The probability of what is happening is practically zero.

Three 6-sigma events occurred in one week.

– Debt securities
– Silver
– Gold

We are experiencing a statistical impossibility.

Let me explain:

Last Tuesday, the 30-year Japanese debt registered what we call a “6-sigma” session.

Two days ago, silver did even better: it was at 5-sigma on the upside, then reached 6-sigma on the downside. IN A SINGLE SESSION.

And gold now? It rose 23% in less than a month. We are getting very close to a 6-sigma event.

That's three 6-sigma events in ONE WEEK.

To explain briefly: in finance, we measure price movements around an average using the standard deviation, which we call sigma.

1-sigma: normal
2-sigma: common
3-sigma: starting to become rare
4-sigma: exceptional
5-sigma: extremely rare
6-sigma: should occur once every 500 million

These are the 6-sigma type episodes we've seen before:

– The October 1987 crash, a 22% drop in one session
– The COVID-19 crash in March 2020
– The surge in the Swiss franc in January 2015
– WTI oil going negative in April 2020

But we've never had 3 events occurring in one week.

Do you understand the point?

A 6-sigma event is almost NEVER triggered by a simple macro headline.

It almost always comes from the market structure: leverage, overly concentrated positions, margin calls, collateral problems, and forced sales or purchases.

This is important to understand because we are talking about internal tensions in the mechanics of the system.

As you know, the Japanese bond market is at the heart of the global financial system, and I won't go into that whole thing, but a 6-sigma movement in a market of that size doesn't go unnoticed.

Seeing a 6-sigma movement in silver just a few days later gives one pause for thought.

And now gold?? This is absolutely insane.

Why are we seeing extreme statistical events, days apart, in such different markets?

When a pillar of global financing becomes unstable, leverage tends to contract, and two things happen simultaneously: forced selling in certain assets and forced protective buying in others.

Historically, precious metals tend to be among the beneficiaries.

Long-term interest rates say something about the credibility of states: that is, their ability to honor future debts without resorting massively to inflation.

Precious metals say something about the credibility of the currency itself, and when both become unstable at the same time, we are looking at a questioning of the monetary framework. I won't elaborate, because I want to share the rest in another tweet tomorrow, but generally when a regime starts to crack, the adjustments are BRUTAL.

It's precisely at these moments that several high-sigma events appear in different asset classes.

I'll repeat: seeing three consecutive 6-sigma events is not normal.

Gold and silver are explicitly telling you that we are experiencing a real paradigm shift.