Rick Rule: Don’t Hold Yourself Hostage in Any Counterfeit Currency
Tom welcomes back the legendary investor Rick Rule to discuss the mining business and current geopolitics. Rick takes the gloves off and critiques how governments are inherently corrupt and why they prefer fiat systems.
He explains the difference between backing a currency and pegging it to a commodity.
Rick’s approach to measuring wealth is by counting ounces, not dollars. Investors should try to avoid being held hostage to any one currency. The United States has chosen to weaponize both its banking system and currency. This grants them the ability to export their inflation to the rest of the world.
Those that take control of their own future tend to do very well. He is hopeful that the world will improve and that the safeguards taken never become necessary.
A lot of politics is pretending. We see a lukewarm political war between Russia and Ukraine, and the West. All the while, Europe is buying energy from Russia while supplying Ukraine with weapons. What we see is the manifestation of politics and is truly a tragedy.
Many countries of the west, including Canada are surprisingly anti-oil, and irrespective of economic interest, they don’t want to develop their resources. Energy problems are likely coming to California due to these types of policies.
Higher uranium prices are coming because we consume more than we are producing. Inevitable should not be confused with imminent. The Sprott trust has bought a lot of surplus pounds. Japanese restarts will increase the consumption of uranium and will be extremely important.
Rick gives several reasons why he believes gold will continue to move upward and what it will take for him to consider selling. He believes huge structural changes are coming for bonds, and money will flow to alternatives like gold.
People are reluctant to buy asset classes when they are on sale because they want to follow what others are doing.
Rick invests in juniors by carefully working with successful management teams. Those teams should be operating where they are suited and have had previous success. Deposits need to be in the right jurisdiction with significant size and be very economical.
Rick never buys a stock unless he understands both the upside value proposition and the potential downside target level.
Talking Points From This Episode
- The war in Ukraine and Russia’s decision to peg its currency to commodities.
- Politics, lies, and why governments prefer fiat currencies.
- Why uranium prices will inevitably have to rise.
- What to look for in juniors and why investors fail to take advantage of low prices.
Time Stamp References:
0:00 – Introduction
1:07 – Ruble & Commodities
4:57 – Sanctions & Seizures
8:18 – Gov’t & Trust
10:23 – WEF & Being Happy
14:40 – Reading Picks
18:03 – Rick’s New Role
22:50 – Sanctions & War
27:12 – Nuclear Energy
29:39 – ESG Reality
35:57 – Catalysts for Uranium
43:08 – Politics & Investing
46:03 – Rick’s Gold Thesis
52:24 – On Sale & Sentiment
57:09 – Inflation & Supply
1:02:12 – Probability Investing
1:07:24 – Pricing & Valuing Tuna
1:10:14 – Investing & Discipline
1:15:08 – Wrap Up
Economics in One Lesson – Henry Hazler – https://tinyurl.com/3wf5f3fk
Intelligent Investor – Benjamin Graham – https://tinyurl.com/ycynnfxb
Securities Analysis – https://tinyurl.com/5absy9z5
Human Action – Ludwig von Mises – https://tinyurl.com/4h54z98b
Skin in the game – Nassim Taleb – https://tinyurl.com/3fn8w6ju
Berkshire Hathaway Annual Letters – https://www.berkshirehathaway.com/letters/letters.html
Rick Rule has dedicated his entire adult life to many aspects of natural resources securities investing. Besides the knowledge and experience gained in a long and focused career, he has a global network of contacts in the natural resources and finance sectors.
Mr. Rule is a frequent speaker at industry conferences and is regularly interviewed for radio, television, print, and online media outlets concerning natural resources investment and industry topics. Prominent natural resources-oriented newsletters and advisories frequently quote him. Mr. Rule and his team have expertise in many resource sectors, including agriculture, alternative energy, forestry, oil and gas, mining, and water.
Mr. Rule is particularly active in private placement markets, having originated in hundreds of debt and equity transactions with private, pre-public, and public companies.