A record day driven by policy, not fear
Gold rose $175 on Wednesday the 19th and closed above $4,500, the strongest single day of the year. GDX and GDXJ each jumped 8%. This came after another weak jobs report: non-farm payrolls missed badly on August 7th. A year earlier, on August 1, 2025, payrolls missed by 250,000 jobs on a downward revision from prior months, which fueled a 7% day in GDX and GDXJ. Critics said that data point did not matter much; the price action since argues otherwise.
The trigger this week was Treasury Secretary Scott Bessent running another "Operation Twist" - buying longer-dated bonds to push down the 10-year yield. The 5.3% rate was a level he did not want. To intervene he has to print money, so the Fed balance sheet grows and the dollar falls. Nobody expected the move, so gold got a large boost. The dollar went below 99.9. A dovish Fed and a flatter yield curve also support gold.
Miners lead, but Wall Street is absent
The miners flew. Two silver-linked names rose 12-13%. One sector leader was up at least 10%; it traded at 134 in the last week of June and closed at 208, up more than 200 in under three weeks. The HUI index pushed above 800, after sitting in the low 500s not long ago. In July, miners outperformed the metal for the first time this year, and that follow-through showed up strongly in this session.
The move is technical, not fear-driven, which is less exciting for a long-term investor who wants the fear trade to arrive. The real signal would be capital rotating out of the roughly $60-70 trillion equity market and into miners. That rotation has not started. The HUI sits above 800 with sentiment in the miners still not even positive - which is exactly why the target is a HUI of 3,000. When people call 3,000 crazy, the answer is: wait until Wall Street shows up.
The S&P 500 (SPX) sits at an all-time high near 7,700 but has no market leadership, which is a problem for equities. The index is unlikely to hold that level through mid-October.
Unresolved cracks under the surface
Silver at 66 came off a 10% move and could fall back to 60 quickly. Many see a breakout, but confirmation is not certain until mid-October. Broad stress remains: Japan intervened when the yen hit 163, pushing it to 157, then it bounced to about 160 - not resolved. France's 10-year yield was zero in 2022 and is now 4%. The Kospi is up big year-on-year but only about 13% over six months and is struggling to make a new high, a sign the AI trade may be rolling over. The war in Iran adds to the list, though Trump softened his rhetoric about pressuring Iran over the past few days, likely under staff pressure that harsh action would cost the midterms if it dragged into October. A path out in August or September looks possible.
The Fed shift also matters. At the June 17th meeting the chair was very hawkish, framing inflation as the sole concern with a "my way or the highway" tone; those direct on-mic comments were unexpected and read as a break from Jerome Powell, feeding fear across the market including tech and AI (IBM (IBM) fell 25% in a day, Tesla (TSLA) fell 13% on earnings). Late July moderated only slightly. Then the terrible August 7th payrolls and low CPI on August 12th killed the case for a rate-hiking campaign like the one Yellen ran from 2016 into 2019. That is bullish for gold and silver.
The sector was smoked from March 1st to August 1st on the war and the Fed change, a 40% selloff in the HUI and GDX. The current bounce comes off an artificial bottom, so today's gains still need confirmation from broader capital rotation before they mean the bull market is off to the races.
Company-level ideas
Eric Sprott does not own one particular stock; if he paid for its full capex - roughly 15% of the company, around $80 million - it would fix the company's funding problem and set up a 10-plus bagger.
A gold junior (Lahontan) released an updated resource estimate reaching 2.4 million ounces; adding roughly 300,000 ounces from a Santa Fe West asset puts it near 2.7 million. Crossing 3 million ounces brings a new level of recognition from mid-tier and major miners. CEO Kimberly is seen as ambitious to build this into a $2 billion company; current value is easily over $1 billion, and an acquisition could double it before a sale. At $4,300 gold before the rally, producers were already making strong money at their all-in sustaining cost. A price expectation of 152 (cents) was floated - explicitly a speculator's guess. Investors were urged to buy such stocks at 26 cents before they reach 40 cents. These numbers depend on future ounces and $7,000 gold, which are assumptions, not guarantees.
Investor behavior decides the outcome
The stance all year: ride the train and buy the dip, do not get off to trade. Following that, the portfolio is higher now than in January, with strong dip buys in June and July, and no losers left - weak names were sold and replaced with better ones. The only borderline underperformer was Alamos, which is expected to recover.
The core lesson is the gap between investment performance and investor performance. GDX was up 155% last year; a disciplined holder captured 153% retail, but most traders did not because they moved in and out. Miss the three big August days and you fall behind, then chase the sector as it runs away from you. Consistent accumulation during weakness beats trying to time every correction.
The view remains bullish for Q4 and very bullish for 2027, seen as the final battle. This is a three-leg move and we are still in the early innings - the first three innings of leg one.
A conference runs September 18-20 in the Phoenix metro area, 8-10 minutes from the airport, announced around July 1st despite a rough July. September 20th (8:30 to noon) covers the investment process used on the portfolios; September 19th lets investors sit with companies for 20 minutes and ask any questions.
