Transcription
I think that's new. I think that is in in a meaningful way a game changer. Now, that does not mean gold has to go straight up from here.
>> Um
>> Sideways is okay. Like I don't mind it.
>> Well, for the business of mining gold,
>> Right?
>> Yeah. I mean, if $4,000, are you kidding?
>> I mean, they're the the producers, unless you're a really crappy producer.
>> Special coverage from the Rule Symposium 2026 in Boca Raton, Florida is brought to you by First Majestic Silver. There's no substitute for silver. Hello and welcome to Sore Financially here from the floor of the rule symposium in Boca Raton, Florida. My name is Kai Hoff and I'm the Edj Mining guy over in X and of course your host of Sore Financially and I'm really looking forward to the conversation now with Loa Tigra independent speculator. Lo, it's great to see you again. How you been?
>> Not so far from Frankfurt, but you know what a difference a couple months makes to the markets.
>> It does, eh? Yeah, it's interesting times we live in. We always say it's always interesting. It's what you make out of it.
>> Well, we have a memorandum of understanding.
>> Well, you know what does that mean really? Like maybe we'll start there. Maybe we'll start there. Let's start maybe with a little bit of geopolitics cuz it has been influencing our market quite a bit. Meaning the precious metals market, the miners, uh it has influenced. What is your current green on the situation? So I I do think this is actually interesting and I don't have a you know a stock pick to say therefore but I think investors should be aware uh my perception my read on the data is that Mr. Market has decided the war is over or okay there's still I I call it a less fire instead of a ceasefire and it and Mr. Market seems to think like you know if it's not entirely over it's going to be soon. It seems to me the markets are pricing in the winding down of this war. And I and I won't say that's entirely wrong. I I certainly think the US wants out of the war or at least lower oil prices until the midterms. And I think the IRGC wants to be able to sell oil if only to rearm, regroup, rearm. So I I think both sides want the oil to flow. Uh but of course they want almost everything else to be different. So, as we record, there was shooting again. US hasn't responded yet. Who knows? But to your to your question or I I do think that the markets, the investors at large have pretty much decided, you know, it's it's pretty much over. Phew. We've we've dodged the bullet. We're headed in a right direction. And so, um, to the degree that that could be wrong, there's opportunity. It also means that I I I think we've seen investor decisions pivot back to the Fed, Fed watching, monetary policy, those things that for a while seemed to go into the back seat when the war and and the next things blowing up were really driving the markets. And for us, you know, as resource investors, the most significant transmission belt is how, you know, there there's still this idea of gold and interest rates and Fed policy. And if the Fed is more hawkish, that's bad for gold. You know, that that supreme irony of of high inflation being bad for gold, right? So, what I'm saying is if if you know, as long as the Middle East doesn't really go up in flames again, and that's the direction the market is going, then those dynamics are going to shove around the prices of those minerals we hold most dear. No, it's interesting because geopolitics, Fed, inflation, like they all intersect and gold seems to be in the middle of it. Well, um, as you said, like inflation fears, rate hike fears have have pushed gold quite quite quite a bit lower below 4,000 here and now we're trading around 4,100 recovered a little bit, but because it seems like the inflation balloon or the the sorry, the rate hike fear balloon like some air's been coming out of that like rate hike fears 17% expectations.
>> But but this is a classic case in point. So like this last week we had some weaker than expected labor data from the US that was bullish for gold, bearish for the dollar. So that's an example of what I mean by the markets pivoting back. You know if if the same kind of data came out when you know Trump was talking about complete obliteration and stone age and all that stuff much less impactful like we saw this two months ago when I said what a difference two months make. This is case in point. So yeah, it it's interesting, but here's the thing. Like there's a lot of hope that the inflation genie will go back in the bottle because, you know, the war is over, oil prices are down, but of course we know that, you know, uh well, let's put it this way, the actual inflation prints, the EU did see a cooler print, but the US prints have all still gone up. And even if they do come off a little bit because oil as one input went down over this month, the underlying inputs are still going upwards. The the producer prices and that's true in Europe and the US are still going up. You know, the the PPI in the US not yet passed on to consumers. You know, that gives you I think any reasonable investor would look at that and say there's no reason to expect inflation to really go down from here and maybe cool off a little bit, maybe go sideways a little bit, but we're by no means done. you know the prices are still going up on the input side. So um you know I guess the bad news is for for monetary metals enthusiasts gold and silver is that you know the market may be unpleasantly surprised by stickier for longer inflation which ultimately is good for gold and silver ultimately but near-term that reaction function is still there and we could see prices head lower.
A question actually David Lynn asked me and I'm stealing it from him was that Kai do you see parallels to 2012 where we we've entered this sideway move sideways move in in gold and the precious metals in particular is that do you see similarities is it different this time
>> well history doesn't repeat but it can rhyme and yes I do see similarities it in fact the I'm not really a chartist but if you superimposed January of 2026 over September of 2011 on the gold chart it is spooky how similar those are. And you know, the good news is that that was 2011. In 2012, gold went sideways for a while, but then it fell off a cliff, right? And we got a 4-year bare market. So, I'm not predicting another bare market in gold. But I'm just saying to the degree that that these charts echo, that's not a good thing. You know, it it says, okay, over the next year we might see correction, consolidation, but it says the next big move will be down, not up. My view as a fundamentalist is the opposite and people people call me names and get mad at me because I took profits but my view is actually still that the next big move will be up. I could be wrong but that is my base case. And so it it is interesting to to look at those charts and um we are actually right now at a point where if you superimpose the last three big peaks 2011, 1980 and 2026. Right now the the sell-off this year looks worse than 26 but better than 1980. But if it keeps going lower, it's going to be worse than both.
>> And that would be pretty alarming. you know, even if I'm not a TA, you know, so just to be clear, dear audience, I'm not predicting a bare market. I'm not saying the next four years are down. But I'm saying there's data on the table that says it might be. So, and it is dangerous to say, "No, no, I'm not listening. I'm not listening because central bank buying or whatever, it's got to go up." We're here at the rule symposium. So, my answer to that is the famous Rick Ruleism. Never confuse the inevitable with the imminent. Like even if you're right, that doesn't mean that gold and silver can't go lower in the near term. Again, not my prediction. I'm just saying it is prudent to take that risk into mind.
>> Well, the question is like how is important to how important is the current price level around 4,000 plus or minus a few dollars. Um cuz it seems like that's where we started the year, right? A lot of people have sold off.
>> Yeah. Isn't it funny? When we hit 4,000 on the way up, people were popping champagne, but and now 4,000 after the the interim peak. It's crying into our beers. Bubbly in both cases, but different sentiment. Um, yeah. So, how important is that? I I'm not sure that it's I mean the reality is if you're mining gold and you have a mine that was built sub $2,000 gold, which most of the producing mines today were built with that price assumption, you are making money literally. And if it's 3,900 or 4,100, it doesn't matter at all. I mean, marginally, but but you're making money either way. Um, but you know, psychologically important levels. If it breaks significantly lower than 4,000, that could trigger more selling stops. That sort of thing could happen. But here's a more bullish thing. For all the all the doom and gloom that you might think, dear dear audience, I was just saying here's a here's an optimistic idea. Over the last month, we have seen, I think, four or maybe five sub $4,000 plunges overnight and then in the morning, it comes right back up again. there is somebody out there with deep pockets buying that dip. So, I don't know if 4,000 is all that important, but I think there's somebody, maybe a central bank with a mandate to increase its gold holdings that has said, "Okay, you know, we're a buyer, but we're not going to chase it while it's up. You know, every time it falls below this level, we'll buy until we're full in our allocation." If that's so, if that allocation is large and there's a long way to go, you know, that could be a pretty that could that could make 4,000 a pretty good floor. But I'm of course I'm speculating. I don't know that that's the case. I'm just saying somebody's buying these dips. And if that continues, that would actually be pretty encouraging cuz what happens next if it's 1980 is is another big draw, you know, step down. Uh what happens next if it's 2011 2012 is waffling sideways and lower. Um, so if if 4,000 is a is a strong floor, somebody's buying that consistently and they've got big enough pockets to keep going, I think we would actually see the this pattern diverge from the previous peaks and that would be bullish.
We've seen a lot of outflows also from the ETFs for example. But the question is like where is the liquidity flowing to? Is it just plugging holes elsewhere or is it being invested elsewhere? Let's say space for example.
>> Right. Right. So you know that's one of those hard to know things. It's I think it's likely that a lot of people sold some, you know, took profits on Nvidia or or whatever to buy into SpaceX. I mean, you know, all that money had to come from somewhere and, you know, so did some of it come from gold? Sure, I could imagine that happening, but these are pretty different investor types. I don't know many gold bugs who like, "Yeah, I want me some SpaceX in my portfolio."
>> I don't think you meet that person to be honest. Maybe maybe some, but yeah, I haven't met one here yet, right? Uh so it by the way people would sometimes ask me okay you know what else besides metals and mining and forget commodities is there anything else you might buy for years I've actually said SpaceX is a is a unique company it you know it has that moat like like Warren Buffett loves Blue Origin is just now beginning to catch up with SpaceX. The Chinese keep blowing up rockets trying to copy SpaceX, right? It's it's rocket science isn't easy. N
>> so there's there's quite a moat. It's a valuable service. Starlink is, you know, the one thing that's making money for them. Um so that actually made sense as a as a company thesis, but a $2 trillion valuation, you know, that's not buy low, sell high, right? So no,
>> but uh do you see any other competition right now? Like of course we got the data centers. It seems like we're we're you know beating old cliches here, but is there like back in the day like back in 2011 or even now 20 was it 16 we had the cannabis hype and craze and all that good stuff.
>> Yeah. Yeah. Yeah. No, actually the answer is no. I do think you again we can't prove it but but we do have some evidence of sovereigns selling gold during the war because they needed to buy oil or they just needed to shore up their budgets in general. Uh we know for example that Turkey sold a bunch of gold. Russia for slightly different reasons but at the same time. So if if you didn't have those big sovereign sales I I think we actually would have seen much less of a correction in gold than we have. And that's if the war is over that's one off. Like to the degree that people were selling gold to shore up their their their SPRs or whatever. Um you know I that is that is winding down now. Uh, so that would be, hey, hey, there's another bullish argument. If that if that's what knocked gold back from 5,000 to 4,000 and that's done, that's optimistic. There's several ifs in that sentence. Um, so that would be one where, you know, if I see that that's the case, that would change my perception of the market and maybe my shopping list.
>> You touched on it. The jobs report last week was ultra weak. No, it was weaker than expect the market expect. What had me hopeful though is the reaction of the precious metals cuz they jumped 2 3% and those are bigger moves for precious metals like silver in particular as well but like gold jumped 3% that day. So there is there are buyers waiting for the bleeding to stop
>> I think so. So so that's actually another point that I think is optimistic you know but again don't confuse inevitable with with imminent. So like I have lots of bullish arguments to make and I think this is one of them. I think there's a lot of investors out there, not just sovereigns who want to ddollarize, but just general investors, family offices, deep pockets, old money from Europe that maybe 10 years ago they would be like, you know, gold it's the it's a pet rock. It's this archaic relic. You know, it's not good for anything besides gathering dust. Doesn't pay interest. But now fast forward to where we are now. And it's not just that gold prices went up and and shocked people, but it was it was why and how they acted as a safe haven, how they responded to geopolitical stress. You look around the world and we still have two hot wars going on. And maybe one is winding down, maybe not. You know, I don't think Netanyahu wants the war in Iran to be over. I don't think he thinks the job is done. So in this world I think there's a lot of money that got the memo suddenly like you know what having a bit of like hard ass like real hard asset that financial long for which there is no short in my portfolio that's a useful thing and uh you know that here again at the role symposium Rick Roll's famous thing about how over the decades the global allocation to gold historically has been 2% and until recently it was half a %. So investment demand for gold would have to quadruple just to return to the to the mean, the long-term mean. That could be what's happening. Or or actually I'm arguing that that is happening. And I have heard that it's already gone from half a percent to 1%. The global mean still needs another double like twice as much. But but even if not, just for it not to go away, just for those people who realized, holy peep, you know, I could use something more solid in my portfolio and and something that works when the internet goes down.
>> Exactly.
>> Something I can, you know, dig up.
>> I think that's new. I think that is in in a meaningful way a game changer. Now, that does not mean gold has to go straight up from here. Um, hey sideways is okay. Like I don't mind it.
>> Well, for the business of mining gold,
>> yeah, I mean $4,000. Are you kidding? I mean, the the producers, unless you're a really crappy producer, they're gushing. And by the way, that's another takeaway here, folks. If you're wondering what to buy, and you've got a company that's saying, "Oh, well, you know, we had this, that, or the other excuse, but we didn't make money." If you're a gold miner, not making money at $4,000 gold, I'm sorry
>> that that's not a tier one asset, right? and and you know, okay, people, well, silver's down already, you know, it's more down over 50%. Yeah, but it's still 60 whatever. It's it's well above what used to be the the dream high peak of $50. Like, you know, silver mines were built most of the operating mines were built sub 20. Some of the newer ones might be 20some, but you know, you're looking at two to three times the price assumption. If you can't make money mining gold and silver at today's, you know, horrible, terrible, worst day ever, you know, levels, there's something wrong with those assets. So, this this helps with selection. If you're, you know, you need to, you know, what what to put on my shopping list, the market gives you a gift in moments like this.
>> 100%. We'll come back to the miners in one second cuz I want to talk about the the 60 2020 portfolio. Although, I'm not sure there's a question. I just wanted to mention it cuz it it sort of speaks to the trend you're seeing there, right? Yes. Yes, there's been a paradigm shift and this isn't just, you know, gold bugs at brick rules conference. This is mainstream financial, right? Right. Yeah. Um,
>> yeah. So, I don't think we need to beat that to death, but but that's part of exactly what I'm saying. I don't think that goes away,
>> right? And and and just let's say gold drops much lower.
>> I don't think that mindset changes
>> unless you're sitting on 40% losses. Well, well, if you're a momentum chaser, if if
>> again, the reason to own gold is not I don't I don't speculate on gold. I don't even invest in gold. I own gold as savings. That is how I crystallize wealth as as an asset that I can be long with no short that has actual value in the real world no matter what. Completely different thing from how do I speculate in the markets. So, so you know, how do I make money? I well I don't make money buying gold. I make money buying gold and silver stocks when they're low, when they're on sale and selling when they're high. It's a completely different question. So and and the mindset that we're talking about those those those family offices and that you know that old money from Europe, they're not buying gold as a speculation cuz it's going up. They're buying gold because holy beep, look what's going on. We have a war with a nuclear power on our our eastern front. you know, maybe a hedge, a hedge, not a speculation, a hedge, right? It's it's a completely different idea. So, no, I don't think that goes away at all if it goes down. If anything, you you might see more dip buying from that mindset. Now, now the momentum chaser, the guy who bought pot stocks when they were hot and who jumped in Nvidia when that was hot and jumped in gold when it was going like that, yeah, that guy's going to sell, but I don't think that's a very large part of the market. And once they're shaken out, um, you know, onward and upward.
>> Exactly. And I think that's where we're at at this point, but that's my own opinion, right? Um, two two directions. Pedro dollar maybe is one that I want to talk to you about as well cuz dollar we talked about dilization before cuz I know we talked about Brent Johnson's check theory and I feel like the activities in the Middle East have sort of slowed down the decay of the dollar. Would you agree with that?
Yeah, I I I have to say that what we've seen in the markets lately, certainly the rebound in the dollar has kudos to Brent like he called that he was right about that. Now overall I I I agree with Brent's overall thesis I think but again inevitable and imminent. Um and and the overall trend well actually let me let me rephrase that. I wouldn't say that I'm I'm entirely in the dollar milkshake camp. I get the argument and it may well be right, but I'm not sure that the dollar eventually blows up and ends in strength. I could see it going the other way. And the current administration, even if you in the US, even if you agree with all their agenda, I think any objective person has to admit the reality that Trump is not making a lot of new friends around the world. And that is, I think, accelerating. It's adding to the incentive to ddollarize. Um, and it's adding to the incentive to create different alternatives and solutions. You people keep talking, well, you know, the Euro dollar market doesn't have the depth, doesn't have the bond market, all that stuff. But everybody knows that and people are working on these things. So, we'll see. You know, Brent might be right. But it could be that the dollar just keeps going down, keeps going down, and then it hits a critical level where it's just not that important anymore. And it, you know, as the saying goes, slowly first then all at once. I could actually see that happening. Uh, but again, I'm I'm a due diligence guy. I get paid to kick rocks. So I I'm I don't I don't know which way that's going to point out pan out. But I think it is an important reminder like if you have some big macro thesis uh you know don't don't kid yourself about that that proves what's going to happen in the market today. You keep making great cases for gold here. By the way that was another great argument for it. So I know you didn't point it out to the camera but uh great point. U because we've seen gold weakness when the dollar was rising to 101 or so 1015. We saw headwinds in gold. Um I want to come back to the miners um and maybe bring it all together. Back in 2022, March and in May in particular, we've seen rate hikes by by the Fed in the US and risk capital disappear for our sector completely. Do you fear that happening again?
>> No. So again, I'm a due diligence guy, but if I put my Fed whisperer hat on for a moment, you see how thin it is. You can't even see it. Uh yeah, I think Wars is talking tough. I think he had every incentive to talk tough. I mean, what was he going to do? Show up at his first press conference and say, "Yeah, I'm a Patsy. I'm Trump's yes man. I'm going to cut rates no matter what?" Of course not. Right. Of course not. So, but the markets are pricing it in like he's a proven hawk. We're going to have rate hikes. And maybe they backed off a little, but but that we're even talking rate hikes at all is so completely different from where we were at before. So again, I don't know what's going to happen, but it seems to me that the market thinks it does, and that's dangerous, and that could that could easily unwind, go in the different direction. Um but but this does matter because to the degree if if the war doesn't heat back up again, my perception is that investors have pivoted to paying back more attention to the Fed and monetary policy which kind of took the backseat during the war, you know, stopped blowing up in in the straight horses caught markets attention and and now well like just this last labor report, I I do perceive the reaction function what it did to gold. It was good for gold in that time, but you know, there could be another one. You know, that that ultimate irony of of a higher inflation report being bad for gold near-term, right? You know, we could see that. So, you know, I don't have a hot stock tip to give you here, but to the degree that this is the dynamic we're seeing going forward and that the market is wrong about Wars, then it gives us, I think, some reason for if not predicting then in expecting how how the reaction functions will be in in the immediate future because it's interesting like back in the day like financing completely disappeared for our sector, right? Just bringing it back to the miners a bit. um that then risk doesn't seem to be imminent right now.
>> Yeah, a little bit of push back. You know, the the true tier one projects, they never had trouble raising money. You know, if you had a great project and it was not a great time. I mean, there were examples, the Londines, for example, they would move into something and maybe even precisely because the market was crappy and they could get a better deal, but they they they know their stuff. They know when somebody's got something that's a mind in the making. And so, by the way, does our host here, he's pretty good at that. And, you know, if you had a really great a truly tier one project that all you needed was money to to, you know, prove the thesis, Rick's checkbook was there. You know, he he wanted a a juicy warrant, but the checkbook was there. So, I just I just don't buy the oh, we can't raise money in a crappy market. Uh the the tier one assets, they can raise money in any market. Um, and now this isn't a crappy market. If anybody's, this is another litmus test the audience can take away. If anybody's telling you, "Oh, it's a crappy market. Sentiment's so bad. You know, we can't raise any money now." Are you kidding? At $4,000 gold and silver above the $50 previous ceiling, you can't raise money in this market or $6 copper. Like, come on.
>> Get out of here.
>> Right. Yeah.
>> Literally, get out of here.
>> You said it, brother.
>> No, absolutely. Um, look, we got 2 minutes left um before our camera shut off. Um, I was just going to ask you, so when we spoke in May, you said you're 80% cash. You're waiting for the opportunity of a lifetime. Paraphrasing just a little bit, but we might get a buy. Yes.
>> How close are we? And have you bought anything?
>> I haven't bought any gold and silver stocks yet. We just had all these bullish things, but I I haven't been able to shake the possibility that we're looking, you know, at the January 1980 possibility. I don't want that to be the case, but since it's possible, I'm not buying ahead of that. I'm I'm not willing to buy catch that falling knife. Copper, I love copper, but over six bucks, not cheap. Uranium, I love uranium, but you know, 90 bucks, you know, averaging spot in long, can't say it's cheap. The stocks certainly are not on sale. Uh, the one mineral that I like that has really fallen off a cliff since quai piece, that memorandum of understanding is oil. And I do see opportunities there. And I did finally, for the first time in months, buy a stock and it was in the oil patch. I have a shopping list for clients right now. It's all oil stocks.
>> Where can people find the shopping list?
>> independent speculator.com. That is not in the free letter. I I did promise readers that I would say when I pivoted and I did. In the free letter, I said I have started buying again carefully. Um that was free in the macro letter, but if you want to see, you know, where I put my own hard-earned money, that's in the paid product.
>> Perfect. That's what it's for. Absolutely. We tremendously appreciate it. Lo, it's always great to have you due diligence guy on X as well. You're quite active. Oh, sorry, forgot the shout out there.
>> Good.
>> Thanks so much for stopping by. It's always great to see you.
>> Thank you.
>> Always enjoy the conversation and uh we'll talk soon. Everybody else, thank you so much for tuning in. Tremendously appreciate you watching Sore Financially.
>> Leave a comment, leave a like, help us out with the algorithm. Really curious to hear from you as well. Have you started buying yet again? And what are you buying? Thank you so much for tuning in. We'll be back more with a lot more here from Booker Raton. Take care.