We did have a breakout to an all time I recently, but it was
only a daily breakout, and then the gold price came right back down into
that three month consolidation. So it's building a stronger base here. Gold bounced
off. It's a rising eighteen week moving average has been pretty strong support for
the past year or so. You were listening to Carrie Letz's Financial Survival Network
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Survival Network now more than ever, And welcome you are listening to and watching
the Financial Survival Network. I'm your host, Carrie lets Hey, what's going
on with the price of Goal silver? Silver's under thirty dollars? It's not
a huge bargain. Is it going up the three hundred? Like Eric Sprout
predicts, Well, let's find out with David Earfley, Junior minor junkie with
a y dot com and has got a question for David myself. Email kl
Kerrie. Let's go out David, how are you doing there, Ron Grey
Kerry, how are you always nice to see it? Oh? Lece so
go Like, we haven't been able to break twenty five hundred yet, so
we're getting closer, closer, closer, not quite there. Every time it
gets closed, something seems to happen. Yeah. What Well. Since we
had that monumental breakout of that thirteen year cup and handle pattern above twenty one
hundred back in March, gold's been making higher highs and higher loads. You
know, we had a four hundred and fifty dollars move in the space of
about nine weeks, and that's that move's been consolidating for about three months now,
but it's making higher highs and higher lows in that consolidation. We did
have a we did have a breakout to an all time high recently, but
it was only a daily breakout up and then the and then the gold price
came right back down into that three month consolidation. So it's building a stronger
base here. Gold bounced off. It's a rising eighteen week moving average has
been pretty strong support for the past year or so, so it came down
to test that, which at the time was around twenty three hundred, and
silver has just tested, it's eighteen We move a average here this past week,
I think it was this week, and it's tried to it's it's trying
to stay in its consolidation as well, So you know, it's all it's
all good as far as the metals are concerned. I mean, they're they're
at a bull market. They're making higher highs and higher lows. So question
it is, do we go buy silver now? Is it worth doing it?
Do we this the run? What are you there? Well, you
know, silver's got a long way to go as far as catching up to
the gold price. You know, the inflation adjusted gold CPI inflation adjusted gold
prices around twenty six ninety something like that, which which you know we're not
too far away from that, but and that's from nineteen eighty. But when
the Hunt Brothers tried to corner the silver market in nineteen eighty, the the
you know, the silver price got up to fifty bucks and the inflation adjusted
price for silver CPI inflation adjusted price for silver is around one hundred and fifty
hundred and sixty dollars. So silver is still massively undervalued in relation to the
gold price, and as well as the gold stocks. You see, you
know, the goals mining sector and silver both have been underperforming gold for quite
some time. Where do you get more leverage with the stocks or with silver?
I mean, if it's going to go up to one hundred and fifty,
that's that's a five bagger if it goes up that high. What did
the stocks do? Are they one hundred five hundred beggars? Yeah? Well,
I mean you said your question was you go with silver or the stocks?
How about silver stocks? But there's really not that many that I think
are worth investing in. You got you got to get a hold of a
basket of the right ones, and all that's going to take is just a
one or two of them to fly, and you're going to do really well.
I mean, this is what happened with me. Fortunately, back in
the two thousand and eight to twenty eleven run up. I got into a
couple of silver stocks. At the time, they were relatively unknown. One
was First Majestic Silver and the other one, yeah, and the other one
at the time was Wheat and was wheatn yeah, over called silver Wheaton then
and I got into those really heavy and you know, they were multiple,
you know, ten fifteen to twenty baggers for me. Yeah, heya.
You know, I really cleaned up on the first Majestic. They hadn't listed
warrants back then, and I loaded up of it. I mean I didn't
put enough money in it, unfortunately, but it was like a twelve bagger
in like two weeks. Yeah, yeah, I think there, Yeah,
warrants you get. You got to get the time being on those and you
get to do really well. Yeah. So but now there aren't, like
you said, it's not any silver pure plays that you want to touch,
right, yeah, absolutely, You just you've got to really do your homework
and get into the right ones at the right time, and then be very
patient. And with what's going on in the world, it seems to me
like we're looking all over the world for this stuff, but the jurisdiction or
risk is increasing by the day, right it is. And then you have
these top tier jurisdictions also in North America, where you know, they're fabulous
jurisdictions to operate in. But as far as getting the getting your your project
permitted, that could take a really long time. So for for instance,
and you know in Canada and in the US, it might take you know,
seven eight, nine years to finally get your your proud year project permitted
once you get close to to the feasibility stage and you've got to wait several
more years to get it permitted. But then the flip side of that,
you've got some of these West African companies cut countries where the governments own you
know, a portion of the mind and they want to get you permitted quickly.
So you know, you could go from discovery to construction within three or
four years in some of these West African countries. That's like the only place
really in the world where you can do that, right absolutely, yeah,
but you just you but but then you know you've got to deal with with
with with the West African risk as well. Yeah, so you've got to
governments come and go like forget it, right, Yeah. I mean there's
you know in a place like Burkina Faso where there's you know, there's a
coup every couple of months, there's you know, but as far as the
but as far as the country is concerned, you know, these these mines
get permitted quickly. A lot of gold mines have been built in Burkina Faso
in the past twenty years, and their discoveries are made and then permits are
given quickly and the mind is constructed. Uh and and the company does really
well, but still not as well as a top tier jurisdiction because uh,
investors see that it's West Africa. They feel, okay, this is this
is a risky place to do business, even though the mine is doing well,
the company is doing well. That you've got it. You've got you
know, a discount on the share price, and of course you got productivity
issues once you get outside if you get it so called top tier jurisdicitions,
right right exactly, Yeah, wild, yeah, I mean it's it's yeah,
it's it's funny because you know, during the last major bowl market in
the mining sector from two thousand and one to twenty eleven, especially towards the
end there, permitting really wasn't an issue. Uh. You know, investors
they were just clamoring for more ounces. They were, they were there,
they were you know, they were they were telling their the majors that they
were owning, Hey, we need more ounces golds flying you know, care
we needed at any price. So they invested in you know, these low
grade bulk tonnage projects just to get ounces on their books, and permitting wasn't
it wasn't even issue. Nobody even looked at that at them. So when
we last spoke, we talked about a little company probably remember called Numat,
Yes and Numat at the time I believe was forty one or two. It's
now hit forty eight, and that's anticipating blockbuster earning. It's coming up.
I was planning to buy options, but in the account where I wanted to
buy them, I didn't have options. Authorization didn't. But I knew it
was going to happen because we said they're doing like a couple of million ounces
a quarter, and you multiply that time it's three four hundred dated right,
hidden that's like right, And they had already written everything off. They were
smart, Like year two years ago, they said we're getting rid of all
this stuff. They wrote off everything but the kitchen, saying they took their
it because they knew this was coming right, smart, right, Yeah,
absolutely, I mean, and now they're you know, they're basically in a
league by themselves after they gobbled up New Crest and they're they're producing nearly twice
as much as the number two gold miner, which is now a Nico Eagle.
You know, Eric keeps keeps getting getting lower and lower as they're they're
not jumping on the M and A bandwagon. But as far as Neumon is
concerned, you know, it's interesting you bring them up because they're going to
be kicking off Q two earning season after the bell today here on Wednesday,
and I expect their profits to be record breaking, monster profits because if you
take a look at what happened with them in Q one, you know,
they they they had they had blowout profits and the stock went up twelve and
a half percent the day they announced earnings, and it was by far the
largest gainer on the S and P five hundred. And by the way,
Numon is the only gold miner on the five hundred, and we're going to
have these they're there their Q two announcement after the bell today, like I
said, and the gold price back then averaged around twenty seventy to twenty ninety
that announce back in Q one, and in Q two the gold price averaged
two hundred and fifty dollars higher, and the oil price, which is probably
about fifty to sixty percent of Newmont's costs. Because you know, they have
these huge open pit diesel guzzling gold mines, right, and that the oil
price went down sixteen per sixteen dollars during Q two, so their costs are
probably going to be either flat or a little lower, while the gold price
went up two hundred and fifty dollars. So I expect numont is probably going
to be announcing another monster quarter. And nobody's really paying attention as far as
the street's concerned. You take a look at the at the at the volume
and GDX and GDX j ever sets it ever sets gold hit another all time
high here a couple of weeks ago. The volume has been decreasing down,
down, lower and lower as everybody's still concentrating on the stock market, right,
So nobody's really expecting what new mas Is is about to announce, I
think, and you know, once if they if they come out with another
blowout quarter, that's back to back quarters. They're going any fund managers and
been big money traders there, they're they no longer can ignore this sector.
You know, they've been ignoring the gold mining sector for the past decade.
I mean in twenty thirteen, twenty twelve, twenty thirteen, when the gold
price lost fifteen hundred dollars an ounce. That's when the bottom fell out of
the mining sector and the generalist investor left in mass and they've yet to return.
And you and the evidence of that is just looking at the volume of
GDX and GDXJG just keep sitting lower and lower and lower. And the old
adage never short a dull market comes to mind. You know, we've got
today, We've got the stock market is rolling over and gold and the gold
stocks are going higher. They're starting to decouple. That's not a trend,
you know, that's that this is this is just day one. I don't
know if that's going to continue, but I know the Magnificent seven stocks lost
about a one point three trillion in value in one week recently. They went
to a to a total market cap of seventeen trillion down to fifteen trillion recently
here. So I think there's going to see You're going to start to see
some sector rotation coming into the gold mining stocks, especially if you see back
to back blowout quarters from these miners. Yeah, well, look got a
nimock was an easy one. And the best thing was even in Q one
they had some write offs there that kind of artificially the press, right,
and they announced divesting their their by divesting some non core astes, they're going
to pay off some debt. So their ballant sheet is getting stronger and stronger.
And that's happening with a lot of these gold companies, right, I
mean, that was the thing right back during the last full market. Their
balance sheets were crap, and they took on all these projects that needed higher
gold prices and they did it with stock. So it kind of kind of
ruined the industry for a decade. But now they've come back strong and they've
got really they got really strong ballot sheets. They're paying dividends. I mean
back when I got into this sector twenty years ago, it was unheard of
that a minor paid a dividend. Definitely, So they're paying dividends, they're
doing stock buybacks, their ballot sheets are healthy. Now they've got to start
concentrating on growth. So that's where the juniors coming because the reserves are declining.
We know exactly the resources they're declining, and they got to be looking
for they discoveries and that's where the high quality not an oxy war on jiniors
come in. And you know there's about ten percent of them out there that
have something. But you know, I've been in the business long enough,
like you. I was looking at a list of companies from It's Ticket was
back in like twenty eleven or maybe it was twenty thirteen that one of the
conferences, and you know what covered there were some old dogs that just never
die. But most of those companies they've been I don't know if they've been
rebranded, they didn't exist anywhere, but they've been gobbled up or they've gone
under. Yeah, I mean there's yeah, the turnover is is you know,
could be large. You know, there's there's a lot of lifestyle companies
in the junior sector. I mean, I'm with Rick Rule, you know.
I mean that eighty eighty five percent of them are uninvestable. So you
know, really got to get you got to you got to sharpen your pencil
and do your due diligence and make sure you're getting into the right one because
you know, you want to you want to make sure to to to accumulate
a basket of them because like I said before, you know you're gonna have
You're gonna have some dogs. It's gonna happen. Yeah, you know,
it's it's like a it's like a hitter in baseball, right, you're in
the Hall of Fame if you if you go twenty years and you have a
battering, you average over three hundred. Well, it's the same thing in
picking junior stocks. You have you know, if you get three out of
ten, you're doing well, like any think. So all right, that's
obviously why people need to subscribe to Junior minor Junkie and just tell us what
you do and just let me stay up front. What I'm like best is
when you give a buy reco or a settle, you wait before you execute
your own trade to let your subscribers get in, which is the utmost of
them. Heygardie in an area where it's sometimes lacking. Absolutely, Yeah,
when I started my newsletter back and now back in April of twenty seventeen,
it doesn't seem like it was long ago. But I wanted to make sure
that I was completely transparent and that basically, you know, I'm whatever I
invest whatever I'm I'm recommending others invest in that I'm going to invest in also,
and I want to want to give them the opportunity to get in.
At the same time, I do. So what I do is I if
I'm if I'm about to purchase a a position in a junior, I'll do
a detailed company report on the stock and I'll send it out to my subscribers
the day the day before I plan on beginning to accumulate the stock, so
we could kind of all try to get in it together and hold it and
hold it for a period of time to where it's going to make us at
least three to ten times our money. I won't touch a junior unless I
see at least three times potentials three times upside potential in the stock. So
basically, it's a completely transparent service. I let everybody know what my trades
are, what I buy, what I sell, how much I made,
how much I lost, and it's it's done really well. I got a
great subscriber base, and I work very hard. You know. The the
newsletter comes out every week. It's a weekly newsletter, and even if I'm
on vacation, it's sure it's a scale down one. But I still put
out of weekly newsletters because that's because I love I love my job and I
love helping people make money in the sector. Hey, all right, so
we've got a cross over, David or myself she meet emailed Kate el at
Caerrie Loves dot com. The link to junior writer Junkie dot com is in
the show notes of this interview on Financial Survival Network dot com. While you're
there, sign up for your free newsletter. David, It's going to be
interesting and be interesting to see how long this ride lasts. Absolutely, yeah,
I think the second half of the year is going to be really is
going to do really well for investors in the in the junior sector. Thanks
for listening to Carrie Letz's Financial Survival Network, your solution to today's trying times.
For the latest, go to Financial Survival Network dot com. Financial Survival
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