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Sprott's Thoughts:
A Recovery "Is Going to Happen" -- Rick Rule at the Sprott-Stansberry Symposium By Henry Bonner (hbonner@sprottglobal.com)
Is this what a market turn feels like?
“Great opportunities in natural resources occur once per decade,” Rick Rule
explained at the Symposium. “They occur at the bottom of a ‘bear market.’
“And this ‘bear market’ is the most severe that I have seen since the mid
1980's. That suggests a very dramatic recovery.”
Despite a down market, our Natural Resource Symposium garnered big numbers.
Around 800 people showed, including attendees, exhibitors, and speakers.
The audience was far from gloomy too. In previous years, and at other
conferences, attendees have lamented a poor sector. Not here.
From speakers and attendees alike, we saw optimism for natural resources.
Some were on the sidelines, waiting for more bottoming for their chance to get
in. Others were heavily invested already.
Where are gold and other natural resources headed now?
Speakers were divided. Some believed that a bottom was in, or at least that
the sector was cheap enough today.
Others favored sitting it out for now, waiting for a recovery to “announce
itself.”
Sprott US Chairman Rick Rule hasn’t given up on natural resources. “A
recovery is inevitable,” he said.
Rick revealed that he was still holding “lots of cash” to prepare for future
buying opportunities during a major dip.
Agora founder and self-proclaimed “rogue economist” Bill Bonner advocated
for owning gold regardless of the price. We’ve been living in a “zombie boom”
for the last 40 years, he told the audience. During that time, the “takers” and
cronies have gained increasing control over the US economy.
The economy has managed to grow anyway, sparing regular folks too much pain,
thanks to the bull market in bonds that has occurred over the same timeframe.
But this can’t last forever. As he wrote in
Financial
Reckoning Day and
Empire
of Debt, a collapse will occur eventually. “You’ll want to own gold
as insurance for your portfolio,” he says.
Steve Sjuggerud of Stansberry’s
True
Wealth has a more upbeat take on the zombie boom: It will go on for
a few more years, so you can still make money in stocks and real-estate.
He wasn’t ready to make a major play in natural resources, he said. “They’re
cheap, they’re hated, but I still want to see an uptrend.”
After he sees an uptrend in resource stocks, Steve will be ready to make a
big play in the sector.
Eric Sprott was one of the most-awaited speakers at the conference.
Contrary to other speakers waiting for signs of a turnaround, he isn’t
holding back. He told the audience that he’d personally taken ownership of a
gold mine, along with other big investments in the sector.
Other big-name speakers included Robert Friedland, Chairman of Ivanhoe
Mines. He told the audience they’d be crazy to miss this opportunity.
Copper, zinc, platinum, palladium – these metals are priced for the “end of
the world,” as he put it, saying China in particular will be a big consumer of
these metals. You need copper for electrical grids, platinum and palladium to
purify motor exhaust, and zinc as a crop fertilizer. These are all areas where
China may have a need for the metals.
“The mining sector cuts are not just skin deep, they are to the bone,” he
said. Miners can’t afford to produce if metals prices go any lower, so if they
drop from here, it means the world doesn’t want a supply of these metals,
according to Robert.
Even Doug Casey said he was getting heavily into resource stocks now –
despite his speech title,
Mining
Is a Dying, Stupid […] Business.
Did the speakers give any specifics about where they’re looking?
Dan Ferris of Stansberry’s
Extreme Value gave his “top pick of the year,” Altius Minerals, a
royalty company. The company gets a small cut of many different mining
operations’ revenues.
Frank Trotter, co-founder of EverBank told attendees to take a look at
“metals-backed CDs.” According to Frank, these can increase in value with
metals prices, but contain minimal downside risk.
Of course, the conference also featured over 50 resource companies. As Rick
explained, he expects at least some of the companies that were at the Symposium
to become high-performers in the next up-move.
Some of the most well-followed names were Kaminak Gold, presented by Eira
Thomas, Uranium Energy with Amir Adnani, and Sprott Resource Corp, represented
by Steve Yuzpe.
Miles Thompson presented Reservoir Minerals and William Lamb presented the
Lundin Group.
Dev Randhawa was also there, representing Fission Uranium and Randy
Smallwood presented for Silver Wheaton.
David Harquail told attendees to consider Franco-Nevada, the world’s largest
royalty company, as an alternative to a gold ETF. Franco-Nevada offers
diversification because it has so many separate royalty contracts, he argued.
The resource sector is cheap right now, but it could offer great rewards to
investors who are willing to participate.
As Rick Rule put it, the companies in the sector face a bad reputation. But
investors forget that some hard-working, ethical, and talented people are doing
“real work.” And the price of participating in their projects, as investors,
has often dropped dramatically.
“We’ve had a whole lot of fun at this conference,” Rick concluded, “and
we’re going to do it all again next year.”
Didn’t make it to the Symposium? All keynote speeches, except Robert
Friedland’s Q&A, are available for replay online, along with select
workshops.
Click
here to order.
Quelle:
http://sprottglobal.com/thoughts/
Quelle: http://www.naturalresourcesymposium.com
