Saturday, July 27, 2019
Eric Sprott: The Global Events Currently Affecting Gold and Silver
Tuesday, July 23, 2019
Sprott Money News Ask The Expert: Danielle DiMartino Booth
- Source, Sprott Money
Friday, July 19, 2019
Eric Sprott: The Renewed Precious Metals Bull Market
- Source, Sprott Money
Tuesday, July 9, 2019
The US Dollar Relies on Faith, Gold Does Not
"I think that’s very important. The U.S. dollar is a promise to pay. It supposes that people will continue to accept it. Almost every fiat currency in history has always retreated to its intrinsic value, which is, of course, zero. If, as an example, rather than having U.S. dollars in your jeans, you had Venezuelan bolivars, you would understand the promise for what it was. Something that could be broken.
Gold is very different. It doesn’t rely on faith. Gold isn’t a promise to pay. It is, in and of itself, payment. It is an asset that isn’t simultaneously somebody else’s liability. And I think that’s very, very important. I don’t think, as an example, that you’re seeing the Chinese government, the Chinese Central Bank, buying gold because they like the chart. I think that you’re seeing them buy gold because they’re afraid that the U.S. government will use U.S. financial markets and U.S. dollars as a weapon in foreign exchange transactions.
And so the Chinese are looking—and I just point out the Chinese, others are looking the same way—to a medium of exchange that isn’t under anybody’s control and isn’t a promise to pay, but rather constitutes payment in and of itself.
It’s interesting to note, Maurice, that over the last couple of days in the news, you will see that Venezuela exported seven tons of gold to Uganda, and then apparently onto either Dubai or Turkey. A pariah state that can’t necessarily trade in U.S. 10-year Treasuries can trade, can buy and sell gold. But even more interestingly, apparently those gold bars date from the 1940s, and they were payment from the United States to Venezuela for oil that was sold in World War II, when the Venezuelans had some doubt as to the outcome of the war, and weren’t willing to take U.S. dollars for their oil. They were willing to take gold.
So even a creditor as strong as the United States has periods of time, has circumstances, where their promise, which is what their currency is, isn’t acceptable. But there hasn’t been a time in recorded history when gold wasn’t acceptable."
Gold is very different. It doesn’t rely on faith. Gold isn’t a promise to pay. It is, in and of itself, payment. It is an asset that isn’t simultaneously somebody else’s liability. And I think that’s very, very important. I don’t think, as an example, that you’re seeing the Chinese government, the Chinese Central Bank, buying gold because they like the chart. I think that you’re seeing them buy gold because they’re afraid that the U.S. government will use U.S. financial markets and U.S. dollars as a weapon in foreign exchange transactions.
And so the Chinese are looking—and I just point out the Chinese, others are looking the same way—to a medium of exchange that isn’t under anybody’s control and isn’t a promise to pay, but rather constitutes payment in and of itself.
It’s interesting to note, Maurice, that over the last couple of days in the news, you will see that Venezuela exported seven tons of gold to Uganda, and then apparently onto either Dubai or Turkey. A pariah state that can’t necessarily trade in U.S. 10-year Treasuries can trade, can buy and sell gold. But even more interestingly, apparently those gold bars date from the 1940s, and they were payment from the United States to Venezuela for oil that was sold in World War II, when the Venezuelans had some doubt as to the outcome of the war, and weren’t willing to take U.S. dollars for their oil. They were willing to take gold.
So even a creditor as strong as the United States has periods of time, has circumstances, where their promise, which is what their currency is, isn’t acceptable. But there hasn’t been a time in recorded history when gold wasn’t acceptable."
- Source, Rick Rule of Sprott Global
Friday, July 5, 2019
Rick Rule: Money is Made Employing New Ideas in Old Places
"It’s not like I think Congo, or Russia, or Sudan, or Bolivia are the greatest countries on the face of the earth. I’m certainly cognizant of political risk. The truth is, however, that I’ve experienced lots of political risk in places that are alleged to be good. My worst personal experience with political risk was here in the People’s Republic of California. But I’ve also had money stolen from me by legislatures in places like British Columbia.
The truth is that investors who look like me, old and Caucasian, tend for some reason to believe that money that’s stolen from us in English, according to the rule of law, is somehow less gone. So I’m not afraid of bad jurisdictions, it’s just I’m also afraid of so-called good jurisdictions. And what I’ve learned is that in jurisdictions where capital feels comfortable, a lot more exploration has taken place, which means that the probability that I’m going to find a high-quality deposit in a jurisdiction that I’m also comfortable in is very low. The probability is that I’ll find the type of deposit that will give me the returns I’m looking for—1,000% plus—are much more likely to occur in jurisdictions that have not been looked at as thoroughly.
Perhaps my most important mentor in the 1970s told me that in exploration, money is made employing new ideas in old places—that is, new technology—or old ideas in new places. But if you’re using old ideas and old places, you’re assuming that you’re smarter than everyone that came before you, which is usually an incorrect assumption.
So, as an example, investments around the application of new technologies like three-dimensional seismic measurement while drilling, and new fracturing and recovery techniques, have revolutionized the old oil fields of West Texas. That’s a new idea in an old place. But old-fashioned exploration technology—that is, projection of existing trends, things like that—work well in places like Congo and Kazakhstan, places that haven’t been explored thoroughly for 40, or 50, or 60 years, as a consequence of challenging social, economic, and political circumstances. So I would say that while I’m certainly cognizant of political risk, I define political risk much differently than many of my competitors."
The truth is that investors who look like me, old and Caucasian, tend for some reason to believe that money that’s stolen from us in English, according to the rule of law, is somehow less gone. So I’m not afraid of bad jurisdictions, it’s just I’m also afraid of so-called good jurisdictions. And what I’ve learned is that in jurisdictions where capital feels comfortable, a lot more exploration has taken place, which means that the probability that I’m going to find a high-quality deposit in a jurisdiction that I’m also comfortable in is very low. The probability is that I’ll find the type of deposit that will give me the returns I’m looking for—1,000% plus—are much more likely to occur in jurisdictions that have not been looked at as thoroughly.
Perhaps my most important mentor in the 1970s told me that in exploration, money is made employing new ideas in old places—that is, new technology—or old ideas in new places. But if you’re using old ideas and old places, you’re assuming that you’re smarter than everyone that came before you, which is usually an incorrect assumption.
So, as an example, investments around the application of new technologies like three-dimensional seismic measurement while drilling, and new fracturing and recovery techniques, have revolutionized the old oil fields of West Texas. That’s a new idea in an old place. But old-fashioned exploration technology—that is, projection of existing trends, things like that—work well in places like Congo and Kazakhstan, places that haven’t been explored thoroughly for 40, or 50, or 60 years, as a consequence of challenging social, economic, and political circumstances. So I would say that while I’m certainly cognizant of political risk, I define political risk much differently than many of my competitors."
- Source, Rick Rule of Sprott
Monday, July 1, 2019
The New Game For Gold: Opportunity of a Lifetime
“And then we have this week Paul Tudor Jones coming in, being interviewed on Bloomberg, one of the world’s most successful investors saying that his best trade in the next two years is being long gold because it’s going to go to 1750.
And when the Fed starts to cut interest rates, gold will “scream,” in his words. And the impact of that happening is so stunning for the gold stocks. It’s so stunning. We are looking at hundreds of percents of gains here. Hundreds! DON’T MISS IT! This is a lifetime opportunity here to make a truly, truly outsized gain.”
- Source, Sprott Money
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