Are gold and silver back?

Disclosure: S3 Consortium Pty Ltd and its associated entities may hold direct or indirect interests in securities referred to in this publication and may receive fees or other forms of consideration from entities mentioned. These interests and arrangements may create a potential conflict of interest in the preparation of this material.

The information contained in this communication is provided for general information purposes only and may relate to speculative investments. It does not constitute financial product advice, and has been prepared without taking into account your personal objectives, financial situation or needs. You should consider obtaining independent financial advice before making any investment decision.

Any forward-looking statements are uncertain and not a guaranteed outcome.

Gold and Silver are on the move again.

Silver up over ~5% last night.

Gold up ~4% last night too - a huge single day move for gold.

And yes...

The gold and silver price chart screenshots are back:

(might even soon dust off a new “cup and handle” that we are seeing...)

(source)

The past performance is not and should not be taken as an indication of future performance. Caution should be exercised in assessing past performance. This product, like all other financial products, is subject to market forces and unpredictable events that may adversely affect future performance.

So the big question is - Is the global “debasement trade” back too?

Let’s drop the financial jargon for a second and explain what the “debasement trade” actually means:

Governments are spending far more money than they collect.

For a government, the easiest way out of ever-growing debt is to print more of its own money.

More money, chasing the same amount of stuff, means each dollar buys less - that's called currency debasement.

So the "debasement trade" is simple: own the things that governments can't print.

Gold, silver, hard assets - anything with a fixed or slow-growing supply.

You can’t just ‘print’ more gold or silver.

(If you melt down every ounce of gold humanity has ever mined - from ancient Egyptian pharaohs' treasures to modern wedding rings and tech components - it condenses into a single solid cube measuring ~22m on all sides.)

So the “debasement trade” is where global investors pile into all things gold and silver - the physical commodities AND gold and silver stocks.

The debasement trade gained popularity and an early run during the second half of 2025.

This was when gold and silver both delivered those outrageous price runs to all time record highs, and took ASX gold and silver stocks along with them.

But alas, as we often say, the past performance is not an indicator of future performance.

Things cooled off over the last 6 months...

(like most global trades, the initial hype phase saw too many speculators pile in too hard and too early. We needed the real world to catch up - ie the 2018/19 battery metals run before 2020 mega bull)

In the last 7 days we have seen:

• Jul 31 - Aug 3: The Japanese yen hit a 40-year low, forcing Japan and the US into their first joint currency intervention since 2011- a ~US$59BN rescue just to stop a major fiat currency from sliding further.
• Aug 3 - South Korea’s central bank went on record saying it will start buying gold for the first time in 13 years to “support ⁠its management of foreign reserves”.
• Aug 4: New analysis showed five of the seven G7 nations (all but Germany and Canada) now spend more on debt interest payments per year than on their entire military spending.
• Aug 4: The US Treasury lifted its Q3 borrowing estimate to US$739BN. $68BN more than planned just three months ago... with another $628BN pencilled in for Q4.
• Aug 4: Central banks bought a record 289 tonnes of gold in Q2 (up 62% year-on-year) - the money printers themselves are stockpiling the thing that can't be printed.
• Aug 4-5: Weak US jobs data slashed the odds of a September Fed rate hike, sending gold up ~4% through $4,200 and silver above $62.

Current reality catching up to the 2025 hype?

The last 3 days in gold and silver have certainly felt a bit FOMO-y...

Small ASX gold and silver stocks are starting to bounce hard off their lows

Before the 2025 gold and silver run, we added small ASX gold and silver stocks to our Portfolio.

And yes we probably should have trimmed down our positions a lot more during the January 2026 peak - but our theory is that gold and silver still have a long way to run.

We think there will be a second and bigger run in the gold and silver prices.

The mystery is if (when?) exactly this will properly begin - no one really knows.

But the last 3 days (especially last night) is the most alive we have seen gold and silver in a long time...

It’s only a few consecutive days of significant rises, so of course it could be another false dawn...

OR could this be the re-ignition of the global investment community’s interest in the debasement trade?

Our overall thesis is that if gold and silver deliver a wild run - then small gold and silver stocks will go with it.

We already saw this happen during the gold and silver run 6 months ago.

We have positioned our portfolio accordingly. But of course we could get it wrong. Like anything in life and the markets, there’s no guarantees.

Here are all of our gold/silver exposures (click the link to read our Investment Memo):

Our silver Investments:

• SS1 ($199M) - Silver in Nevada, USA
• IVR ($118M) - Silver in South Australia.
• BKB ($87M) - Silver in Texas, USA. (plus gold in Nevada)
• WCE ($41M) - Silver in Western Australia.
• MTH ($40M) - Silver (and gold) in Mexico.
• RCM ($38M) - Silver in New South Wales.
• AVM ($32M) - Silver in Mexico.
• PAT ($18M) - Silver in Peru.
• PFE ($10M) - Silver in Arkansas, USA.

Our gold Investments:

• TTM ($171M) - Gold in Ecuador.
• KAU ($115M) - Gold producer in Tasmania and Victoria.
• RML ($98M) - Gold in Idaho.
• BKB ($87M) - Gold in Nevada.
• HAR ($38M) - Gold in California, USA and in Senegal.
• AVM ($32M) - Gold in Victoria.
• WAU ($28M) - Gold in Western Australia.
• BPM ($23M) - Gold in Western Australia.
• PUR ($18M) - Gold in Argentina
• TG1 ($13M) - Gold in Western Australia
• LSR ($13M) - Gold in Western Australia

Out of the lists above, below are the ones with major potential share price catalysts inside the next 30 days (based on recent company announcements).

Specifically focusing on drill results - the market loves a big drill hit when gold and silver FOMO is on.

IF gold and silver are about to start a run over the coming weeks, it would be a great time to announce a face melting drill result...

(keeping in mind that drilling often leads to face-saddening (freezing?) results that aren’t exciting)

Our gold and silver companies in the middle of a drill campaign where a result could be announced any day now are:

• Resolution Minerals (ASX:RML) - assays pending from gold-tungsten discovery in Idaho, USA - next to $4BN Perpetua Resources. (read our latest RML article)
• WA Gold (ASX:WAU) - Assays pending from drilling on its gold project next door to $1.5BN Minerals 260 (read our latest WAU article)
  
• Advance Metals (ASX:AVM) - assay results from its 22.4M ounce silver project in Mexico (we are following this one on a hole by hole basis after the recent copper hits from the project). (read our latest AVM article)
• Rapid Critical Metals (ASX:RCM) - RCM shouldn’t be too far away from drilling results on the discovery made last year. This time drilling is from east to west into that newly discovered structure - so we should know for sure IF RCM’s made a big new discovery or not with these results. (read our latest RCM article on that discovery - and watch RCM CEO talk about the company here)
• West Coast Silver (ASX:WCE) - WCE just finished drill testing underneath and around what was once Australia’s highest grade silver mine. Assays from that drilling are expected this month. WCE has a track record of putting out some seriously high grade results which the market usually responds well to when silver prices are up. (read our latest WCE article)
• Black Bear Minerals (ASX:BKB) - assay results from silver project in Texas, we could also get a surprise conversion of its 17.6M ounce silver equivalent foreign resource estimate into JORC status on this one. (read our latest BKB article)

BKB also had some results out this morning (re-assaying old holes) - let’s see how the market reacts to that news with silver up overnight.

• Sun Silver (ASX:SS1) - drilling right now at its ~539M ounce silver equivalent deposit in Nevada, USA. We already know the silver is there. The big surprise here could be antimony hits + a potential maiden antimony JORC resource estimate. (read our latest SS1 article)

Check out SS1’s Managing Director Andrew Dornan’s presentation at Diggers and Dealers here.

A solid preso, our favourite line was - “this in a gold equivalent at today’s ratio is 7.2M ounces at ~1g/t” - a very nice way to make it easier to understand the size/scale of SS1’s project.

If you want a reminder on our broader gold and silver thesis: Here is our gold and silver Ebook from a few months back.

So why the sudden interest in gold and silver again?

On Monday, the US Treasury intervened in currency markets to prop up the Japanese Yen - and US Treasury Secretary Scott Bessent is basically saying he is ready to do whatever it takes.

Long story short, the US Treasury is getting the Japanese some USD without Japan needing to sell US assets/treasuries.

(like having a big known seller of a stock - but offering to buy them out off market so they stop selling on market and crater a company’s share price)

(source)(source)(source)

Without US intervention, the Japanese would have had to sell down its giant pile of US Treasuries to effectively raise US dollars.

(Japan is the biggest foreign holder of US Treasuries holding ~US$1.1 trillion).

(source)

IF the US did nothing and Japan dumped its US treasuries it would push US rates higher (and risk damaging the US domestic economy).

Long story short - the US Treasury is out in the market defending... the US Treasury market.

Which means more US dollars getting pumped into the system and a US government openly signalling it wants its currency weaker.

(weaker dollar + more dollars = gold's two favourite things at once)

We also saw the below news go around the traps this week - five of the G7 countries now spend more on interest payments than they do on their entire military:

(source)

So the G7 countries need to decide if they cut spending to fund things like the military or just pick the easier option and just print more cash.

(we all know which one governments historically pick)

Just quietly - US money supply actually hit another record recently - US$23.16 trillion.

(source)

Every time that chart goes up and to the right, the “value of the USD” should theoretically get lower.

This is why we said the fundamentals of the gold market appear STRONGER now than at the January peaks.

We think this week could be the catalyst that re-energises everyone who was in the "USD de-basement trade" and "gold as the reserve asset" camp over the last two years.

And then - inevitably into silver.

Also - again, we could be wrong... this is just one thesis.

What could go against our thesis?

The big obvious risk with everything in this article is IF gold and silver prices reverse and go backwards.

There is always a chance the current move is a temporary move higher AND over the next few months we could be completely wrong about which direction gold/silver prices head in.

We have seen a few bounces like this during the washout already.

IF gold and silver prices were to fall, no matter what our Investments do (drilling/permitting etc etc), their share prices could move lower/sideways based on the markets overall sentiment towards the sector.

For the individual stocks, the big one is exploration risk.

A good chunk of our list is drilling RIGHT NOW with assays pending.

We said earlier that a face melting drill result into a rising gold and silver market is the dream scenario...

...but most drill results are NOT face melting.

Drilling regularly returns thin, low grade or plain boring intersections - and a disappointing result released into a hot market usually gets punished harder than normal.

Funding (and dilution) risk is always present with small caps.

Almost every company in our lists is pre-revenue and will need to raise money again at some point.

Raises mean dilution - and raises done during weak patches mean dilution at unfavourable prices.

And finally - remember that we are biased.

We hold positions across the stocks in this note, we are long gold and silver exposure, and we have written today's note through that lens.

These are all speculative small cap stocks - only ever invest what you can afford to lose, and always do your own research.