Categories: Base Metals / Precious Metals
Topics: General Base Metals / General Precious Metals

Brien Lundin of Gold Newsletter Gives His Insight into the Metals Markets and a Preview of the 2017 New Orleans Investment Conference

Gerardo Del Real: This is Gerardo Del Real with Resource Stock Digest. Joining me today is Brien Lundin. Brien is the publisher of the Gold Newsletter and host of my favorite conference, the New Orleans Investment Conference, which will take place this year between October 25th and October the 28th. Brien, thank you so much for taking time today.

Brien Lundin: Great to be with you, Gerardo.

Gerardo Del Real: Well listen, we're coming out of the summer doldrums where we tend to see a slight pick up in gold prices usually. I know that sounds a bit counter intuitive. You've documented that pretty well over the years. And despite the summer doldrums, there's a lot going on. There's Trump, there's copper, there's zinc, and of course gold. So I'd love to start by getting your take on the metals market. If we could start with the precious metals space, and then maybe segue into the base metals, that'd be excellent.

Brien Lundin: Absolutely. You know, you mentioned the summer doldrums. That's kind of a myth in the market, you know? Everybody says there's the summer doldrums and I guess there are. But I went back and looked at - since 2000 - every summer to see how gold performed. And from June 1st through say Labor Day, gold more often than not, in fact the clear majority of times, it ended that period higher than it began. Now, a lot of summers there were declines mid-summer, but toward the end of the summer we typically had a recovery in the market. And by mid-August to early September the market was higher than it was before. So I think that's precisely where we are. We see gold recovering right now. We see gold finding reasons to rise.

That's one of the key hallmarks, after being in this industry for decades, that I look for to determine whether gold really is a bullish posture. Is it finding reasons to rise rather than excuses to fall? And it seems that gold always is finding reasons to rise. It's taking data or information that sometimes could be interpreted as bearish, and it's interpreting, or investors are interpreting that information as being bullish for gold.

One of the things of course is Donald Trump. He's taken the art of geopolitical and political crises and turned them from one-time events into kind of a constant drum beat. I think that's supported gold. And not just in the US. I think that’s supported gold around the world. Overseas, foreign investors are more concerned about Trump than American citizens. So that's why I think you've seen good buying overseas, but physical demand in the states through coin dealers and the like actually being a bit soft over this year, really since Donald Trump took office.

So, it's been a bit bifurcated in that case, but gold is as we speak in a recovery mode. It's finding reasons to rise. And I think that's going to take us well into the fall.

Gerardo Del Real: Excellent. Now, Brien, you do an excellent job of following geopolitics and covering its effect on the metals space. Do you see the geopolitical situation as a major catalyst here in the near future? I know that it tends to break down into two camps. I happen to be in the camp that believes that geopolitics will absolutely play an important factor in the direction that the gold price takes. Where do you fall along those two camps there?

Brien Lundin: Well I would be in direct opposition to you until this year. I've always advised our readers that these kinds of geopolitical flashpoints and crises, they come and go. The gold price will go up, sometimes for no logical reason, but it will rise because of some kind of a dust up somewhere. And then it will fall right back. And if you try and invest in gold because of these crises, you're almost always going to end up holding the bag because the traders are just quicker and sharper than you'll ever be. And they'll end up buying before you do and selling before you do.

So, I really think that the primary reason why anyone needs to buy gold is because of the long-term steady, consistent, unavoidable deterioration in the value of the dollar and other fiat currencies, as global debts, both personal, corporate and particularly sovereign debts, have grown out of control. The only way to control those debts is to depreciate the currencies. And that's going to happen. And it's going to happen increasingly more frequently and more severely as those debt burdens begin to bear their weight because of rising interest rates.

So I think that's the real reason, monetary reasons. Long term, large scale secular monetary reasons to buy gold. That's why you need to buy gold. With all that said, as I just noted, Donald Trump has changed the game. And there's a bit of a steady undercurrent of worry and concern in the world right now, that's perpetuated, or punctuated rather, here and there by more acute crises, or statements, or positions that he makes. But, there is this steady tide of demand for gold that's largely due to Donald Trump. And so I think the game has changed a bit in that respect.

More specifically, we've seen the issue with North Korea quiet a little bit because of some domestic things that have happened in the US with demonstrations and the like, and things that Trump has said. But the North Korea issue is not going to go away, and it really is severe. There's no way that the US is going to accept a North Korea that's nuclear-armed with ICBMs that can reach the US. And there's no way at this point that Kim Jong Un is going to stop developing those weapons, because he's so close he can practically coast across the finish line.

So, we're at a point in that crisis where there's no more road to kick the can down. We can't procrastinate, we can't pass it along to somebody else, it's got to be resolved soon and I'm afraid that it could be resolved in a very unsettling manner.

Gerardo Del Real: I agree 100%. I find it fascinating that on the monetary side, the math simply, it's just facts, it's just math. The debasement situation will get worse before it gets better and there has to be a shake out there. So again, I do agree 100% there, and simultaneously, geopolitically I agree with you again. I just think that it's very, very different times and geopolitically I do think this time it's different.

With that being said, the base metals like copper, zinc, an amazing run, specifically these last couple of months. I think zinc recently hit a 10-year high. Thoughts there in the base metal space?

Brien Lundin: Well that's telling us something, you know. Just reflecting back on gold as well, it's hard to find a fundamental reason for gold's strength recently. I harken back to what my friend Jim Dines said to me many years ago, you know when looking for a reason why gold was rising, or some metal or commodity, I forget what it was. And he showed a chart and he said, "Don't think, look." Just acknowledge the fact that it is. The market is seeing something that we're not, it is discounting something that we don't know anything about yet. And, if you look for a fundamental reason, now with zinc there are supply-demand issues…

Gerardo Del Real: Sure.

Brien Lundin: ... to some degree, but to a lesser degree in copper there has been some supply destruction. But, not any real surge in demand or a reason for a surge in demand that we can see. So these markets, the base metals, are seeing something and recognizing it and discounting something right now that we don't see, and we could not have forecast, and we didn't expect. Most likely, that's some sort of rebound in China. And these are the first signals to the market that this is going to happen.

So, while I can't explain it sufficiently to my mind, we have to recognize that these markets are in break out modes right now. And that means opportunity, that spells opportunity. There aren't that many zinc plays out there. There's certainly a lot of cooper plays, but they're undervalued right now. And, that sector will have a significant impact, particularly copper, on the gold market and a lot of juniors that we all know and love.

So, I think it just bodes well for an upsurge in metals prices, and the beginning of the kind of a bull market atmosphere that we haven't seen for 5 or 6 years.

Gerardo Del Real: Yeah, I think in respects to the copper space commentary there that you just provided, Brien, I think it was Donald Rumsfeld that said, "it's a known unknown." So, that's all ...

Brien Lundin: Exactly.

Gerardo Del Real: … very, very interesting. With that being said, what are you following in the junior space right now? You mentioned that copper juniors are relatively undervalued, relative to the price performance of copper. And again, I agree 100%. But what do you like in the precious metal space? We were talking a bit off the air about this exploration cycle finally picking back up, and that's a beautiful thing to see. What are you following, Brien?

Brien Lundin: Yeah. In Gold Newsletter, I've been pushing exploration stories over the past couple of months. Well, what we've seen is that the market, gold market, bottomed in December of 2015. And companies spent much of last year recapitalizing, raising money, going back to projects that had pretty much laying fallow for 4 years or so. And, doing the preparatory work that's necessary for drill programs. And now, this season, particularly in the northern hemisphere, we see companies starting to drill and drilling some outstanding prospects. We've seen some discoveries as a result. I practically begged my readers to buy GT Gold over the last couple of months because the drills were turning there. And of course, that was a big discovery. The share price has quadrupled. And, there are other ones I believe on the way.

I like Klondike Gold, they have a great prospect of course in the Klondike. I think they're proving up a bulk tonnage target there that the market really hasn't recognized yet. It's about a 4 kilometer long soil anomaly. Just really huge in scope. And they have potentially 3 or 4 other zones that could be just as significant. So, I look for a lot of news coming there. They've just put some more drills on the property and expanded the drill program. So there's going to be a lot of news flow form that company.

I like Atomera Resources that's drilling in Washington state. And they should have results coming out pretty soon. I think Precipitate Gold is going to come out with some drill results fairly soon. That could change the nature of that company. They're drilling the second of a couple of targets, the more exciting of their targets. And, I've got high hopes for that prospect.

Gerardo Del Real: It's great to see exploration companies back in focus.

Brien Lundin: It really is. It's great to see discoveries because that puts money back in the market, and starts those dominoes falling that can create a broad, sector wide rally.

Gerardo Del Real: Excellent. Excellent. Now, last but not least of course, I'd love to talk about the New Orleans Investment Conference. I mentioned earlier that the conference is my favorite conference. It's a beautiful city, the people are beautiful, the food is amazing, and as always, you've managed to put together a really fantastic lineup. Can you give us the details, Brien, as to why this year is particularly important?

Brien Lundin: Well, yes. The timing is what really strikes me as where the real opportunity is right now. You know we touched on it so far that this is one of those rare times in the markets where the turnaround is confirmed, yet the prices haven't gotten out of reach. So, this is the time when the New Orleans Conference really shines, in that you can discover some of these early stage plays that could become at some point legendary discoveries, and literally create fortunes along the way.

Our exhibit hall is going to be packed wall to wall with companies that could be the next Diamond Fields or other big discoveries that were introduced at our conference over the years. In addition, this is, as we also noted, a very turbulent time. Very volatile markets in geopolitically and economically. We're at a bit of a crossroads in so many important areas, and that's the kind of atmosphere or environment where the New Orleans conference has truly shined in the past as well. We bring in speakers that can address these issues. We bring in speakers that are world renowned and high profile, and they tell us things in this intimate setting that they don't say otherwise.

So, it's a great opportunity to get analysis from these world class experts. In particular this year, we have Tucker Carlson from Fox News. We have Charles Krauthammer of course, the Pulitzer prize winning columnist. We have Robert Kiyosaki this year for the first time, who has an enormous following of investors and is one of the biggest self-help, self-wealth creation type of gurus out there.

Gerardo Del Real: That should be fascinating.

Brien Lundin: Yeah, as I said he has a tremendous following and we have a lot of excitement over his appearance. And what's interesting about Robert is, he stresses that he's excited about the conference because he wants to sit in the audience and take notes. He looks at our agenda and he's going to be out there in the audience with everybody else, asking questions and taking notes and listening to our speakers. He's looking at it as a great learning opportunity. Which it is, which it is.

Gerardo Del Real: Absolutely. Who do else do you got on the line up there, Brien?

Brien Lundin: We've got Jonah Goldberg, who's a political columnist for the National Review. We've got Judy Shelton, who is a highly respected economist and gold and sound money advocate. She's actually head of the long standing Sound Money Project. As I said, very highly respected and on a short list of potential Federal Reserve Board nominees for Trump. So, that's going to be kind of an insight into the future makeup of the fed. You won't see her at any other investment conferences, we were able to attract her purely because of our reputation and credibility.

Gerardo Del Real: Wow.

Brien Lundin: We have Doug Casey, we have Peter Schiff, we have Rick Rule. We have Nick Hodge and you, of course. We have all the other great news letter writers in the sector, and analysts. We have Peter Boockvar. Man, the list just goes on and on. Dennis Gartmen. Dozens and dozens of the top experts that you can't find anywhere else in the same place.

Gerardo Del Real: Well it should be absolutely fascinating. I've been attending for nearly a decade, and I'm particularly excited this year, both as a presenter and much like Mr. Kiyosaki, as a student sitting down taking notes. I think it's going to be excellent.

Brien Lundin: Well good. If they register now they can save up to $400 in registration and get free Gold Club upgrades. So, you know, time is of the essence because we did sell out last year. And, we sold out the hotel and every hotel in the city was sold out, so time is of the essence.

Gerardo Del Real: Where can people go to register and sign up, Brien?

Brien Lundin: Goldnewsletter.com. And we also sent you a link that you could put up, and sends people right to what they need to find out.

Gerardo Del Real: Fantastic. Brien, is there anything else that you'd like to add?

Brien Lundin: Just don't sit on your hands in this market. There's a lot of opportunity out there, investors need to subscribe to the best newsletters in the sector and go to the conferences and get involved. Find these opportunities while they're still at the early stage levels, because there are fortunes that are going to be made over the next year or two.

Gerardo Del Real: I definitely agree that a disproportionate amount of the gains come early, and I think were at the sweet spot of the cycle. So, I want to thank you for your time today, Brien, and I hope you join me back again prior to the conference to get your take on uranium and the critical metals space and maybe some alternative technologies that I know you're involved with.

Brien Lundin: Any time, Gerardo.

Gerardo Del Real: Thank you very much. Brien Lundin everybody.

Brien Lundin: Thank you.

 

Click here to learn more about Brien Lundin's Gold Newsletter.

Click here to register for the 2017 New Orleans Investment Conference.