Rick Rule: Gold, Silver, Uranium — Key Price Drivers and What to Watch Now

Summary

In this insightful interview, Charlotte McLoud from investing.com engages in a deep conversation with Rick Rule, a prominent figure in rural investment media. They explore the Federal Reserve's stance on interest rates, the impact of central bank policies on the US dollar, and the significance of gold as a hedge against inflation. The discussion delves into the dynamics of gold and silver markets, the influence of Chinese investment, and the intricacies of the uranium market. Rick also highlights the importance of the Resource Symposium, emphasizing its value for investors seeking macroeconomic insights and investment opportunities in the natural resource sector.

Takeaways

• 📉 The Federal Reserve (FED) is unlikely to cut interest rates soon, as they prefer to discuss the possibility rather than act on it, influenced by political biases and the belief that they are the only branch concerned about inflation.
• 💵 The US dollar strengthens when other countries like Canada and England cut rates, as investors seek a safer haven for their money.
• 🌍 The geopolitical weaponization of the US dollar and the central banks' buying of gold are significant factors affecting gold prices, rather than just retail investor interest.
• 🧘 Gold is seen as a currency without a political constituency for devaluation, making it a stable investment against the backdrop of fluctuating interest rates and inflation.
• 🇨🇳 China's central bank and retail investors are significant players in the gold market, with cultural predispositions towards gold ownership and concerns about economic stability.
• 📊 The gold price is tied to interest rates in terms of maintaining purchasing power, but a disconnect exists between the gold price and gold equities, partly due to central banks not buying gold stocks.
• 📈 The gold mining industry needs to improve margins with the gold price increase, as production costs have risen, impacting profitability.
• 🥈 Silver is following gold's trend, but the reasons behind its price movements are not entirely clear, with speculation and cultural factors potentially playing a role.
• ⚔️ Platinum and palladium are considered undervalued and are essential for internal combustion engines, which are expected to remain in use beyond current predictions of their demise.
• ⚠️ Supply disruptions in platinum and palladium could easily double their prices due to their concentration in a few politically unstable countries.
• 🔍 The Real Symposium is a prestigious event featuring macro thinkers and successful resource investors, offering insights into the natural resource market and investment opportunities.

Q & A

What is the main topic of discussion in the interview between Charlotte McLoud and Rick Rule?

The main topic of discussion is the Federal Reserve's stance on interest rates, the impact of political decisions on the economy, and the state of various commodity markets, including gold, silver, uranium, platinum, palladium, and nickel.

What is Rick Rule's view on the Federal Reserve's approach to interest rates?

Rick Rule believes that the Federal Reserve prefers to talk about cutting interest rates rather than actually doing so, and that they are the only branch of the US government concerned about inflation.

How does Rick Rule describe the administration's approach to economic messaging?

Rule describes the administration's approach as 'schizophrenic,' where they claim the economy is doing well while also benefiting from lower interest rates, and he criticizes the 'election year BS' of taking credit for positive economic stats while blaming others for negative ones.

What is the significance of other countries cutting interest rates before the US, according to Rick Rule?

The significance is that it strengthens the US dollar as money seeks a relatively safe haven in US dollars, which are perceived as more attractive due to the higher interest rates.

Why does Rick Rule suggest that investors should consider gold as part of their savings?

Rule suggests gold because it is the only currency on the planet without a domestic political constituency in favor of devaluation, offering protection against the potential negative impacts of political decisions on other currencies.

What has been the trend in retail investor behavior towards gold according to the ETF data mentioned by Rick Rule?

The trend has been that retail investors in Western Europe and North America have been sellers rather than buyers of gold for the last two years, with foreign central banks being the primary buyers.

How does Rick Rule explain the disconnect between the gold price and gold shares?

Rule explains that the disconnect is due to central banks being buyers of gold but not of gold shares, which has temporarily changed the audience for gold and created a dichotomy between the gold price and gold shares.

What is Rick Rule's perspective on the role of China in the gold market?

Rule believes that China plays a significant role due to the cultural predisposition to buy gold among ethnic Chinese, the government's encouragement of savings in gold, and the rapid increase in private savings in China.

What does Rick Rule predict about the future of uranium prices and the market?

Rule predicts that the term market for uranium will become increasingly important, with producers able to lock in contractual pricing and volume contracts for up to 20 years, which will lower the cost of capital for uranium producers.

How does Rick Rule view the potential impact of social or political discord in platinum and palladium producing countries?

Rule views it as a contingency worth speculating on, as any significant social or political discord in Russia, South Africa, or Zimbabwe could interrupt supplies and potentially double the prices of platinum and palladium.

What is the Real Symposium and why is it considered valuable for investors?

The Real Symposium is a long-standing mining investment conference known for attracting macro thinkers, providing insights from successful analysts and portfolio managers in natural resources, and featuring 'Living Legends' who share their experiences building multi-billion dollar mining companies. It offers a money-back guarantee if attendees do not feel they received value from the event.

Outlines

00:00

📉 Federal Reserve's Dilemma on Interest Rates

In this segment, Charlotte McLoud interviews Rick Rule about the Federal Reserve's latest meeting, which showed no change in interest rates. Rule suggests that the Fed is the only US government branch concerned about inflation, while other branches focus on spending. He speculates that the Fed's institutional bias is to maintain market interest rates rather than manipulate them downwards. The conversation also touches on the political pressures affecting the Fed's decisions and the potential impact of rate cuts from other countries like Canada and England on the US dollar.

05:01

🌟 Gold's Movements and Central Banks' Role

The discussion shifts to gold, with Rule noting that gold prices have risen without the participation of traditional retail investors. He explains that foreign central banks have been the primary buyers of gold, possibly due to the weaponization of the US dollar in foreign policy. Rule also addresses the disconnect between gold prices and gold shares, attributing it to central banks buying physical gold but not gold shares. He predicts that as the impact of inflation becomes more apparent to the public, retail buying of gold could increase significantly.

10:01

🏦 China's Influence on the Gold Market

Rule discusses China's role in the gold market, highlighting the cultural predisposition of Chinese people to buy gold and the government's encouragement of gold savings. He mentions the rapid growth of private savings in China and the concerns about the stability of the Chinese economy, which drive the interest in gold as a savings instrument. Rule also talks about the development of infrastructure for gold distribution in China and anticipates that Chinese retail investors will become increasingly important in the gold market.

15:03

📊 Gold Stocks and the Impact of Central Bank Buying

The conversation delves into the performance of gold stocks and the reasons behind their disconnect with the gold price. Rule explains that central banks' buying of physical gold does not extend to gold stocks, which could explain the discrepancy. He also discusses the importance of gold mining industry margins and the expectation that they will improve as gold prices rise. Rule identifies companies with good cost containment records as potential performers in the gold market.

20:03

📈 Silver's Market Dynamics and Chinese Speculation

Rule addresses the complexities of the silver market, noting the difficulty in predicting supply and demand due to silver's dual role as an industrial material and a monetary metal. He also comments on the cultural propensity of Chinese people for speculation and gambling, suggesting that this could influence the silver market. While acknowledging the traditional belief that gold moves first and silver follows, Rule expresses uncertainty about the recent silver price increase, hinting at potential generational differences in market behavior.

25:04

🔍 Uranium Market Insights and Investment Strategies

The discussion turns to the uranium market, with Rule sharing his views on the importance of the term market for uranium producers. He explains that long-term contracts provide price certainty and volume, which can lower the cost of capital for uranium producers. Rule also touches on the potential for uranium prices to rise due to supply disruptions in countries like Russia, South Africa, and Zimbabwe, and how this could impact investment strategies.

30:06

💼 Rick Rule's Portfolio Review and Resource Investing

In the final segment, Rule offers a portfolio review service for investors interested in natural resource stocks. He emphasizes the importance of understanding the term market in uranium investments and how it can provide insights into a company's revenue and margins. Rule also promotes the rSymposium, highlighting its reputation for attracting high-quality speakers and providing valuable insights into the mining investment community.

35:09

🎤 Upcoming rSymposium and Investor Opportunities

Rule provides an overview of the upcoming rSymposium, emphasizing its long-standing tradition of offering valuable insights into the mining investment sector. He mentions the conference's focus on macroeconomic thinkers, successful resource analysts, and the unique 'Living Legends' segment where successful mining entrepreneurs share their experiences. Rule also discusses the vetting process for public company exhibitors and offers a money-back guarantee for attendees, showcasing the confidence in the conference's content.

40:09

📝 Final Thoughts and Portfolio Review Invitation

In the closing remarks, Rule invites viewers to list their natural resource stocks on his website for a personalized portfolio review. He reiterates the importance of focusing on resource investing and the value of the insights provided by the rSymposium. Rule also encourages viewers to attend the conference, either in person or via live stream, and reminds them of the recording option for revisiting the conference content.

Keywords

💡FED (Federal Reserve)

The Federal Reserve, often referred to as the FED in the script, is the central banking system of the United States. It plays a crucial role in setting monetary policy, including interest rates, which influence economic activity. In the video, discussions revolve around the FED's stance on interest rates and its potential impact on inflation, highlighting the institution's significance in shaping economic outcomes and investor behavior.

💡Interest Rates

Interest rates are the cost of borrowing money and are a key economic tool used by central banks like the FED to control inflation and stabilize the economy. In the script, there is a focus on the FED's decision-making regarding interest rates, with implications for investment strategies, particularly in the context of gold and other commodities.

💡Inflation

Inflation refers to the rate at which the general level of prices for goods and services is rising, and subsequently, the purchasing power of currency is falling. The script discusses the FED's concern about inflation and its potential actions to mitigate it, which is a central theme in the broader economic narrative and affects investment decisions.

💡Gold

Gold is a precious metal that is often viewed as a store of value and a hedge against inflation and currency devaluation. The script explores various aspects of gold, including its price movements, central bank buying, and its role as a component of investment portfolios in times of economic uncertainty.

💡Dollar Hegemony

Dollar hegemony refers to the dominant position of the US dollar in global trade and finance. In the script, there is mention of the US dollar being the worst currency except for all others, indicating the dollar's role as a safe haven, even despite potential issues with the currency itself.

💡ETFs (Exchange-Traded Funds)

ETFs are investment funds that are traded on stock exchanges, similar to individual stocks. They track an index, sector, commodity, or a theme. The script mentions ETF data to illustrate the trend of retail investor behavior in relation to gold, indicating a shift in who is buying and selling the precious metal.

💡Central Banks

Central banks are the main monetary authority in a country, responsible for monetary policy and financial stability. The script discusses central banks' actions, particularly in buying gold, which can influence the gold market and signal confidence or concern about economic stability.

💡Gold Shares

Gold shares refer to equity in companies that are involved in the mining and production of gold. The script points out a disconnect between the price of gold and gold shares, attributing this to central banks buying physical gold rather than shares in gold mining companies.

💡Uranium

Uranium is a chemical element that is primarily used as the fuel in nuclear power plants. The script touches on the uranium market, discussing price fluctuations and the importance of the term market for uranium producers, which can provide long-term price stability and investment certainty.

💡Precious Metals

Precious metals are rare, naturally occurring metals that have a high economic value. Gold and silver are classic examples. The script discusses the dynamics between gold and silver prices, and how they are influenced by various market factors, including investor sentiment and industrial demand.

💡Resource Investing

Resource investing involves putting capital into companies that are involved in the extraction or production of natural resources, such as metals, minerals, and energy products. The script provides insights into various aspects of resource investing, including the importance of understanding the macroeconomic environment and the specific dynamics of different commodity markets.

Highlights

Discussion on the Federal Reserve's latest meeting and its implications on interest rates.

Speculation on the Fed's institutional bias towards maintaining market interest rates rather than manipulating them downwards.

Analysis of the political pressures influencing the Fed's decisions and their potential impact on the economy.

The significance of other countries cutting interest rates and its effect on the US dollar and gold.

The role of gold as a currency without domestic political pressures for devaluation.

Observations on gold price movements and the involvement of foreign central banks as buyers.

The dichotomy between gold prices and gold shares, and the central banks' influence on this.

China's role in the gold market and the cultural significance of gold among Chinese people.

The potential for increased Chinese retail investment in gold due to economic concerns.

Discussion on the disconnect between gold prices and gold mining industry margins.

Predictions on the future of gold mining shares and their potential performance as a leveraged instrument.

China's pause in gold buying and its psychological and actual impact on the gold market.

The potential for a silver bull market driven by Chinese retail investors and speculators.

Comparing the opacity of the silver market to other commodities like copper and uranium.

Uranium market dynamics, focusing on the importance of the term market for uranium producers.

The impact of term contracts on the cost of capital for uranium producers and their investment appeal.

Rick Rule's personal investment strategy in the resource sector, including his diversified portfolio.

Upcoming Real Symposium preview and its significance for investors in the mining and resource sector.

Details on the unique features of the Real Symposium, including its focus on macro thinkers and mining industry veterans.

The offer of a money-back guarantee for attendees of the Real Symposium, reflecting confidence in the event's value.

Transcripts

[Music]

I'm Charlotte McLoud with investing.com

and here today with me is Rick Ru

proprietor at rural investment media

thank you so much for being here great

to have you charl it a pleasure thank

you for having me

back of course really good to be

speaking with you and of course we're

talking ahead of the real Symposium

which we'll make sure to touch on toward

the end of the conversation but where I

thought we can begin today is with the

FED because we had the latest meeting

literally just DRP up so I think as

expected we didn't get any changes in

interest rates and I was looking back to

our conversation at the beginning of the

year where you had mentioned really the

FED would prefer to talk about cutting

as opposed to actually cutting so I was

going to begin by asking how long do you

think they can just keep talking about

it as opposed to actually doing anything

I think that's a good question uh I

should begin by saying I don't know but

I'll be speculative and say that the

institutional bias within the FED is

that the FED believes probably rightly

that they're the only branch of the US

government that's concerned about

inflation that Congress believes that

they get paid paid to spend the

administration wants to spend because

we're an election

year and so from the fed's point of view

the the institution that stands between

the US dollar and Oblivion uh is in fact

the

FED

now from the administration's point of

view there's two different things they

have to do which are contradictory the

first is to tell Americans that they're

enjoying a great

economy and that all of the employment

statistics and all that kind of stuff

are great at the same time uh they would

benefit they know from lower interest

rates so they have a sort of a

schizophrenic uh approach to dealing

with the fed and I really don't know how

it's going to going to work out I I I

was amused at President Biden discussing

the economic statistics uh 10 days ago

taking credit for employment and lower

oil prices and all that kind of stuff um

when it suits them of course they attack

the grocery chains like Trudeau does for

high prices and then they turn around

and say that Jo grocery prices are

moderating through their own effort you

know it's the typical election year BS

and I think that the FED is being pushed

backwards and forwards by all this

politics but as I say I I think the bias

within the fed and I need to tell you

that I don't know anybody at the top

levels of the FED but I know some of the

regional Governors and I know some of

the employees in the fed the the the

bias of the

institution is clearly to um maintain

closer to Market interest rates rather

than manipulating interest rates

down okay so that's what's going on with

the FED at the moment but outside the US

we did get rate Cuts recently from

Canada and from England and I wondered

if you could talk a little bit about the

significance for investors of other

countries starting to cut

first well what that happens is

strengthen the US dollar uh people go uh

people go with their money to where it's

treated well uh for political expediency

for domestic political purposes both

Canada and England uh have lowered the

interest rate they pay on savings which

causes more Canadian dollars and more

British pounds to seek Safe Haven or

relatively Safe Haven uh in the US

Dollars that's why uh Doug Casey has

always said the US dollar is the worst

currency in the world with the sole

exception of all the

others um whether or not for purposes of

political expediency the US will be

forced to do that uh is a different uh

and

you know open question uh it's also

U Charlotte I think a reason why your

listeners need to consider to consider

need to continue to consider pardon me

uh having gold as part of their savings

gold would seem to be the only currency

on the planet that doesn't have a

domestic political constituency in favor

of

devaluation um there are political

pressures that cause countries like

Canada Great Britain United States

uh to deprive savers of a reasonable

return on their Investments gold has no

similar

constituency right and if we look at

gold I think I often begin gold

conversations by talking about the fed

and interest rates inflation Etc we're

just really used to doing that but one

question I've been asking lately more

frequently is is that the most important

thing to consider when we talk about

gold especially given that this year

gold is really on the move without the

rate cuts that everybody said we needed

so what what are your thoughts there two

different questions I think um you are

correct in your latter assumption which

is that the gold prices moved without

the participation of the traditional

saver the retail investor uh studying

ETF data suggests that for the last two

years retail investors at least in

Western Europe and North America have

been sellers rather than buyers of gold

the buyer of gold has been foreign

central

banks uh and I think that has as much to

do with a weaponization of the US dollar

the use by our administration of the US

dollar as a means of exerting foreign

policy both through confiscating $300

billion doll worth of Russian treasury

Holdings and Al through also through the

weaponization of the Swift banking

system interestingly too Charlotte away

from your question when people are are

concerned about the dichotomy between

interest in gold and the gold shares the

fact that gold has moved and the gold

shares haven't moved I think that's

explained uh by this by this phenomenon

the central banks have been buyers of

gold but they aren't buyers of gold

shares so it makes perfect sense that

because the audience for gold at least

temporarily has changed that this

dichotomy exists going back to the first

part of the original

question in my

experience uh

gold the gold price is tied to interest

rates only in the sense of whether

interest rates are negative or positive

which is to say when investors are

concerned about the maintenance of their

purchasing power in conventional Fiat

instruments then they become interested

in Gold uh that hasn't happened yet uh

and I will

note as a consequence of my age I was

there that it took five years for this

to happen in the 1967 1972 time frame in

other words while people understood that

inflation was taking place the

perniciousness of it the impact on their

own personal lifestyle wasn't apparent

for five years and my suspicion is that

we're facing a delayed punch with

regards to taxpayers and Savers

understanding the impact of uh inflation

on their own purse uh as they come to

understand that I think that you will

get a layer of retail buying the

traditional retail buyer on top of the

Central Bank buyer uh and if I'm right

with regards to that then you could see

some real fireworks in the gold

price okay a number of points to follow

up on there and I think the direction

I'll go first is You' mentioned the

importance of Central Bank buying lately

for gold and recently we heard that

China paused buying in May the Chinese

Central Bank and that seemed to cause a

reaction the gold price were among gold

investors so I'm wondering do you think

that's significant what what are your

thoughts there it it was significant in

two reason for two reasons one they were

the biggest buyers of gold uh if the

biger biggest buyer goes away it has an

impact on price but there was also a

psychological uh impact there are some

gold investors like myself who buy it as

an insurance policy who buy it out of

fear uh I person personally couldn't

care less if gold goes from $2,275 to

$2,500 I'm not a Trader in Gold that's

not why I own it I invest in other asset

classes for capital gains I invest in

gold for protection but there's a whole

different group of people out there who

are more momentum oriented and for them

the fact that the Hiatus in ch Chinese

buying might last three months as an

example and as a consequence the gold

price might might not move for three

months

that prevents them uh in some senses

from accessing

gold I believe as people come to

understand people in United States and

Canada come to understand that the CPI

is a very inefficient mechanism for

measuring the deterioration the

purchasing power of their savings uh and

of their

salaries that people will begin buying

irrespective of Chinese intention

but until that occurs uh factors like

Chinese buying and the lack of Chinese

buying will impact the market perhaps

more so than the direct impact of

Chinese buying or a lack of Chinese

buying if that makes sense I I think the

psychological impact of it on the

trading community and the speculative

Community was as great as the actual

impact of the impass in Chinese

buying yes yes I think I think that does

make sense so thank you for going into

that and a little bit further on the

note of China so of course we've been

watching the Chinese Central Bank and

you just went to do what that pause in

May buying looks like but I'm also

hearing quite a bit about buying from

China among retail investors and I

wonder if there is anything more you

would add about China's role in the gold

market right now because it seems that

it is getting a lot more attention and

and feeling more elevated at least to me

from what I've been hearing

uh I I think it's a very important

factor it it's very difficult to

quantify I I've seen a lot of estimates

and I've seen a lot of people try to

justify their estimates and I suspect

that most of them like me don't

know but what I do know is that there is

a strong cultural predisposition to

buying gold among ethnic

Chinese uh I've done business with

ethnic Chinese for 20 years at least uh

I mean in China not just in North

America and there's a strong interest in

gold uh it wasn't that long ago that

Chinese were prohibited from owning

physical gold in C in

terms with certain exceptions what

you've seen now is that the government

of the People's Republic of China is

actively encouraging Savings in gold and

I think that there's a lot of appetite

in the citizenry for increasing their

gold Holdings private savings are

increasing rapidly in China and the

Chinese people in general have a

predisposition to save as opposed to

spend and I I think that there's a lot

of concern in China I can tell you this

anecdotally from Chinese people that I

correspond with uh about uh future

economic stability in China and so there

is a nervousness among many Chinese uh

about investing in traditional savings

products they're concerned about Bank

solvency they are concerned uh at least

in their discussions with me about the

opaqueness uh of the Chinese banking

system

and to them uh the traditional role of

gold is a savings instrument an asset

that isn't simultaneously somebody

else's liability is very attractive the

fact that this is

permitted uh in a society with a

predisposition to it and now with

incentive to means for me at least that

Chinese retail uh will be an

increasingly important component of the

gold market it's worthy to note too that

the medium mediums for distribution of

gold to retail holders in China almost

didn't exist 10 years ago the whole

range of storage facilities

Banks uh dealers that we have in the

United States had to be created from

scratch in

China uh and at the same time that the

Chinese citizenry began gradually to be

permitted to own gold the infrastructure

allowing them to purchase and uh store

gold has been developing and so I think

it's it's going to be an

increasingly important subset of the

gold

trade do you think it will be for silver

as well I think I've started to hear a

little bit about that Chinese interest

spilling into silver but it seems to be

something that's hard to get information

on I do uh at the risk of being accused

of being racist the Chinese people that

I know are very much gamblers and very

much speculators

uh I have noticed uh in my time on Earth

that precious metals bull markets are

led by fear buyers so gold is the

predominant mover in the early part of a

bull

market as the precious metals narrative

is given Credence by the increase in the

gold price then the speculators come in

the greed buyers come in

uh speculative silver market perhaps

because of its lower unit cost I don't

know uh creates a very a frenzied

environment and there again is a

cultural predisposition in China around

silver uh it hits fertile ground but on

top of that uh Chinese people are

notoriously fonded of speculating

gambling and my suspicion is that a we

will have a silver bull market uh and B

the extent of ethnic Chinese

participation both in the diaspora but

more particularly in the PRC will be

extraordinary this time around whether

or not that participation comes down

into the silver mining

shares uh at least among Chinese and the

PRC is a very different circumstance

certainly you have seen ethnic Chinese

participation in silver equities in

places like San Francisco and Vancouver

for decades whether or not that extends

to the the PRC and whether or not the

infrastructure to distribute uh junior

silver miners in J Junior silver mining

equities in China develops is of course

a different

conversation okay I have a couple more

questions on Silver but before we go

there I want to finish up with gold

where I have one more question as well

so you explained earlier in the

conversation why there would be a

disconnect between the gold price and

the C equities central banks are not out

there buying gold stocks so we talked in

I believe in March about that disconnect

as well and you'd mentioned the the

level of hostility toward gold stocks

and I wondered if you've seen that cool

down or is that starting to alleviate at

all what what is the sentiment you're

seeing for gold stocks uh I've seen it

uh alleviate a little bit but we are

going to need to

see uh gold mining industry margins

improve with the gold price what we've

seen thus far is that the moves in gold

price have been

mirrored by an increase in production

costs you know Energy prices have

certainly doubled skilled miners wages

uh particularly in Ontario and Quebec uh

have been exploding upwards cement

charges have been going upwards and the

social rents uh for producing gold

around the world taxes and royalties

regulation off-site expenditures by

mining companies for social license have

been increasing so what you've seen uh

in the last couple years is despite the

fact that the gold price is up by

20% the margin increases that the

industry was expected to enjoy haven't

occurred yet uh my belief is that that's

going to change beginning this quarter

some of the companies that have a better

record with regards to Cost Containment

I'm thinking anniko Eagle uh Alamos

Endeavor uh uh will I think surprise the

investment Community with the margin

increases that they're going to enjoy

and if I'm right uh I think you will

begin to see a reasonable amount of

money uh flow first into the senior gold

equities

the the sector in the gold equities that

has outperformed in the last 6 months uh

has been you know really sort of

concentrated around the high margin

issuers which is to say the safer

issuers issuers with high Allin

sustaining Capital cost like Newmont

haven't participated particularly in the

rally while companies like wheat and

precious uh agnico Eagle have done very

well and I think that

continues uh if as I suspect the gold

price continues to

increase uh I do think that the gold

mining shares will find an increasingly

sympathetic constituency which is to say

people will buy gold shears in

anticipation of their performance as a

leveraged instrument uh around the

increase in the gold price but time will

tell this this may be a bit of a basic

question but when we talk about margin

for you what what would be good what

would you want to see from the gold

miners

well you're kind of asking me almost a

Santa Claus question um what I look for

in a company is

efficiencies that put them in the bottom

quartile of aisc so I'd like to see

Allin sustaining costs in the $1,200 or

lower

range um you know I want to see bottom

cortile

performers uh I am also interested in

return on Capital employed one of the

ways that you lower your Allin

sustaining costs is that you over

capitalize the capital stack you know

uh so at the same time that I want to

see all-in sustaining costs in the 1200

or 1250 range if possible uh I also like

to see return on Capital employed

numbers uh in the sort of 25% or better

range so I want best quartile return on

Capital employed at the same time that I

enjoy best

quartile

aisc okay okay thank you for explaining

that I'll go back over to to Silver now

and with silver I I hear often from you

and from others that gold performs first

and silver follows and we all got

excited a couple weeks ago at this point

I guess to see silver above 30 per ounce

and I wonder is that simply silver

starting to follow gold or are there

other things going on

there I hate to give you this answer

Charlotte but I don't

know uh in my own experience as I say

silver follows gold I would have thought

that the upward Trend in Gold would need

to be more pronounced before silver

follows on I do note an anomaly which

was 2021 the Reddit silver squeeze where

we had a sort of a nent bull market in

Precious Metals one that didn't have

follow through but Ironically in that

market the normal process which is to

say the metal moves then the major

miners move then the Juniors move was

turned on his head the more speculative

components of both markets moved uh

around an online narrative that I've

never experienced before so it might be

that your generation doesn't do things

the way that my generation does uh I'll

I'll need to observe that but the honest

answer to that question is I honestly

don't know I I need to say from my own

perspective I'm an investor and a

Speculator but I'm not a Trader so the

move in the silver price from2 $9 to $31

while it might be psychologically

important to somebody else is a small

move to me it doesn't matter um I own

gold not because it was going to go from

2750 to 2500 or silver from 28 to 31 I

own it because I'm afraid that gold is

going to go to $8,000 or $9,000 or

$110,000 as a consequence of a lack of

lack of con confidence if that happens

uh I think you can expect gold to the

silver pardon me to out base gold on a

percentage

basis uh which means that $35 is a silly

Target that there's a much much much

higher price that would take place by

the way I'm not saying this is going to

happen I'm not saying that this is a con

that this is a certainty that one

invests in I think that this is a

contingency that somebody who's that

somebody who is financially in cycle

logically capable of uh speculates in I

I think that's a very important

different you know

difference that that actually does help

me so thank you for going into that and

it ties in well to another question I

wanted to ask you I was watching one of

your recent interviews on another

Channel and you're talking about how

silver is really not knowable in the way

that the copper Market is I thought that

was very interesting because I'm so

interested in or I'm so used to hearing

about the uranium market for example is

opaque but I hadn't I hadn't heard it

from the silver perspective so I

wondered if we could talk about that a

little bit if I understand the question

um the silver supply and demand is

really difficult to understand I've been

trying for 50 years

unsuccessfully uh silver is at once an

industrial material uh which means it's

economically sensitive it's a monetary

metal those are very

different circumstances and silver

Supply is difficult to predict too in

the sense that only 16 or 177% of

primary new metal supply comes from

Silver Mines the rest comes from

Recycling and comes from byproducts from

copper you know gold things like that so

to understand what silver Supply will

look like five years from now you have

to understand what capital expenditures

would be in the copper business there's

so damned many

variables uh the second part of Supply

is that most of the silver that's ever

been mined is still Supply and a lot of

it isn't declared it's owned by people

who are afraid of their governments

people as an example in India uh we

don't know how much silver they have we

don't know what are the motivators for

them to buy more perhaps rural incomes

from a good harvest we don't want know

what would make them sell perhaps bad

harvests you know so it's it's a really

really opaque metal with when you look

at Copper you might not get it exactly

right but you can look at the direction

you can understand the lag time between

higher copper prices and higher copper

Productions a consequence of Permitting

and mine construction you could look at

primary Supply you can look at primary

demand you don't have to be fooled too

much by above ground inventories because

there aren't many uh you just need to

look at what it's going to be used for

try to determine what the economy is

going to do and then toose that with the

production that's existing or could be

brought online in the next 5 years while

it's not straightforward in Copper it's

much more straightforward than it is in

Gold pardon me in uh

silver yes that's exactly what I was

hoping you could talk about there I

think that helps I had just never quite

thought about silver in that way so very

helpful and I want to go over now to

uranium and hopefully we can touch a

little bit on this before I let you go

so so the last time we talked about

uranium I believe was back at the

beginning of the year when we were in a

very exciting time for prices and since

then we've seen prices pull back hit a

little bit of a plateau did we did we

just need to see some consolidation

there I think that's right uh Charlotte

you'll remember my saying in that

interview and many times talking to you

previously the cure for high prices is

always high prices and the cure for low

prices is always low prices this uh

retreat in price ing in the uranium spot

Market I think is an important

breather uh I think now as I thought

then that a much more important trend

for Uranium Equity investors is the

rising prominence of the term Market

where uranium producers will be able to

lock in contractual pricing and volume

contracts for as long as 20 years with

investment grade

counterparties this pricing environment

doesn't exist in any other commodity on

the

planet and the certainty around the

price that producers can receive for

their product and the volumes that they

can sell means that over the next five

years the cost of capital for Uranium

producers relative to other commodity

producers will be

lower and that's important I I can't

tell you what the spot price of uranium

is going to be uh a year from now and to

be honest with you I don't

care uh because the spot Market is

increasingly an inefficient predictor of

prices on many days the Sprat physical

uranium trust generates more dollar

volume than the spot Market does which

is to say in some senses the sprot

market has become the spot

Market uh and while it's an important

psychological source of

information the real pricing structure

is being determined in the term market

and increasingly it's going to be uh

reflected in the the term Market

in the fiveyear product the 10year

product the 15-year product and the

20-year product and this is going to

have really profound and positive

implications for those few uranium

Juniors that have developable products

because their cost of capital is going

to be much less than people

understand okay okay so the term market

right now is that your main main element

of the uranium Market to watch at the

moment I remember for a long time it was

Japanese restarts is this the the new

kind of focus yeah the Japanese restarts

are built baked in the cake um they're

truly baked in the cake the next shoe of

fall will be the ability of both kamico

and Kazam prom to lock in enough

production in the term Market that they

can restart their shut in

production uh generating attractive

rates of return for their shareholders

both Boards of directors have said that

the condition precedent

for production restarts is sufficient

term volume to earn attractive rates of

return for the shareholders that's

important the next thing and the really

big thing will be right now these terms

are opaque companies don't have to

report the details of the terms you have

to understand you have to surmise the

term contracts by Looking Backward at

the income statement and the balance

sheets of the big producers like camoo

to figure out what their active cost

what their um

uh what their revenue line is relative

to the spot price which allows you to

back guess on terms what I think happens

over the next five years is that the

companies who report accurately their

terms enjoy a lower cost of capital

because there will be more certainty on

the revenue line uh both both with

regards to volume but also with regards

to price and understanding the Revenue

will give you a better predictive sense

of their margin which will allow lenders

my like myself as an example higher

certainty that they're going to get

their loans repaid and will allow lazy

Equity analysts also like

myself uh to understand the revenue

lines of the company uh better that will

mean that the companies that are more

forthcoming with information about their

terms will have higher share prices and

hence a lower cost of capital and I

think that the market will force

reporting

compliance okay very interesting and

when it comes to uranium you've said

many times at this point that you've

essentially der risked your investment

there which I don't think means you are

out of it so I was wondering what does

your exposure look like at this point do

you have a spectrum from explorers to

producers or or in Broad terms how does

that look I do and I've covered the

Waterfront uh I own the physical

indirectly through the spot the Sprat

physical trust I own the two major

producers which is to say camoo and

Kazam prom and I own either nine or 10

uranium Juniors that have what I

consider to be viable

deposits uh when I say I don't have any

risk in the sector anymore what that

means is that I've sold enough equity

you'll remember Charlotte in 2022 when I

was sort of pounding the podium on your

show uh I was a pretty big buyer of

uranium equities when nobody wanted them

and when that market moved from being

hated and cheap to being at least

tolerated if not loved uh those stocks

were up pretty dramatically I have sold

enough now that I have recouped all my

initial investment uh I sold a little

more so that I could pay the capital

gains taxes uh on the profits that I

enjoyed and in certain circumstan es

where I've noted uh large amounts of

Insider

selling uh I've sold as much as half of

my remaining

position but the truth is that my cost

basis was low enough that I was able to

sell uh stock to recoup my cash outlays

and still retain uh pretty large

Holdings in those companies because as I

say um there is a supply demand

imbalance

and we are going to have some certainty

with regards to pricing and cost and

that should lower the company's cost of

sh cost of

capital okay good to go into that as

well and I have a fun question now or at

least I think it is fun so when we spoke

in March you mentioned you were doing a

lot of research on Platinum Palladium

and nickel and just trying to learn as

much as you could there so it's been a

few months and I wondered if you could

share any any earnings yeah I've been

again uh starting by buying the Sprat

product uh the Sprat physical platinum

and Palladium

trust

uh because I'm attracted to those

markets uh I'm attracted to them

precisely because they fall in 50% in

price I love hate and if you look at

comments in social media around platinum

and padium uh people question your

sanity if you buy them the Topline

Narrative of course is that platinum and

padium are used in internal combus

engines and if you listen to the big

thinkers of the world the Justin Trudeau

the Joe bidens the Angela merkel's they

tell you that the internal combustion

engine is going the way of the

dodo except it

isn't I believe internal combustion

engines will be with us till at least

2060

2065 and platinum and padium are a

necessary

component uh of

anti-mog it it takes at today's Lo low

prices about $1100 worth of platinum in

a catalytic converter to enable the sale

of a 50 or $60,000 car if the price of

platinum or Palladium doubled it

wouldn't change the Shelf price of that

automobile and you don't see a bunch of

kids wandering around downtown Vancouver

with protest signs saying more smog more

smog more smog you know uh so the demand

is going to

continue the other side of that is

supply of course and platinum and

Palladium come primarily from two

countries Russia and South Africa with a

bit player being

Zimbabwe if in any of those three

countries there were greater social

Discord or political Discord uh which

caused supplies to be interrupted it

would be easy for the price to double

let's look at those countries South

Africa which is a basket

case uh Zimbabwe which aspires to be a

basket case uh and Russia which some

fairly obvious challenges I'm not saying

that any of those three countries

sociologically will explode to the

extent that it will

grievously interfere with their ability

to produce platinum and padium but I

think that that is a contingency worth

speculating on if that occurred I think

that you would see an almost immediate

double in Platinum and Palladium prices

I don't own platinum and Palladium

producer well I should say that I

shouldn't say say that uh I owned from a

very old movie uh stock in

nilk which I can't either buy or sell

because of US Government sanctions but I

don't own any South African producers

what I do own is development stage

assets outside of any of South Africa

Zimbabwe or Russia if you experienced

politically or socially originated

disruptions in Supply having access to

supplies that didn't come from those

countries I think would suddenly become

regarded by the investment Community as

strategic and so I am speculating around

that theme

actively okay very very good to go over

that and now I will go back to the r

Symposium which is coming up very

quickly in less than a month at this

point so I'll be attending I'm excited

to be going once again what should

investors

know well investors should know first of

all that they got to watch Charlotte

McLoud plying her trade uh at the

conference which is fun to watch

um on a different note uh I think the

fact that we have put on this conference

for 28 years means that we have pleased

a constituency of the mining Community

it's one of the most venerable mining

investment conferences on the planet and

I would suggest you it's the

finest for the following reasons we have

a long tradition of attracting

big picture macro thinkers who teach our

attendees the way the world really is

not the way the CBC or

CNBC wishes it were Jim Rickards who

talks about strains in Wall Street

because as general counsel for long-term

Capital Management he almost brought

Wall Street down you know a voice from

the belly of the Beast Nomi Prince

talking about the structure of Wall

Street as a former Goldman Sachs partner

and analyst Daniela D Martino boo

talking about the FED because she worked

for the

FED uh high quality insiders talking

about the way the world is truly

structured if you come to that point of

view and I believe you

will

um the resource narrative requires

implementation and to that we have

analysts and portfolio managers with

three decades of success in natural

resources not failed Tech analysts you

know um but people who cut their teeth

and made money and resources more

importantly than that we have a

wonderful feature called The Living

Legends where people who have built

multi-billion dollar mining companies

from

scratch uh tell you how they did it uh

and importantly tell you how to identify

$5 million market caps that are going to

become $5 billion market

caps uh this is critical important you

know listening

to the Robert fredland or or the Bob

quarters telling you how they did it and

what they learned and why that's

important also at our conference every

single public company exhibitor is

vetted if they aren't owned in the

portfolios of the sponsors of the

conference they can't exhibit at every

other investment conference I know the

qualification to be an exhibitor is a

check that cashes that's it

at our conference we have to know you

well enough that we own you finally you

can attend this conference either live

which is what I would prefer or via live

stream in the comfort and convenience of

your own home however you do it we're

going to give you 60 hours of intense

programming over four days more than you

can absorb so we're going to tape all of

the proceedings including the breakout

sessions so that for the balance of 2024

you can revisit the conference again and

again and

again those five

factors allow me to say this to your

attendees whether you attend live or in

person if you don't believe that you

have gotten your money's worth there's a

goldplated money back guarantee no

questions asked just send me an email

saying Rick I honestly don't believe I

got my money's worth I want my money

back and I'll send it back to you

there's no other conference on the

planet that I know of no other

investment conference on on the planet

that I know of where the sponsors have

the confidence in their content that

they can say to the attendees absolute

unequivocal money back

guarantee okay thank you very much for

going through it as I said I'm really

excited to attend and I always

appreciate the recording option because

there is truly so much to see so I'll

leave a link in the video description so

people can take a look if they would

like to and I'll look forward to seeing

you there just before I let you go

usually we go through your portfolio

review option as well so I'll put it

back to you if you wanted to speak about

that I absolutely want to do that uh if

people care what I have to say about

natural resource investing and want to

personalize it all they have to do is go

to my website rinv media.com list your

natural resource stocks there if I know

them and we follow 800 of them in our

service we will rank your portfolio 1 to

10 one being best 10 being worst we'll

comment on individual issues if we think

we our comments have any value and this

service comes with no cost or obligation

uh all you have to do go to rural

investment media.com list your natural

resource stocks please no crypto please

no tech stocks please no pot stocks or

siloc cybin stocks you know leave an old

resource guy what he does well once

again rural investment media list your

stocks we'll rank them

very good and I will leave a link for

that as well in the video description I

I would definitely encourage people to

check that out and I think we will wrap

it up here this is really good thank you

so much for going through all the

different Commodities that I had

questions about and I will see you

soon thanks for the opportunity

Charlotte and I look forward to seeing

you in boar

Rong of course and once again I'm

Charlotte McLoud with investing news.com

and this is Rick rule

thank you for watching if you like this

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we'll see you next time

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