Five signs the Fed is quietly pivoting again (Gold’s next move?)

In a recent episode of the Money Metals’ Midweek Memo podcast, host Mike Maharrey argues we are watching a familiar setup return. The financial system, he says, increasingly resembles 2019, when cracks began showing after the Fed attempted to tighten policy.

A new year, same setup

He frames the episode around a simple premise. If the system is flashing the same warning lights it did back then, you should pay attention to what those signals typically lead to, and what they tend to mean for gold and silver.

Sign #1: The “Gold bubble” calls keep failing

Mike starts with the precious metals correction and rebound to show how fast sentiment flips. Each dip becomes a headline about the bull market ending. Each recovery forces the narrative to move the goalposts again.

His point is not that prices never fall. It is that the big move in gold and silver is not being driven by hype. It is being driven by the conditions underneath the markets, especially the system’s dependence on easy money and the strain that shows up whenever that support is reduced.

Sign #2: The boom-bust cycle has a script

To explain the underlying stress, Mike leans on Austrian business cycle theory. The Fed pushes rates down, credit expands, and a boom follows. Then the Fed tries to normalize policy, and the bust emerges.

He argues this is not an occasional mistake. It is the structure of the modern system. Easy money encourages borrowing and spending today at the expense of the productive foundation that would make growth durable tomorrow.

Sign #3: You can’t print the real economy

Mike’s brick wall analogy does the heavy lifting here. Cheap credit lets people start projects that look profitable under low rates. Eventually, the economy hits limits, and the limits are not financial.

Resources, labor, and productive capacity are real constraints. When money expands faster than the ability to produce real goods, projects stall, malinvestments are exposed, and the boom loses its footing.

Sign #4: Debt makes the system fragile in a higher-rate world

Mike calls it a debt black hole. Years of easy money reward leverage, and leverage make the entire economy sensitive to the cost of borrowing.

When rates rise, servicing that debt gets expensive across households, corporations, banks, and the government. That is why, even with inflation still above target, there is constant pressure for rate cuts. He argues it is not just preference. It is a dependency.

Sign #5: Repo stress is the canary that looks like 2019

The episode’s most concrete signal is the spike in the Fed’s standing overnight repo facility. Mike explains repo as short-term borrowing backed by collateral like Treasuries and mortgage-backed securities. It is where the system goes to keep daily liquidity moving.

He notes that repo usage often jumps at quarter-end or year-end because banks become balance sheet constrained and want their books to look stronger. But he emphasizes that the size of the spike matters, and so does the fact that usage persisted into early January.

In his view, heavy reliance on the Fed’s facility suggests private liquidity is either scarce or too expensive. When markets need the Fed as a backstop for routine short-term cash, that is a sign of strain, not calm.

The missing piece: The Fed is easing again without saying so

Mike ties repo stress to what he sees as a quiet pivot back toward balance sheet expansion. He argues that officials can avoid the phrase quantitative easing, but the effect is the same if the Fed is adding liquidity and growing the balance sheet again.

He also points to the pattern from 2019. Tightening exposed fragility, stress appeared in funding markets, and the Fed reversed course while insisting it was merely managing “plumbing.” Mike believes we are watching a similar reversal unfold again.

Why the pandemic matters to this story

Mike adds a crucial layer. He believes the system was already reaching a breaking point around 2019 and early 2020. The pandemic did not fix the cycle, in his view, but delayed the reckoning and made the imbalances larger.

That delay matters because it expanded the size of both the debt bubble and the asset bubble. In his telling, the cleanup that a recession normally forces was postponed, and now the pressures are returning with more weight behind them.

What this means for Gold and Silver

Mike’s bottom line is that the Fed is trapped. Tighten to fight inflation and risk breaking a debt-heavy system. Ease to stabilize markets and keep liquidity flowing, and accept more inflation and currency debasement.

He argues that this dynamic is why gold and silver have remained strong despite corrections. The metals are responding to a system that cannot function without recurring intervention, and to a currency regime built around managed loss of purchasing power.

Plan like you’re not going to get a gentle outcome

Mike closes with practical advice framed as urgency. If inflation is policy, saving in dollars means saving in something designed to lose value over time.

His recommendation is to hold real money, and he points to gold and silver as protection against the next phase of the cycle he thinks is already underway. He also highlights junk silver as an efficient way to get silver exposure, referring to pre-1965 dimes, quarters, and half dollars with 90 percent silver content.