Brien Lundin – Macroeconomic Factors Moving The Markets As We Navigate The Pullback In Precious Metals
Brien Lundin, Editor of The Gold Newsletter and our host at the New Orleans Investment Conference, joins us to discuss how he is navigating the current correction in the precious metals sector, and what macroeconomic factors he is looking towards that could change the trend. We lead off with a more general discussion on what effects the debt ceiling debate, the banking sector concerns have had leading up to this point, and ultimately how these ongoing situations correlate to Fed policy expectations moving forward.
This filters down into how gold, silver, and the mining stocks have reacted so far this year, and as we’ve hit the “sell in May” period, where he now sees room to be a bit more cautious leading into the seasonally slower summer doldrums period in the months to come. Ultimately, the bigger picture is still quite constructive for the precious metals sector, and this pullback should be seen within a larger bull market pattern. With the Fed funds futures markets still pricing in rate cuts as soon as September, this could indicate there will be some economic challenges as the year unfolds, and this should be bullish for the PMs.
We wrap up with Brien highlighting I-80 Gold (IAU) (IAUX), Gold Basin Resources (GXX) (GXXFF), and Vizsla Silver (VZLA) as examples of companies continuing to build more value in press releases, while their prices have corrected down with the sector. While he cautions against trying to catch falling knives, he provides the nuance that accumulating quality companies during corrective moves, and holding through any further weakness, will be rewarded as the sentiment improves and the metals pricing breaks out later in the year.
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I doubled my position in Argonaut Gold today. DT 😉😊🤣😍😁😎👌✔🤩😜😀, Okay, I get the message! LOL!
Magino, is on track for first gold pour in second half of May, that should wake up investors.
I feel like Howdy Doody’s brother “Double Duty”, maybe I should double it again, just pondering The Lassonde Curve. As Always Do Your Own Due Diligence. DT
Any bugs they’ll have to address at Magino before really get rolling?
Every new mine has bugs and teething issues during ramp up, so there are always unexpected kinks, but since the team at Argonaut are already competent producers with plenty of operational experience, I’m less concerned here than I am with a single-asset company that is trying to go from developer to producer for the first time.
Hi DT. I’ve got a solid position going in Argonaut as well, and started accumulating at the very end of last year in late December, and then again 2 more times in February. So far it’s been a nice solid double-digit gainer and well in the green.
As you mentioned, as they bring on Magino over the next month into the production profile and start ramping up towards commercial production by the end of the year or beginning of next year, then it will substantially augment their overall production, bring down their costs, and have them well in the green.
This project has been a long time coming, and now when so many former investors have abandoned ship due to their cost overruns announced last year (as I also did at the time), many have failed to realize how silly the valuation became all things consider. Argonaut could very well be a dark horse that comes from behind to outperform much of the pack in the gold producers marathon.
Hi Ex, I’m glad you are hanging in there with Argonaut. It’s a good thing you pointed out their operational experience, it is so hard to bring a new mine online and if they do it correctly, we can expect to see a re-rating much higher. Cheers DT!
Some good comments from Brien Lundin today with regards to I-80 Gold and Vizsla Silver. Both companies have continued to put out solid news all year long, but have sold off with the rest of the sector regardless. Both have putting out very high-grade drill intercepts and continuing to grow their resources, and sold off on the news. Eventually, when the worm turns, and sentiment improves, all that ongoing value creation should make for a nice re-rating higher in both stocks.
I have a feeling that precious metal stocks are going to decouple from the physical metal and now start moving higher, this is not information based on technical analysis but rather on watching some of my positions that seemed to move inversely with the physical today. The precious metal stocks have moved in tandem with the physical for quite a while now, and at some point, they must start moving out of the house and stand on their own. I think we are starting to see that! Nudge, nudge, wink, wink. DT