Danny Moses: Gold's Make or Break Moment is Here

**Guy Adami** (0:00)
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**SPEAKER_2** (1:05)
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**Guy Adami** (1:30)
A very warm welcome to the Risk Reversal Podcast. That sexy man you see, you know who he is. That's Danny Moses, the great Danny Moses. Of course, a big short fame, but so many other things. Hello, Danny.

**Danny Moses** (1:43)
Hello, Guy. Good to see you. Happy summer. Happy middle of summer.

**Guy Adami** (1:48)
That is so good. You used a phrase before we were talking about the horse races. You used a term, an Italian term.

**Danny Moses** (1:54)
Intermezzo. You said, what's going on? I go, this is like the intermezzo. This is before the big Saratoga races, then the Breeders Cup and all that. This is like the three-year-olds are maturing. This is an interesting time. The horse sales are coming up, Guy, and I'm sure you're buying one this year. Yeah.

**Guy Adami** (2:09)
Well, that is one of my goals in life, a goal that has not been achieved, and people are probably saying, I wish Guy would mature a little bit, but it's probably not going to happen at 62 years old. Let's take a look at some of the things that transpired this week. We're taping this on a Friday, and what we think is going to happen in the ensuing week. We obviously have some earnings, we have a Fed meeting, so let's take a look back. I will throw in my two cents and say, moving yields in a word is troubling, Danny Moses.

**Danny Moses** (2:40)
Yeah, the yields certainly were back to where we were about a year and a half ago, maybe even a little long, yeah, about a year and a half ago, and you're at 4.7%.
I know Carter Worth had been talking about kind of 4.62 was resistance, but Guy, obviously, it's not just the yields here, it's globally and you look at Japan and they're doing everything they can to hold their tenure yields down and their currency keeps weakening. I don't mean to front run the stuff we're gonna talk about here, but no, mortgage rates are going higher, everything's getting a little bit more expensive again. And I know we're gonna talk about kind of the Fed next week, they're certainly in a pickle, but I think if people believe that Trump is gonna stay quiet on the Fed and leave Boershe alone, I think we're gonna see some activity next week.

**Guy Adami** (3:25)
I agree with that, and we're not gonna jump anything, let's talk about what's going on in Japan, because I've brought this up, I know when you and I were podcasting together more frequently, this was something that was concerning us both, but what's amazing is we've been talking about this for the better part of a couple of years, all of our concerns have been warranted through the lens of what's going on in Japan, but for some reason, it has not made its way into our equity market. I will say, their currency continues to weaken. I think you're talking about, again, the weakest it's been in 40 years. You just mentioned the bond market.
That is a relationship problem, as Elizabeth Thomas says, a deteriorating bond market and a deteriorating currency, and they're gonna have to sort of pick one, and in picking one, it's gonna screw up the other. I don't know if there's an elegant way out of this thing.

**Danny Moses** (4:16)
So there is a relationship with the largest foreign holder of US Treasuries. They have been selling.
Oil for them is really the stress point. They import it all. And so when you have a weakening currency with oil going higher, everything becomes more expensive, and inflation, careful what you wish for. For decades, they were trying to get inflation. Well, now they have it, and now they have an issue. So we have the Fed next week, and the BOJ is next week as well, at the end of the week, and so it should be quite a week. And let's not kid ourselves, Scott Besson is all over this, in the sense of what he needs to do, talk to Japan and figure it out. He can't afford to lose a buyer of our treasuries, and he can't afford to have this carry trade potentially unwind on him. And so we're back to those kind of levels, Guy, where everything's at its limit, in terms of how much this market can take, certainly where the S&P 500 is, right? Certainly where the economy is, and all these affordability issues, which many are just self-inflicted, to be honest with you. And so we're kind of there, Guy, we're hitting the stress pole.