Looks like we’ve made it through without a catastrophe, but as for next month, that’s unclear. The monthly percentage of dollars backed by absolutely nothing other than Federal Reserve losses keeps rising at about 0.15% per week. Bitcoin is still 33% below all-time highs, though threatening a trendline breakout against gold will see if it is able to succeed. I have my doubts, but I’ve been wrong before about Bitcoin. Ultimately, I won’t be wrong about it, but I’ve been wrong about it a lot of times in the battle, but the war as to what is the real money is still clear from a positivist standpoint.

One chart that tells you why nobody cares about the gold rally or the silver rally and why that is about to change. It has to do with the gold to S&P 500 ratio, which is on the verge of a breakout to the upside. And I’ll show you the major head and shoulders bottom that we just experienced. And now we’re up against a big resistance line, which we will break through shortly. The 10 year minus three month Treasury yield curve spread is about to normalize, go above zero for the first time in, I don’t know, has it been two years or something like that? Whatever it is, it’s the longest stint below zero ever.

And within the next two weeks, it is likely to normalize. And after that, we only have a few months before official recession gets recorded. And this time it will be a doozy. I don’t know what a doozy is exactly, but it’s big. Watch out for that first step. It’s a doozy and deep. The silver short term technical picture matches up with the silver long term technical picture with support here at about 30 to 50 going back to about 2012 after the silver parabola of 2011. QT has slowed 37% since June when the Fed said it was going to slow it down and they have.

And finally, bank reserves are steady, but they won’t be next week as we go into a new month and they’re going to fall. And judging by what just happened in the Treasury market with the $531 billion clearing for October, they could go below $3 trillion by next week. And we could be very close to the final banking crisis. This silver report this week is brought to you by The Dirty Man Safe. Practice safe stacking. Put your silver in here and bury it somewhere. But don’t tell anybody. To prove it, this is a brand of Dirty Man Safe.

Here’s the label. This silver report is also brought to you by my Patreon, where you can find at Patreon.com slash endgameinvestor, where you can get biblical lessons in economics, government, and monetary policy. The last thing we covered is why a Hebrew word for inflation is hamas, which means theft, but very small theft, small amounts of theft that can’t be adjudicated just like inflation. And it builds over time until society is destroyed. And then we rebuild. And with that, let’s go to the slides. All of the months starting from October, 2023, with the exception of maybe one, reverse reboots have spiked into the end of the month.

This is because banks are trying to make their balance sheet as lean as possible going into the end of the month so that they can have the lowest amount of fines and the lowest amount of regulatory costs. You have to know the regulations pretty intricately to understand why exactly this happened. But it happens every month, except for this month. You’ll see here, all these black lines point to end of month spikes in the reverse repo facility. You can see spike here, spike there, spikes everywhere, especially over here in July and August, September, October was a big one, going into October.

But going into November, we have a new low-interverse repos of $201 billion. Why was there no spike of reverse repos this month? That’s because of the $531 billion that came due in Treasury auctions for settlement yesterday. And most of those dollars will be sucked into the federal, the federal government’s bank account at the Fed. And that will be used to spend on warfare and welfare as usual until the dollars run out and the banks collapse. This next chart here is the monthly percentage of dollars backed by Federal Reserve losses. Every week, the amount of dollars as a percentage of the monetary base, the monetary base is the amount of dollars that banks can use to pile up and pyramid loans on top of that.

It’s about $5.55 trillion the monetary base today. So this is the amount of those dollars that are being backed by deferred assets, otherwise known as Federal Reserve losses. These are the true unbacked dollars by any asset whatsoever because a deferred asset is not really an asset. See here, it’s been an average of 0.15% a week, sometimes above it, sometimes below it, but zigzagging back and forth. So that’s a month, not a week. But 0.15% of all base dollars in existence are becoming unbacked by any asset every month. And this rate is not slowing down even though quantitative tightening has slowed down.

Why not? Because the monetary base is shrinking with higher interest rates. So this shows that the rate of the dollar, the base dollars that are dying isn’t slowing down even though the rate of quantitative tightening has been slowing down. So this rate is going to continue and it’s going to rise. Bitcoin is still 33% off of its all-time highs relative to gold. You can see here, the long-term chart of Bitcoin. I say long-term even though it’s going back to 2019 because that’s all we have with Bitcoin really versus gold. It’s a new thing.

It’s still new. It’s going to be new for several decades if it survives several decades, which I doubt. We see here that it has been crawling along just below the 50-week moving average versus gold for I think 12 weeks. I think we’ll see that in the next slide if I remember if I set it up correctly. And we’re below here about 33%. We’re at 25.26 and the all-time high is 37.5. So that’s about 33% off of all-time highs relative to gold. So don’t celebrate quite yet. Bitcoiners, maybe you will celebrate. You could go higher.

Could be a new high. I don’t know. I don’t think so. Bitcoin is unpredictable. We are just at the downtrend line. We could break through it. It’s threatening to. But we’ve been pinned below the 50-week moving average here for 12 weeks. It’s a 12-week call below the 50-week moving average. Bitcoin could reach, let’s see, old highs over here, about 34. That’s still way below the all-time highs, about 37.5. But we’ll see what happens with Bitcoin. Could be wrong. Why? Nobody cares about the gold run and why that changes soon. This is a chart of the gold to S&P 500 ratio.

So you see here a few things I wanted to point out. We see a head and shoulders bottom here with the head at 2022 of heroarm circling and the shoulders at 2018 and 2024. Head and shoulders bottoming pattern. And we have broken through both the 50-week moving average and the 200-week moving average. And we have a golden cross, which I think I pointed out last week. The blue line, the 50-week moving average is crossed above the 200-week moving average, excluding 2020. This is the first time that this has happened since 2001. I pointed that out last week.

But the point here is that the reason that nobody cares about the gold run, by nobody, I mean the mainstream. They don’t care about the gold run is because since 2015, look here, 2015, I have this highlighted, the low in 2015, the ratio was 0.503. We are now at 0.44. So despite gold’s bull market since 2015, at 2015, it was at 1054 low, I think. And now it is at 2760. So it is more than double gold is more than double, but it still underperformed the S&P 500 despite that. And it’s very frustrating for gold bugs and the stock stackers.

Can you stack stocks? Well, let’s just call them the bubble chasers. They are saying, you know, and rightfully that the stock market S&P 500 is still outperformed gold since then. And they’re right. But we have here a line in the sand here, a pivot point. This is the point of the 2015 low in the ratio. And we’re about to break through it again. We have knocked on this number many, many times. One, two, three, four, five, six is the seventh time since 2022. We’re going to break through. And once we break through, I think we’re going to be in a multi year.

If the monetary system lasts, it will be multi something. It’ll be a long time where gold is going to outperform stocks. And once that happens, more and more people are going to pile in as they realize that in real terms, their portfolios are evaporating, even if their dollar amounts are rising because their gold ounce amounts are going to be falling. You have here the 10 year minus three month yield curve. And here I show you why the normalization of this curve is going above zero is within about two weeks because we see here two weeks ago on October 21st, we were at negative 0.558 or negative 56 basis points.

Now we are at 26 basis points, negative 26 basis points. So that move, once that is repeated, will be above zero. So just within two weeks of that. And once we get within two weeks of that, we’re only a few months of another Keynesian style recession. And this time it’s going to be accompanied by a banking crisis. Here’s the long term view of the 10 year minus three month yield curve spread. Consider that we’ve been going far and fast since mid 2024 from about 150 basis points negative to now 26. And once we start this momentum, it’s hard to stop it.

We’re going to be normalized. We’re going to go above zero. And then we’re going to get into a banking crisis at one point or another very soon. This short term silver technical picture is this. Here is the trend line since August when we were at 26. Now we’re at 3280. We’re still above that trend line. We would tag it here at about 32. We’re also at a support zone, which we hit in September on October as resistance and also in May as resistance of about 3280. We’ll see if we bounce here so it can be very volatile.

And once the Fed turns once the reverse repos run out and the reserves go down and then they have to print more. So it was going to turn around violently and it’s going to be scary for stock market stackers because they’re going to start losing real value quickly. The bigger term, the bigger silver picture here technically is that we have a line. I forgot to draw it in here. I did draw it in, but it’s not here. I guess I put the wrong picture in. But we’re at this, this resistance line of 35.

You can see it’s the same area as was resistance in from 2011 to 2013 before the bear market really started. So we’re at that point here. So the fact that this is resistance again is not particularly surprising to expect to slice through this very old resistance all the way back from 2011 is a pipe dream thinking, but we will slice through it. It’s just going to take a little bit longer, maybe a few weeks, maybe a month or two. Maybe it’ll be timed with the Fed turning around after the next banking crisis.

We’ll see, but it’s close at hand. QT has slowed by 37% since June. You can see here the numbers that I put in at December. The balance sheet was at 7.7 trillion and 22 weeks later when the Fed started to slow down QT, it was at 7.284 trillion and now it’s at 7.013 trillion. So the rate of decline in the balance sheet is down by about 37%. From these 22 weeks to those 22 weeks, they have slowed it down, but they have not slowed down the amount. The percentage of dollars that are being backed by literally nothing.

And that is the backend mechanism of what hyperinflation actually is when the assets of a central bank are worthless that back the liabilities, which is the currency. Bank reserves are steady. These are the reserves, the extra dollars that if they fall below 3 trillion, we should be at the next banking crisis. Can see here the red lines, all point two month ends when bank reserves tend to fall and they probably will fall this month too. The numbers will be in at the end of the month. This data is good until October 30th for Wednesday.

And it could be a very violent drop given how much money has been vacuumed out of the system. Thanks to those treasury auctions that cleared last week. So all in all, my friends, is that we can measure the next crisis in weeks to months. It’s going to be sometime either very late this year in December or very early next year, but it’s not going to be much farther than that. There’s going to be another inflationary round exactly what it’s going to look like. I don’t know, but once it does, silver and gold are going to take off again.

We might have a break until then. We deserve a break because gold and silver have been going very high, very quickly. And the public has not yet noticed because its stock portfolio is still doing relatively well, but that is about to end pretty soon. This is Rafi of The Endgame Investor with this week’s silver report. And I’ll see you guys next week. If you would like to support this channel, then buy a dirty man safe using the code ENDGAME10 at checkout for 10% off and check out my Patreon at patreon.com slash endgame investor for religious slash biblical lessons in monetary policy, government, and economics.

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