$1 Trillion Debt Added Every Month; This Is ‘Not Sustainable’ | Ryan King

$1 Trillion Debt Added Every Month; This Is ‘Not Sustainable’ | Ryan King

every 100 days the US debt goes up $1
trillion do so that was 30 days ago now
it’s every 99 or 98 days it just it is
unbelievably almost to my opinion my
small mind
unsustainable how what what is going to
happen here you know based on what I
know and what I’ve heard there’s three
World Reserve currencies one is the US
dollar one is the Euro and one is gold
and gold is the only currency Reserve
currency that governments cannot
replicate I.E reprint print more of to
devalue it we’re speaking now with Ryan
King he is a senior VP of corporate
development and investor relations at
caliber mining Corp cxb on the exchange
we’ll be talking about not just the
company but also Ryan’s outlook on the
mining sector and the gold space welcome
to the show Ryan thanks very much David
appreciate the opportunity to be here
and talk about uh gold and gold equities
uh caliber has uh a number of gold
projects so let’s talk about gold first
before we talk about those projects
themselves first question everyone wants
to know how sustainable is this rally
what are your thoughts yeah so it’s a
it’s a great question because it’s the
one everyone wishes they knew and nobody
really knows everyone has theories for
where gold is and why it’s going up or
down um but honestly it just seems so
unique every time time okay gold own
gold in inflationary periods own gold in
deflationary periods own gold when
geopolitical Strife is happening around
the world you know it just seems to be
one of those things but honestly I guess
if you take a step back and you look at
gold as an asset
class you know um as we print more money
and as we have quantitative easing and
as we you know as a a western Nation
Canada or the United States continues to
take on significant debt loads that
almost are unachievable to pay back it
it would seem that folks or the price of
gold I should say continues to have uh
at at some point in time there’s no
Rhyme or Reason as to when but it seems
as though it will continue to go up in
value because our Fiat currencies are
going down in value over time you know
on a day-to-day basis month to month or
year to year we we don’t know now we’ve
seen almost a 20% increase in the price
of gold since the beginning of the year
you have pundits out there that are very
well followed like Pierre Lon that just
recently came out and said you know
based on an S&P 500 ratio gold could
easily be at
$199,000 per ounce
us you have gold in every fiat currency
on the planet hitting record
highs you have City Bank that has just
recently come out and said said you know
gold they anticipate gold to be close to
$3,000 an ounce by the end of this year
or Goldman Sachs that has recently said
$2700 us per ounce this year you have
central banks that are buying on record
demand quarter over quarter over quarter
for the last several
quarters uh it’s a unique environment
because investment funds or ETFs are
seeing outflows of gold equities right
but sticking with the gold price for the
moment
it would seem like we’re in such a
unique time I.E extreme amounts of debt
where maybe there’s a situation where
the us or large Nations like that have
to reduce rates because they can’t
afford paying their debts because they
can’t afford interest rates you know I
just heard a I just heard a stat you’ve
probably heard the same every 100 days
the US debt goes up $1
trillion so that was 30 days ago now
it’s every 9 or 98 days it just it is
unbelievably almost to my opinion my
small mind
unsustainable how what what is going to
happen here you know based on what I
know and what I’ve heard there’s three
World Reserve currencies one is the US
dollar one is the Euro and one is gold
and gold is the only currency Reserve
currency that governments cannot
replicate I.E reprint print more of to
devalue it it’s the only currency that
doesn’t have government inter
intervention into that into that Reserve
currency so I do believe that you’re
probably we were talking a little bit
offline prior to the to the interview I
do believe we’ve probably seen a hot
gold run here which maybe is too F too
much too fast but maybe that was also a
catchup trade to look at how long gold
had sat there at 1900 or 2000 and is
finally starting to break out of that
and because of the demand by central
banks you know particularly China that I
believe is selling us treasuries now and
buying physical assets of
gold so where is it going um I can only
think that based on what I read what I
see what I hear it is very likely that
it’s probably in the environment or the
price it should be and given that you’ve
got Goldman Sachs and other um you know
very smart analysts looking at you know
Supply and demand and the the global
macroeconomic environment saying that
it’s going to be higher I can only
believe that’s you know who who who to
trust one can only speculate but do you
have any idea as to why central banks
have been stockpiling gold last year and
into this year I think they there’s a
lot of countries out there that realize
that we’re probably heading into a very
tumultuous economic environment I.E debt
debt level is too high maybe some type
of a reset debasement of currencies you
know as I said you know the the for
example Chinese continue to sell us
treasuries from what I understand and
buy physical assets like gold because
those physical assets are not being
debased right so I don’t know but it
would appear to me that maybe don’t we
don’t have all the information yet but
in times like this we’ve definitely seen
gold go higher on the back of
significant Central Bank buying if
history is to repeat itself here’s a
here’s a chart okay Junior Gold minor
index the gdxj is the bar line and the
orange line is gold price you can see
that they’ve correlated perfectly
throughout the year until recently
Divergence it seems to me that Traders
are taking profits at a top a couple
weeks ago while Gold’s continuing to
Hold Steady right why the Divergence in
sentiment you think between equities and
the um underlying medal well I I I I
think that right now there’s a various
indicators that are saying risk off risk
off like so maybe you know uh equities
even though it is backed by um by by by
gold that is has been going up but I
think you know it’s it I believe that
we’re so shortterm minded now there’s so
many people with online trading accounts
um and masses that are you know wanting
to capture a little bit of alpha in a
short period of time right so I mean
we’re seeing a gold price go up 20% and
maybe equities going up 20 to 30% in six
weeks time if you bought at the right
time people are going to take profits
quickly the psychological nature of
humans right let me just ask you uh
somewhat personal question you are the
VP or senior VP of corporate Dev of your
company you how are you feeling right
now are you feeling good are you buying
into this Euphoria are you nervous about
this ending soon about not this being
not being able to be sustained um are
you feeling neutral because you’ve seen
this before two years ago
yeah I I I’m always a little bit more
cautious in my
Approach
however you know when my I I want
exposure to Gold it’s through an
entrepreneurial effort with the group of
guys that put together caliber mining so
I take a very long-term view here um for
putting businesses together and and you
know really when we take a look at
caliber we restructured the company to
become a gold producer in 2019 and
that’s when I first started uh really
buying position a position into caliber
and every year year over year I’ve
continued to add to my position because
the business is delivering on what we
said we would do it we’re we’re meeting
and beating expectations of our
investors gold is going to go up and
down and up and down but over time it
would appear to me that um largely again
because of the de basements of
currencies around debasements of Fiat
currencies particularly the us we’re
seeing these hard assets go up in value
and it’s not going to happen overnight
but it is over time and we’re building a
business that will increase our gold
resources or increase our gold reserves
and increase our cash flow per share as
we develop our business and execute and
deliver on our business so I take a
long-term View and honestly I know it’s
going to be up and down like a roller
coaster over time especially in terms of
turmoil and volatility and change but I
try to take a longer term view have you
seen more investor interest in the last
two months with gold price going up to
$2,300
yes has it been significantly more than
let’s say in January when it was only at
2,000 yes yes I have I very I I very
seldomly get incoming calls from larger
institutional investors and I’ve seen an
influx in that over the last uh that is
interesting um would you say generally
speaking not just for your company we
will talk about your company plans I
want to get to know what you want to do
with your assets but generally speaking
do you think higher gold prices are
actually I would say negative for m&a
prospects for juniors in other words why
would a senior overpay right for a
junior company when gold is on an
all-time high we’re breaching new
alltime high is probably the ration now
and so investors might be like you know
what stay away from the sector when
Gold’s really really high because buyout
prospects are low is that the correct
approach to think about it well I think
gold equities are trading at Mass
discounts even to the price of gold at
$2,000 an ounce right so so if if we
take a case a case study that that would
be gold Corp in early 2000s right and
you look at what gold Corp did
year-over-year um adding new assets as
the price of gold through 2002 to 2011
went from about $250 an ounce to $1,900
an ounce in
2011 right so if we look at that example
I would say that I think that there’s um
a huge influx of m&a that is about to
happen yes there’s cautious optimism
about the gold price staying here but
companies that are producing gold if
you’re not finding it through your
exploration efforts guess what you’ve
got to go and acquire it you’ve got to
issue shares and acquire Advanced stage
exploration or ready assets to go into
production I remember talking to some um
some seniors a few years ago when gold
was at its previous alltime High post
pandemic and they said that one of the
mistakes that the industry has made was
overpaying and going on what they
described
was irresponsible shopping spree back in
2011 when go was at its then alltime
highs what do you think they’re going to
do differently if let’s say these
memories are still fresh on people’s
minds they don’t want to repeat the same
mistakes probably spend heck of a lot
more time doing due
diligence okay honestly I mean mistakes
were made because assets weren’t great I
think that was a big part of it um
mistakes were made because uh um people
were being rewarded for pipelines
instead of uh cash flow per share
delivery so it wasn’t it wasn’t
necessarily about free cash flow margin
it was about what’s your production
pipeline look like over the next 6 12 18
and 24 months that’s how people were
getting in invest or uh uh companies
were getting rewarded from a share price
performance perspective but then you
look at that and you look at what was
required to deliver that in terms of
capital intensity time and projects
actually delivering upon expectations
based on engineering reports it didn’t
deliver so we actually it was
destructive uh period of time uh where
now I think we’ve you know companies
have learned from that they’ve cleaned
up balance sheets they’ve spent more
time doing investigative work and doe
diligence as well as investing in their
own assets to organically grow and to
make sure that there’s good free cash
flow margins that’s one of the critical
elements right now is in investors all
investors are looking for free cash flow
particularly uh uh large institutional
investors is looking for new areas where
there are companies generating actual
strong price to earnings or free cash
flow margins versus you know in some
cases tech companies that you know have
great innovation in Inventions however
are not
generating reasonable uh cash flow for
share for earnings I want to get your
thoughts on this I’ve heard the argument
that gold ETF f s have been not great
for the mining sector in other words
there Capital flowing into an ETF that
could have gone directly to the
companies and so from the company’s
perspective how do you feel about these
products well this is part of the reason
why I think that um passive Investments
like this indexes and ETFs are part of
the reason why we may not see as much
Capital flowing into individual stocks
for sure I would agree with that I mean
you know you I I I don’t know what the
numbers are but if you look over the
years ETFs yes they’ll look at buying u
in the case of a GDX or a gdxj they’ll
they they’ll actually buy a very large
position depending on your market cap
and trading
liquidity and will sit on that on that
position for for a period of time until
you you don’t meet the metrics they
require to stay in the ETF so there’s
large events that happen to get included
and then you know get excluded out of
that ETF and investors you know whether
it be retail or investment advisors or
other funds are they trade around these
these these events that get telegraphed
out to the market based on individual
companies in the portfolio and that’s
all disclosed by the by the vanc uh um
group of companies right so it has taken
Capital away however if you meet the
metrics you get included for example
caliber was just included into the D
vanc
GDX um ETF so the larger of the two and
uh on one day at the end of the day uh
which was which was already well known
based on uh
analysis uh we we traded 54 million
shares and that was that was where you
know a number of funds will will buy the
stock and then sell it to the ETF uh for
one big printed trade so you know we
would lose out on that Capital that
would go directly to you know
potentially caliber other gold stocks so
Capital goes to that product so you’re a
Canadian listed America focused gold
producer tell us about the results from
your last quarter so significant
increase in revenues from the previous
year congratulations was that a result
of just the gold prize or it have you up
production volume uh yeah thanks so so
we’re actually in we’re in Central
America in Nicaragua uh we acquired
acids there in Q4 of 2019 and originally
um the anticipated result there was 50
to 70,000 ounces a year uh was what this
was a new acquisition you made last year
this was in 2019 okay right so that’s
how we became a gold producer to start
with caliber was an Explorer in
Nicaragua uh we then transitioned to
become a gold producer because we
acquired these assets in a a very
collaborative win-win deal with B2 gold
so B2 had had begun their company in
Nicaragua by building the the libertad
facility or Mill and operating the lemon
mine and Mill so they were producing 125
to 175,000 ounces a year from those
assets uh for 10 years prior to caliber
being there uh we were able to uh strike
a deal where they became a significant
shareholder of caliber and we paid some
in cash so it was a $100 million deal we
did back in 201 19 when gold was $1,200
an
ounce uh it’s not that we had foresight
knowing that the gold price was going
higher although I’d maybe like to claim
that
but but nonetheless no it was you know a
deal where B2 gold had become focused on
their very large assets around the world
uh we became a almost a a a subsidiary
of B2 gold because they reported some of
our production because at the time I
think they owned almost 30% equity in
caliber but the big transition here was
when our CEO Darren Hall who’s uh who
was um who’s been an operator for 30
years and what he did was he worked for
numont and optimized Assets in their
portfolio uh lowered costs uh
utilization of infrastructure Etc and uh
I could tell many stories about his
career and what he’s done but what he
did here uh with these assets was
unlocked a significant amount of value
via a change of operating strategy right
we went from two separate Mills and uh
and assets to really consolidating them
together and operating what we call a
hub and spoke approach so that first
year uh we produced 136,000 ounces of
gold in the full year of 2020 in the
following year we produced 180,000
ounces of gold by bringing on new
satellite deposits and feeding them into
our existing infrastructure so the
return on invested capital is very high
um and we were able to do that by using
operating cash flow and reinvest back
into the business in the drilling and
the development of new new satellites to
feed into our infrastructure and that
gave us a platform from which we could
grow and that’s where we went in 2021
acquired a uh a cash flowing expiration
uh company called fé gold in Nevada
which is a 40 to 45,000 ounce a year
producer on a heap Leach operation a 220
Square km land package so incredible
exploration uh oper opportunity there
which gave us a diversification a first
step in diversification of the company
and so uh you know that was a
long-winded answer to say that last year
we did 283,000 ounces of gold and uh Q4
of
2023 was a record a record quarter for
us uh 75,000 ounces of gold production
so um we had seen organic growth we’d
seen some inorganic growth in Nevada but
uh we continue to deliver I think it’s
been 17 quarters now where we’ve
delivered we’ve met or or beat
expectations from the 11 analysts that
cover the company also slight
Improvement in your gross margins I’m
just noticing just a quick back of the
envelope calculation 2023 30% gross
margin income from M operations over
revenue and 25% in 2022 so can you
explain the 5% increase what happened
there you know we’ve been we
year-over-year we’ve seen an increase in
average grade mind so we’ve discovered
new areas and fortunately those new
areas have been higher grade than
previous ones mined I’ll give you an
example at our leemon operation we
currently mine uh open pit to about 3
and a half to four gram material and
five to six gram material underground
well um through the through the
investment we did in Exploration we
discovered what we call the Panton North
Zone which is uh it’s not huge at the
point in time it’s about 300,000 ounces
at roughly 9 grams per ton gold so you
know the margin is is being offset by
some inflationary impacts but because
the grade is is or sorry the grade is is
offsetting some of the inflationary
impacts but we’re also seeing the
benefits of increased margins so year to
date I think I’m looking at the share
price caliber mining 38% it’s
outperforming a lot of your peers how
are you going to continue to add
shareholder value I think is the
question investors have on their minds
yeah no that’s uh that’s obviously a
question as to where where we’re going
and I think it’s very exciting times for
caliber uh over the next year we’re
developing a new property in Canada uh
so we just recently closed a deal with
marathon gold where we acquired the
Valentine Gold Mine which is a 5 million
ounce uh open pit resource deposit in
the central region of
newfinland the what’s exciting about
this is that the project is already 62%
through Construction uction and we would
anticipate by H1 of next year to be
adding uh to be adding that that new uh
asset to our production Port portfolio
and So based on a 2022 feasibility study
it it is anticipated that uh on average
for the first 12 years of a 14-year
Reserve Life the asset will produce
195,000 ounces of gold a year so uh upon
delivery of this asset and I’m very
confident we’re fully financed to be
able to deliver this project
the caliber will see a 60% production
growth by delivering this asset it’ll
also help lower our Allin sustaining
costs that cost the uh consolidated
asset base and of course this is 5
million ounces in Canada in a
jurisdiction that has a lot of
expiration potential so it’s continued
drilling continued delivery continued
execution on the construction of the
project to be able to be in production
by uh the first half of 2025 and uh you
recently closed 115 million dollar of
financing tell us about that yeah so
look anytime a company of our size yes
we’re producing $275 to 300,000 ounces
of gold this year uh and we have a solid
balance sheet but a company that’s in a
position of strength you always want to
think ahead and be proactive we’re
building Atlantic Canada’s largest open
pick gold mine you know we’ve seen
companies that have uh run into funding
issues we we have seen companies that
have uh had significant capex uh
increases and uh we’re planning ahead we
we have a very high level of comfort and
confidence in what it’s going to take to
complete this asset we want to ensure
that we have a good buffer there so uh
when we got approached an unsolicited
approach for aot deal financing by the
Bank of Montreal uh the company thought
very closely about it uh the board
decided to uh to go ahead and proceed
with the equity financing which is about
uh at the time a little less than 10%
dilution for the company uh but puts us
in a very strong financial position uh
to cover any sort of increases in
capital and uh deliver the Valentine uh
the Valentine gold asset by H1 of next
year if your investors are saying to you
Ryan well look you’ve already got
significant improvements in margins over
the last year you’ve got $86 million of
cash as of December 31st 2023 you’re
generating uh great iida uh why don’t
you just not raise shares dilute equity
and just grow organically could you do
that how would you respond to that look
that’s an option always right but when
you’re investing anywhere from uh from
from 20 to $25 million a month a month
on construction of a new asset in Canada
you want to yes you you’re you’re in a
position where you’re generating some
good operating cash flow and the price
of gold has gone up so that’s even
benefiting you further uh but you never
know when something’s going to go bump
in the night and so you want to be
prepared for that planning ahead being
proactive about uh um anything that
could come out a left field so yes
absolutely we uh we were in a better
position than most in these
circumstances but uh when somebody
approaches you to do a bot deal
financing uh during a time of a of a
large construction investment to be able
to increase production 60% and then
transition from a junior to a mid-tier
gold producer that has higher uh higher
multiples uh I think that’s a very smart
and prudent approach rather than being
in a position where you come out with
some news and say oh no Capital cost has
increased cash flow has reduced oh my
goodness we’re in a tough position well
I think the share price would probably
be a lot lower if we were in a position
of weakness to uh to help us finish
financing and completion of the build
than in a position of strength and uh I
notice you currently don’t have a
dividend policy or at least you’re not
paying dividends is that correct are you
planning to change that anytime soon
well the biggest thing we have on our
plate at the moment is is delivery of
this asset of this new asset in tier one
jurisdiction so that’s our our Focus
right now with the transaction we did
take on $225 million of sprout resource
lending uh a facility there with with
Sprout so uh as we advance the project
we anticipate drawing that Capital so 50
million of that Capital has been drawn
there’s 175 remaining so you know when
it’s all said and done we’ll have over
$200 million us of of debt on the
balance sheet and the company would like
to really focus on um paying that back
uh as quickly as possible so that will
be a focus for us as well as investing
back into particularly Valentine here
given the expiration upside uh in my
view in our view is that discovery of
ounces economic ounces can be quite
valuable for share price performance
dividends 100% would be something that
that uh that we would be reviewing in
the future absolutely once we uh get to
a 4 to 500,000 ounce a year production
profile uh we also do have in place uh
potential for share BuyBacks so we got
approval for that last year uh but again
our focus is delivering Valentine
getting that up and running and then
paying down debt as quickly as possible
uh I want to end on gold one more time
we come full circle so we’ve talked
about how you think gold could go higher
for the number of reasons you’ve listed
what could ultimately be the Catalyst
for let’s say I I’m not going to go as
aggressive as peist on $199,000 gold but
you know if we were to move towards
$3,000 an ounce which some people have
told me it’s possible now given where
Golds already been running up what would
that Catalyst be Ryan well I think that
uh you know as the as the FED continues
to talk about rate reductions if we saw
rate reductions I think we’re going to
see an explosive move to the upside on
gold um probably uh probably various
various uh investment in instruments as
well but I think that will be one if we
were to see some type of quantitative
easing uh in addition to that I think
that would be massive for gold again
that that to me is is significant
because of the debasement of the
currency right um and uh very likely the
supply and demand is starting to get
interesting given the the amount of
Central Bank buying uh continues to bind
and it is price agnostic it would seem
at this point in time nobody has a
crystal ball but what price what kind of
what is the high-end that would not
surprise you by the end of the year
$2500 okay makes sense thank you very
much where can we learn more about
caliber Mining and keep up to date with
the developments there yeah uh obviously
the best communication Tool uh at the
time is in and the easiest is is caliber
mining.com our website and uh you’ll
find information where you can call me
directly there on the website or email
me directly we do put out a lot of new
news and there’s information in their
news releases as well as to ways to get
in touch with the company but um yeah
best communication tool is our website
perfect thanks very much Ryan I look
forward to speaking with you again soon
best of luck with your current
developments thank you David I look
forward to it thank you for watching
don’t forget to follow caliber mining in
the links down below and don’t forget to
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Ryan King, Senior VP of Corporate Development and IR at Calibre Mining (TSX: CXB | OTCQX: CXBMF), discusses the fundamentals of the gold price, as well as the current sentiment around mining stocks.

This video was conducted on behalf of Calibre Mining Corp. and was funded by LFG Equities Corp. after David Lin was engaged for a one-time sponsored video. For our full disclaimer please visit:
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*This video was recorded on April 16, 2024

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0:00 – Intro
1:10 – Gold price recap
5:45 – Central bank buying of gold
6:50 – Gold vs. miners
9:55 – Gold price and M&A
13:35 – Gold ETFs
15:46 – Calibre Mining overview
20:55 – Calibre Mining’s future plans
22:31 – Recent financing
25:25 – Calibre Mining’s dividend policy
26:55 – Catalyst for higher gold price

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