Gold’s 30% price increase in 2023 is driven by Asian demand, central bank buying, and macroeconomic factors like U.S. fiscal irresponsibility and rising deficits, with expectations to surpass $2,100/oz in the coming years.
Silver is projected to break out of its current range, potentially reaching $75-100/oz in the next few years, with miners trading at all-in sustaining costs of $12-22/oz, resulting in substantial margins.
The best gold stock bull markets occur when the broader stock market is sick, with the current market just starting to show weakness, potentially leading to 10-bagger returns for some silver companies.
Lepard’s fund is up 30% YTD, with expectations to reach 100% in the next year, while indices rise 20-30%, as gold stock investors remain cautious due to the battered gold stock bull syndrome.
Risk management is crucial for mining investments, considering country-specific risks like resource nationalism and geopolitical concerns, with some West African countries’ mining permit threats viewed as empty bluffs.
ESG principles are important for mining companies, as they must be environmentally responsible and comply with First World standards to avoid harm to their operations and reputation.
The 2020 US election could lead to unprecedented market instability, with both parties experiencing desperation and panic, potentially triggering a monster bear market if the Fed cuts rates again, breaking key momentum levels.
Commodities, especially those related to agriculture, energy, and base metals, are likely to follow gold’s lead during market upswings, with the Bloomberg Commodity Index having corrected 50% back to its 2020 low of $58 and now trading sideways around $100 for the past year.
Gold could surge reminiscent of the late 1970s and early 1980s, where it experienced 8-fold growth from $103 to $850 during the stagflation period, potentially driven by stock instability, central bank issues, and government debt markets.
The silver-to-gold ratio is currently around 1.89, historically cheap, with a ratio above 1.3 potentially triggering a massive silver surge, reaching up to 2% of gold’s price, a phenomenon that has occurred 21 times in the past 50 years.
The dollar index peaked in 2022 at 115, now trading at 103, with technicals looking vulnerable despite the stock market breakdown, potentially leading to a rapid decline in all major Fiat currencies.
A looming government debt crisis could drive a short-term rally in T-bonds as assets flow out of stocks into perceived safety, but ultimately result in a downward trend in price and upward yield.
Central banks panicking can exacerbate underlying currency degradation and commodity price inflation, as the money unit collapses in real value, affecting people’s perception of rising prices.
The Fed has shifted focus from inflation control to defending the economy due to concerns over an inadequate job market, particularly in manufacturing and essential industries, and a looming debt crisis.
Focus on the top third of producing gold companies, top quarter of development companies, and top 5% of exploration companies for the best returns, as investing in the entire sector can lead to bankruptcy.
High-quality companies like Agnico Eagle are poised to benefit from upside surprises in earnings and stock prices, with potential for 10-bagger returns over the next decade.
Lithium prices fell 75% over 7 years due to a shortage of processing capacity, creating a focused investment opportunity for the next 2 years.
Oil and gas, particularly natural gas, is an attractive sector for investors with a 5-10 year time frame, offering the best return on capital employed despite being out of favor since 2001.
Tier one assets are large deposits with at least $10 billion recoverable reserves, generating $1 billion+ annual sales revenue with all-in sustaining costs in the bottom quartile globally.
Successful investing involves buying when assets are low and hated, and selling when they’re screaming up, a strategy that has worked for the speaker since age 30.
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