How’s it going, Lobo? Happy to be back on the show. Yeah, thanks for coming on. You’re actually, uh, a hard guy to get a hold of for all the right reasons. You’re very gracious. It’s, uh, but you’re very, very busy traveling around. And, uh, as you said, your dance card is, uh, seems like perpetually full, but I just want to thank you for the time and coming up on here.
So we’re at the 2024 Rural Investment Symposium. What are your thoughts so far about the conference? Um, and that sort of thing and the energy that we’re here. Uh, um, but this is probably like one of my top two favorite conferences. The people that seems to attract seem to be my type of people, like people who want to do due diligence, who want to ask these companies questions.
Um, I have typically a, a, a dinner or a cocktail reception or something for readers when I go to conferences, and this one is always packed. It’s the biggest, you know, there’s just seems to be more of my type of people at this conference. So I like, yeah, excellent. Um, so when we last talked, this was about and really the springtime, and it was a really a fascinating conversation because we have this thesis that we’re heading into a recession.
And the, what a lot of people assume, when that happens, everything is going to, to drop. And so you’re, you’re positioning yourself, you’re going to be really long gold and heavy gold. Which would be, you know, benefit from going into recession. The other side of that is really a supply side equation is you’re really bullish and long uranium and you have two yellow metals.
Yeah, exactly. And so, yeah, talk about that, how that is going for you. If your thesis has changed and where are we at with that, all that calculus? Yeah, sure. So the update would be that I’ve actually added silver to the mix again, despite being branded Darth silver. I’ve never actually been anti silver. I just, you know, had the bad grace to say that if we go back on a gold standard, we probably would not see silver circulate again, because it’s not necessary anymore to make change.
Hence, Darth Silver. But, you know, that wasn’t a bearish case for silver, uh, you know, as a commodity. Or So I’m I’m not digressing. The point is that the thesis is still there, but if you like gold, and silver is still acting like gold, which it is. And, and it hadn’t been for some while. It was correlating more closely with copper than gold, when you and I last spoke, or, or before that.
And then this year it started to change, and then this year with Guster, you could really see it, uh, starting to move more like it should, as a monetary metal should, with gold, and less like copper. So I responded to that data and I’ve added silver back to my shopping list. My problem with silver isn’t the metal or my interest in speculating on stocks that have leverage.
It’s finding a great silver play that’s not in a basket case country going the wrong direction. So on the bright side, that makes for a limited number of choices. So it’s easier in a way, a smaller field to pick. But the update is, uh, one, uranium is played out. Almost exactly as I would have guessed, and I didn’t know, nobody knows the future, I have no crystal ball.
Uranium, at this conference last year, was my top pick. Well, you know, conference full of gold bugs, and I said, uranium. And I’ve had people come up to me at this conference and say, boy you were right. But also, you know, I’m not a permabowl or a cheerleader. When uranium went vertical and went over 100 bucks, I said, you know, that’s way more than it needed to go up and a bit of a correction would be to be expected.
And that’s where we are now. Boy, did I get a lot of hate for that too. You nailed it though. Darth Uranium.
But the supply story hasn’t changed. Yes, okay, high prices have incented new production, but that takes years to come online, and it remains to be seen. The world’s two largest uranium producers are ramping up. The biggest and lowest cost, you know, that, that one price setting producer, uh, has already yanked guidance for this year.
Hasn’t provided guidance for next year. You know who I mean, right? So that’s huge. You know, if you were worried about high prices, securing high prices right away and the world’s biggest and lowest cost producer says, sorry, we’re not going to be able to do what we thought we would, that’s a big deal. Um, and that other shoe 2025 guidance should drop soon.
That’s interesting. Like this isn’t just imminent or inevitable. This should happen like this month. And if it doesn’t, that will tell you something. Uh, and the other one, you know, they say, yeah, our two big minds were going to be up, you know, full steam this year, but they haven’t actually done it yet. And just about everybody else who’s tried has run into a, b, c, d, X, Y, Z problems.
So it remains to be seen if they can actually deliver that. But even if they do, it’s not enough supply to say, okay, prices are going to go down. Like the mind supply has never really been enough. It’s been secondary supply. It’s been the variable and brought, hoovered that up. So that thesis is still strong, people are getting bored, it’s in, it’s in the mid 80s, it’s, you know, corrected and it hasn’t gotten up again and people have such short attention spans.
It’s, it hasn’t quite gone back to being hated the way it was in 22, but it’s gotten to be boring, which is pretty good if you’re a buyer. So I like the thesis, the thesis is, is, is playing out, I think, more or less as one should reasonably expect it to. And I think that’s great. I think that’s anybody who missed the big run up in uranium last year.
I think this is their chance to load up on uranium stocks. Don’t be crazy. Don’t chase anything at a, you know, a multi year high, but look for the ones that have corrected and still actually have uranium in, you know, not just in the name of the company and the gold thesis, I have to say, you know, okay, well, here we are close to 2, 400 again.
You can say Lobo, you nailed that. Uh, but I didn’t. The reasons why I said gold will go up, as you were talking about the recession, which is good for gold, and then the Fed pivoting and all that, hasn’t happened yet. So, being right for the wrong reasons is still wrong in my book. I don’t want to toot my horn and say, Yeah, okay, never mind what I said, gold’s up, so we’re fine.
You know, if I’m an analyst, and what I said was wrong, you know, that matters. That’s material. But the update actually, I think, is very positive. If all those reasons why I think gold should go higher are still on the table, then gold goes higher from a much higher base. If 2300 is the new 2000, or, you know, 1900 2000, that’s extremely bullish.
I didn’t even want to say where the gold dollar exchange rate goes, because it sounds like I’m a, you know, tinfoil hat wearing kind of guy if I say it. But it’s It’s like, just think what 10 or 20 percent up on gold now from now, you know, 10 percent 20, 230 more from where we are now. What does that do to the price?
20 percent is, is 460, almost 500 bucks from where we are now. What does that, you know, like, those are some pretty eye popping numbers that already even where we are now has mainstream media talking about it. So I’m very bullish. We say, well, wait a minute, you know, why should we assume that what you said is going to happen?
It hasn’t happened. Well, when you and I last spoke, and I’m sorry for the long winded answer, but I’m winding down. This is the answer to your question. Um, you know, when you and I last spoke, it, Team Soft Landing was morphing into Team No Landing. It seemed like, you know, the premature victory laps were running up a whirlwind of all these people saying, Well, if there’s no recession by now, we’re not going to have a recession.
Right? You remember that this is, this was the context. And so I was really the lone wolf. Well, not quite, you know, they’re the Peter Schiff’s of the world. But I’m not. Totally alone, but we were the vast minority while team soft landing, no landing was, was declaring victory. And now that has started to change.
The narrative has shifted back, like particularly the weakening, not just one statistic, but number after number, stat after stat of the, the, the cracks in the labor market are finally starting to show up. And it’s affecting the consumer retail sales. So that’s, that’s the pillar of American exceptionalism.
And it’s starting to tremble, if not show, you know, signs of serious distress. So I think, um, that I’m right, and I will be shown to be right this year. This is very uncommon for me, because I’m not Mr. Prediction, Mr. Crystal Ball. Uh, but I do think it’s, it’s starting to not just be inevitable or imminent, it’s, we’re seeing in the data that it’s starting to happen now.
And so either I’m right or I’m wrong. And, and I think I’ll be right. I think this year that will be very beneficial for the gold dollar exchange rate and long suffering gold bugs with their gold stocks. As long as they actually have gold in them, you know, not just moose past your exploration. This is a Rick rule isn’t we’re at Rick, you know, if it doesn’t have any gold besides on the name of the stock certificate, then you need to worry.
But if you actually have gold leverage to gold or are building a gold mine, a pre production sweet spot, right. Or you’re a producer that your margins are going to go up. Some deliverable value, or you’re a successful explorer that’s, you know, drilling off a deposit. Yeah, I, I think we’re going to see our payday.
Um, so I’m, I’m pretty excited. So, you, I guess my question is, is why do you think, and I agree, I think your thesis is going to, is playing out as we speak, and it’s going to play out more significantly in the future, meaning within the next few to several months. Yeah, as far as which is sorry, dear audience.
If you don’t like this is really unusual for me. I do not make predictions. I’m just happy if I generally get the price direction right, but I better worse. I’ll be flat out wrong if I’m flat out wrong. But I see this happening now. Yes, it’s starting. So why, I guess, what’s the reason why it’s taken the trajectory?
I should say the delay that it has. And it was my expectation too that we would be in full blown recession in the springtime, late springtime, and summer. And again, these things are so hard to nail. I get it. But yeah, it’s not just that. It’s not just, oh, it’s tough. I get it. But it’s two things. Um, one is I was wrong like many people when the Fed went, you know, like from zero to 500 basis points.
I shocked things didn’t break immediately. I, I drank that Kool Aid. I thought that we would see more breakage, not just three medium sized banks, but I thought we’d see more fireworks sooner. Yeah. I, I really thought that and I was wrong. Um, and now in hindsight we see, okay, a lot of corporates, you know, papered up with, you know, dirt cheap financing, zero rates.
And even households, you know, they got mortgages or even second mortgages at ridiculously low, you know, your mortgage has flipped from being a liability to an asset. In some cases, if your mortgage rate, if you’ve got a fixed mortgage at 3 percent or something in a five, six, whatever, 7 percent mortgage, like that, that bank is hemorrhaging cash.
They would love to buy out your mortgage. Um, so. So, there was a fair amount of insulation from this shock. Like, the shock was real. That really was a record breaking shock. You know, people like to say, oh, well, Volcker went from, you know, more than 5 percent at once. Well, not at once, but you know what I mean.
He went more than 5%. Uh, yeah, but he wasn’t starting from zero. Right. So, uh, you know, proportionally, zero to 500 is, is like, infinite. Right. Actually, zero to anything is mathematically infinite, just about. Um, I know there’s a mathematician out there that’s going to argue with my definition, but you know, go with it for practical market purposes.
So, so yeah, I, I really thought that would break things and I didn’t appreciate the installation that would have, I also didn’t appreciate the post COVID labor hoarding and you know, the, the behavior patterns that were really altered by that experience and, and on the employer side as well as on the consumer side.
You know, the revenge spending, who revenge travel, like how is that even a thing, but it was still is, uh, you know, even like right now we’re looking at serious signs of the labor market cracking. I don’t mean just initial signs. I mean, like second month, you know, second read, this is weakening. Um, the, the indicators are there and yet the airlines are all saying they’re looking at a record holiday travel season.
This summer. And I, I, I just, I just tweeted, there was a headline in the BBC about the U. S. consumers racking up credit card debt for their groceries and going into debt, uh, having to downsize their lives, downgrade their lives and racking up debt just, and, um, and sorry, but the, the photograph of the person interviewed is not excessively thin.
I’m trying to be as diplomatic as I can here without getting too much hate. And one can’t help but think, you know, this person could perhaps use with a little belt tightening. Like, the, but where I’m going here, I’m not trying to make fun of this person. I’m actually talking about America. Right. And the spending patterns.
Yep. Um, so, I, I, I think, I think when the dam breaks here, it’s not going to be a mild event. You know, that’s the sort of refusal to face reality, or let’s put it this way, let’s, let’s leave the, the poor people who are having to give up their, I mean poor as in sad, not necessarily just poor, middle class too, everybody who’s having to give up their aspirational lifestyle and live within their means.
That has, you could say salubrious effects, but in an election year that could have catastrophic effects. But you know, back, back on the corporate side, on the business side, if you’re a business that didn’t lay off people, you should have, cause you were afraid you wouldn’t be able to get them back. Like post pandemic, you made, you made a bad business decision.
You maintained your expenses higher than you needed. And I’m not trying to be cold blooded, but in a way I am like, if you hold on to 10 to 20 percent of your staff, cause you don’t want to let them go, or you’re being warm hearted or whatever, and you go bankrupt. Well, now you’ve laid off a hundred percent.
So by, by being kind to the ten or twenty percent, you’ve actually been stupid and been unkind to a hundred percent. This is not kindness to be a bad business manager. Uh, that’s really the point. That’s the ultimate lesson of economics. Whether it’s the seen and the unseen or Adam Smith’s invisible hand, it is not a kindness to be stupid in business.
And so if I’m right, if that’s where we’re headed this year, we’re going to see a lot of kindness unmasked and that will be salubrious for things real, like gold and silver, uranium, real estate. It’ll be interesting real estate because high interest rates are bad for real estate. But if I’m right in the Fed pivots, it was the interest rates go down and we could see real assets of all stripes really show their colors here.
I don’t want to get into the prediction racket here, but I’m just saying, you know, we’re at it. We’re at an inflection point. Actually, I believe the inflection point is probably behind us. When the, when the tide stops rising and starts falling, that instant is imperceptible. And over time you start saying, oh yeah, the tide has changed.
I think that’s where we’re headed. Yeah. So let’s talk about the, uh, what you’re looking at and doing. We don’t have to go into specifics, but I do want to say like you. Your thesis on, I want to get this right, the pre production, the pre production goldmine, if you would, I want to say that correctly. I think that’s just brilliant, and I’ve actually counseled some family members, like my dear old mother.
Mom, look at this, you know. Um, but, I want to layer into that, is that all you’re looking at as far as, are you looking at some, some really good plays? And again, you don’t have to name drop. No, no. I got it. I got it. So, and I don’t. Uh, so, okay. Going from the theory to how do I put this into practice? Yeah.
Okay. So, but, but to wrap up with the theory right now, I like gold. I like silver. I like uranium. Yeah. And like nothing else at the moment, because I do think we’re going into undeniable recession. Now, I also think that the powers that be will instantly. Go to free money again, the free money helicopters will fly.
So I’m not talking long protracted recession But I do think there’s a scare point where copper gets whacked oil gets whacked things. I like everything gets whacked And sorry one more clarification a recession doesn’t necessarily mean a market crash right, and in fact a recession could make the market soar because the you know, The Fed pivot or sorry that the Fed put The Fed has trained investors to believe that bad news is good news.
So a recession could have investors say, Oh, the Fed’s going to pivot, easy money’s coming, and you could see stocks hit new all time highs. So I’d be very clear that a recession is not necessarily a market crash call. If there’s a market crash, then even gold gets whacked too, because you need the liquidity, right?
There’s that, you know, 2020, 2008, right? That short, sharp, negative spike, Which is a buying opportunity. If that happens, should we be so lucky, right? You know, sell blood, garage sale, whatever. Back up the truck during that negative spice the house, right? To to go along those things that we know come screaming back, but if there’s no market crash that doesn’t happen.
So don’t wait for that and don’t sell everything waiting for the market crash because it may not happen. The recession. I think does happen. I think that’s very bullish for gold. So gold silver and uranium because uranium is fairly recession. Proof resistant. Uranium has gone sideways to up in the last three or four recessions.
Not a bad track record. Everything else, even oil and copper, which I love, is afterwards. So afterwards, oil, copper are the starting places, and then we’ll see about nickel, zinc, or anything else. Uh, that’s, that’s the big picture. Now, implementing this, I have a couple favorite strategies. One is the pre production sweet spot that you mentioned.
Another is what I call success in progress. And, um, Those would be two of my favorites. And then it’s just anything where I see the trend, the momentum, not just momentum, that this is happening, right? This is happening now, and this is something I want. Like a growth story in a producer that has, it’s making money, and they have a clear expansion, not just potential, but like here’s phase two of the mine, and it’s twice as big, that sort of thing.
Right. Um, So coming back to your question, the pre production sweet spot is hands down my favorite strategy for like stock picking, because the, the, the numbers are phenomenal. The number of companies that succeed at building their mind and the pre production suite is pre production. So it’s not just anybody building a mind.
It’s a company making that transition from exploring, literally pouring money into holes in the ground, drilling, right? To producing, which is literally taking money of a great big hole in the ground. So there’s a market re rate there. And that is, it’s not perfect, but it has a very high odds of delivering substantial gains.
And there’s a free report on this on the website. You know, just look on the free report section, pre production sweet spots. Rick Rule is here at the conference. Rick has called this the greatest discovery of my career, the greatest thing I’ve ever done. So yeah, I love it. The problem with it is that there’s, how many companies do this per year?
It’s just a handful. Even a handful might be generous. It’s like one or two per year. Um, So maybe I’m impatient or, but like, you know, I, I need a bigger portfolio that just a couple of stocks at a go. So I’m looking for other things like we were just mentioned. The other one I call success in progress.
It’s also a free article on the website. You can search for, and the idea there is nobody, not Rick rule, not Doug Casey. Nobody knows who’s going to make a discovery before they make it. Um, you know, you can. You can help the odds by picking a good prospect generator. I like prospect generators, royalty generators.
It’s another, I wouldn’t call it a strategy, it’s a category. Um, but, but nobody knows who’s going to make a discovery. But the point is, of success and progress, is that it’s, it’s not a singular point in time. Sure, that discovery hole, you know, 200 meters of 2 grams or something like that. Woohoo, the stock doubles overnight.
Nobody can predict that. But the point is that’s not the end of the discovery. Like, that’s the first hole. What happens afterwards? They drill on either side, and guess what? There’s nothing. It was a pipe. It wasn’t there. It’s not real. Or they drill on either side, and they hit, okay, a gram here, three grams there.
Well, oh, now there’s something there. And then from there to defining a resource, your first 43 101 compliant, you know, we’ve got two million ounces at one and a half grams per ton or whatever it is, right? There’s a whole process there. And And if that’s happening, you can see predictability in the drill results.
That’s what I call success in progress. Doesn’t always win. Doesn’t always work, but it takes a huge amount of the, like the, all of the pre discovery risk is gone. You’re, you’re now betting on something that, wow, this has predictability. In a world of speculation, predictability is the cat’s meow. Yes. So I really liked those two strategies.
Yeah. And they have a lot of data and there’s a lot of calculus to both. I’m a, I’m a cold hearted calculating wolf. So Lobo, uh, do you really need no introduction or, uh, but I’d love for you to give your website, and you mentioned these articles, how can people find you and, again, Yeah, please, please share that with our viewers.
Alright, so I need no introduction. It’s funny, I say I’m a cold hearted wolf, and you say Lobo is the next word, which means wolf in Spanish. Um, I, I should clarify for anybody that doesn’t know, I wrote under the name Louis James for Doug Casey for almost 15 years. I worked with Casey Research, that’s the backstory.
I went independent in 2018. I am The Independent Speculator, and the website is theindependentspeculator. com. And the simple sell here is, you know, forget, you know, handing me money, sign up for the free letter. You may like it. You may not. The one thing I can promise is I will not spam you. I hate that flood of daily advertisements and stuff.
You get one email per week. You can see how I think, see how I work and decide whether you want me to be your due diligence guy. Excellent. I will put all of this in the show notes, both on YouTube as well as Spotify and Apple podcasts. They’ll all be in the show notes. Lovo, I just want to thank you so much for your time.
It’s great to see you. Thank you, Andy. You bet. Thank you.
