Gold's Rise and the Dollar's Demise

Rick Rule, president and CEO of Sprott U.S. Holdings Inc., shares how the worldwide explosion of negative yielding debt shapes his bullish outlook on gold. 

He examines the impact that a "war on savers" has on the global financial system and on precious metals, and he shares his ideas on where inflation fits into the equation. 

Rule explains his outlook for the future of the monetary system by analyzing the evolving relationship between cryptocurrencies, precious metals, and fiat currencies.

- Source, Real Vision

Rick Rule: This Consolidation for Gold Tells me this Market is Extremely Healthy

Craig Hemke: Exchange For Physical?

Two years ago, following a surge in the use of “Exchanges For Physical” by traders at the COMEX, Eric Sprott asked me to begin tracking and recording the daily totals for this practice as posted by the CME. It’s time for an update.

First, let’s attempt again to discern what the heck an “exchange for physical” really is, because the truth of the matter is, no one really knows. When we first wrote about EFPs back in April of 2018, this was the best summary explanation we could find:

So, these are “ex-pit transfers between two parties”. OK. If that’s the case, then EFPs are best categorized as a swapping of positions between two parties. Given the volume of these transfers each day, it’s safe to assume that the two parties in question here are almost always Bullion Banks. And what are “Bullion Banks”? These are the banks that manage the physical delivery market in London…and they operate hand-in-glove with their trading desk operations on the COMEX in New York.

(By the way, the conspiracy to rig and manipulate prices between London and New York trading is precisely what the U.S. Department of Justice is currently investigating under the RICO statutes…an investigation that has already yielded six indictments, including the former head of JP Morgan’s global precious metals desk, Michael Nowak. It’s noteworthy that up until his indictment, Nowak also proudly served on the board of directors of the LBMA. Read more here: https://www.zerohedge.com/markets/abject-corruption-exposing-financial-political-complex-protecting-its-own-gold-manipulation)

Anyway, back to the EFPs. Though this practice of “ex-pit transfer” has been around for decades, the use of this scheme has increased dramatically in the past several years, possibly coinciding with a similarly dramatic increase in total contract issuance and open interest.

How does the CME itself define an EFP? Here’s a link, an excerpt of which is pasted below: https://www.cmegroup.com/trading/metals/precious/g…

Note the last line above. “EFP is a key component in pricing OTC spot gold”. Dutch money manager Gijsbert Groenewegen offered to provide his expertise and insights to this process back in 2018, and back then, he suggested that the dramatic surge in EFP use was also a tool for Banks to directly impact price. Groenewegen theorized that The Banks do, in fact, now use EFPs as a means to control prices off-exchange and through the deliberately-opaque OTC markets. This is worth considering, and you can read his article here: https://www.tfmetalsreport.com/blog/8942/guest-pos…

But let’s get back to the sheer volume of EFPs at present, because in the end, I believe it helps to reveal again the utter scam, sham, and fraud of the current digital derivative and fractional reserve pricing scheme.

From the CME Group’s own website, it is explained that futures contracts and EFPs are utilized by “gold traders” who “frequently trade OTC with Banks to hedge gold transactions”. OK, that sounds legitimate. You’ve a big position and you’d like to hedge it? Go right ahead...

- Source, Craig Hemke via Eric Sprott's, Sprott Money

Silver and the Miners Wait Patiently for Gold

The Fed surpasses expectations for more QE to address potential liquidity issues in the repo market around year-end. This means interbank funding issues are getting worse, requiring ever more stimulus. Meanwhile, Trump announces a phase one trade deal with China “in principle”, which means nothing substantive has been agreed whatsoever. Yet, the stock market eats it up and we head to new highs. Meanwhile, the bond market takes a hit, with the 10-year yield rising back up to 1.95%.

It is no surprise that Gold, despite setting a marginal higher high yesterday, ended the day near its low.

Silver didn’t fare much better, although it did close up slightly for the day and relative to the previous close.

Miners did not escape the pain but still continue to outperform the metals. The clear standout recently has been SILJ, the junior miners ETF. It came within a whisker of its September peak at 11.57 before falling back. So while Gold and Silver continue to drift lower in their bullish flag patterns, SILJ is testing its highest level since May 2018. Unfortunately for SILJ, it also hit a negatively divergent higher high yesterday, which could signal trouble in the very short-term.

The bigger issue is that although Silver hit a positively divergent lower low this week, according to its daily RSI and both MACDs, Gold has yet to match that feat. While Silver and the miners can continue to outperform Gold, it is difficult but not impossible to see the sector move materially higher near-term without Gold establishing a clear trough. On top of that, the risk is that the rise in stocks and bond yields may have some momentum into year-end, weighing further on the metals and miners.

On the other hand, much of the good news has now been priced into stocks. The Fed has announced it will paper over any liquidity problems through year-end, and we got a trade deal in principle with China. It is not clear to me what the next catalyst will be to justify further increases in stocks and bond yields.

Simply put, we could see further downside pressure on the metals and miners in the next two to three weeks, but if and when we get that positively divergent lower low in Gold, below 1446, followed by a higher high above 1492, then we can look forward to higher highs across the sector. My preferred target for Gold on the downside has been in the low 1420s for quite some time. That represents a 50% retracement of the entire rally from 1267 to 1566. A negatively divergent peak in the 10-year yield above 1.97% wouldn’t hurt either.

December has been a very kind month to Gold in each of the past four years, but once we get that bottom in Gold, it is Silver and especially SILJ that I will be focusing on to the upside.

- Source, David Brady via Eric Sprott's, Sprott Money

Eric Sprott: Precious Metals Market and Mining Industry Update

Legendary Canadian investor Eric Sprott discusses the precious metals markets and the mining industry. He also answers listener questions regarding a few specific mining companies.

- Source, Sprott Money

Sprott Money News Ask The Expert: Brent Cook of Exploration Insights

Economic geologist Brent Cook answers listener questions regarding the mining sector and discusses some specific companies that he expects to perform well in the months ahead.

- Source, Sprott Money News

Rick Rule on the Current State of Gold

Rick Rule, President and CEO of Sprott U.S. Holdings Inc., shares how the worldwide explosion of negative yielding debt shapes his bullish outlook on gold. 

He examines the impact that a “war on savers” has on the global financial system and on precious metals, and he shares his ideas on where inflation fits into the equation. 

Rule explains his outlook for the future of the monetary system by analyzing the evolving relationship between cryptocurrencies, precious metals, and fiat currencies.

- Source, Sprott

Gold Equity Earnings About to Surge

Gold companies will be announcing Q3 earnings shortly with the majority reporting in the first week of November. We mentioned in our prior commentaries that the increase in gold pricing would be reflected in gold companies’ earnings materially. The average price of gold bullion in Q3 was $1,474/oz, which is 12.6% higher than the Q2 average of $1,309/oz. Using the World Gold Council’s data on gold production costs, the industry has roughly an all-in-sustaining-cost (AISC) of $900/oz.

Here we take a stab at estimating the impact of the higher gold price on gold producers’ profits. We are assuming that the Q3 industry AISC is likely to remain unchanged at $900/oz as the main component costs of labor and energy remained subdued.

• The Q3 average gold price of $1,475/oz less industry AISC of $900/oz = $575/oz profit (40% higher)

• The Q2 average gold price of $1,310/oz less industry AISC of $900/oz = $410/oz profit.

Q3 over Q2 profits, in general, should increase about $165/oz or 40% higher based on the 12.6% gold price increase. This quarter-over-quarter increase is materially higher than any industry that we have scanned. The operating leverage in profit increase also helps illustrate why historically gold equities typically have a 2x to 3x leverage to gold prices. High-cost producers will benefit even more as their leverage to the change in the gold price is much higher. If we use a higher cost Q3 AISC of $1,000/oz in this example, the Q3 profit will be $475/oz versus Q2 profit of $310, or 53% higher.

- Source, Sprott Monthly Report

Sprott Report: The Sweet Spot for Gold Equities

October was another consolidation month for gold bullion. Gold traded in a narrow $33/oz range dictated mainly by the action of global bond yields. Gold held above our support level of $1,450 and consolidated within a bullish wedge pattern. From a positioning view, Commodity Futures Trading Commission (CFTC) longs had a minor pullback. CFTC shorts remained unchanged while ETF holdings continued their gradual accumulation. 

Since the gold price peak in early September, there has been an uneven nascent risk-on short-term basing action in some parts of the capital markets. The October 30 Federal Open Market Committee (FOMC) meeting resulted in the expected 25 basis point cut in interest rates and a signal from the Fed that future rate cuts may be on hold, representing more of a “pause-lite” rather than an “absolute pause.” With the “Fed put” reaffirmed, the U.S. stock market rallied to new all-time highs, yields declined, the U.S. dollar fell and gold closed higher on the day.

Month of October 2019

• Indicator 10/31/19 9/30/19 Change % Chg AnalysisGold Bullion $1,513 $1,472 $40.56 2.75% Consolidating in short-term range, before rise 

• Silver Bullion $18.11 $17.00 $1.11 6.55% $17 base held, carving out base

• Gold Equities (SGDM)1 $24.13 $22.90 $1.23 5.25% Breaking out from a consolidation flag

• DXY US Dollar Index2 97.32 99.38 (2.06) (2.1)% Testing bottom of rising trend

• U.S. Treasury 10 YR Yield 1.69% 1.66% 0.03% 1.6% Consolidating in short-term range

• German Bund 10 YR Yield (0.41)% (0.57)% 0.1% 28.07% Consolidating, major downtrend in place

• U.S. 10 YR Real Yield 0.14% 0.14% (0.00)% (0.00)% Consolidating in short-term range

• 0 $14.76 ($1.93) (13.1)% Pullback inline with yields

• CFTC Gold Non-Comm Net Position3 and ETFs (Millions of Oz) 111.20 116.90 (5.67) (4.9)% Pullback in CFTC longs only

We believe that the recent injection of liquidity has continued to inflate asset prices. The S&P 500 Index has made new highs despite weakening global growth, an earnings slowdown and funding stress. By contrast, global bonds continued to trade near highs as signs of economic weakness abound.

The 5Y/5Y inflation swaps for both the U.S. and EU remain subdued with a long-term downtrend solidly in place. The EU 5Y/5Y touched all-time lows in October despite the launch of quantitative easing (QE) by the European Central Bank (ECB).

Credit stress remains subdued, likely due to the massive liquidity injections in the repo market, although LIBOR-OIS (London interbank offered rate-overnight indexed swaps) spreads remain elevated in line with the condition of the repo market. Commodities continued to struggle as demand remained weak.

Gold bullion, by contrast, still has a very constructive outlook in the medium- and long-term.

Figure 1. Gold Bullion is Consolidating Below the Last Significant Resistance Level Before a Re-Test of Previous Highs

- Source, Sprott Monthly Report, read more here

Rick Rule: Strategic Relocation and Strategic Assets

Given the crisis actions currently being taken by central banks, the drastic erosion of constitutional liberties and privacy, and the unprecedented levels of debt & derivatives posing risk of global financial collapse, you may be wondering whether you should relocate in order to reduce taxes, government intrusion, and other risks.

But where should you consider moving, and what factors should you consider? 

Rick Rule, CEO of physical precious metals fund leader Sprott Asset Management, returns to Reluctant Preppers to share his own personal story of strategic locations considered and selected.

Rick also answers YOUR questions on tried & true principles for strategically protecting your family's financial future, investing, and more!

- Source, Reluctant Preppers

Seeking Market Guidance from Rick Rule

Rick Rule explains what to make of the existing political and market environment and how he plans to survive the troubled waters that lie ahead.

- Source, Jay Taylor Media

Eric Sprott: Why Silver Will Be The Star Of The Show

It’s been a great week so far, with the FOMC meeting and U.S. jobs report both proving good for gold. But what about silver? Eric Sprott returns to break down all the gold and silver news you need.

“Basically, the report was weak… The thing that’s bad for the worker is the average workweek was down .3 hours. Now, people may not think that’s much. 

It’s almost 1% of the number of hours that the average person works, which means that collectively everyone made 1% less. 

And they made .3% more per hour, but they worked 1% less time, so that’s not a very instructive number in terms of the total paychecks that were issued…. Kind of weak, I’d say.”

- Source, Sprott Money

Eric Sprott: The Latest Economic News Surrounding the Mining Sector Explained

Eric Sprott discusses the latest economic news and answers listener questions regarding the precious metals mining sector.

- Source, Sprott Money

Eric Sprott: Gold and the Impacts of Q4 on it's Price

Eric Sprott discusses the recent economic news and the impact on gold and silver prices as Q4 begins.

- Source, Sprott Money

Eric Sprott: Price Manipulation Charges in Precious Metals Market

Eric Sprott discusses the price manipulation charges in precious metals and his personal method for trading the mining shares. 

He also answers listener questions regarding some specific mining companies.

- Source, Sprott Money

Extremely Volatile Time for Precious Metals

Eric Sprott reacts to a volatile period in the precious metals and looks ahead to FOMC meeting next week.

NOTE: The audio quality of the podcast is poor due to weak internet connection.

- Source, Sprott Money

The Case for Gold, Commodities, and Natural Resource Investing

In this conversation between two resource industry thought leaders, Marin Katusa from Casey Research interviews Rick Rule, founder of Sprott Global Companies. Fast-paced and focused, the discussion cuts through a range of resources and commodities, investment styles, and global resource capitals - a must-watch for anyone with resources in their portfolio.

- Source, Real Vision Finance

Ask the Expert: David Rosenberg

David Rosenberg is Chief Economist and Strategist for Gluskin Sheff in Toronto. In this episode, David answers questions regarding negative interest rates, central bank policy and the outlook for the dollar and gold.

- Source, Sprott Money

The Failing Economy and Growing Physical Gold Demand

Eric Sprott returns this week to discuss negative interest rates, the failing global economy and growing demand for physical gold and silver.

- Source, Sprott Money

Precious Metals, Mining Shares and Strategies for the Remainder of 2019

Rick Rule of Sprott USA joins us this week to discuss the precious metals, the mining shares and his investment strategies for the remainder of 2019 and beyond.

- Source, Sprott Money

Rick Rule: I See Gold Moving This Year, Uranium Next Year

"I like the uranium business. But I'm more focused on gold right now because I see gold moving this year and uranium moving next year," says Sprott's Rick Rule in this interview.

- Source, Investing News Network

Eric Sprott: The Latest Developments in the Mining Sector

Eric Sprott discusses current events affecting the precious metals market and he also reviews some of the latest developments in the mining sector.

- Source, Sprott Money

Sprott Money News: The Ongoing Rally in Precious Metals

Eric Sprott discusses the ongoing rally in precious metals and looks ahead to next week's FOMC meeting.

- Source, Sprott Money

Sprott Money News Ask The Expert: Chris Martenson

Chris Martenson is co-founder of PeakProsperity.com. In this podcast he addresses issues such as physical gold storage, the slowing global economy and steps to be taken ahead of the next financial crisis.

- Source, Sprott Money

Eric Sprott: The Global Events Currently Affecting Gold and Silver

Eric Sprott discusses the events of the past week and how they will affect gold and silver prices in the weeks to come.

- Source, Sprott Money

Sprott Money News Ask The Expert: Danielle DiMartino Booth

Danielle DiMartino Booth is a former advisor to The Federal Reserve Bank of Dallas. In this episode of "Ask The Expert", she answers questions about the U.S. dollar, the U.S. economy and the recent shift in Federal Reserve policy.

- Source, Sprott Money

Eric Sprott: The Renewed Precious Metals Bull Market

Eric Sprott discusses the renewed and surging bull market in the precious metals as well as the intriguing profit potential offered by the mining shares.

- Source, Sprott Money

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."

- Source, Rick Rule of Sprott Global

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."

- Source, Rick Rule of Sprott

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

Money Made In Gold Could Offset Money Lost In Dollar Based Accounts

"I try to be mathematically and empirically based. The truth is, in terms of philosophy, my own political philosophy is very much libertarian and free market oriented, which means that I’m always a sucker for the gold bug pitch. The consequence of that is that I try not to listen to my philosophical side as often.

Now, related to a libertarian philosophy is an acceptance of the precepts of Austrian economics and, in particular, the predictions with regards to the activities of markets and groups of people that was evidenced by Ludwig von Mises in “Human Action.” I would say, in that sense—the understanding of economic cycles and the understanding of the impact of cycles on human action—that that part of my investing philosophy has been absolutely instrumental to my success.

Von Mises points out that although all of us believe ourselves to be rational fact-gatherers, that’s not what we are. We have a view of ourselves as impartial observers that gather information, hither and yon, and process it in a rational fashion. But that’s not what we do, in fact. We gather information that is convenient to our prejudices and our paradigms, and we use the information that we gather to support those same prejudices and paradigms.

Von Mises also points out that our expectation of the future is set by your experience in the immediate rather than the distant past, which is why bull markets go on longer than they should and why bear markets go on longer than they should. If you have done lots of work around an investment or speculation and you’re attracted to it, but your experience in the last five years has been that you get spanked for all your hard work, you tend to be cautious and conservative in bear markets—which is precisely when the markets are cheap—because your most recent experiences have been bad rather than good.

Conversely, in bull markets where stocks are doubling and tripling for no reason, you do two things. You confuse a bull market with brains. That is, you assume that your good performance is in some way, shape or form due to your own efforts. And you also become less cautious. Your expectation for the future being set in the immediate past means that you’re irrationally bullish. Even in a market that’s up 400% or 500%, which is, as you know by now, Maurice, something that’s not an uncommon phenomenon in our sector. Yeah, I’ll leave it there."

- Source, Rick Rule of Sprott

Eric Sprott: Summer is Breaking Out and So is Gold...

“I love going back to the call we had three weeks ago, when I said I’d read an article that I really believed in that suggested gold would have a rally for 5-7 weeks… 

We’ve had three of them now! This rally started at $1275. We’re at $1400. That gentleman, Chris Vermeulen, and I’ve got to give him credit for being prescient…

The first target was $1450, but he actually thought it was going to go to $1650. And I want the listeners to think about that: $1650! What would happen?”

- Source

Eric Sprott Takes On This Week In Gold And Tackles Your Questions

It’s a special edition of the Weekly Wrap Up this week, as Eric Sprott takes time to answer some or our Sprott Money customer questions about precious metals.

Due to the enthusiastic response, this week’s WWU is over 30 minutes as Eric and Craig try to answer all your questions. Although this was to be exclusively a Q&A session, there was just too much Gold news this week to be ignored.

Listen to Eric and Craig get excited about the later FED speak about ELB – Effective Lower Bound – basically, zero interest rates and what this could mean for Gold investors.

- Source, Sprott Money

Eric Sprott: A Recession is Coming, Are You ready?

“Of course, the big macro is the trade war, which now seems to be getting really spread out as we put Huawei into the whole thing… I don’t think the Chinese are going to sit idly by and do nothing here—it’s been mostly a U.S. initiative so far. 

But you know the other shoe’s going to drop… There’s no doubt in my mind that the Chinese economy is way bigger than the U.S. economy. I don’t care what the numbers say.… 

They’re the biggest steel producer, they’re the biggest gold consumer. They’re the biggest everything, OK? … Think about what happens when the Chinese say, ‘No mas, man.’”

- Source, Sprott Money

Eric Sprott: How The Trade War Affects Gold

 
“We see evidence of world trade slowing down. We see it in airport traffic. We see it in ship traffic. We see it in truck haulage in the United States. 

We saw it in retail sales this month,that we’re down .2%. So there are many, many indications that a slowness is taking hold here. And, of course, the more the trade war manifests itself—i.e. we put on the tariffs and people start having to pay more for the same goods—that is not going to be a good situation. 

And, of course, the worst part about it all: the government takes in the tariff, and the people pay it. And the people that are paying it are the people who can’t afford it… It’s not a good situation that we have.”

- Source, Silver Doctors

Wallbridge Mining edges closer to production at Quebec gold project

A Sudbury mine developer is putting the pieces in place to reopen a former Quebec gold mine.

Wallbridge Mining, which is proving up its high-grade Fenelon Gold property in northwestern Quebec, posted the results of a recently-completed 35,000-tonne bulk sample.

In a May 15 news release, Wallbridge said the former open pit and underground mine is capable of producing good grades with low-cost bulk mining methods. Stope grades released by the company ranged between 10.94 grams per tonne (g/t) to 38.33 g/t.

Wallbridge ran 33,233 tonnes of ore through the Camflo Mill in Val d’Or from its bulk sample to produce 19,755 ounces of gold at an average grade of 18.49 g/t.

The company has applied to the Quebec government to take a second bulk sample and will shortly be filing for full production permits.

The Fenelon project is located 75 kilometres northwest of Matagami, Que.

Wallbridge acquired it in 2016 and has since updated the resource estimate, posted a positive pre-feasibility study, and found more gold offshooting from the main deposit. The company has a major exploration drilling program underway.

"Completing the bulk sample provided valuable information while generating positive cash flow to fund our 50,000 to 70,000-metre exploration drill program at Fenelon," said Wallbridge president-CEO Marz Kord in the release.

"Overall, the bulk sample results met or exceeded our initial projections in terms of grade and gold recovery.”

Their aggressive method of sampling offered a valuable lesson on how best to mine the deposit.

“Selective mining methods allowing narrower zones with less dilution will be tested if a second bulk sample is granted."

Frank Demers, the company’s vice-president of mining and projects, echoed Kord that the Fenelon experience “has given us the opportunity to understand how best to approach developing the property.

"As we continue expanding our exploration efforts and ideally undertake a second bulk sample, we will continue to broaden our understanding of this deposit and maximize overall value.

“Some notable achievements during this campaign include better than planned safety results, zero environmental exceedances, underground development of nearly 2,100 metres and 25,000 metres of diamond drilling.”

On the same day, Wallbridge also announced it closed a $7-million deal with mining financier Eric Sprott in exchange for 29,166,667 common shares.

The private placement increases Sprott’s stake in Wallbridge from 19.9 per cent to 24.9 per cent.

Earlier in the month, William Day Construction and William Day Holdings bought $702, 505 worth of common shares in Wallbridge, representing a 15.16 per cent amount of the company’s shares.

Wallbridge has a stable of nickel, copper and platinum group metals properties in the Sudbury Basin with copper and gold exploration interests in British Columbia and Jamaica.

- Source, Northern Ontario Business

Pure Nickel up 200% on Eric Sprott deal

Pure Nickel Inc. [NIC-TSXV; PNCKF-OTC] said Tuesday April 30 that it has signed a deal with a numbered company controlled by Eric Sprott that outlines the arm’s length terms for the acquisition by Pure Nickel of a 51% interest in the Neal Development Ltd. Partnership from Sprott Mining, and the option to acquire an additional 27% of the Neal LP and seven unpatented mining claims.

The Neal LP holds a lease to operate the Neal Project, a gold project consisting of five patented and seven unpatented lode mining claims located 27 km southeast of Boise, Idaho.

The Neal Project site was the most productive gold producer in the Neal Mining District, with underground production from 1889 through 1941, sourced mainly from the Hidden Treasure, Homestake and Daisy mines.

According to the US Bureau of Mines records, the Neal Mining District is estimated to have reported production of at least 30,000 ounces of gold, mostly from the Neal property.

Pure Nickel shares jumped 200% or $0.02 to $0.03 on volume of 4.5 million on Tuesday, making the junior the most actively traded stock on the TSX Ventures Exchange. The shares trade in a 52-week range of $0.01 and $0.03.

There are currently 200 outstanding limited partnership units in Neal LP, of which Sprott Mining owns 142. It has the option to acquire another 54 units (total 196 units or 98% of the units.). Four units are held by a separate party.

Under the agreement, Pure Nickel will acquire 102 units of Neal [51%] by issuing 10.2 million shares to Sprott Mining, an amount that represents 15% of the issued and outstanding shares of Pure Nickel. Once the deal is complete, Pure Nickel becomes the operator of the Neal Project.

Pure Nickel will have an earn-in option to acquire an additional 54 units [27%] of Neal LP and seven unpatented mining claims by raising up to $1.5 million for exploration drilling. On completion of this future financing, Pure Nickel has the option to pay Sprott Mining $84,706 ($1,568.63 per unit) causing Sprott Mining to exercise its option to acquire the remaining 54 units and assign them to Pure Nickel.

Sprott will also transfer its interest in the seven unpatented mining claims to Pure Nickel. Once the earn-in option is fully exercised, Pure Nickel will own 156 units or 78% of Neal LP, leaving Sprott with 40 units or 20%. A separate party will continue to hold the remaining four units or 2%

The Neal LP currently leases the core patented private property at the Neal Project from Daisy Mining & Land, LLP, and the underlying claim holders. Under the lease agreement, Neal LP may remove, extract, ship and sell ores, minerals and materials from the property.

In exchange, Daisy Mining will be entitled to receive lease payments equal to $3 per ton for all material removed from the property.

If the annual lease payment is less than $10,000, Neal LP will pay Daisy Mining as cash top-up to meet the $10,000 annual payment minimum. Daisy Mining will also receive production payments on any production in the form of a 3% net smelter royalty.

“We are very pleased that Eric Sprott has agreed to allow Pure Nickel to become the operating partner at the Neal Project, while at the same time becoming a significant shareholder of the company,” said Pure Nickel’s President and CEO David Russell.

- Source, Resource World

News Bites Is Fear Finally Coming Back?

Fear is finally making its way back into the financial markets and pushing gold higher, said Eric Sprott, billionaire precious metals investor and founder of Sprott Inc.

“The outlook for gold works against the market and that’s why it is up this week because the markets have been down about 3% across the board and there is fear coming back into things here,” Sprott said during Sprott Money’s Weekly Wrap-Up on Friday.

Spot gold opened stronger on Monday in Asian trading, up 0.10% on the day at $1,287.10, according to Kitco’s aggregated charts.

Investors hear conflicting things about the economy and inflation all the time, which drags gold prices in different directions, Sprott noted.

“There are great waves of macro-information flipping back and forth here. At the odd time, we’re told that the economy is great, and then we look at some of the data and the economy is awful. Inflation is rising, and then it’s not rising. The trade war is going to be settled, and then it’s not going to be settled. Each of these seems to be used as an excuse to move the prices around on COMEX,” he said.

The latest headlines keeping the markets worried are the trade war negotiations that are likely to be an ugly affair with no easy resolution, Sprott pointed out.

“You can just sense it. It is not going to be an easy negotiation. Obviously Chinese pushed back on things and the only option Trump had was to put more tariffs on. And this trade war … is going to have a big impact on earnings and sales all around the worlds and those who believe we are in the Goldilocks market might have to reconsider,” Sprott explained.

A more reliable measure when it comes to gold price direction is the physical side of the market, added billionaire precious metals investor.

“I always fall back on the physical side,” he said, highlighting impressive demand for the metal worldwide.

“China stepped up their buying to 15 tonnes last month. That I find very significant … Plus, we have these other government and central banks that are also buying,” he noted.

- Source, Kitco News

All Manipulations End: Why The Future Looks Bright For Gold & Silver

“It’s funny how [gold] got smashed. Because it actually went up initially. It went down later, I think when [Powell] made some pro-growth comments in the interview after. But there’s been a lot of criticism of the Fed. 

We had some funny things happen. This IOER, the Inter-Bank Offered Excess Reserve Rate, something like that, was cut, and there’s a lot of suggestions that the Fed is losing control of interest rates. 

We still have an inverted yield curve, which does suggest that there’s no one out there thinking there’s any great amount of growth happening here.”

- Source

Eric Sprott: Think Numbers Don’t Lie? You’re Not Paying Attention

“It’s hard to imagine that [GDP] is actually growing at 3.2%. Particularly with the trade wars and every other darn thing that’s going on, and these companies that are coming out with horrendous reports on how their own business is going. So, I tend not to believe it. 

It looks like the market’s not believing it. As you and I discussed, the bond market’s rallying in the face of it. Gold is rallying in the face of it. So, maybe people are getting wise to looking through the numbers.”

- Source

We’re In A New Bull Market For Gold: Patience is Key

“As you describe, the price of gold going down $20 in the week, it feels worse than that, if you know what I mean. 

And of course the reason it feels worse is it’s gone through a bunch of the moving averages…

I’m sure it’s 100% orchestrated. So I hope everyone can have the fortitude to hang in there. 

Every time I see these very, very sharp declines, you know it’s orchestrated. And typically it’s going to go right back up again. So, we’ll have to stand by and see what happens there.”

- Source, Sprott Money

The Death of Money: The Coming Collapse of the International Monetary System

Trying Day, Trying Week Make It A Great Time To Buy Gold

“While I’m on the jobs report, the one data point that I did see is that the participation rate went down by .2%. 

Well, I can tell you, .2% of the total workforce available for work, which is about 200 million is like 400,000 people [that] all of a sudden weren’t participating, even though theoretically, 196 [thousand] joined… 

But as you know, I’m not a believer in this data. I think it’s, for the most part, fabricated.”

- Source, Sprott Money

1 U.S. Eisenhower Ike $1 Dollar Coin 1971 to 1978 Collectors Coin

Quarter End Reasons To Own Gold Look Great

“I think the most important feature of yesterday’s events was that we have quarter end today for the financial institutions. Let’s just focus for a second on palladium. 

There were about 2.5 million ounces of palladium that they were short; they had lost a lot money on that. 

All of a sudden, palladium is down 200 bucks, somebody is better off by 500 million? 500 million? For quarter end? Oh, how wonderful! Gee, we made it to the end of the quarter and didn’t lose that 500 million… I think quarter end had a lot to do with this.”

- Source, Eric Sprott

EISENHOWER (IKE) DOLLARS SET OF 4 DIFFERENT DATES BETWEEN 1971-1978

Don't Let the State Take Your Assets

Even if you've largely opted out of the financial system to reduce systemic risk to your nest-egg, what must you do to prevent your hard-earned hard assets from being taken by the state anyway? 

Rick Rule of Sprott visits Reluctant Preppers this first time to explain why physical precious metals are different, and what additional principles you should incorporate in your plans - and even your location - to protect what you've saved!

- Source, Reluctant Preppers

Three Steps Forward, Two Steps Back

 
“The thing I found most interesting is how all of a sudden, on the financial networks, the narrative has changed. And the narrative, in the words of the data folks, always follows performance. And the narrative now is: ‘Oh! Yields are going up. Stocks are going up. We must have some kind of economic recovery going on!’ … And all of a sudden the need to have gold is diminished. I would suggest that the reason we’ve had this turn… is because the People’s Bank of China instructed their banks to lend 30% more to small businesses this month.”

- Source, Silver Doctors

Synchronized Global Decline, Bad for World, Good for Gold

“It’s worth thinking about this funny situation we have in the world, where everyone’s solution to economic weakness is printing money. The Chinese did it in January. The ECB did it. 

Obviously, the Fed has changed their strategy here. And it’s something that will have unintended consequences. You just can’t print money to solve problems… Who’s going to pay the debt?”

- Source, Silver Doctors

Eric Sprott: Lots of Lousy Economic Data

“Lots of lousy economic data. But it’s just the COMEX, man… Luckily, today we’re back up a little. Maybe we’ll get some sanity back in the market. 

But it’s frustrating to have to sit by and watch it. And as I thought about what happens, here we have gold going down 1%. 

The stocks went down 3%! The stocks whose options are expiring today went down 3%. 

When you have an option, it’s that fine line between making money and not making money. 

That last 3% can wreak a little bit of havoc. It’s sickening that it happens. 

It’s just the commercial banks ripping off their customers again… for the sake of today’s profits.”

- Source, Eric Sprott via Silver Doctors

Beware The Ides Of March? What Stock Prices Are Trying To Tell Us

As we barrel towards the March FOMC meeting, the economic outlook continues to be lousy. Eric Sprott returns to break down all the gold and silver news you need to survive.

In this edition of the Wrap-Up, you’ll hear:

• What the U.S. presidential race means for gold
• Why you should be afraid right now
• Plus: Eric answers your questions about the mining shares

- Source

The Operative Word For Gold & Silver? Patience

“I’m quite surprised, when you think of the 180-degree turn from about three months ago, and we really haven’t accomplished a lot in gold yet. 

And the more I think about what other people—what investors— must be thinking in the world about what’s happening here… they’re all buying bonds and the yields are going down. As you’ve mentioned, the yield curve gets inverted. 

They’re buying stocks, and quite frankly, I think they’re buying gold. But we have some forces at work in the COMEX that aren’t quite letting us get to where we think we should be.”

- Source, Silver Doctors

The Only Panel Talk On Gold And Mining You’ll Need

Rick Rule, CEO of Sprott U.S. Holdings, joins forces with Amir Adnani, chairman of GoldMining and CEO of UEC, in this panel discussion on the hottest headlines of the gold industry today.

Topics range from the Barrick-Newmont takeover deal, Trump’s third year in office, and their outlook on gold and uranium prices.

- Source, Kitco News

Warren Buffett Doesn’t Need Gold, But You Do

An investor on the caliber of Warren Buffett most likely doesn’t need extra insurance on his portfolio, but that doesn’t mean that it’s not good practice to own gold as a hedge, said Rick Rule, CEO of Sprott U.S. Holdings. 

“Were I as smart as Warren Buffett, were I as disciplined as investor and as good an analyst, I probably wouldn’t need gold either. Part of what gold does is it protects us from our own worst instincts,” Rule told Kitco News on the sidelines of the PDAC 2019.

- Source, Kitco News

What The Latest Numbers Mean For Gold And Silver

“There are lots of reasons to worry about where we’re all going. We’ve seen those downgrades, in Europe, of the GDP. We see Chinese data that gets weaker all the time. 

We see weakness in the U.S. in terms of industrial production and PMIs and things like that. So, yeah, I think that stocks could easily roll over.”

- Source, Sprott Money

The Magic Palladium Bullet

Over the past few months, we've written frequently about palladium and the threat it poses to The Banks' Fractional Reserve and Digital Derivative Pricing Scheme. As palladium prices are continuing to rise, we thought it best to explain this dynamic again today.

A few years back, my friend Max Keiser coined the phrase "buy silver, crash JP Morgan". Back then it was hoped that silver could be a "magic bullet", where physical demand would expose and crash the current fraudulent pricing scheme. And it nearly worked, too, as a massive Commercial short squeeze in 2011 nearly led to a runaway price spike. Only through the direct, official intervention of the CFTC and CME was price reversed and the crisis averted.

In the eight years since, JP Morgan was approved to open their own COMEX silver vault, and they now store nearly 150,000,000 ounces of silver for use against any potential price squeeze. So at this point, the idea of crashing or breaking The Banks through silver seems unlikely. On any sustained future rally, JPM can simply deliver their silver stockpile in an unwind of their short position and, for them at least, a repeat of 2011 can be avoided. Here's just one article that we've written on this subject:https://www.sprottmoney.com/Blog/jpmorgans-dominat...

But that's just silver. The Banks are still exposed through the identical pricing schemes that are applied in gold, copper, platinum and... palladium. And this is where 2019 could get very interesting.

Since last August, a physical supply squeeze has been evident in palladium. How do we know that this situation is due to a physical metal deficit? 

Two things: 

1. Extraordinarily high lease rates for physical palladium in London, where one-month lease rates in 2019 have occasionally been in excess of 20%.

2. Full backwardation of the futures board in New York. Backwardation (where spot prices exceed future prices) is extremely rare in the commodity sector, particularly in the precious and industrial metals, and it is almost always indicative of a supply squeeze. See the chart below.

And you can see this on the daily price chart too. Note that the advance in palladium is NOT some sort of parabolic speculative blow-off. Instead, what you see below is an unrelenting grind higher due to an ever-tightening vise of dwindling physical supply.

Having established that this price rally is primarily due to a shortage of physical palladium, please take a moment to ponder this next bit of information...

For COMEX silver—which was hoped to be the "magic bullet"—there are currently 296,000,000 ounces of silver stored in the COMEX vaulting system. This compares to a total COMEX silver contract open interest of 220,000 contracts. At 5,000 digital ounces/contract, the ratio of leverage of digital to vaulted physical is3.72 times. Stated another way, there are 3.72 ounces of tradable silver exposure for every one physical ounce in the vaults (both eligible and registered).

For COMEX gold, there are reported to be 8,221,512 physical ounces in the COMEX vaults versus a total open interest of 480,000 contracts, representing 48,000,000 ounces of digital gold. That makes the ratio of digital to physical leverage 5.85 times.

Now check this. For COMEX palladium, there are reported to be just 42,583 ounces in the vaults. Again, that's BOTH eligible AND registered. However, there are currently 28,846 contracts of open interest. At 100 digital ounces per contract, that's 2,884,600 ounces of digital palladium exposure. Applying the same math as above, we find that the COMEX palladium market exists upon leverage of 67.3 times. Hmmmm... how about that?

What's the point? In 2019, do you want a "magic bullet" and something that could lead to a force majeure declaration and exposure of The Banks' fraudulent schemes? Watch palladium! What do you suppose will happen if, sensing Bank blood in the water, the "Bond Vigilantes" of yesterday become the "COMEX Vigilantes" of tomorrow? That's the point.

Should the LBMA/COMEX palladium market fail and collapse, sensible people and institutions around the world will be correct to conclude that gold and silver operate under an identical pricing scheme. If there's not enough physical palladium to cover the Banks scheme, and thus a price squeeze, then there's not enough physical gold and silver either.

And there, my friend, is your magic bullet.

Of course, The Banks may still be able to wriggle off the palladium hook. Perhaps they can collapse price through unbridled derivative issuance? Maybe a fresh supply of palladium will suddenly be unearthed? But if not, it's hard to see how this doesn't end in chaos for The Banks. And if that chaos extends to gold and silver...

This year and next are already pegged to provide the best gains for gold and silver investors since 2010-2011, as central banks capitulate, interest rates are cut and QE programs re-started. Now throw in some market collapse and possible force majeure declarations, and you've suddenly got a recipe for considerable price gains in the months ahead.

- Source, Craig Hemke via Eric Sprott's, Sprott Money

When The World Decides To Get Into Gold, The Price Will Go Up

“I think I mentioned a couple of times recently… gold used to kind of get hammered big time and then sort of stay down there. 

And it’s interesting, now, when we see these declines that happen quickly. One, they’re not major. 

They may be five or seven dollars. And then it seems to rebound quickly. And I get the sense that they meet up with a physical buyer. 

You know, that there’s a physical buyer there, and the game might very well be ending. Which would be the best news that could ever happen for our side.”

- Source Sprott Money

Eric Sprott: The Biggest Factors Affecting Gold & Silver in 2019

Eric Sprott discusses factors that are currently influencing the precious metals markets and looks ahead to an interesting year for the mining shares.

- Source, Sprott Money

Eric Sprott: Surging Demand for Physical Gold & Silver

Eric Sprott discusses how surging physical demand for gold and silver will impact prices in the year ahead.

- Source, Sprott Money

Eric Sprott: Incredible Dysfunction in the Political System

Craig Hemke & Eric Sprott: You Can't Eat Gold

Eric Sprott says some interesting things are happening in gold & silver, and he says that most of the incoming precious metals information is good. 

Here’s why… 

Eric Sprott interviewed by Craig Hemke As we barrel towards the end of the month, it’s been a positive week in precious metals, with slight gains since last Friday. 

Eric Sprott joins us once again to break down all the gold and silver news you need heading into the weekend.

- Source, Financial Argument

Eric Sprott: Big Things Can Happen in 2019, Here's Why

We’ve been aided and abetted by the tremendous weakness that was experienced in the stock market… 

It’s instructive, certainly for people in the precious metals business, because even though we’ve had a bear market rally here, I suspect it will roll back over again. I think it’s interesting that gold and silver—particularly silver—have fared very well, even while the markets rallied. 

So, I don’t know that the precious metals markets are buying into this bear market rally that we’re going through. So, lots of good signs for great things to happen.

- Source

Why You Need to Own Gold Bullion: Everything Is Going Down

More important than the gold going up is what else is going on. 

It’s funny how the macro-theory all along suggested that when the Fed stopped their quantitative easing and rates went up—but particularly the quantitative easing, where they go from quantitative easing to quantitative tightening—that one should have expected the stock market to roll over. 

Because the whole 2009 to 2018 was essentially a fraud created by the Fed, by doing things that no one in the history of the financial world had ever heard about before: printing money and having zero or negative interest rates. 

Well here we are. Now we’re doing the opposite. Are we surprised that stocks are going down? Well, we shouldn’t be.

- Source

Bizarre Things Happening In Gold and Silver

 
We have these recent rallies that we get early in the mornings, only to find that they’ve faded away. 

Which is typical of a bear market, right? It used to be that the market would be weak, and then along comes 2:30 in the afternoon, and from 2:30 to 4:00, things would go up. Now, from 2:30 to 4:00, things go down. 

Which is what you would expect in a bear market, when people are seeking liquidity.

- Source

Eric Sprott: A Date Which Will Live in Infamy...

  

It’s been a good week. I think the best part of it … was kind of the setup that we could see manifesting itself, where stock markets were weak, bond yields were crumbling, indicating something. We had huge problems with various companies, whether it was GE or PG or the FANGS … 

And you had this sense that the markets were different. And, of course, then we roar into this week, and we just give them the biggest bop of all time with 800 points on Tuesday. And then yesterday we were down, at one time, 800 points … so there’s a lot of things shaping up that would take people to gold.”

As we put another action-packed week behind us, Eric Sprott returns to break down all the gold and silver news you need.

- Source, Eric Sprott

Why Right Now Is The Best Time To Add Gold And Silver Bullion To Your Portfolio

Typically, the guys who run the COMEX—which is the Commercials—always end up that the price is at what we call ‘Max Pain.’ Max Pain is where the individual investor loses the most money. 

And, of course, the converse is that the commercial banks make the most money. And that’s probably about where we are right here, around 1220 on gold and 1430 on silver. 

I’m sure there’s not many people making any money on any puts and calls they’ve written. Because, of course, you pay a big premium, and meanwhile we’ve ended up with very little movement.

- Source, Silver Doctors