on the Goldbacks. Well worth a look. watch here

On the Stockcharts.com charts above, the blue vertical lines are our proprietary system buy signals and the red vertical lines are system sell signals – for information purposes only

An interview with Josh, owner of Scottsdale Mint: watch here

Please contact us to arrange the purchase and storage of your gold and silver requirements in a safe, insured location outside of your jurisdiction.

If you are interested in an overview of Fort Kobbe, you may want to have a look at this video: Mike Brown, Director, Fort Kobbe, International Vaults, A DotCom Magazine Exclusive Interview

This is my interpretation of the market and is not to be taken as financial advice. Before making any buy or sell decisions, I recommend that you consult with your professional financial advisor.