Jordan Roy-Byrne - Technical Commentary on the Metals – Wed 23 Oct, 2019

A steepening yield curve and a Fed pause might not be as bad for gold as you think

Jordan Roy-Byrne joins me for a broad look at the main drivers for gold. Over a year ago Jordan was saying that gold would finally move when the Fed switched course from rate hikes. That happened at the end of last year and helped gold go though a very good 2019 so far. Now it is important to understand what could happen to gold if the Fed stops it’s rate cuts. We cover a lot in the interview but it is all important to understand.

Click here to visit Jordan’s site – The Daily Gold.

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Comments:
  1. On October 23, 2019 at 1:51 pm,
    Marty says:

    Quite a day for Great Bear, expect some news shortly

    • On October 23, 2019 at 9:13 pm,
      Excelsior says:

      Yes both GBR Great Bear and WM Wallbridge had good news, trading, and volume today on an otherwise blah kind of day. My overall portfolio was up .08%, so essentially flat, and most of the lists and indexes I keep were in the same boat.

      This is just part of the consolidation through time that Jordan was eluding to, and it is healthy longer term, but reminds me of sitting for an eternity in a doctors waiting room…. most of the sector is quite boring….

      • On October 23, 2019 at 9:16 pm,
        Excelsior says:

        Correction – There was only good news out for WM Wallbridge today 27.00 g/t Au over 38.39 metres, but there really wasn’t any news for GBR. I misread two posts over at ceo thinking they were discussing the news, but they were stating the 14% up move was on no news, just technically oversold, and a new buyer coming in to get positioned.

        Regardless, it may be in anticipation of news as you suggested Marty.

        Cheers!

        • On October 23, 2019 at 9:55 pm,
          Excelsior says:

          It should be noted that Zinc has been quietly starting to head higher this week and I was shocked to see some of my beat up zinc stocks actually posting green shoots today.

          Nothing to get too excited about, but still an encouraging little uptrend under the surface…

        • On October 24, 2019 at 5:35 am,
          Excelsior says:

          Ah – and there is the news on GBR….. Looks like this news leaked early and some insiders were front-running this announcement. How in the world could Great Bear suddenly go up 14% the day before the news breaks unless there were loose lips?

          Great Bear to Spin Out Net Smelter Royalty to Shareholders

          by @newswire on 24 Oct 2019

          https://ceo.ca/@newswire/great-bear-to-spin-out-net-smelter-royalty-to-shareholders

  2. On October 23, 2019 at 2:48 pm,
    CFS says:

    May the Gods protect us from Fed Reserve morons that advocate endless printing of fiat dollars.

    https://www.frbsf.org/economic-research/publications/economic-letter/2019/october/yield-curve-responses-introducing-negative-policy-rates/?utm_source=frbsf-home-economic-letter-title&utm_medium=frbsf&utm_campaign=economic-letter

    The politicians of the Left-Coast (in every sense of Left) do not realize the public will not lend money to banks at negative rates, which leaves us solely with government financing, and governments have no real money other than what they take from the people by force.

  3. On October 23, 2019 at 4:58 pm,
    JMiller says:

    Repos and Reverse Repos are not really QE,

    • On October 23, 2019 at 5:23 pm,
      CFS says:

      JMiller, technically you are correct, inasmuch as the banks have to sign over collateral to obtain fiat.
      However, since the collateral is NOT marked to market, it is at least part temporary QE.
      Further, given that the biggest banks using Repos are insolvent, this is clearly kicking the can down the road until the first major bank collapses. Then, given the derivative problem, many, many banks collapse.

    • On October 23, 2019 at 7:17 pm,
      CFS says:
      • On October 24, 2019 at 1:01 am,
        JMiller says:

        The use of Repos, which is used to help control short-term rates, existed long before QE, which is used to help control long-term rates. There is a difference in purpose and effect so it would not be right to simply call it QE as Pinto and others wrongly believe it should be called.

        • On October 24, 2019 at 7:10 am,
          Matthew says:

          I hope I’m wrong but it seems you think that interest rate manipulation is okay and that the Fed operates openly and honestly.
          Wealth transfer and currency debasement is what the Fed and Keynesian economics is all about and gold is up significantly this year for a reason. The Fed will do whatever it takes to keep their scheme going and that means one thing: inflation.

          It’s worth reminding everyone of Keynes’ own words (which are totally accurate):
          “There is no subtler, no surer means of overturning the existing basis of society than to debauch the currency. The process engages all the hidden forces of economic law on the side of destruction, and does it in a manner which not one man in a million is able to diagnose.”

          • On October 24, 2019 at 9:20 am,
            CFS says:

            I agree with you Matthew.
            Unfortunately, we know taxation is limited, and thus the only way Government can survive is sneaky taxation via the backdoor of inflation appearing to reduce debt.
            The Fed simply colludes with the political scum.
            Unfortunately, mechanisms are so delayed in cause and effect, and we are now setting up hyperinflation.

          • On October 24, 2019 at 10:50 am,
            JMiller says:

            All I am saying is a wrench is not a hammer and a hammer is not a screw driver. They are all different tools that serve a different purpose. So no, I will not call what the Fed is doing with the Repos, QE.

          • On October 24, 2019 at 10:59 am,
            Matthew says:

            Very few are really against such theft/redistribution. All that matters to the vast majority is how the loot is spent, not the immoral way in which it is acquired.

        • On October 25, 2019 at 3:02 pm,
          JMiller says:

          From one of the smartest people out on the internet, Wolf Richter, talking about the Fed’s “repo operations”.

          “As these operations were undertaken every day for the past four days, it’s essentially the same $75 billion that gets recycled every day. The daily amounts are not additive. And these operations have nothing to do with QE.

          https://wolfstreet.com/2019/09/20/fed-admits-plan-a-of-controlling-money-market-rates-fails-shifts-to-plan-b-repos-which-was-plan-a-till-2008/

  4. On October 23, 2019 at 8:37 pm,
    Matthew says:

    “Not QE” is in high gear, $7.5 billion in one day… | McAlvany Commentaryhttps://www.youtube.com/watch?v=FA7Fy935q8A

    • On October 25, 2019 at 9:57 am,
      paul says:

      David and Kevin are two idiots that do not know the difference between the Fed’s use of repos and QE.

      • On October 25, 2019 at 3:03 pm,
        JMiller says:

        Unfortunately many seem to be ignorant of this fact.

        • On October 25, 2019 at 4:59 pm,
          Matthew says:

          It is more unfortunate that many defend such a corrupt system at all costs.

          • On October 25, 2019 at 6:30 pm,
            JMiller says:

            Yes. And who would that be?Certainly not me. The facts speak for themselves.

          • On October 25, 2019 at 7:30 pm,
            Matthew says:

            That would indeed be you, JMiller. Yes, the facts do speak for themselves.

          • On October 25, 2019 at 7:41 pm,
            JMiller says:

            You really need to stop misrepresenting people. And just how do I defend the corrupt system smart ass?

          • On October 25, 2019 at 8:06 pm,
            Matthew says:

            Most if not all of your “corrections” are attempts to defend officialdom. To point out one example, you wrongly took issue with shadowstats.com not long ago.

            What you do is worse than rearranging the deck chairs on the Titanic.

          • On October 25, 2019 at 8:21 pm,
            JMiller says:

            Matthew,

            I apologize if I make it sound like I do. I do have a problem with some of John Williams numbers, namely the unemployment rate. I always had a problem with that because most of the U.S. has had a noticeable improvement in employment since the 2008-2009 Great Recession but John Williams number hardly changed for 10 years. Seems hard to believe. Wolf Richter, who is very good and is respected by many, recently criticized John Williams numbers also. So I will try to do a better job of expressing my thoughts.

          • On October 26, 2019 at 9:29 am,
            Matthew says:

            JMiller, the unemployment rate CAN’T be what the government claims since those who’ve given up looking for work are no longer counted as unemployed. Of course there are other changes that also help to keep employment figures elevated. I’m sure you are right that the unemployment rate has decline since 2008-2009, but there’s no way it’s as low as is currently claimed. There’d be no need for rate cuts and huge repos if everything were as rosy as claimed. And yes, those repos are a form of QE. First, the easing: T-bill rates would spike without the repos and, second, the effort is “quantitative” in nature, not qualitative.

          • On October 27, 2019 at 5:18 am,
            JMiller says:

            Matthew,

            Let me make it clear that even though I do not agree with John Williams estimated unemployment rate does not mean that I agree with the BLS rate either. Their reported U6 unemployment rate is currently 6.9% however they do not include longer-term unemployed people (those that have not worked or looked for work in over a year) and they probably tweak the number to show it being better than what it is. So yes, the unemployment rate is certainly higher than that but not as high as John Williams 21%. John Williams did admit that his estimated unemployment rate may be a little high and also admitted that while many places in the U.S. have seen little economic growth, that there have been many other places that have such as Florida, Texas and parts of California according to him. I would also add to that list many places in the Northeast as we have seen plenty of construction of homes and some businesses and plenty of help wanted signs. I do realize that many of those help wanted ads are for lower paying or part-time jobs. Several people from North Carolina also reported the same economic growth. So I believe the unemployment rate is more likely around 12-15 percent which is more believable especially to someone like me who lives in an economically robust area.

            You state that those repos are a form of QE. Yes, I will not argue that it is not a form of QE, just that there are some differences from the QE that we all came to know a love. /sarc

            I am sure if you and I sat down together we would probably agree 90% of the time on things we discuss here.

          • On October 27, 2019 at 8:15 am,
            Matthew says:

            JMiller, thanks for the clarification. It does seem like we might agree more than I thought.

      • On October 25, 2019 at 5:00 pm,
        Matthew says:

        Paul, only an idiot could conclude that either David or Kevin are stupid or of low intelligence.

    • On October 24, 2019 at 1:18 am,
      JMiller says:

      I am not sure Powell really lied. He said “This is not QE. In no sense is this QE”. That statement could be true. The use of Repos, which is used to help control short-term rates, existed long before QE, which is used to help control long-term rates. There is a difference in purpose and effect.

      Central Bank Tools of Intervention: Reverse Repos versus QE
      http://www.bsic.it/8092-2/amp/

      • On October 24, 2019 at 2:08 am,
        JMiller says:

        Just to add to what I said above concerning Powell’s statement about the use of Repos. He stated “This is not QE. In no sense is this QE”. The first part where he says “This is not QE” is true. It is the second part where he says that “In no sense is this QE” that one may be correct to disagree with. But even if one does not agree with Powell on that statement does not mean he lied as the Mises Institute claims. You can be wrong without lying.

        • On October 25, 2019 at 9:55 am,
          paul says:

          Good point jmiller.

  5. On October 23, 2019 at 9:30 pm,
    Excelsior says:

    CEO Technician (aka: @Goldfinger), Robert Sinn on a Simple Approach to Technical Analysis for Junior Resource Companies

    An episode of Mining Stock Daily – By Trevor Hall #AudioInterview

    https://anchor.fm/mining-stock-daily/episodes/CEO-Technician-Robert-Sinn-on-a-Simple-Approach-to-Technical-Analysis-for-Junior-Resource-Companies-e7me61

    • On October 23, 2019 at 9:32 pm,
      Excelsior says:

      Gold Mining Companies Suck And That’s Why They Offer A Great Investment Opportunity Today

      by @Goldfinger on 23 Oct 2019

      https://ceo.ca/@goldfinger/gold-mining-companies-suck-and-thats-why-they-offer-a-great-investment-opportunity-today

      • On October 24, 2019 at 6:32 am,
        Charles says:

        Ex – I saw you post about Eric Sprott buying in to Metallic Minerals and finally decided to buy a little starter position yesterday. I realize it could go lower in the short term, but if it is anything like Alexco, I look forward to the ride long term.

        • On October 24, 2019 at 11:12 am,
          Excelsior says:

          Welcome aboard Charles!

          Yes, there may be some short-term pressure, but once they get those drills turning I’ve already seen trenching and rock chip samples that show just how well-endowed the mineralization is on their property.

          Also I was a shareholder of monster mining who held this property before metallic and they had a number of Bonanza grade samples and drill hits.

          When Alexco announces they’re going back into production it should put more eyeballs on the story.

          • On October 24, 2019 at 1:25 pm,
            Charles says:

            Thanks Ex. What have you heard about when Alexco will go back in production. I sold out a good portion of my shares at the last peak and want to buy them back at a discount.

          • On October 24, 2019 at 3:10 pm,
            Excelsior says:

            They have stated that they’d announce a production decision/timeline in the 4th quarter, so only 2 months left. Maybe it will dip down a bit further, going into tax loss selling season for you to reload before that happens. Personally, I don’t want to risk being out of the market on AXU in case they come to market with that news randomly, so I’ve already added some back into this weakness. I would like to add one more tranche this year though for a full position.

          • On October 24, 2019 at 3:14 pm,
            Excelsior says:

            For clarity AXU doesn’t plan to actually be in production until Q2 or Q3 next year, so the announcement that is supposed to happen before year end is just that they are finally going to move ahead with production. They’ve already starting putting in decline ramps, into Bermingham and Flame & Moth, so to “announce” they plan on going into production is already expected at this point, but it would make it official and give more timelines and metrics on guidance.

          • On October 24, 2019 at 3:18 pm,
            Excelsior says:

            However, AXU may be smart to make an official proclamation of production as that will bring more analysts over to their story, and thus should also assist MMG in getting more eyeballs as a consequence of being their neighbors at Keno Hill.

  6. On October 23, 2019 at 11:33 pm,
    CFS says:
  7. On October 23, 2019 at 11:56 pm,
    CFS says:
  8. On October 24, 2019 at 6:41 am,
    OOTB Jerry says:

    Finally………..Gold back above $1500…………

    • On October 24, 2019 at 6:42 am,
      OOTB Jerry says:

      Just because the FAKE FED is going to babble some garbage about something……lol

      • On October 24, 2019 at 6:45 am,
        OOTB Jerry says:

        Platinum finally starting to get a bid…….up $15……….$930……..
        and the overprice palladium…..up

        • On October 24, 2019 at 6:48 am,
          OOTB Jerry says:

          Investors in WeWork.scam……getting hit……who could not figure out the scam in short term office space was not going to work……..never owned an office building…JOKE.
          Reminds me of Office Condo scam of the 80’s….

  9. On October 24, 2019 at 7:53 am,
    bonzo b. says:

    Hi Matthew, what does your chart tell you about IRVRF? Have you bought any?
    Thanks. I bought some when it fell below 1.30 but would like more.

    • On October 24, 2019 at 8:59 am,
      Matthew says:

      Hi Bonzo, I don’t think it has much downside from here as long as the sector holds up. There’s some MA and Bollinger Band support 5-6% below the current level…
      https://stockcharts.com/h-sc/ui?s=IRVRF&p=D&yr=1&mn=0&dy=0&id=p33693265607

      I do not own it.

      • On October 24, 2019 at 9:19 am,
        bonzo b. says:

        Thanks, Matthew. When the drilling results come back soon from the lab in Australia this stock will either plunge or soar. NEM has taken an interest.