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David Kranzler: The Strongest Fundamentals for Gold Since 2008

Tom welcomes back David Kranzler of Investment Research Dynamics to the show.

David discusses how companies often reframe their results to be more “socially acceptable”. During the tech bubble the game of earnings management evolved; analyst’s influence drove the consensus estimates down and then, when the company beat the estimates, it painted a manipulated picture of their financial standing.

David explains the effect that higher rates have on the housing sector; many households are already overstretched and not prepared to pay for house payments when interest rates increase. We are beginning to return to the liar loan phase which helped cause the 2008 housing crisis with Mortgage-Backed Securities. Similarly, auto loans are also being bundled with both prime quality and riskier loans being sold to investors.

The financial system is dependent on continued growth of the money supply, which drives it. However, if the increase is pulled back too quickly, the entire system can collapse, which will eventually happen. Lastly, David urges people to ignore mainstream media and do their own research.

Time Stamp References:
0:00 – Introduction
0:40 – Reframing Results
10:31 – Rates & Housing Impacts
18:45 – Lending Shenanigans
24:49 – Banking Crises & Rates
29:44 – Inflation Themes & M2
44:50 – Gold & Monetary Systems
49:22 – Confidence in Miners?
56:33 – Mining Risk & Returns
57:45 – Gold & Rising Tides
1:00:00 – Putting a Pin In It

Talking Points From This Episode

  • Factors driving the debt cycle globally.
  • Why we’re in a dangerous period with housing and auto loans .
  • Risks around earnings and company financials statements.

Guest Links:
Twitter: https://twitter.com/InvResDynamics
Website: https://investmentresearchdynamics.com
Newsletter: https://investmentresearchdynamics.com/mining-stock-journal

David Kranzler spent many years working in various analytic jobs and trading on Wall Street. For nine of those years, he traded junk bonds for Bankers Trust. Dave earned a master’s degree in business administration from the University of Chicago, concentrating on accounting and finance. He writes a blog to help people understand and analyze what is going on in our financial system and economy.

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