Weekend Show – Sat 13 Jun, 2020

Hour 1 – Making sense of the US Market Selloff and an update from Great Bear Resources

Full First hour

At the end of the week fear entered the markets as the S&P had its largest one day drop in 12 weeks. This was on the back of a Fed meeting which confirmed that ZIRP is staying for the foreseeable future and that they are still worried about the US economy.

On this weekend’s show we focus mostly on the stability of the US markets with an update from Great Bear Resources to wrap up the show.

Please keep in touch by emailing me at Fleck@kereport.com. I love hearing about the companies you think have good prospects.

  • Segment 1 and 2 – Mike Larson kicks off this hour with a focus on the crazy moves in bankrupt companies the broad US markets this week. Also addressing the Fed’s statement that locks in the easy money policy through 2002.
  • Segment 3 – Dana Lyons shares his trading strategy for US markets and safe haven assets.
  • Segment 4 – Chris Taylor, President and CEO of Great Bear Resources (TSX.V:GBR & OTCQX:GTBAF) recaps recent high grade drill results announced this week from the Dixie Project.

Exclusive Company Updates This Week


Mike Larson
Dana Lyons
Chris Taylor – Great Bear Resources

Comments:
  1. On June 13, 2020 at 4:06 am,
    bonzo says:

    After selling 1/2 my NGD@1.50 on Thur I decided to throw caution to the wind and bought more NSRPF@2.39 yesterday morning. It rose to 2.49, fell to 2.34, and closed@2.42.
    This is more exciting than NFL football which I will never watch again.

  2. On June 13, 2020 at 6:11 am,
    Charles says:

    Thanks for the show KER!!

    • On June 13, 2020 at 7:33 am,
      Excelsior says:

      Agreed. Thanks to Cory, Big Al, and all the KER contributors to another great week of daily editorials and the weekend show.

      Ever Upward!

  3. On June 13, 2020 at 7:43 am,
    Excelsior says:

    Goldies Added to the S&P/TSX Composite Index
    June 12, 2020 by EconomicAlpha

    – Dundee Precious Metals (TSX:DPM)
    – Equinox Gold Corp. (TSX:EQX)
    – Lundin Gold Inc. (TSX:LUG)
    – SilverCrest Metals Inc. (TSX:SIL)
    – Teranga Gold Corporation (TSX:TGZ)

    https://economicalpha.blog/2020/06/12/goldies-added-to-the-sp-tsx-composite-index/

    • On June 13, 2020 at 7:46 am,
      Excelsior says:

      GDXJ MVIS Q2 Rebalance Update
      June 12, 2020 by EconomicAlpha

      MVIS completed their review and revealed the updates. The (GDXJ) changes will take effective at MOC next Friday June 19.

      Deleted:

      – China Gold International (CGG)

      Additions:

      – West African Resources (WAF)
      – Alkane Resources (ALK.AX)

      https://economicalpha.blog/2020/06/12/gdxj-mvis-q2-rebalance-update/

  4. On June 13, 2020 at 8:03 am,
    Excelsior says:

    The Metals, Money, and Markets Weekly by Mickey Fulp

    Kitco Media – June 12, 2019

    “Join The Mercenary Geologist Mickey Fulp and Trevor Hall of Mining Stock Daily every Friday afternoon for a recap of metals, money, and markets. ”

    https://soundcloud.com/kitcomedia/the-metals-money-and-markets-weekly-by-mickey-fulp-june-12-2019

    • On June 13, 2020 at 2:09 pm,
      Excelsior says:

      One For The Ages
      Jun. 11, 2020 – Jesse Felder

      “The stock market has set many records this year. After putting in the fastest 10% decline from a new high, it then put in the fastest 20% and 30% declines.”

      “An unprecedented boom in money printing for the explicit purpose of supporting asset prices is certainly part of the reason for the recovery but it is also important to note what that money printing has inspired: an unprecedented boom in financial market speculation by retail traders.”

      “Combine massive money printing with mass speculation and record low liquidity (in futures and almost every other market) and you get the fastest 50-day rise in the stock market on record.”

      “One trend I’ve been following for a while now is the growing participation in the financial markets on the part of young individuals. Since most brokers went commission-free, following in Robinhood’s footsteps, the interest in trading has gone through the roof. This week feels like the narrative is reaching a crescendo.”

      https://seekingalpha.com/article/4353375-one-for-ages

      • On June 13, 2020 at 2:11 pm,
        Excelsior says:

        Licking Yesterday’s Wounds Today
        Jun. 12, 2020 – Marc Chandler

        “The nearly three-month rally in risk assets ended with high drama with a stomach-churning almost 6% slide in the S&P 500 yesterday…”

        https://seekingalpha.com/article/4353494-licking-yesterdays-wounds-today

        • On June 13, 2020 at 2:19 pm,
          Excelsior says:

          Economic Reality Sets In: This Could Be The End Of The Ever-Popular Buy-The-Dip Strategy
          Jun. 12, 2020 – Altitrade Partners

          Yesterday, Jerome Powell burst the stock market bubble by publicly acknowledging there will not likely be a “V”-shaped economic recovery.

          “He indicated that it will take years for the economy to return to the recent levels of economic growth that we experienced just a mere four months ago.”

          “Investors that had hoped for a continuation of the 11-year bull market, were whistling past the graveyard. The Great Bull Market is over. RIP.”

          https://seekingalpha.com/article/4353511-economic-reality-sets-in-this-be-end-of-ever-popular-buy-dip-strategy

          • On June 13, 2020 at 2:22 pm,
            Excelsior says:

            S&P 500: Why This ‘Pullback’ Will Likely Continue
            Jun. 12, 2020 – Victor Dergunov

            “The S&P 500/SPX just had a pullback of 7%. However, the selling is probably not over just yet.”

            “The Nasdaq corrected by around 5.5%, but if a crucial technical level is breached, the correction could be around 12%-13%.”

            “The VIX illustrates that many market participants became extremely complacent and were caught off guard by the violent selloff.”

            https://seekingalpha.com/article/4353605-s-and-p-500-why-this-pullback-will-likely-continue

  5. On June 13, 2020 at 8:07 am,
    Excelsior says:

    Chris Vermeulen: Gold Wins in All Situations Moving Forward

    Palisade Radio – June 12, 2020 #AudioInterview

    “Tom welcomes Chris the founder of Technical Traders Ltd. back to the program. Chris discusses the current market conditions and why a trend change is coming as precious metals, miners, and bonds are all showing positive patterns this week. Sentiment is reaching new highs, and a lot of leverage is being deployed in the markets.”

    https://youtu.be/d3fLjKE3S4k

  6. On June 13, 2020 at 8:38 am,
    John says:

    Silly question, but how Do I cast your report to my google home?

  7. On June 13, 2020 at 10:02 am,
    Dick Tracy says:

    Sprott Weekly Wrap, June 12, 2020. Always a good listen, Eric mentions a few of his favorite stocks but he is particularly salivating over T.FVL, Freegold Ventures. DT

  8. On June 13, 2020 at 12:24 pm,
    David says:

    DT:
    I picked some Freegold when they had those excellent drill results and saw Sprott already been buying. Evidently they have a fairly big resource already. Sprott has mentioned at least 3 buys. I am up over 30% but they may be only as good as their next drill. Sprott also talked about Tudor with a possible large resource in the Golden Triangle. Then he through in about his interest in Discovery as a silver play with their large resource. I own all 3 but just acquired Tudor. Last week I entered Teuton And made some profit. Then looked at Tudor and got more interested in the Tudor resource and swapped. Of course Tudor and Freegold are in cold zones which have weather limitations, but this is June and we have some possible drill results. Discovery, I added to as its been slow along with silver to get going and with their resource should go with silver when and if…
    Sprott pumps usually work …but I guess the Fed meeting affected momentum. I will be glad when I can quit trying to guess which stocks will be good in a rally and actually see them perform. But, that might be too easy.

    • On June 13, 2020 at 2:48 pm,
      Excelsior says:

      Hi David. Good point about the weather limitations around Golden Triangle plays (like Teuton & Tudor you mentioned, but really most most miners there), and the need to contend with big freeze and thaw every year, and impetus to drill like crazy from June to September.

      We are in the window to be watching all the drill plays to see who hits paydirt and who hits dusters.

      As for (DSV) Discovery in Mexico, I’m very jazzed to see how their second half of the Phase 1 drill program goes, as they were doing great during the first half until the Covid 19 global shutdowns.

      Cheers!

      • On June 13, 2020 at 3:19 pm,
        Dick Tracy says:

        Ah Yes, David and Ex, and then there is Pure Gold, you don’t have to worry about them, they are a buy and hold. It is almost too good to be true. DT

        • On June 13, 2020 at 3:33 pm,
          David says:

          Yes on Pure Gold. I have had it for awhile and it sat and sat. Then I halved it… and it sat and sat. Then I bought some Great Bear, and some mire and some more. What’s going on with Pure Gold? Then at a MIF or one of the conferences, pure Gold was a popular pick as we entered 2021. So I added back. And then slowly but surely, it is up 75% while no one is looking. I think it it is on Gwen Preston’s agenda on the June 18 th MIF. That’s a good thing. Red Lake has some good stuff.

          • On June 14, 2020 at 9:29 am,
            David says:

            2020 instead of 2021. I guess all years look alike when buying miners.

          • On June 15, 2020 at 7:41 am,
            Charles says:

            Thanks for your thoughts Ex. Yeah Bonterra has floundered. I own it and am in a slight loss position. Might trade it for Pure Gold as it seems like a little safer play at this point. I really appreciate your detailed insights.

          • On June 15, 2020 at 10:00 pm,
            Excelsior says:

            Hi Charles.

            Pure Gold is definitely hitting their stride and will have nice leverage to rising gold as they move towards production, and Red Lake projects are in demand with Evolution Mining taking over Goldcorp’s Red Lake Mine, with the continued exploration success from Great Bear and Pacton on the move in the area as well.

            With Bonterra, for the record, I still really like it and believe it represents a very attractive value proposition at these depressed prices, and may have further to run from present levels, on a percentage basis, than Pure Gold as they work to turn their ship around. However, it may take Bonterra a while longer to start to get some traction, and they’ll have to find a way to recapitalize their operations with a larger partner. They also started their winter drill programs late in the season in Feb, and then immediately had to shut them down in March due to Covid 19. That is a real bummer as that drilling was going to hit a number of highly anticipated targets and it got shelved.

            Pure Gold is a safer bet, with a bright future, but Bonterra is an attractive underdog bet that will be due a nice re-rating when they finally figure out a financial solution to the mess they are in.

            May

        • On June 13, 2020 at 3:43 pm,
          Dick Tracy says:

          I was always aware of Pure Gold but when Ex started to draw attention to them, I had a second look and dipped my toes in along with a few others. I was drawn to the water and had a drink, thanks Ex. LOL! DT

          • On June 14, 2020 at 7:30 am,
            Charles says:

            What do you guys like so much about Pure Gold other than it is in the Red Lake Region? I own Bonterra and wonder how Pure Gold stacks up.

          • On June 14, 2020 at 2:57 pm,
            David says:

            http://www.puregold.com
            Their cover page has a good summary. They plan to pour gold before the end of year. 9g/t average, at cost of $800 per ounce with IRR of 51% in Red Lake and aren’t through identifying source.

          • On June 14, 2020 at 3:06 pm,
            Charles says:

            Thanks David. That is some good timing.

          • On June 14, 2020 at 4:59 pm,
            Excelsior says:

            Thanks DT. Yes (PGM) (LRTNF) Pure Gold is a solid pick on a high-grade developer moving towards production by year end or the beginning of next year. It has definitely been a company I was glad to have had a nice drink of in 2020.

            Charles, yes, I echo what David posted that because it is high grade, a low projected AISC, and has so much more prospective land in the Red Lake area to explore, it makes it a top gold developer to own as they move towards production.

            In my experience, almost all companies have a few hiccups after the initial first gold pour, so I may lighten the load some after that as they work out the kinks, but right now Pure Gold is in the “Golden Runway” on the construction and development phase into production, where most stocks make a substantial move higher. This Golden Runway phase is typically accretive in any kind of market, but with Gold prices rising to where they are now in the $1700’s it spikes the economics on the project bigly, and if Gold goes to $1800, $1900, $2000 over the next 12 months, then they’ll have really nice leverage to the rising gold prices since they are in the process of graduating to a producer.

            Lastly, I still believe a larger producer could still be waiting until they get the project construction completed and producing, and then take them over (for a great liquidity event to exit the position in full). That’s my 2 cents and why I’ve been bullish on Pure Gold since last year.

          • On June 14, 2020 at 5:41 pm,
            Excelsior says:

            Charles, as for Bonterra (BTR) I own a position that is slightly underwater in it, and have considered averaging down in it fairly soon, but there were so many other quality companies that sold down from late February to mid March, that I decided to back the horses I knew would run hardest coming out of that intermediate low, and shelved adding to BTR for once those companies have moved… and most of those already ran hard in from mid March through late May.

            BTR had financing challenges in the recent past, and now there are a few wildcards up in the air.

            > (KL) Kirkland Lake owns 12.5% of Bonterra, and Eric Sprott owns 7%, and much of this interest came from when Sprott was involved with Metanor (prior to Bonterra buying them out in the merger), and it was Metanor that had the operating mill that BTR now owns. Sprott is likely underwater on that position and will be a fan of anyone that can get BTR’s properties moving once again and create some value. Kirkland Lake also is interested & invested with Bonterra’s neighbors – Osisko Mining, backstopped by Osisko Gold royalties.

            I thought Kirkland Lake may make a move on acquiring Bonterra this year, with the ultimate plan of making a move on Osisko Mining after that to consolidate the whole Windfall Lake Urban/Barry Gladiator zone for themselves. However, KL got busy and took a detour with Detour Lake, and now may be more interested in grabbing the combined Wallbridge/Balmoral merged entity. Regardless, I still believe both Kirkland Lake and Osisko Gold Royalties have their eyes on Bonterra and Osisko Mining to consolidate that area play and get it into production.

            For the last year Bonterra has floundered a bit financially, and despite doing some good exploration work, they are in need of a recapitalization plan. There have been a few changes to their board of directors, and some anticipated changes coming to their management team, so they are currently in flux.

            >> Akiba Leisman is a Director on the board of BTR now. He is quite a capable leader, and the force behind Wexford Capital and I’ve made good money backing his team in Marlin Gold, then Sailfish Royalties, and then Mako Mining. Some postulate that Wexford Capital could take a stake in Bonterra, and one of the ideas being tossed around is if Mako Mining merged with Bonterra, diversifying them from Nicaragua risk by growing into Quebec.

            I have mixed feelings about this idea as I do not really see the synergies between Mako and Bonterra, but it would be fine if that is what plays out, because Wexford doesn’t mess around, and escalates the advancement of their projects quickly [something I wish more teams would do in the mining industry]. It could just be that Akiba was brought in and put on the board to watch over Wexford’s interested in Bonterra getting things moving.

            >>> There is always the potential for Option #3 where a large producer comes in and scoops up the rest of Bonterra out of left field. We’ve see the large Asian mining syndicates being very active over the last year, and the larger Aussie producers were active the year before. If Kirkland Lake, Osisko Mining, and Wexford are not careful, then one of the big boys outside the region could always swoop in and steal Bonterra on the cheap while it is currently out of favor. I don’t like that idea one bit, as there would be more value creation in Options 1 or 2, but it can’t be ruled out either.

            Once I make a bit more on some other Gold positions, and peel off some winnings, I’ll be averaging down in my BTR position to lower the cost basis and get ready for whatever partner comes in to take the current team out of their misery. From that standpoint, I believe the current valuation is incredibly prospective for a large re-rating when some of these deals get worked out and get announced over the next 6-12 months.

            BTR is one of the unloved and forgotten companies ripe for a JV with a strategic partner or a takeover that most investors are not paying attention to because they’ve been stalled most of the year. That is an excellent time to add or build a larger position before the other shoe drops.

    • On June 13, 2020 at 3:29 pm,
      Dick Tracy says:

      Hi David, with all the day traders watching Freegold and waiting for news on the next drill restart, I think we could get this stock levitating somewhat on any news as the volume well speaks volumes. DT

      • On June 13, 2020 at 3:38 pm,
        David says:

        There is a long report on ceo.ca Freegold, where a geologist wrote a report on Freegold’s recent drill results that was very positive. I think it was recent and easy to find.

        • On June 13, 2020 at 3:49 pm,
          Dick Tracy says:

          Eric Sprott mentioned in one of his interviews that two geologist’s had phoned him about Freegold. The 2001 hole was amazing, that one really blew me out of the water, all the way to Bermuda! LOL! DT

        • On June 13, 2020 at 3:50 pm,
          David says:

          Ex:
          I had owned EXK for years waiting for it to regain its glory after its run to 12 in 2016. I sold it but bought back after its good drill results. The more I thought about it, I flipped EXK into Discovery which is my largest share holding other than Theralase. Great Bear, Irving, Ely and Silvercrest the biggest dollar holding. Waiting for Discovery, Freegold, ELy and Azimut to catch up.

          • On June 13, 2020 at 4:11 pm,
            David says:

            Ely in dollar value column right now. Can’t be both. Sorry.

          • On June 14, 2020 at 5:54 pm,
            Excelsior says:

            Thanks for sharing your strategy around EXK Endeavour and DSV Discovery. I own both, have added to both in the last few months, and a still believe EXK is going to surprise folks and get out of the operational batting slump they’ve been in the last few years.

            Endeavour closed down a mine (El Cubo) that wasn’t working, got a new mine (El Compass) going, and optimized the 2 primary mines (Guanacevi & Bolanitos). Now their costs should start coming down and economics should improve, which is step 1 in their turn-around plan.

            However, their real game changer is Terronera as a massive development project that will completely change their production profile. The market is not properly valuing just how big of a deal that is going to be, and is only rating them based on their last few quarters of production. They are missing the forest for the trees.

            Then Parral is a nice project after that, and then they have the pipeline of exploration projects in Chile after that. The best years for EXK are still in front of them, but there is time to rotate from other stocks back into them down the road as nothing is imminent and they need to rebuild trust from investors over the next few quarters of production and show they’ve got their turn-around well under way first.

            All of EXK Endeavour Silver’s current projects are solid, but why I remain invested and optimist is for pages 16-19 on this Corporate Presentation:

            https://s22.q4cdn.com/579360173/files/doc_presentations/2020/06/June-10-2020-website.pdf

          • On June 14, 2020 at 5:59 pm,
            Excelsior says:

            As for Freegold, it is quite an interesting story and getting a lot of eyeballs right now due to Sprott covering it regularly (along with DT of course). I know they already have 6 million ounces, which is sizeable, but I need to dig a little deeper into how it got so undervalued in the first place if that is the case.

            Ely Gold has been an awesome success story, and with them having the NSR on Wallbridges Fennelon property, they’ve really surged. I feel it is properly valued at this point, and thus much of the value has already been realized by other investors that got in much earlier. I missed it betting on Maverix, Golden Valley, and Sailfish Royalites, which I did well in, but admittedly would have done better in Ely. I may still get some funds moved over to them as a profit dumpster, because I believe a larger royalty company will buy them out.

            Azimut I’m aware of but really don’t know much about it, and will need to do a bit more homework. What is their main value proposition that see as a reason they will outperform their peers?

          • On June 14, 2020 at 7:25 pm,
            David says:

            Ex:
            Azimut;
            Second attempt. First deleted. Azimut reports they own the largest mineral exploration portfolio in Quebec. it includes 4 Gold properties in Elmore Camp, 2 gold properties in the lower Greesnstone belt, and 6 copper and gold propeties in 6 different Canadian areas. 2019 drilling appeared to show some success in copper and gold in the James Bay area. Then on Jan 14, 2020 they released drill results for “substantial gold mineralization” from there Patwon Prospect, Elmer Gold Property, James Bay Region. Sever holes: .62g/t over 101. 3, 3.15g/t over 102, 2.8g/t over 108.2, 1.68 g/t over 97, 1.54 g/t over 54.1, 1.15 over 129, 1.93 g/t.
            This release was met with a few 100% run up and held around $1 or so US since Jan with a drop in the .80 cent range and then recently worked its way back up and Friday reached $1.56 US. I got in around $1.05 taking a chance. Of course, Eric Sprott bought 3 times while I was wondering if I did the right thing. So looks like it has worked its way up hoping for another good PR. I put my one bullet in the chamber and spun the cylinder. But, the drill results aren’t bad and that is only one location of many.

          • On June 14, 2020 at 7:31 pm,
            David says:

            Azimut: the 1.93g/t was over 82 m

          • On June 14, 2020 at 10:01 pm,
            David says:

            Azimut:
            Forget Sprott. I was thinking Freegold. Azimut has Hecla, Gold Corp and 3 other partners.

          • On June 15, 2020 at 7:38 am,
            Excelsior says:

            Thanks for the additional info on Azimut. Those are nice grades, but more importantly over very wide intercepts… so they’ll be economical drill hits. Also having Hecla and Goldcorp as partners are pretty solid.

            Much appreciated!

  9. On June 14, 2020 at 9:57 am,
    OOTB Jerry says:
  10. On June 14, 2020 at 10:50 am,
    OOTB Jerry says:
    • On June 14, 2020 at 6:29 pm,
      Excelsior says:

      Those are nice charts. Thanks for posting Jordan’s article OOTB.

      • On June 15, 2020 at 6:10 am,
        OOTB Jerry says:

        You are welcome, and no problem….. 🙂

  11. On June 14, 2020 at 6:42 pm,
    Wolfster says:

    Well that was an interesting week. Not the one I anticipated…..did sell some of my IMCC for almost a double and find myself owning some discovery and vizsla now….for those following orezone there was a cross of 19459500 at .65 on Friday

    • On June 15, 2020 at 7:35 am,
      Excelsior says:

      Good plan on owning some Discovery & Vizsla…. and the Orezone of course.

  12. On June 15, 2020 at 7:02 am,
    David says:

    Bankers have first payment due on escape home In the Cayman Islands. Hang on!

  13. On June 15, 2020 at 7:34 am,
    Excelsior says:

    (MXSG) Mexus pays off outstanding debt obligation
    Mon June 15, 2020

    “The ability to basically extend our debt obligation comes at the right time for Mexus. We are increasing production at the Santa Elena mine and expect revenues to grow exponentially in the coming months. Revenues from the sale of gold are currently being reinvested to increase our monthly production. Long term, this will be a substantial benefit to Mexus and its shareholders,” added Mexus CEO Paul Thompson.

    https://seekingalpha.com/pr/17899395-mexus-pays-off-outstanding-debt-obligation