Palisade – Sprott Monthly Market Update with Rick Rule: I Am Optimistic About Gold and I Am Cautiously Bullish on Gold Stocks
Rick sees weak global demand for almost everything, however there is a sentiment change for resource stocks. He thinks this change is somewhat justified- although many recent resource prices do not appear to reflect any underlying rationale. Mr. Rule is cautiously optimistic about gold stocks and the gold price. We are in one of those flight-to-safety periods where the US dollar does well, and interest rates go up.
The outlook for precious metals is still positive, and may be similar to the late 1970’s. In two to three years, he anticipates much higher commodity prices, as current prices do not promote resource development. He shares details on why precious metals and related stocks may be the best option for 2017.
Uranium stocks can go a lot further but they may fall by 30% – 40% first. Rick is bullish in the long term, and confident that the price will go from $23 to $60. The current price however is still an unmitigated disaster for the business. He recommends those in the uranium market should have a three to five year outlook and be prepared to take a lot of pain for your gains.
Rick thinks that if you own GoviEx, with the view that in 2017 something fundamental will change, then you are misguided. He discusses the real reasons why you should hold GoviEx. This is a game that if it works, you get to put a zero behind your initial investment or you will be shaken out by a 50% decline. If you aren’t prepared to hold for three to five years don’t own stocks like this.
Talking Points From This Week’s Episode:
• Weak resource and economic demand worldwide in 2017.
• Recent rises in various resource commodities may lack fundamentals.
• Uranium price is still a disaster and needs to go much higher.
• Precious metals may be the best option for 2017.
Rick Rule began his career in the securities business in 1974.. He is a leading investor specializing in mining, energy, water, forest products and agriculture. Rick founded California-based Global Resource Investments, Ltd., which grew into a much larger organization with significant affiliated companies. As Director, President, and Chief Executive Officer of Sprott US Holdings, Inc., Mr. Rule leads a highly skilled team of earth science and finance professionals who enjoy a worldwide reputation for resource investment management.