Bring It On... Eric Sprott On The FOMC Rate Hike

Another week behind us, and Eric Sprott returns from the field to help us interpret it. In this edition of the wrap-up, you'll hear:

The macro fundamentals moving people towards gold.

What you should pay attention to in the mining sector (hint: it's not the news releases).

Plus: Eric's predictions for a volatile week ahead.

"My first thought is: OK, bring it on, baby! Let's have that rate increase. Let's get it over with here. Because typically, I don't think the Fed really could possibly read things as bullish as it might have started the year off thinking. Because it's really not quite coming together. Housing's weak, auto's week, retail sales are nothing special, you've got inflation affecting lots of areas... We have lots of reason for the Fed to be expressing concern. So, fine... Let's bring it on, let's see what happens. And I'm pretty certain that gold and silver will survive yet another rate increase. And prosper, quite frankly."

- Source, Seeking Alpha

Summer Rally? Gold and Silver To Prosper After Yet Another Fed Rate Hike

Despite another Federal Reserve rate hike already priced in for Wednesday, the U.S. central bank has “lots of reason” to be concerned, said billionaire precious metals investor and founder of Sprott Inc Eric Sprott, adding that gold and silver will “prosper” following the very likely hike.

We could possibly be looking at a summer rally here, according to Sprott, who told the Fed “to bring on” the likely rate hike.

“Let’s have that rate increase. Let’s get it over with, here. Because, typically, I don’t think the Fed really could possibly read things as bullish as they might have started the year off thinking. Because it’s really not quite coming together,” he said in a Sprott Money’s Weekly Wrap-Up on Friday. “Housing’s weak, auto’s week, retail sales are nothing special, you’ve got inflation affecting lots of areas… We have lots of reason for the Fed to be expressing concern.”

The Fed language will be key to pay attention to during Wednesday’s announcement, founder of Sprott added.

“I’m pretty certain that gold and silver will survive yet another rate increase. And prosper, quite frankly,” he said.

Latest historical trend is also on Sprott’s side as gold has rallied between 10-30% during the last five out of six Fed rate hikes.

The macro fundamentals are also working in favor of the precious metals, which could support prices going forward, Sprott pointed out.

“The macro fundamentals going on in the world that might also cause people to go to gold. For example, if you are Brazilian and your currency is falling 5% in a week, maybe you’d be better off owning gold. Things going on in [Turkey and Italy] are becoming potentially upsetting for Europe,” he said. “More and more exports data are suggesting that the world economy is slowing down, which would cause rates not to be continually pushed up.”

Out of the precious metals, silver was a big winner recently, gaining about 1.85% during the last 30 days and moving up above its 50-day moving average. Silver also had over 220,000 contracts of Comex Open Interest, which totaled about 1.1 billion ounces, according to Sprott.

July Comex silver was last trading at $16.74, down 0.44% on the day, while August Comex gold futures were at $1,302.70, down 0.02% on the day.

- Source, Kitco News

Eric Sprott: The ongoing chaos in European markets

Eric Sprott: This Is When Gold Will Begin its Climb

Eric agrees that the average gold investor likely feels rather depressed. However, behind the scenes, there is a lot of activity. Kirkland was up 150% last year, and Novo has good performance. He feels we are still in the beginnings of a bull market for several reasons. 

Real economic recovery is lacking as low-interest rates and money printing continues. The second half of 2018 should be better than the first. Commodity prices are looking good across many assets like copper, lead, and zinc. Many exciting things are going on in the commodity space. 

Lithium, nickel, and vanadium are all also doing quite well. Much of the speculative investment in cryptocurrencies has now moved away from that sector. A decline in the economy and stock market could happen soon. Those two things will be critical to watch as a drop should get people thinking about gold and silver. Eric likes the recent bulk sample results from Novo Resources. 

Marindi metals have found fine gold and recently nuggets. Marindi feels that the basin-wide theory is correct and that could mean a 250km by 250km with the potential for multiples of tens of millions of ounces. 

Kirkland is doing very well regarding earnings and their stock still seems cheap compared to other companies. He discusses the mines and production details that they are working on. It takes work to find the opportunities, and you have to be on the hunt for them. 

Your fortunes can change quickly in the natural resource sector. When things turn good, the stock prices often change fast. If you don’t have time to look, you need to invest with someone that can do that for you.

- Source, Palisade Radio

Eric Sprott Talks About The Chaos In European Markets And The Volatile World

“The week has been—I would just say from a normal understanding of economics and financial situations—rather chaotic, to say the least… It must be confusing for the average viewer to try and figure out what’s going on here. Sometimes I suspect that we’re only told half of the information. And we’re told in a very biased way.”

- Source, Eric Sprott