To me the I mean what's happening now is that that gold it's not that gold is consolidating. It's that the dollar is taking a rest because now we're at a breaking point where you know we're at either a a deflationary moment or or a further inflationary moment. We have to pick the the course. So, it as long as the Fed hasn't picked yet because it's it's barely hanging on with the with the short-term interest rates and it's barely hanging on with this and it's


trying to give repos to try to stabilize everything. So, as long as as we're at the fork and we haven't taken a path. So, it's just a question of waiting it out. And as for the dollar price, I'm not even going to say what it's it doesn't even matter. The the the question isn't what the dollar price of gold is going to be. Concerns about growing instability in the US financial system are rising as key liquidity indicators point to mounting stress. Rafie Farber highlights


that the secured overnight financing rate, the core of short-term funding, is steadily climbing and has even surpassed the Federal Reserve's upper policy limit at times. With this market handling over $3 trillion in daily volume, while the Fed funds market becomes less relevant, the increasing cost of overnight cash signals growing pressure on banks that depend on short-term borrowing. The quiet reappearance of repo operations, even in small amounts, reveals a deeper problem. The banking system is running


short on available liquidity. Farber explains that when this critical financial plumbing tightens, it often precedes a sudden break, similar to the 2019 repo crisis, which forced the Fed into massive balance sheet expansion. Amid rising funding stress, the Federal Reserve has begun holding private meetings with major banks to figure out why they are avoiding the Fed's cheaper repo facility. According to Farber, banks fear that using it would reveal weakness and raise their borrowing costs elsewhere. This hesitation suggests the


system is nearing another dangerous point where leverage positions, especially those tied to treasuries and wider markets, become vulnerable to forced liquidations. A sudden liquidity shock could spark cascading margin calls, much like the rapid collapse of Silicon Valley Bank, where everything seems stable one day and disastrous the next. With liquidity thinning and borrowing costs climbing, the Fed faces a crucial decision. continue tightening and risk a systemic breakdown or reverse course and inject liquidity which could


reignite inflation. Farber warns that the US is approaching a critical turning point in its fiat currency system. Once an inflationdriven cycle begins, he argues the only outcomes are to accelerate inflation until the currency breaks or stop inflation abruptly and let leveraged institutions fail. Neither choice preserves the current structure. At the same time, precious metals are entering a new phase as mainstream investors increase their exposure, sensing that gold and silver may be dramatically repriced as confidence in


the dollar erodess. Now, we present the clips from the Rafie Farber interview. >> Things that I'm tracking the I I always track the plumbing first and then I see if it's affecting other things. So, uh what I mean by the plumbing, those who have followed me probably know what I'm talking about. the uh the interest rate that is the basis of all other interest rates. That's the secured overnight financing rate. The rate at which banks charge each other to loan cash in exchange for


treasuries overnight. That's uh it's heading higher and higher and high. It's drifting higher even higher on some days than the Fed's upper limit on the Fed's fund on the Fed funds rate. The Fed funds rate is like a different thing. That's it's a very minor market. It doesn't even matter anymore. It's like the the volume there is like hundred billion a day at most whereas the secured overnight financing market is like over $3 trillion. It's like the the largest volume has been 3.2


trillion. And uh there it keeps going up the volume which means more and more and more banks need money overnight for whatever reasons that it is. I mean, it's probably a lot of their the bank's clients are engaged in some kind of basis trade on whatever treasuries and keeps getting bigger and bigger. They can't provide the dollars, then those trades have to close. The Fed is in a is in a bind now because eventually this is going to lock up pretty soon. I thought it was going to lock up already because there's less


than $3.2 trillion in bank reserves out there, but apparently uh you can go above that. I don't know how much farther you can go above it but we at this point last time we already had locked up in 2019 and then from there came uh the expansion of the balance sheet and then from there few months later was the co printing round and now you could see that as separate phenomenon or coincidence that they had an excuse to print like four or five trillion just a few months after the the the plumbing locked up or you could take


a more conspiratorial angle and say it was planned or they just had an excuse and they and they went with it. Whatever it is, I mean, they needed to print the money. Ever since then, from from then until around now, there were no more uh repos provided by the Fed. You mean repos provided by the Fed is when banks don't have enough cash to lend to each other. So, the the Fed has to step in and say, you know what, we'll provide their missing cash. So that was the case from about uh maybe like 2014


to 2019 like after QE3 ended and they started um they started drinking their balance sheet for the first time. So they were repos in those years until 2019 and they they they stopped then they started again after the apocalypse and they and then they they stopped during the co printing until now. So now the Fed is providing repos again, not that much. And I just read an article on Bloomberg that uh there was an emergency meeting or a sideline meeting between John Williams, head of the New York Fed, and


a whole bunch of representatives from different banks as to why they weren't utilizing the repo facility more that because what they're doing is they're they're banks are borrowing at higher rates from other banks than the Fed is offering on repo. And then John Williams is like, "Why are you doing that? Why are you paying more if you just come to me and I'll give you the I'll give you the cash?" And they're like, basically, well, it looks bad if we do that and we


don't want to come to daddy, you know, for for money because then it makes us look really weak and then other banks charge us higher interest rates because they don't trust us. So, the only way they can make the repo facility more attractive is by forcing everyone to use it so everyone's on an equal playing field. I think they'll probably try to do that. But anyway, the fact that that there are repos going on now, even if they're small, means that they're out of cash. There's


no more cash. So, something something is going to buckle. Whether it's somebody leveraged in the Bitcoin market, somebody leveraged in Nvidia, uh since the cash isn't flowing anymore, something is going to cause a margin call somewhere else, and everything's going to start falling over very fast. Remember, Silicon Valley Bank was fine one day and the next day it was gone. So, the same thing's going to happen this time. It's going to be some other catalyst, some other bank, some other


institution, but it's going to happen pretty soon. >> The fact that it seems like the mainstream is actually starting to pay attention now. >> Well, yeah, the mainstream will follow whatever is hot. If Bitcoin is hot, they'll follow Bitcoin. If gold's hot, they'll follow gold. So, there's nothing there's no there's there's nothing new there. To me, the I mean, what's happening now is that that gold, it's not that gold is consolidating. is that


the dollar is taking a rest because now we're at a breaking point where, you know, we're at either a a deflationary moment or or a further inflationary moment, we have to pick the the course. So, it as long as the Fed hasn't picked yet, because it's it's barely hanging on with the with the short-term interest rates and it's barely hanging on with this and it's trying to give repos to try to stabilize everything. So, as long as as we're at the fork and we haven't


taken a path, things are going to be volatile up and down. Gold has gone up $100 one day, down $100 the next day. Is it up today or is it down today? I don't even remember, but I I think uh I think it's steady today and gold stocks are diving because other stocks are diving because Nvidia was a buy the rumor, sell the fact thing. And Bitcoin's diving and that's probably causing margin calls in other places because people take out debt to buy Bitcoin. Who knows how much debt is is uh is stacked into Bitcoin?


Nobody knows. So, I think we're going to continue to be volatile until the Fed picks a direction. Please subscribe to our channel and activate the bell icon to receive timely updates.