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Best Recession Indicator Flashed Red – What it means for Gold, S&P 500, & Copper?

Best Recession Indicator Eurodollar Index Flashed Red

What next for S&P 500 & Gold?

The most important index, the Eurodollar Index, is one index that no one is paying attention to, and it just turned RED. The last time it turned red was one month before the US Federal Reserve (Fed) started cutting interest rates in 2007, and one month before the fed started cutting in 2001. In both cases, the US entered a recession within six months. How do we know no one is paying attention to the Eurodollar Index?

Google Says No One Is Paying Attention

You probably have never seen the coming chart before. When you do a Google search on Eurodollar Index…What happens? You only get 2,410 search results on Google. Think about that for a second. There are tens of thousands of investment professionals around the world, maybe even hundreds of thousands, there hundreds of millions of retail investors, and yet when you do a very specific search on the Eurodollar Index, less than 3,000 searches show up.

Then when you look at news articles, the media isn’t paying attention to the Eurodollar Index either. Only 2 news articles have been written on it.

Yet, “The volume in Eurodollars (traded at the CME) is beyond anything you gold and crude oil can comprehend. Consider the following volume figures for 2012: Gold – 43.8 million contracts, Crude Oil – 134.2 million contracts. Eurodollars – 425.1 million contracts”

Something Broke in the Markets

When you read about the markets you hear about: Valuation metrics, like P/E or P/S.

But this doesn’t help you, the investor, because things can get much more expensive than investors think or they can get go much lower than they expected, which many commodity investors from 2012 to 2016 were caught up in value traps.

This is why we look for the sweet spot to avoid the value strap by not being too early. In order to get the capital flow coming in, we are looking for momentum to come back into the sector and/or stock.

Let’s have a look here. This is the Eurodollar Dollar Index going back to 1999. It really helps give us the temperature of the banking system.

“Somewhere out there in the banking system – There is some bank or multiple banks that cannot get funding.”

Going back to 1999, every time, AFTER the index went from a trend of falling for a number of years, bottomed, and flipped to start accelerating again ABOVE the moving average this was a clear warning SIGN that something is not good in the bank deposit markets.

Pay attention here. In December 2000, when the Eurodollar Index broke above the long-term averages, its momentum only further accelerated from there before the crashed the ensued from there. In August 2007, when the Index broke above the long-term averages, and this was the point the acceleration took resulting in the next recession which brings us to today.

So where are we today? We are back to where we were in 2001 and 2007. The Index has broken above the long-term averages.

Why is this important?

Eurodollar Index – Click to zoom in

Music Has Stopped

It all comes down to liquidity. Back in July 2007, the CEO at the time of Citigroup, Chuck Prince made this now infamous quote. “When the music stops, in terms of liquidity, things will be complicated. But as long as the music is playing, you’ve got to get and dance. We’re still dancing” (Ft.com)

Just one month later, as we mentioned previously, in August 2007, momentum for the Eurodollar Index accelerated back above the long-term averages, which highlights the music has stopped.

Voices of the Past

In every instance that the Eurodollar Index accelerated, the US Federal Reserve cut interest rates.  In January 2001, the US Federal Reserve made a “surprise” rate cut before the recession started. Looking forward to September 2007, one month after the Eurodollar Index Accelerated higher, the US Federal Reserve cut rates for the first time in 4 four years. Now that the momentum accelerated higher, we shouldn’t be surprised that the Federal Reserve will cut interest rates, and it’s not because it’s a good sign.

Today: Fed vs Everyone Else

And yet today, the Fed says it won’t cut, until 2020. Yet we know from history that when Eurodollar Index accelerates above its long-term momentum, the Fed Funds rate falls, which it is doing today, and within a month the Federal Reserve cuts interest rates. Why? Because something bad happened. Will it be tariffs? Who knows? But something has broken and the US Federal Reserve will need to act.

Recession Within 6 Months

In November 2000, the Fed Funds rate was 6.51%, a month later in December 2000, the Eurodollar Index accelerated above the long-term averages and by May 2001 the US was in a recession.  Then in July 2007, the Fed Funds rate was 5.26%, a month later in August 2007, the Eurodollar Index accelerated above the long-term averages, and by December 2007 it was the start of the US recession.  Fast forward to today and the Fed Funds started falling in May after peaking, then in June, the Eurodollar Index accelerated higher breaking above the long-term moving averages.  That puts a recession starting in the range of October to November of this year.

S&P 500 & Gold in 2000

As the Eurodollar Index accelerated at the end of 2000, the S&P 500 peaked higher initially before stumbling into a 2-year bear market. Gold blasted higher initially, then stumbled lower for the first half of 2000, before more than doubling from the inflection point.

S&P 500 & Gold in 2008

As the Eurodollar Index accelerated in 2008, the S&P 500 peaked higher initially before stumbling into the 2008 bear market. Gold, on the other hand, blasted higher for a number of months just like silver. Both gold and silver fell late 2008, but gold remained above the August 2007 inflection point.

Now You Know

  • Momentum has now accelerated confirming the value trap is now over for the Eurodollar Index. It is now in motion, and if history repeats, the S&P 500 wins briefly before losing over the next six to twelve months.
  • Gold won in both 2001 and 2008.
  • Silver is a mixed bag of beans. Interest rates have a high probability of being cut next month, the music will stop, and the excitement is only getting started. Now you know.

About the Author:

Paul Farrugia, BCom. Paul is the President & CEO of First Macro Capital. He helps his clients take advantage of cycle opportunities across all sectors and asset classes, for the long-term. He provides a checklist to find winning gold and silver mining producer stocks, to take advantage of the commodity cycle.

Disclaimer:

The information contained herein is obtained from sources believed to be reliable, but its accuracy cannot be guaranteed. It is not designed to meet your financial situation – we are not investment advisors, nor do we give personalized investment advice. The opinions expressed herein are those of the publisher and are subject to change without notice. It may become outdated, and there is no obligation to update any such information.

Very Important Week for Gold

By Money Metals News Service

What happens to the gold price this week will likely set the trend for the foreseeable future. While many precious metals investors disregard technical analysis and key chart formations, you can bet your bottom dollar that large traders and institutions are watching the price action of the yellow metal quite carefully. And if you think that these large traders and institutions don’t believe in market intervention, then you are sadly mistaken.

The entire market is rigged, so we should get past the notion that only the gold and silver prices are controlled. Furthermore, one of the reasons that the gold and silver prices have languished over the past 5+ years has to do with the “Grand Trading Market Casino.” For example, one of the new trendy stocks is ROKU.

ROKU, a TV streaming platform company, has seen its stock price surge from $26 to $105 over the past six months. That’s a 300% increase from the December 2018 lows. Why would anyone want to mess around with gold, that may go up or down 5-10%, when you can make triple-digit gains on ROKU?

Roku Daily Chart (June 21, 2019)

As we can see, ROKU enjoyed two extensive BREAKOUTS during the days of positive earnings release. When these positive earnings releases occurred at key technical levels, the stock price shot up 15-20% in a single day. You will also notice how ROKU is trading off the upward blue channel (blue dashed lines). There is no coincidence that ROKU is trading this way.

Moreover, ROKU is trading close to 10 million shares a day, the same as the GLD ETF. So, traders, hedge funds, and institutions are focusing on stocks like ROKU because the share price action is providing excellent returns in a very short period of time. It doesn’t matter that the markets are rigged, or that central banks are providing trillions of dollars of liquidity. What matters to those who play in these markets, are the NICE RETURNS that can be made in the “Grand Market Casino.”

While ROKU’s stock is certainly hitting all-time highs, the company still hasn’t made a profit in the past four years. Of course, Wall Street analysts say not to worry because it will take the company 5+ years to be profitable. But what if that fifth or sixth year takes place during the next big recession?? Just look what happened to ROKU’s stock from October to Dec 24th, 2018. Do you honestly believe ROKU’s financials and revenues fell that much to push the stock down by 65% in three months?? No, ROKU’s share got BUSHWACKED because the entire market was in freefall. That is, until the central banks came to the rescue.

Unfortunately, for many investors, ROKU is just another high-tech over-valued stock that will crash along with the markets when the lousy economic fundamentals finally kick in.

BYND Daily Chart (June 21, 2019)

And what about the recent IPO of Beyond Meat (BYND)? The stock price opened at $25 on May 2nd and reached $200 on June 19th, less than two months later. Talk about a COOL 700% return in a lousy seven weeks. Again, why on earth would investors pay attention to the precious metals market when they can get rich on stocks like ROKU and BYND??

These crazy stock prices become even more insane when we compare them to “Real companies.” How does Beyond Meat’s present stock price of $154, based on Q1 2019 total revenues of pitiful $40 million compare to Tyson Foods trading at $79 a share with $40 billion in Q1 2019 revenues? Where is the fundamental logic behind Beyond Meat’s valuation???? There isn’t any. But, the flow of funds focused on high-flying stocks in the market keep investors from paying much attention to gold… up until now.

So, getting back to gold. The problem with many precious metals investors is that they don’t believe technical analysis works in a rigged market. What they fail to understand is that most participants in the market realize that central bank intervention is taking place. It’s not a state secret any more.

However, there is some METHOD to the MADNESS when it comes to the gold price action over the past 40 years. Here is a monthly chart of the gold price going back until 1981:

Gold Price Monthly Chart 40 Yr (June 21, 2019)

Now, there is no coincidence that gold enjoyed a nice BREAKOUT in 2007 when it finally surpassed the long-term $700+ resistance level. And then when gold surpassed the $1,000 level, it had another BREAKOUT to $1,400. Of course, there were important “Fundamental factors” that pushed gold above that $700 level, but when it finally surpassed it, it shot up to $1,000 quite quickly.

If we look at the 20-year gold monthly chart, we can see some interesting trends:

Gold Price Monthly Chart (June 21, 2019)

After gold surged to $1,900, like with all stocks, it experienced a typical correction. Normally, stocks will correct back down to prior support-resistance levels. After gold fell back to the $1,350-$1,360 level in 2013, it continued lower to $1,050. Now, once again, there is no coincidence that the gold price bottomed at $1,050 in late 2015 right at the very same level it that peaked in 2008. You can see that black dashed line at $1,050. Furthermore, the Ascending Triangle baseline (blue dashed line) was another bottoming area for gold when both key technical levels converged.

However, the technical $1,050 level where gold bottomed was also based on fundamental data on the gold production cost. At that time, the top gold miners were producing gold at $1,025-$1,100 an ounce. The declining production gold cost was due to the oil price falling to a low of $26 from a high of $110 in 2011. So, technical analysis in the chart also provided a clue as to the bottom in the gold price.

If we look at the weekly gold chart, we can see the Key Technical levels:

Gold Price Weekly Chart (June 21, 2019)

It has been more than five years since the gold price reached $1,400. So, it’s an important milestone. According to gold’s price action, the important technical levels are $1,050, $1360, $1,550 (or $1,600), and $1,800. There is a reason the gold price has traded off these technical levels. Traders and institutions are trained to use these technical levels as a guide.

So, are the central banks using these technical levels to control the gold price? Likely. However, when the fundamentals of the market get to the point where the central banks are no longer able to keep the gold price capped under a certain level, like the Fed announcing interest rate cuts, then the traders, hedge funds, and institutions in the market take over. And when the gold price surpasses certain key technical levels, then BREAKOUTS occur.

IMPORTANT NOTE: Years ago, I did not pay attention to Technical Analysis, so I did not understand the value of these key technical levels or how to spot them. Even though gold will become one of the best assets to own in the future, its price rise will likely take place at these key technical levels, regardless if precious metals investors believe it or not.

For gold to continue a BULLISH TREND, it will need to close above the $1,360 level at the end of the month, shown in the top two charts. If it closes below that $1,360 level, then it will just take more time for the trend to push above that level for an extended period. But, if we do see continued buying of gold next week, then we will likely be in a new Bull Market for gold.

The last chart is the Gold Daily Chart. It clearly shows how gold shot above that critical $1,360 level:

Gold Price Daily Chart (June 21, 2019)

While gold is overbought on the Daily chart (shown at the top right part of the chart, 81 RSI), it isn’t on the first Monthly gold chart above. Even if the gold price falls to the $1,370-$1,380 range by the end of the week, that could still be a positive sign, because it’s still above the key $1,360 by the end of the month.

If we continue to see more “Iran War News” in the media this week, the gold price may head to the $1,410-$1,425+ level. Regardless, for gold to finally break above its 5-year $1,360 is a crucial milestone for traders and investors. A significant close above $1,360 for June could be very Bullish for the yellow metal.

Lastly, if we do see gold close above the key level and move higher in July, it will likely retest the $1,360 level before doing so. Then look for the next technical level of $1,550-$1,600 for gold to find serious resistance.

In conclusion, technical analysis provides traders, hedge funds, and institutions, key levels to focus on. When these technical levels are breached, either to the upside or downside, then we can see significant movement in the price action. So, for gold to head to $2,000 and higher, it will likely do so in and around these key technical levels.


The Money Metals News Service provides market news and crisp commentary for investors following the precious metals markets.

Will Silver Soon Follow Gold’s Lead?

By Money Metals News Service

Gold prices have broken out of a massive multi-year consolidation pattern to the upside. That suggests the possibility of a massive multi-year rally ahead!

Gold Price (June 21, 2019)

To be sure, there is also the possibility of some retracing and back-testing this summer before the $1,400 level is conquered for good.

The fall and winter periods are typically more conducive to big precious metals rallies.

Seasonality, however, isn’t a dependable trading tool. Some technical analysts (who will go unnamed here) wrongly turned bearish on gold and gold stocks after they put in a disappointing early spring performance and were thought to be headed straight into the summer doldrums.

Instead, the summer solstice arrived with gold’s chart displaying a powerfully bullish long-term setup.

The one glaring problem with the current setup in precious metals markets: silver hasn’t yet confirmed gold’s breakout.

Silver Price (June 21, 2019)

Silver needs to break above $15.50, then $16.00 (the last intermediate cycle high) in order to establish a bullish trend on par with gold’s.

The white metal’s lagging price performance in recent months has resulted in it trading at its biggest discount to gold in three decades.

Hardy silver bugs are excited at this rare opportunity to buy more ounces on the cheap. Others are understandably concerned that silver isn’t showing any leadership during rallies in the metals sector.

Silver, being a smaller and naturally more volatile market than gold, is supposed to amplify gold’s moves on both the upside and downside. So why is silver instead acting like an anemic version of gold?

Lots of reasons can be proffered – from record central bank buying of gold, to silver’s reliance on industrial demand, to low (official) inflation, to market manipulation.

It probably comes down largely to investor psychology. When precious metals markets have been out of the “mainstream” news cycle for years – trumped by a rising stock market and the rise of digital currencies – the general public won’t be interested in precious metals.

The super-rich and large institutional investors who are more apt to take contrarian positions in overlooked assets generally prefer gold over silver because it is more convenient for them to accumulate in large quantities.

We are still in the stealth phase of a precious metals bull market. When we enter the public participation phase – and demand for physical bullion increases – we have no doubt that silver will shine.

 


The Money Metals News Service provides market news and crisp commentary for investors following the precious metals markets.

Big Tech and Banks Push for “Cashless Society”

By Money Metals News Service

The War on Cash isn’t a conspiracy theory. It’s an open agenda. It’s being driven by an alignment of interests among bankers, central bankers, politicians, and Silicon Valley moguls who stand to benefit from an all-digital economy.

Last week, Facebook – in partnership with major banks, payment processors, and e-commerce companies – launched a digital currency called Libra. Unlike decentralized, free-floating cryptocurrencies, Libra will be tied to national fiat currencies, integrated into the financial system, and centrally managed.

Critics warn Libra is akin to a “spy coin.” It’s certainly not for anyone who wants to go off the financial grid.

War on Cash

Many of the companies involved in Libra (including Facebook itself) routinely ban users on the basis of their political views. Big Tech has booted scores of individuals and groups off social platforms for engaging in “far right” speech. If Libra one day becomes the predominant online payment method, then political dissidents could effectively be banned from all e-commerce.

You can still obtain some degree of anonymity in the offline world by using paper cash. But that will become impossible in the cashless future envisioned by bankers.

Last week Bank of America CEO Brian Moynihan touted new developments in digital payment systems while speaking at a Fortune conference. He said, “We want a cashless society…we have more to gain than anybody from a pure operating costs.”

They gain – at the expense of our financial privacy. A cashless society is the end of a long road to monetary ruin that began many decades ago with the abandonment of sound money backed by gold and silver.

 


The Money Metals News Service provides market news and crisp commentary for investors following the precious metals markets.

Analyst: Bid to Buy Battery Metals Firm Good Deal for Acquirer

The Energy Report

Source: Streetwise Reports   06/21/2019

Canaccord Genuity explained in a report its reasons for severely reducing its target price on this cobalt company post offer.

In a June 18 research note, analyst Eric Zaunscherb reported that Canaccord Genuity reduced its target price on Cobalt 27 Capital Corp. (KBLT:TSX.V; CBLLF:OTC; 27O:FSE) by about 68% to CA$5 per share from CA$15.50 due to the proposed acquisition of the company’s main assets by Pala Investments and due to the related switch in the basis for valuing the company.

Zaunscherb commented that the deal is a good one for Pala and it is unlikely another entity will make a better offer. Pala agreed to buy 100% of Cobalt 27’s issued and outstanding common shares for about CA$501 million. In return, it will gain Cobalt 27’s 2,900 tons of refined cobalt metal in bonded warehouses, its cobalt stream on Vale’s Voisey’s Bay nickel-cobalt mine as of 2021 and its debt.

As part of the arrangement, a newly listed entity called Nickel 28 Capital Corp. will be formed to hold an 8.56% direct participating interest in the operating Ramu nickel-cobalt mine, along with an array of exploration and development project royalties, several minor equity interests and $5 million in cash, noted Zaunscherb.

The current spot price for cobalt is around $15 per pound. In comparison, the cobalt price in Canaccord Genuity’s deck is at least $33 per pound, Zaunscherb pointed out, reflecting an expected pricing rebound as artisanal miners in the Democratic Republic of the Congo back off producing at the low prices and as electric vehicle and energy storage system sales increase demand.

With the Cobalt 27 acquisition, Zaunscherb highlighted, “Pala’s offer crystalizes this upside at these low levels, and therefore, the financial services firm switched to using the cobalt spot price in its valuation, thus lowering its target price on Cobalt 27 significantly.

“In other words,” the analyst explained, “our previous target captured the impact of a rebound in cobalt prices over the next 12 months while the revised target reflects cash in hand plus the stub shareholding in a nickel vehicle.”

Despite the reduced target price, Canaccord Genuity maintains its Speculative Buy rating on Cobalt 27, which “reflects a 15% projected return and the slim outside chance of an alternative bid surfacing,” Zaunscherb noted.

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Disclosure:
1) Doresa Banning compiled this article for Streetwise Reports LLC and provides services to Streetwise Reports as an independent contractor. She or members of her household own securities of the following companies mentioned in the article: None. She or members of her household are paid by the following companies mentioned in this article: None.
2) The following companies mentioned in this article are billboard sponsors of Streetwise Reports: None. Click here for important disclosures about sponsor fees.
3) Comments and opinions expressed are those of the specific experts and not of Streetwise Reports or its officers. The information provided above is for informational purposes only and is not a recommendation to buy or sell any security.
4) The article does not constitute investment advice. Each reader is encouraged to consult with his or her individual financial professional and any action a reader takes as a result of information presented here is his or her own responsibility. By opening this page, each reader accepts and agrees to Streetwise Reports’ terms of use and full legal disclaimer. This article is not a solicitation for investment. Streetwise Reports does not render general or specific investment advice and the information on Streetwise Reports should not be considered a recommendation to buy or sell any security. Streetwise Reports does not endorse or recommend the business, products, services or securities of any company mentioned on Streetwise Reports.
5) From time to time, Streetwise Reports LLC and its directors, officers, employees or members of their families, as well as persons interviewed for articles and interviews on the site, may have a long or short position in securities mentioned. Directors, officers, employees or members of their immediate families are prohibited from making purchases and/or sales of those securities in the open market or otherwise from the time of the interview or the decision to write an article until three business days after the publication of the interview or article. The foregoing prohibition does not apply to articles that in substance only restate previously published company releases.

Disclosures from Canaccord Genuity, Cobalt 27 Capital Corp., June 18, 2019

Analyst Certification: Each authoring analyst of Canaccord Genuity whose name appears on the front page of this research hereby certifies that (i) the recommendations and opinions expressed in this research accurately reflect the authoring analyst’s personal, independent and objective views about any and all of the designated investments or relevant issuers discussed herein that are within such authoring analyst’s coverage universe and (ii) no part of the authoring analyst’s compensation was, is, or will be, directly or indirectly, related to the specific recommendations or views expressed by the authoring analyst in the research.

Analysts employed outside the US are not registered as research analysts with FINRA. These analysts may not be associated persons of Canaccord Genuity Inc. and therefore may not be subject to the FINRA Rule 2241 and NYSE Rule 472 restrictions on communications with a subject company, public appearances and trading securities held by a research analyst account.

The authoring analysts who are responsible for the preparation of this research have received (or will receive) compensation based upon (among other factors) the Investment Banking revenues and general profits of Canaccord Genuity. However, such authoring analysts have not received, and will not receive, compensation that is directly based upon or linked to one or more specific Investment Banking activities, or to recommendations contained in the research.

 

Required Company-Specific Disclosures (as of date of this publication)
Cobalt 27 Capital Corp. currently is, or in the past 12 months was, a client of Canaccord Genuity or its affiliated companies. During this period, Canaccord Genuity or its affiliated companies provided investment banking services to Cobalt 27 Capital Corp.

In the past 12 months, Canaccord Genuity or its affiliated companies have received compensation for Investment Banking services from Cobalt 27 Capital Corp.

In the past 12 months, Canaccord Genuity or any of its affiliated companies have been lead manager, co-lead manager or co-manager of a public offering of securities of Cobalt 27 Capital Corp. or any publicly disclosed offer of securities of Cobalt 27 Capital Corp. or in any related derivatives.

Canaccord Genuity or one or more of its affiliated companies intend to seek or expect to receive compensation for Investment Banking services from Cobalt 27 Capital Corp. in the next three months.

Disclosures are available here.

( Companies Mentioned: KBLT:TSX.V; CBLLF:OTC; 27O:FSE,
)

Rating on Solar Panel Manufacturer Downgraded on Recent Stock Strength

The Energy Report

Source: Streetwise Reports   06/21/2019

The potential impact on the company of likely macroeconomic tailwinds are discussed in a Raymond James report.

In a June 19 research note, analyst Pavel Molchanov reported that Raymond James downgraded its recommendation on SunPower Corp. (SPWR:NASDAQ) to Market Perform from Outperform following the stock’s year-to-date 104% jump. The previous target price was $9 per share, and the share price currently is around $10.34. Raymond James does not have a current target price on SunPower.

Also noteworthy is that, looking forward, SunPower will likely face some macroeconomic tailwinds, Molchanov highlighted. They include the upcoming incremental decrease in the federal Investment Tax Credit (ITC) that will likely cause demand pullback as it plays out, affecting distributed, or commercial and residential, deployments the most. Starting in 2020, the ITC will drop from 30% to 10% for commercial and to 0% for residential.

There also is the probability of renewed price pressure on photovoltaic (PV) modules, Molchanov pointed out, as Chinese competitors continue to capture market share and the Section 201 tariff phases out, from 25% today to 20% in 2020, 15% in 2021 and zero subsequently. The latter will diminish the pricing advantage that SunPower and other tariff-exempt companies had.

However, SunPower “has a solid position due to its status as an integrated player, including leverage to distributed PV and battery storage, both being themes that we like,” Molchanov noted. It also has the “added bankability advantage of having the energy giant Total as a ‘big brother.'”

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Disclosure:
1) Doresa Banning compiled this article for Streetwise Reports LLC and provides services to Streetwise Reports as an independent contractor. She or members of her household own securities of the following companies mentioned in the article: None. She or members of her household are paid by the following companies mentioned in this article: None.
2) The following companies mentioned in this article are billboard sponsors of Streetwise Reports: None. Click here for important disclosures about sponsor fees.
3) Comments and opinions expressed are those of the specific experts and not of Streetwise Reports or its officers. The information provided above is for informational purposes only and is not a recommendation to buy or sell any security.
4) The article does not constitute investment advice. Each reader is encouraged to consult with his or her individual financial professional and any action a reader takes as a result of information presented here is his or her own responsibility. By opening this page, each reader accepts and agrees to Streetwise Reports’ terms of use and full legal disclaimer. This article is not a solicitation for investment. Streetwise Reports does not render general or specific investment advice and the information on Streetwise Reports should not be considered a recommendation to buy or sell any security. Streetwise Reports does not endorse or recommend the business, products, services or securities of any company mentioned on Streetwise Reports.
5) From time to time, Streetwise Reports LLC and its directors, officers, employees or members of their families, as well as persons interviewed for articles and interviews on the site, may have a long or short position in securities mentioned. Directors, officers, employees or members of their immediate families are prohibited from making purchases and/or sales of those securities in the open market or otherwise from the time of the interview or the decision to write an article until three business days after the publication of the interview or article. The foregoing prohibition does not apply to articles that in substance only restate previously published company releases.

Disclosures from Raymond James, SunPower Corp., June 19, 2019

ANALYST INFORMATION

Analysts Holdings and Compensation: Equity analysts and their staffs at Raymond James are compensated based on a salary and bonus system. Several factors enter into the bonus determination, including quality and performance of research product, the analyst’s success in rating stocks versus an industry index, and support effectiveness to trading and the retail and institutional sales forces. Other factors may include but are not limited to: overall ratings from internal (other than investment banking) or external parties and the general productivity and revenue generated in covered stocks.

The analyst Pavel Molchanov, primarily responsible for the preparation of this research report, attests to the following: (1) that the views and opinions rendered in this research report reflect his or her personal views about the subject companies or issuers and (2) that no part of the research analyst’s compensation was, is, or will be directly or indirectly related to the specific recommendations or views in this research report. In addition, said analyst(s) has not received compensation from any subject company in the last 12 months.

RAYMOND JAMES RELATIONSHIP DISCLOSURES
Certain affiliates of the RJ Group expect to receive or intend to seek compensation for investment banking services from all companies under research coverage within the next three months.

Raymond James & Associates, Inc. makes a market in the shares of SunPower Corporation, Enphase Energy, Inc. and TPI Composites, Inc.

Raymond James & Associates or one of its affiliates owns more than 1% of the outstanding shares of TPI Composites, Inc.

 

Additional Risk and Disclosure information, as well as more information on the Raymond James rating system and suitability categories, is available here.

( Companies Mentioned: SPWR:NASDAQ,
)

‘Strong Well Results Continue to Drive the Story’ for SM Energy Even as Target Price Slashed

The Energy Report

Source: Streetwise Reports   06/20/2019

The raised production guidance for Q2/19 and full-year 2019 was discussed in a Raymond James report.

In a June 18 research note, John Freeman reported that Raymond James lowered its target price on SM Energy Co. (SM:NYSE) to $20 per share from $26 to account for recent weakness in commodity pricing. The oil and gas firm’s current share price is around $12.10.

However, Raymond James also raised its Q2/19 and full-year 2019 volume estimates for SM Energy after management increased production guidance by 0.4 million barrels of oil equivalent on better-than-expected Q2/19 production so far. SM Energy’s new figure implies about 3% higher production in Q2/19 than consensus and Raymond James’ forecasts and about a 4% higher oil volume than previous guidance.

“Continued strong well results prove the quality of SM’s acreage and the company’s confidence in delivering on its 2019 development plans, supported by a roughly 1% increase to full-year volume guidance,” Freeman indicated.

The analyst reiterated that the Colorado-based exploration and development company had encouraging results from its Wolfcamp D and Dean interval tests in the Permian Basin. “While there are no plans on the table, we think SM’s efforts to prove up its south Texas acreage could foreshadow a potential sale process for the asset over the next one to years,” he purported.

Raymond James has an Outperform rating on SM Energy.

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Disclosure:
1) Doresa Banning compiled this article for Streetwise Reports LLC and provides services to Streetwise Reports as an independent contractor. She or members of her household own securities of the following companies mentioned in the article: None. She or members of her household are paid by the following companies mentioned in this article: None.
2) The following companies mentioned in this article are billboard sponsors of Streetwise Reports: None. Click here for important disclosures about sponsor fees.
3) Comments and opinions expressed are those of the specific experts and not of Streetwise Reports or its officers. The information provided above is for informational purposes only and is not a recommendation to buy or sell any security.
4) The article does not constitute investment advice. Each reader is encouraged to consult with his or her individual financial professional and any action a reader takes as a result of information presented here is his or her own responsibility. By opening this page, each reader accepts and agrees to Streetwise Reports’ terms of use and full legal disclaimer. This article is not a solicitation for investment. Streetwise Reports does not render general or specific investment advice and the information on Streetwise Reports should not be considered a recommendation to buy or sell any security. Streetwise Reports does not endorse or recommend the business, products, services or securities of any company mentioned on Streetwise Reports.
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Disclosures from Raymond James, SM Energy Company, June 18, 2019

ANALYST INFORMATION

Analysts Holdings and Compensation: Equity analysts and their staffs at Raymond James are compensated based on a salary and bonus system. Several factors enter into the bonus determination, including quality and performance of research product, the analyst’s success in rating stocks versus an industry index, and support effectiveness to trading and the retail and institutional sales forces. Other factors may include but are not limited to: overall ratings from internal (other than investment banking) or external parties and the general productivity and revenue generated in covered stocks.

The analyst John Freeman, primarily responsible for the preparation of this research report, attests to the following: (1) that the views and opinions rendered in this research report reflect his or her personal views about the subject companies or issuers and (2) that no part of the research analyst’s compensation was, is, or will be directly or indirectly related to the specific recommendations or views in this research report. In addition, said analyst(s) has not received compensation from any subject company in the last 12 months.

RAYMOND JAMES RELATIONSHIP DISCLOSURES
Certain affiliates of the RJ Group expect to receive or intend to seek compensation for investment banking services from all companies under research coverage within the next three months.

Raymond James & Associates, Inc. makes a market in the shares of SM Energy Company.

Raymond James & Associates received non-investment banking securities-related compensation from SM Energy Company within the past 12 months.

Additional Risk and Disclosure information, as well as more information on the Raymond James rating system and suitability categories, is available here.

( Companies Mentioned: SM:NYSE,
)

COT Report: USD Index, WTI Crude & Silver bets rise. Euro, Yen & Gold bets surge

By CountingPips.comReceive our weekly COT Reports by Email

Here are this week’s links to the latest Commitment of Traders data changes that were released on Friday.

This week in the COT data, the USD Index Speculators raised their bullish bets after two down weeks. Euro and Japanese yen speculative positions saw huge improvements on the week (lower bearish levels) while the Mexican peso bullish positions rose after recent declines.

Precious metals speculators continued to boost their Gold bullish positions sharply for a third week and pushed Gold bets to the best level since January 30th of 2018. Silver bets also improved for a third week and are now in an overall bullish position for a second week.

Copper speculators reduced their short bets this week after a streak of bearishness that brought positions to the most bearish standing in 155 weeks.

VIX speculators added to their bearish positions again this week and have now added to short bets in four out of the past five weeks. The large speculator position had recently risen to a record high position of -180,359 contracts on April 30th before pulling back on negative bets. The spec bearish positions have recently started to rebuild.

The 10-Year Bond speculators raised their net short positions this week after a sharp selloff last week. The speculators have found themselves on the other side of the trend in 10-Year bond prices in recent months and continued that trend this week.

Finally, the WTI Crude oil speculators increased their bullish net positions for the first time in eight weeks this week although this was due to short-covering and not exactly a sign of strength. Positions had dropped by a total of -195,704 contracts in the previous seven weeks before this week’s turnaround.


US Dollar Index Speculators raised bullish bets while Euro & Yen bets surged

Large currency speculators increased their net positions in the US Dollar Index futures markets this week, according to the latest Commitment of Traders (COT) data released by the Commodity Futures Trading Commission (CFTC) on Friday. See full article.


WTI Crude Oil Speculators bullish bets rebounded after 7 down weeks

The large speculator contracts of WTI crude futures totaled a net position of 363,087 contracts, according to the latest data this week. This was a change of 11,432 contracts from the previous weekly total. See full article.


10-Year Note Speculators added to their bearish bets this week

Large speculator contracts of the 10-Year Bond futures totaled a net position of -402,984 contracts, according to the latest data this week. This was a change of -36,996 contracts from the previous weekly total. See full article.


Gold Speculators continued to push their bullish bets higher this week

Large precious metals speculator contracts of the Gold futures totaled a net position of 204,323 contracts, according to the latest data this week. This was a change of 20,085 contracts from the previous weekly total. See full article.

 


VIX Speculators pushed their bearish bets higher this week

Large stock market volatility speculator contracts of the VIX futures totaled a net position of -108,644 contracts, according to the latest data this week. This was a change of -17,462 contracts from the previous weekly total. See full article.


Silver Speculators further boosted their bullish bets for a 3rd week

Large precious metals speculator contracts of the silver futures totaled a net position of 14,516 contracts, according to the latest data this week. This was a change of 11,856 contracts from the previous weekly total. See full article.


Copper Speculators reduced their bearish bets for 1st time in 9 weeks

Metals speculator contracts of the copper futures totaled a net position of -23,952 contracts, according to the latest data this week. This was a change of 6,569 contracts from the previous weekly total. See full article.


Article By CountingPips.comReceive our weekly COT Reports by Email

*COT Report: The COT data, released weekly to the public each Friday, is updated through the most recent Tuesday (data is 3 days old) and shows a quick view of how large speculators or non-commercials (for-profit traders) were positioned in the futures markets.

The CFTC categorizes trader positions according to commercial hedgers (traders who use futures contracts for hedging as part of the business), non-commercials (large traders who speculate to realize trading profits) and nonreportable traders (usually small traders/speculators).

Find CFTC criteria here: (http://www.cftc.gov/MarketReports/CommitmentsofTraders/ExplanatoryNotes/index.htm).

Stocks and Gold Rally on Fed Dovishness; Marc Faber: Currencies to Collapse against Precious Metals

By Money Metals News Service

Welcome to this week’s Market Wrap Podcast, I’m Mike Gleason.

Coming up Marc Faber, Dr. Doom, joins me for a must-hear discussion on debt, the global economy and the future of the dollar. Marc tells us how much he believes the average investor should have in gold and silver right now and reveals which precious metal he favors most going forward. So don’t miss a tremendous interview with Marc Faber, coming up after this week’s market update.

Well, what a week – big developments to report in politics, geopolitics, monetary policy, stocks, crude oil, and precious metals.

Let’s start with the gold market. On Thursday, gold prices surged $30, breaking through some major resistance levels and closing at a five-year high. The money metal ended up at $1,390 an ounce, just shy of the psychologically significant $1,400 level. It did cross over that during the Asian trading session last night and as of this Friday recording is back below it now to trade at $1,396 per ounce and is registering an impressive 4.0% gain this week.

Silver shows a weekly gain of 2.6% to bring spot prices to $15.32 an ounce. Silver has been following the lead of gold and has yet to show any real leadership of its own so far during this precious metals rally. Silver prices remain historically depressed versus gold, but that could change quickly.

Gold and silver mining equities have shown powerful relative strength over the past month, suggesting investors are anticipating follow through from the prices of the underlying metals. If you missed gold’s move to new multi-year highs, you’re not too late to catch a possible breakout move in silver – which has yet to even make a new 2019 high, let alone take out highs from previous years.

A catalyst for further gains in metals could be rate cuts from the Federal Reserve. On Wednesday, the Fed announced it would leave rates unchanged for now. That came as a disappointment to doves, but policymakers added language suggesting they are moving closer to acting.

Investors took the central bank’s statement to mean a rate cut in July is on the table, and probably another one after that. The S&P 500 responded by notching a new record high on Thursday.

The stock market stole gold’s limelight, and another leg higher for the aging bull market in stocks would likely diminish the safe haven appeal of precious metals. However, there is no rule that says stocks and metals can’t rise in tandem – especially if they share a common driver in monetary inflation.

Right now, stocks, bonds, and gold are all on bullish footing. Crude oil and other commodities are also threatening to trend higher, which would bring inflationary side effects to the economy.

Another apparent attack this week by Iran– this time on a U.S. drone – helped boost oil prices on fears of a larger conflict. A war with Iran and a blockade of oil tankers in the Persian Gulf could easily send oil prices spiking up into the triple digits.

In such a scenario, investors who hold economically sensitive stocks and low-yielding bonds would be in a vulnerable position.

Some of President Donald Trump’s top advisors clearly want war with Iran, but the President himself seems more interested in domestic issues like immigration and the economy. He formally launched his re-election campaign this week in the crucial battleground state of Florida.

Some national polls show Trump losing to Democrat frontrunner Joe Biden. But we would suggest these early polls don’t mean much.

To begin with, Biden will have a tough time securing his party’s nomination. He’s running on a center-left track record obtained during a different era in Democrat politics. He’s running against several hard left candidates who, combined, are more popular with today’s Democrat voters than he is.

The base of the party now essentially embraces socialism. Radical leftists who vote in primaries will insist that candidates commit to a long list of pie in the sky promises such as socialized medicine, slavery reparations, a Green New Deal, free college tuition, free abortions, and free everything for illegal aliens.

If the former Vice President wins the DNC nomination by going hard left on all these issues, he could make Trump look like the sensible moderate in the general election.

The Vice Presidency is often seen as a stepping stone to the Presidency. But that hasn’t been the case in recent years.

Joe Biden passed on the opportunity in 2016, claiming personal reasons. We can only imagine the pressure that was put on him privately by Hillary Clinton and her backers at the DNC to stay out of the race.

The previous Vice President, Dick Cheney, also declined to run.

Former Vice President Al Gore captured his party’s nomination but failed to win the general election in 2000. That same year Dan Quayle, Vice President to George H.W. Bush, ran unsuccessfully for the GOP nomination that was claimed by Bush junior.

Back in 1984, Jimmy Carter’s Vice President Walter Mondale got crushed in a landslide by Ronald Reagan.

When Richard Nixon resigned from office in 1974, VP Gerald Ford assumed the presidency but failed in 1976 to get elected to the nation’s highest office.

Since 1974, only one former Vice President has gone on to win a Presidential election. That was George H.W. Bush in 1988. Voters threw him out after just one term.

Fast forward to 2019. After running unsuccessfully for President more than three decades ago, then playing second fiddle to Barack Obama for eight years, then deferring to Hillary Clinton, it would be awkward for Joe Biden to try to explain why his time is now.

President Trump’s re-election prospects are probably better than the polls now suggest. If the GOP does keep the White House in 2020, would that be good news for stock market bulls and bad news for gold bugs? Not necessarily.

The last time a Republican was up for re-election was 2004. Incumbent President George W. Bush faced off against Democrat challenger John Kerry.

Gold and silver markets performed well in the second half of 2003 and made modest gains in 2004. The metals were in the early stages of a major bull market.

When George W. Bush won re-election in November 2004, gold was trading at a mere $450. Gold went on to hit a record $1,000 per ounce in early 2008. Over that same period, silver advanced from under $8 to over $20 an ounce. Precious metals vastly outperformed the stock market through the four years of W’s second term.

In the years ahead, forces now in motion should continue to exert upside pressure on gold and silver regardless of election outcomes. Steadily rising government debt and inflationary monetary policy are inevitable thanks to the political priorities of both Republicans and Democrats.

Well now, without further delay, let’s get right to this week’s exclusive interview.

Dr. Marc Faber

Mike Gleason: It is my privilege now to be joined by a man who needs little introduction, Marc Faber, editor and publisher of the Gloom, Boom and Doom Report. Dr. Faber has been a long-time guest on financial shows throughout the world and is a well-known Austrian school economist and investment advisor, and it’s a tremendous honor to have him back on with us today.

Dr. Faber, thank you so much for joining us again, and how are you?

Dr. Marc Faber: Fine, and that it’s a pleasure for me to participate in this interview.

Mike Gleason: Well Marc, we’ll start out today with everyone’s favorite topic, that being Fed policy and what’s happening there because it continues to be such a key driver for everything, much to our dismay. The markets have been so addicted to Fed stimulus and cheat money since the Great Recession a decade ago, so is it possible that they can withdraw this stimulus? Or did we just learn over the last few months… going back to, say, November and December when we saw the equity market suffer dramatically over the idea of the Fed moving forward with those three to four planned rate hikes for 2019, after which the Fed has reversed course and completely backed off on any rate hikes this year… are we just looking at never-ending stimulus from the central banks now, Marc? What are you thinking as you’ve watched the events unfold over the last few months with respect to monetary policy and this apparent sea change?

Dr. Marc Faber: Well, it’s a complex issue. It’s particularly complex at the present time because the global central banks, I mean the major central banks, they can argue, well, there is little inflation in the system, and so we can continue to print money or to purchase assets, which, either way, is true. There is little consumer price inflation, partly because the economy of ordinary people is not particularly good. We have a split economy. The economy of the well-to-do or extremely well-to-do people is doing well, and the economy of the ordinary people in Europe, in Japan, in the U.S., is not doing well. And so there is little inflationary pressure, but there is a lot of inflation, or has been a lot of inflation in asset prices. Stocks are at highs in the U.S. essentially, not the oil industries but several industries. And we have now 10 trillion-dollar worth’s of bonds in the world that have negative interest rates, it’s in some kind of a bubble, or a big bubble.

And so we have this asset inflation, and in my view, the central banks and the policy makers, they realize that if the asset bubble really breaks, if the stock market drops 20%, if home prices drop 20%, if bond prices go down 20% or so, the whole world is in a depression. So, I think that when they started actually in 2008, with QE1 in December 2008, and I was asked at the time, “How do you think it will end?” I said, “They just started QE unlimited. I think they will continue to print money until the system breaks.” And that can take another few years.

But I think, yeah, it’s likely, if you were to look at the political landscape, you have on the one end the Republicans, at the present time under the leadership of Mr. Trump. He wants to spend on defense and on his wall and on all kinds of things. And the Democrats, they also want to spend on all kinds of things. So, you can be sure that the deficit in the U.S. will remain around a trillion dollars a year for the foreseeable future. And in my view it’s more likely that this deficit will go up, and possibly quite substantially. So, the money printing, in my view, will continue.

Now could you have QE, and at the same time the Fed raising interest rates? That is a possibility. But in the current environment, where the economy has been slowing down, I think they will rather do nothing, especially also under the pressure from the White House, which essentially accuses, or tells the world that if the Fed hadn’t raised interest rates, the stock market would be much higher. So, I think they will not increase rates further. I think they will not cut the rates, as Trump and Kudlow would suggest, to simply show them that they’re independent, and that they don’t need Mr. Trump and Mr. Kudlow to tell them what to do.

Mike Gleason: Despite what the Fed has been doing, we are still seeing a strong dollar because the Fed has been a bit more hawkish than the ECB and the BOJ – the Bank of Japan – and other major central banks throughout the world. Do you see this reversing at some point? We know Trump doesn’t want a strong dollar, so how do you see things playing out in the currency markets? Because for the most part, gold, if we relate it to gold, is going to trade off the U.S. dollar in many respects. As long we see strength in the dollar, it’s likely going to be difficult for gold to really catch fire. Give us your comments on the dollar and what you see ahead for the greenback.

Dr. Marc Faber: Well, I think the dollar is strong because many investors argue that the economy in the U.S. is either better conditioned than European economies. Who knows? But one reason the dollar has been strong is you have all these negative interest rates in Europe. In Germany the 10-year yield is now negative, and in Japan as well, in Switzerland as well. And in Spain you have interest rates on the 10-year government bonds of 1%, whereas in the U.S. it’s 2.58%. So, I could argue it’s logical that if you get more than twice as much interest in U.S. Treasuries than in Spanish bonds, and you’re an insurance company in Europe, or sovereign fund in the world, you rather buy U.S. Treasuries than Spanish bonds. I think it’s quite logical. So, I think that has supported the dollar.

But I personally, I think the dollar should in due course weaken, and as the dollar weakens it could also trigger weakness in the stock market.

Mike Gleason: As usual, when you’re a guest on our podcast, we like to get your take on what’s happening globally. In particular, we are interested in what you expect from Asia. There seems to always be talk in the U.S. media about China slowing down. Perhaps the tariffs are having an impact. However, the U.S. trade deficit doesn’t appear to be budging very much. What are you expecting with regards to the possibility of recession in China? And where do you see the global economy headed in the near term?

Dr. Marc Faber: Well as you know, the Chinese had all this excessive credit growth. Now you could argue, well, they have this excessive credit growth because they have also a very high propensity, or rate of capital spending to build apartment buildings and bridges and roads, and the whole infrastructure. This is very costly. And so the borrowings are very high. But whether China will go into recession or not is a question also, can in China some sectors be in a recession, like car sales are down this year, and other sectors continue to expand? It’s a huge country. It’s actually almost a continent with 1.3 billion people. So, different sectors will perform differently. But since I live in Asia, my observation is that there has been a slowdown in economic activity. We’re not in a recession, but we’re in a very low-growth phase. There’s very little growth at the present time, and if there is growth it is because of borrowings… but that is also the case in the U.S. Without a trillion-dollar deficit and the debt build-up, student loans and car loans and everything, and credit card loans, the U.S. economy wouldn’t be growing either.

Mike Gleason: We saw back in, I believe it was late summer 2015 when the Chinese economy really hit the skids there temporarily, and it almost started a massive global panic there in the equities markets. Is China still a key linchpin when it comes to how they’re doing, so goes the world to some respect? And do you see maybe some doom coming down the road for China that could find itself manifesting in other economies and other markets?

Dr. Marc Faber: Well, China consumes approximately 50% of all industrial commodities in the world. So if there is a recession in the manufacturing sector in China, yeah, of course the world feels it. Or if there is less demand for smart phones in China, and also, I have to mention here that India has also become a large market. So, if there’s less demand for these toys, or for these very sophisticated mobile phones, then obviously the world feels it because it affects Taiwan and South Korea. And in turn it affects American semiconductor companies and so forth and so on. So, it goes through like a bush fire. And if China travels less, if there are less international travelers, then you’re talking about 140 million Chinese, and if they drop by 10%, then it’s 14 million Chinese that will no longer travel. And that, every market will feel. So they have a huge impact on the global economy undoubtedly.

Mike Gleason: Marc, how about this move towards socialism that we’re seeing, whether we’re talking about monetary policy or when we look at the landscape of the Democrat presidential candidates who will challenge Trump in next year’s election here in the U.S., what do you make of this movement that does seem to be gaining steam in many respects throughout the world? And how might this impact financial markets and investment opportunities in your view?

Dr. Marc Faber: Well, I just wrote an essay about monetary inflation and the social impact of monetary inflation, because depending how the monetary inflation works through the system… in the case of hyperinflation, Germany in 1922, 1923, the middle class was essentially eliminated. They lost basically most of their savings one way or another. But the rich people made a lot of money. And I’m comparing it to the current time, where the middle class hasn’t lost money per se, but because the rich people became so rich, the middle class has kind of been pushed down relative to the super rich people. That creates then an unfriendly environment.

The people that vote, they don’t understand a lot. But it’s very easy for a politician to go to people and say, “You know why you’re not doing well? It’s because of Jeff Bezos, he’s got so much money, and because of Warren Buffet, he’s got so much money, and Bill Gates, and so forth. And because of these hedge fund managers, they don’t pay any tax or they don’t pay much tax,” which is actually true. The corporate world in America pays very little tax compared to individuals. If you look at the composition of tax revenues by the government, the bulk is paid by individuals, not by the corporate sector.

And so, through destroying wealth and income inequalities, the mood is in favor of taking money away from the wealthy people and distributing money to the ordinary people. And then they see, the ordinary people, how much is being spent on defense, in the case of the U.S., close to 750 billion dollars a year. And a lot of it is not accounted for. And they say, “Well, this money shouldn’t be spent on defense. It should be spent on social programs,” and so forth and so on. So the mood, towards socialism, especially we have surveys that showed the millennials, about 60% of the millennials, they are in favor of more government interventions.

Mike Gleason: Yeah, definitely something we’ll be keeping an eye on here over the next year or so, especially as we get close to the election season, we’ll see what happens there.

Well Marc, as we begin to wrap up here, give us some more of your thoughts on the precious metals. For instance, do you see better value in one of the PMs over the others perhaps? And given everything that we’ve been talking about here today, with all of the debt in the system and the potential of never-ending stimulus and perpetual money printing, do you envision it being a strong environment for the metals moving forward? And basically, how do you see the sector performing overall, say this year and next? And then what will it take for them to sustain a rally to the upside finally?

Dr. Marc Faber: Well, the one thing I want to say, that everybody who lived through the monetary inflation of Germany – which ended up in kind of a hyperinflation, but I just want to explain – in the case of Germany, the hyperinflation was also made possible because the other countries didn’t inflate. And so the mark depreciated against the foreign currencies, which then added to inflationary pressures. In the present state of monetary policy around the world, because everybody prints money, currencies don’t collapse against each other, with very few exceptions like the Turkish lira and the Argentine peso and so forth. But basically, the major currencies, they trade against each other.

So where will the collapse of the currencies come from? In my opinion, they’ll all collapse against precious metals. And it is conceivable, and this is something we just don’t know, it is conceivable that they’ll also collapse against some cryptocurrencies. Now, I think there is a chance, we’re not sure – this is a kind of a theory – it is conceivable that Bitcoin becomes the standard, the gold standard of cryptos. But I’m not sure.

All I want to say, investors, in an environment such as we have of money printing, they need to diversify. They need to own some equities. We don’t know whether these monetary inflations will end up with a deflationary bust, in which case you may want to own some U.S. Treasuries, or it could lead to high inflation, consumer price inflation, in which case you want to own maybe a farm or some properties overseas. Or you may wish to own some precious metals. I think in any scenario, you should own some precious metals. Or the question is, should you own 3% of your money in precious metals or 90%? That everybody has to decide for himself. I recommend about 20, 25% of your assets in precious metals.

And as to the question, which one is (likely to perform) best? I think platinum is the cheapest at the present time of the precious metals. And I think it has actually a favorable outlook. I think there will be a supply shortage, and that the price could significantly outperform gold and silver.

Mike Gleason: Yeah, we agree. Lots of geopolitical dynamics involved in platinum there, and that’s going to be an interesting market to follow.

Dr. Marc Faber: Yes, exactly.

Mike Gleason: Well, Dr. Faber, thanks so much for your time and for staying up late with us there in Thailand. It was certainly real joy to have you back on and get your insights on the state of things. And before we let you go, please tell folks how they can subscribe to the Gloom, Boom and Doom Report so they can get your great commentaries on a regular basis.

Dr. Marc Faber: Thank you. Well there’s a website, GloomBoomDoom.com. And there all the information it contained.

Mike Gleason: Again, it was a real privilege to speak with you, Dr. Faber. I hope we can do it again before too much longer. And have a great weekend. Thanks for joining us again.

Dr. Marc Faber: Yes, you too. Bye-bye. Thank you.

Mike Gleason: Well that will do it for this week. Thanks again to Dr. Marc Faber, editor and publisher of the Gloom, Boom and Doom Report. Again, the website is GloomBoomDoom.com. Be sure to check that out.

Mike Gleason: And don’t forget to check back here next Friday for our next Weekly Market Wrap Podcast. Until then, this has been Mike Gleason with Money Metals Exchange. Thanks for listening, and have a great weekend, everybody.

 


The Money Metals News Service provides market news and crisp commentary for investors following the precious metals markets.

Miner Releases Resource for Arizona Zinc-Lead-Silver Deposit

By The Gold Report

Source: Streetwise Reports   06/19/2019

A BMO Capital Markets report gave the new figures for tons and grades and compared them to ones in a prior estimate.

In a June 17 research note, BMO Capital Markets analyst Edward Sterck reported that South32 Ltd. (S32:ASX; S32:LSE) published a mineral resource for its Taylor deposit in Arizona.

Sterck noted the new JORC compliant resource is generally similar to the NI 43-101 compliant one completed by Arizona Mining, the previous property owner, in January 2018, but with three differences, which he specified.

One is that the new resource encompasses more tons, 155 million tons (155 Mt) versus 145 Mt.

Secondly, grades in the new resource are lower across the board. When comparing South32 and Arizona Mining’s resources, grades, respectively, averaged 3.39% versus 4.1% zinc, 3.67% versus 4.4% lead and 69 grams per ton (69 g/t) versus 78 g/t silver.

Finally, the new resource reflects a 10% reduction in contained metal on a zinc equivalent basis when compared to Arizona Mining’s resource, despite the same cutoff grade of about 4%.

Sterck indicated that the prefeasibility study for Taylor is still expected before June 2020.

In other news, noted Sterck, South32 also released an updated resource estimate for its Illawarra met coal project. Resources there have dropped to 22 Mt from 114 Mt because the company “relinquished a portion of the license area.”

BMO has a Market Perform rating on South32.

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Disclosure:
1) Doresa Banning compiled this article for Streetwise Reports LLC and provides services to Streetwise Reports as an independent contractor. She or members of her household own securities of the following companies mentioned in the article: None. She or members of her household are paid by the following companies mentioned in this article: None.
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3) Comments and opinions expressed are those of the specific experts and not of Streetwise Reports or its officers. The information provided above is for informational purposes only and is not a recommendation to buy or sell any security.
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5) From time to time, Streetwise Reports LLC and its directors, officers, employees or members of their families, as well as persons interviewed for articles and interviews on the site, may have a long or short position in securities mentioned. Directors, officers, employees or members of their immediate families are prohibited from making purchases and/or sales of those securities in the open market or otherwise from the time of the interview or the decision to write an article until three business days after the publication of the interview or article. The foregoing prohibition does not apply to articles that in substance only restate previously published company releases. As of the date of this interview, officers and/or employees of Streetwise Reports LLC (including members of their household) own securities of ?????, a company mentioned in this article.

Disclosures from BMO Capital Markets, South32, June 17, 2019

IMPORTANT DISCLOSURES

Analyst’s Certification
I, Edward Sterck, hereby certify that the views expressed in this report accurately reflect our personal views about the subject securities or issuers. I also certify that no part of our compensation was, is, or will be, directly or indirectly, related to the specific recommendations or views expressed in this report.

Analysts who prepared this report are compensated based upon (among other factors) the overall profitability of BMO Capital Markets and their affiliates, which includes the overall profitability of investment banking services. Compensation for research is based on effectiveness in generating new ideas and in communication of ideas to clients, performance of recommendations, accuracy of earnings estimates, and service to clients.

Analysts employed by BMO Nesbitt Burns Inc. and/or BMO Capital Markets Limited are not registered as research analysts with FINRA. These analysts may not be associated persons of BMO Capital Markets Corp. and therefore may not be subject to the FINRA Rule 2241 restrictions on communications with a subject company, public appearances and trading securities held by a research analyst account.

Company Specific Disclosures
Disclosure 9C: BMO Capital Markets makes a market in South32 in Europe.

For Important Disclosures on the stocks discussed in this report, please click here.