| Sorry for all the alliteration in today’s headline and deck, but the old copywriter in me couldn’t resist.
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| That aside, I want to share with you some important impressions from last week’s Mines and Money Miami conference, where I participated on a panel and talked with dozens of junior mining companies in this one-to-one meeting format.
This was an outstanding event, very well run and brimming with opportunities (as you would expect, with share prices at extreme lows). I enjoyed some stimulating conversations with the London-based production team behind this event and look forward to working with them in the future, perhaps with this year’s New Orleans Conference (more on that to come).
Most importantly, I was like a kid in a candy store exploring all the premier opportunities to be found.
Now, I’m extremely selective with our Gold Newsletter portfolio, but I found one company that is so undervalued, has so much cash and has drilled off so much gold, that I’m going to add it immediately to our buy list while it’s still such a bargain.
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| I’m going to unveil full details on this extraordinary situation in a couple of days in our March issue of Gold Newsletter.
If you’re not already a subscriber, I urge you to join up now here. This one new recommendation could pay the cost of subscribing hundreds of times over.
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| In the meantime, I want to tell you about my experience on a panel at this conference, where we analyzed the metals and mining markets.
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| The Big Mistakes Even The Smart Investors Are Making
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| I was one of five analysts on this panel, along with a very highly qualified moderator, and everyone was a brilliant expert in their own area.
I won’t share all the names because there isn’t a transcript and I can’t remember who precisely said what, but suffice to say that I disagreed with a few of the points that others made. To wit:
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| • Silver is now mostly an industrial metal and has proven to be completely uncorrelated with gold.
• Gold isn’t going to go anywhere until the stock market crashes or at least corrects significantly.
• The industrial story — the rising demand for “battery metals” — is the biggest story right now and will be the big driver for silver.
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| If you’ve been reading my commentaries for any length of time, you know I disagree strongly with all of these statements. And I wasn’t shy in saying so in the panel.
I shared my view that the monetary drivers are and will remain the biggest factors by far for gold and silver. I told the audience that we’re in the end game of a four-decade-plus trend of ever-easier money, and that the Fed’s next emergency move will be so dramatic that it will lift not only gold and silver, but also all risk assets (stocks included).
I think I made my point sufficiently well and that the audience agreed with me.
I’m going to expand on these points, and many others, in the next issue of Gold Newsletter coming out this week.
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| I’m also going to talk about a major new shift in global gold flows, one confirmed by one of my fellow panelists, Joe Cavatoni with the World Gold Council.
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| You see, Western investors have been completely absent from today’s gold market. The holdings in GLD, the biggest gold ETF, are plummeting and open interest on the Comex is at multi-year lows.
At the same time, withdrawals on the Shanghai Gold Exchange were at the second highest level in history last month. This is the best proxy we have for domestic gold demand in China, and it’s showing that they’re buying gold hand over fist right now.
This is highly unusual, because Asian gold demand has been historically price sensitive; these buyers typically come in strongly on big price declines.
That they are buying so eagerly speaks to the economic drivers in China right now, and their willingness to keep buying as the price increases. Conversely, when we get a real breakout in the gold price, the trend-following Western buyers will turbocharge the trend.
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| We know that the Fed’s eventual pivot will spark the next move higher in gold. All the evidence now points to this move being one of the most dramatic ever.
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| If you’re not already prepared, I urge you to get ready now.
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| Brien Lundin
Publisher, Gold Newsletter
CEO, the New Orleans Investment Conference
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