As Silver Rallies, The Mining Stocks Are On Fire

As #Silver Rallies, The #MiningStocks Are On Fire

Silver is rallying, which can be one of the most exciting financial market phenomena when it actually is occuring. And if silver’s been rallying, the mining stocks have been on fire.

Especially the #silverminers.

And to find out more about the rally, how to approach investing in the #silverstocks, and what to expect next, click to watch this interview with #BrentCook of #ExplorationInsights, where he explains it all!

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Recorded by #ChrisMarcus of #ArcadiaEconomics on July 22, 2020:

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Well i you know i i work with a number of uh funds and high net worth individuals and you know over the past few years they’ve been not that keen on it but uh this year i’m seeing a lot more interesting uh people coming to me going

You know what’s going on what to buy uh where do you put the money that sort of thing so it’s it’s the flow of funds is really starting to come into the sector Hello there my friends chris marcus here with you for arcade economics and on a very special day because silver not just twenty dollars but brent i’m gonna pull it up and show you i know brent cook who’s over there on the left side i’ll bet you he checked the

Silver price at some point today and we see even on the kitko kitko chart above 21 it’s still climbing throughout the day and at least as someone who has spent far too much time in the past decade looking at kitko charts hitting the refresh button certainly seems like something has

Changed and we can dig into that and the stocks today with brent cook of exploration insights brent great to have you on here today nice to finally catch up with you again and how’s everything been going with you uh it’s it’s been great you know i’m market’s looking good i think i think

You’re right today is kind of an important day for gold and silver yeah it’s getting noticed all of a sudden it’s looked looking quite well so all these years of pain are starting to pay off it looks good it sure does uh you see the gold price even churning higher 1842

Which brent if my math is correct or even close means we’re about 80 away from the all-time high and i would suggest that given what that represents we’re not talking about you know a company that had great earnings but world’s reserve currency even as mispriced as it may be

You know now finally at least we’re recognizing gold more than we ever have before so i’d love to hear any thoughts on this this gold and silver rally well i you know i i work with a number of uh funds and high net worth individuals and

You know over the past few years they’ve been not that keen on it but this year i’m seeing a lot more interesting uh people coming to me going you know what’s going on what to buy uh where do you put the money that sort of thing so it’s it’s the flow

Of funds is really starting to come into the sector and i think given what we’re seeing on a global basis in terms of uh the various feds pumping trillions of dollars out of nowhere um i don’t see where this i don’t see the downside or not much downside

Um so it looks pretty good and you’re right now what’s the trying to put a pig through a garden hose that’s kind of where it’s going and i’m looking at valuations of companies that are just to be honest outlandish and silly but they continue to go up so

Yeah we’re seeing more money coming in right now and can possibly be absorbed yeah i think that’s the key and i appreciate you mention that because you know just because more people decide they want something someday doesn’t necessarily mean it became more valuable but you know it is a marketplace so there’s

The supply and demand a lot of factors to balance although i’d be curious to get your opinion on this because i’ve felt like especially in the last three to four weeks you know we saw money going into gold and then the gold stocks and starting in silver i mean the

Etf and slv and comex numbers are just mind-boggling but it feels to me that there’s even been a new wave of money into the equities the financings for the silver companies which is often one of the last parts to get rolling have you been seeing that same

Thing yeah for sure i mean there’s there’s a good friend of mine that runs um oh about a billion dollars out of michigan and he’s a generalist i play volleyball with him yeah um and about a month ago he came to me saying you know a lot about gold don’t you

And a little bit since then he’s put he’s uh invested 40 million dollars into various um some gold stocks and and the etfs you know he’s big the bigger companies the larger market cap companies but still and you know he’s double his money already he’s he’s happy as can be and i

We’re going to see a lot more of that yeah because it it feels like it takes a while to reverse something once you really get momentum behind it um so i mean even last year it’s funny uh we’re up at the sprott conference which i know you will be speaking at

Uh this coming week and we’ll touch on that in a bit um but we had a similar rally last year yet it felt like you didn’t have those guys jumping in yet you didn’t have institutional money jumping in yet where it’s like now you have that but even mainstream money coming in too

Yeah i mean you know i’m i’ve been doing this long enough that i’m always a little nervous of sticking my head up because i get hit by a two by four in the back it feels pretty good right now yeah it does feel different and i have

Some fun questions for you today sir um unfortunately brent has put up with my silver fetish before so he knew what he was walking into today although number one mentioned uh gold getting close to the all-time high not far off from two thousand dollars and it seems like

Uh uncle jerome and his gangsters at the fed are basically going to guarantee that we get there so oh maybe i’ll start a poll on this one what do you think the price of silver will be when gold crosses two thousand dollars oh geez i will say that pete that pdac

In toronto last year the last conference anyone got to go to this year i should say uh we always have a dinner party with a bunch of analysts and mining company execs and that everybody picks the gold price for the year usually normally i’m i’m look in the past few

Years i’ve been looking for it to be down this year my price target was 1935 by this coming feeder so i’m sticking with 1935 for gold uh if we see 2 000 gold i would not be surprised to see i don’t know what 35 silver no

I know that’s a lot lower than you’re thinking but well i think that you still have a bunch of people watching today that 35 silver and i’ll be pretty excited about that um curious how does this feel as compared to 2011 um it’s it’s different dynamics because we’ve had

You know the whole global economy go go bust with covid yeah and so there is so much money now being pumped into the system that it really leaves gold as as the only real um monetary uh instrument that is not going to be uh devalued with all the uh you know the

Money coming in i mean the inflation rate of gold is about one and a half to two percent meaning you know production um whereas i don’t know what it is with with the dollar right now but it’s massive so that is the different dynamic right now is that

We’ve got a fundamental change happening in the global currencies uh that is not going to revert for a long long time if ever so that’s the fundamental change that i’m seeing and it’s it’s real it’s not like it’s going to go away it’s not a trend it’s it’s legitimate and it’s

Uh you know it’s frightening for some people yeah i understand what you mean and it’s a great point because that’s really what i don’t know it was 11 years ago maybe it was early but allowed me to feel comfortable even after getting clobbered in 2011 and 2012 because the fed can’t raise interest

Rates all this debt that’s out there for the same reason the housing bubble collapsed for the same reason the dot-com bubble collapsed it’s it’s almost like you have a free we all know about the greenspan put now we’re getting like a different kind of put under the metals so i know a question

That’s on a lot of people’s mind right now they’ve seen especially in gold now the last couple days in silver it happens quickly the stocks have rallied and like you said before on one hand some of the valuations are getting a little bigger yet what do you do where it’s like if you

Think still whether it’s this year or next year the medals are going to go higher um how do you handle that well that’s i’ve been thinking about that a lot joe and i have been talking about that with regards to what goes into the newsletter and there’s

As i see it there’s two ways to play this one is don’t think just look someone puts out a good drill hole you buy it don’t worry about the context the details et cetera if eric sprott buys a stock you buy the stock um if it’s got silver in its name

You buy it that’s one way to do it and i think my achilles so i think that’s one way you know an individual uh retail player can do it assuming they’re not betting too much in an illiquid stock yeah and and that’s fine um and then there’s the leverage place

Where you’ve got companies with deposits that are you know they got a lot of ounces but they’re worthless they’re marginal at best uh that’s not what joe and i are doing because you know when we put something in the newsletter we really have to have a good feel for what is really there

You know the ultimate economics of the deposit or the chances of it becoming a deposit or the chances of a discovery so we go real into detail into the geology the metallurgy what might happen down the road what the you know capex may be what the issues are going to be

And lay all that out because you know in honesty i and joe as well um we’re both economic geologists and i’ve worked all over the world for everybody almost um it’s really i don’t want an embarrassing stock in my portfolio you know i hate that i’m so i’m willing to miss out on

The eric’s brock play or the uh you know the 10 million ounces at 0.6 grams i i’ll miss out on that because i just it’s embarrassing embarrassment i don’t want given we’re so you know we’re scientifically focused and economically focused so that’s the two ways to play it you

Can go really you can go go with a trend yeah it’s an interesting point because along those lines something i was thinking about love to get your view on you could make the case that for people depending on their risk of speculation or degree of speculation that let’s say

You had a move to 50 35 or 50 silver probably the marginal producer that maybe it cost him 19 an ounce to get it out of the ground so he only has a dollar margin probably a lot more risk on the upside but could you make a case that

In that type of you know spiked price hunt brothers environment that actually a marginal producer and again that’s going to be everyone’s preference but would you expect those to go up more in that scenario uh probably yes i mean if if we’re talking that big of a price move certainly uh

My you know my experience has been that on the whole these marginal and unlike economic resources are generally that way for a reason to be the metallurgist problem the capex is a problem location is a problem uh you know you can’t build it you can’t recover it um

The geology’s not right the strip ratio is too high you get too much dilution all those issues uh are there regardless of the price right so i don’t know half of these marginal deposits are always going to be marginal no matter what but you know if i

Try to start building a mine right now on some low grade deposit in i don’t call it alaska i’ve still got five years down the road before i even put the first shovel in so up to that point it’s not that important if that’s your if that your thesis that

Things are going to the moon right so yeah marginal deposits are a good play if that’s how you want to do it we’re not that big on marginal plays yeah well i appreciate that and uh good to just know all the risk of the different things that are out there

Um so perhaps along those lines let’s say folks are expecting a big move in the silver price if you want to look at any particular name or if you just want to answer it in terms of let’s say you expected 35 silver is there a particular type of project

Or stock or stage that you would want to look for any tips that folks might want to consider there i i think you know your best bet in that scenario is is a big silver producer like um pan american silver i mean that’s where the funds are gonna go

Uh the big funds in new york and such they’re gonna go to the big producers you know there’s alexco uh there’s a number of silver producers out there you know we own pan american uh have for quite a while uh what else is there well it’s first majestic silvercrest first majestic

Exactly those those would do well we own another one called evram resources which is a prospect jennifer they’ve got a royalty on one of the first majestic silver properties yeah so that’s that’s another way to play it is via the royalties um that’s the ones that come to mind i’d

Have to pull up a sheet but and you know there’s heckler and core et cetera yep and it’s nice there’s a silver stock i guess depending on whatever investors are looking for that’s what i think is nice about investing world we have now where you can find

It’s like there’s a different tool for each purpose or perspective and i also appreciate what you mentioned though about because i’ve been thinking about it for a while you came on last year i believe it was and i asked you about you know how the different price and silver or gold affects

Things uh but you had an interesting point that maybe you could touch on again where usually people who knew who know how to run a project successfully at the current price you know that usually is the even more important than yes there are places where project can get bailed out but

Usually comes back to who’s running the show yeah that’s that’s a good point there’s a big difference between running an exploration program and making a discovery and actually building a mine it’s a completely different mindset uh of people so if if you’re a company that makes a discovery

And you drill out a resource it makes a lot of sense to kind of back away and bring in the mind builders and the engineers because that transition really is smooth and you get a lot of you know you get a lot of issues with uh resource calculations uh

Metallurgy dilution dilution is a big one for instance a company will put out a drill intersection of call it one meter of 25 grams gold that sounds great eh but you’re gonna have to mine at least a meter or two meters more of waste so you’re diluting that one meter 25 grams by

Double but by two times you know so your real grade is call it something like eight grams right big difference and people need to take that into mind when they see drill results for sure is what’s you know that’s a good intersection but what is the actual

Grade going to be to the mine or the mill yup which i have boring stuff pouring details but you know but it’s it’s the stuff that makes a difference and that you and joe bizumdar point out in exploration insights which we will touch on in one second

Although a final question i had for you i know you’ve looked at bluestone resources who we had jack lundin on the show a couple of weeks ago and any thoughts that you could have there uh from your research sure i was there about two and a half three years ago and came away

Very impressed i mean i’d spent i’ve worked in guatemala and central america a long time and i knew the area i know the issues that pan american and tahoe had with escobar so i was expecting to see similar sorts of issues however they’re in a completely different place

Part of the country it’s all cattle ranching there’s very few of any indigenous people there’s very few environmental issues etc etc anyway joe went down last year and looked at it as well and he came back very positive we actually added it to the portfolio i think it’s one of the better

High grade economic deposits there and i think it will get permitted yeah it seemed like an interesting project they had there and perhaps for folks who would like some guidance in navigating all these things that are going on the stocks that you cover i have exploration insight it’s your

Site pulled up here and um perhaps you could tell folks what they get there and especially more important if you can put in perspective where it’s like all right you know there’s a lot of newsletters but when you really get this stuff right and if we’re correct that

We’re facing a big rally in gold and silver um so if you can touch on that brent sure whether the newsletter was started by me back in 2008 and then um joe mazumdar came on i think in 2015 or 16 and over time it’s it’s become his letter he sort of bought

Me out uh i’m an economic geologist i’ve i’ve worked in over 70 countries uh lived in four uh done everything from uh grassroots exploration generative work all through the bank of bank of both feasibility studies uh joe has a similar track record although he’s been a mining analyst for a couple of

Companies as well he was the metals analyst for uh phelps dodge he does corporate development for newmont so he’s got a lot of experience as well and he’s married to a argentinian geologist they live in vancouver now she runs the back office and corrects all his spelling mistakes um

And so that’s what you get and our focus is on we our exit strategy is not selling to the greater fool we’re trying to sell to someone smarter than us that being a major mining company so that’s why we look at you know all the details of a project’s geology economics

All those issues that’s why we do it so we try to focus on what is what is real and legitimate uh and projects all over the world and you you know you can sign up for a month if you don’t like it you can quit you have access to everything we’ve ever

Written bought sold etc yeah well i appreciate that we’ll have the link in the description below and brent i i like i like that strategy where you let the young guy come out and do it because i know you’re about to go play some beach volleyball and there’s joe

He looks a little cold in some of these pictures so again you see brilliant businessman as well as economic geologists and also uh before we wrap up i know you are speaking i believe it’s friday at the sprott show if you could tell folks what you’ll be talking about

There i know a lot of people watching are going to be attending yeah there’s a um panel discussion of some sort with with questions from the audience at eight o’clock on friday morning that i’m moderating we got uh randy smallwood we’ve got lobo tigre uh and i forget

Had him on the show he’s the third guy that’s gonna be there but there’s gonna be three of us take building questions live questions from an audience so definitely tune into that we’ve also got joe uh presenting uh at the show but that’s gonna be you can access i think he goes

On thursday but that’s accessible all through the show so you don’t need to be there for that and again go to our website there’s lots of free information and commentary commentary there as well exploration insights well i would certainly recommend that and brent thank you as always it’s been

Great getting to know you over the years learning from you uh it’s such a you can’t download mining knowledge from choir from 30 or 40 years overnight so i appreciate you as a resource through these now becoming fun and interesting times we’ll look forward to catching up with

You at sprott and folks if you’re wondering why there’s so much excitement going on especially with silver crossing 21 this morning well that video is coming your way now you