Will Junior Gold and Silver Mining Stocks Outperform their Larger Peers in 2017?

February 10th, 2017
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In yesterday’s article about BTC, I wrote “it is always critical to track what is happening to the Chinese BTC market to understand what may happen to BTC prices in the future ” because “if the PBOC cracks down on BTC, they could cause another huge, rapid sell-off in BTC prices.” About 12 hours after I wrote this, after observing an environment of a large number of Chinese traders shorting BTC that predicted imminent new regulations, the Chinese government imposed new regulations on Chinese BTC exchanges, and BTC rapidly plummeted $100. Of course, with large global banks rapidly increasing their influence among blockchain development companies and other digital currencies, the Chinese government is not the only institution one has to worry about when predicting future BTC price volatility, but you can refer to yesterday’s article for more information about that topic.

 

Today, I want to return our focus to the 2017 global gold and silver outlook. As I stated to start this year, I still believe that 2017 will mark another strong year for gold and silver asset prices, and certainly this year has gotten off to a strong start. I mentioned in previous articles, that we utilized a lot of successful hedges and moved some positions to cash in December when bankers were raiding gold and silver to deal with the temporary downtrend in gold and silver assets while still remaining net long gold and silver assets, and then became more aggressively long after the raid ended.

 

As a result, our Crisis Investment Opportunities newsletter is now up 11.22% for the year and up 14.77% since 1 December to 8 February. However, our Platinum Membership, which focuses mostly on junior gold and silver mining stocks has returned much stronger returns during this short time period. Just looking at the returns of our Platinum Membership gold and silver stock allocation model, which focuses on nearly all junior PM mining stocks, including a recent rebalancing of our portfolio in February, this year our Platinum Membership gold and silver stock portfolio has returned about 18.59%. And if we go back just one more month to 1 December 2016, for our Platinum Members that joined at the start of December and assumed all open positions per our stock allocation model at that time, and then rebalanced the stock portfolio per our February rebalancing, the returns would be approximately 28.90% on our Platinum Members gold and silver stock portfolio in the period from 1 December to 8 February. And these returns are exclusive of the hedges we took during these months against the significant banker raid on gold and silver asset prices in November and December that produced significantly net positive returns as well.

 

So why have junior gold and silver mining stocks been outperforming their larger peers, when normally the risk of investing in the junior gold and silver mining stock asset class is much greater than investing in the mining giants like Barrick Gold, Goldcorp, and Silver Wheaton? To answer this question, we have to analyze and understand what happened during the 4-½ year decline in spot gold and spot silver prices between 2011 and 2015. During this time, the smaller, junior gold and silver mining companies, to survive the vicious banking industry suppression of spot gold and silver prices, had to implement a plethora of strategic moves, including cost cutting, streamlining operations, improving drill techniques, improving metal recovery rates, changing mining techniques to increase gross margins, and even shuttering non-profitable assets while seeking to re-open them after prices recovered. The best junior gold and silver mining companies were able to implement tactics, such as temporarily shuttering non-profitable assets, that their larger peers due to excessive debt burdens that had to be serviced, simply could not. Thus, when gold and silver prices finally reversed last-year, the best gold and silver mining companies positioned to benefit from this price reversal were the smaller, now more efficient companies, not the industry leading behemoths. Precisely because of this difficult gold and silver price environment from 2011 to 2015, the better run, more efficient gold and silver mining companies are primarily junior mining companies. And this will remain, true, in my opinion, for this year, and quite likely the next as well. And in our Platinum Membership, we just spent hundreds of hours uncovering what we believe to be the best junior gold and silver mining companies for 2017.

 

So after such a strong start to 2017 for our top junior gold and silver mining stocks, many of which have risen by 30% and more since December 1, will it be a continued push higher the rest of 2017? Of course not, as all stocks become overbought at some point in the cycle, and there will be corrections, and significant corrections that occur in 2017. However, despite these future significant corrections, which in the past, were often much more damaging than the corrections that occurred with the larger gold and silver mining company stocks, I believe that overall 2017 will be a year in which the best junior gold and silver mining stocks significantly outperform the best intermediate and large-cap gold and silver mining stocks.

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Will the Banker War on Cash Spread to a War on Bitcoin?

February 9th, 2017
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Over the years, I’ve written a number of articles regarding why I prefer physical gold and physical silver over bitcoin (BTC). I believe in monetary competition, however, and believe that different forms of money should be allowed to compete, because the best form will eventually and quite rapidly always rise to the top. However, we are far from such an environment, as government/banking cartels have banned the use of gold and silver as systemically-wide accepted forms of money worldwide while ensuring that their rapidly devaluing fiat currencies remain the norm. So where does BTC fit into this picture? Again, I think that BTC has its place in the economy, especially since transaction fees using BTC are well below the highway-robbery rates of global banking institutions. However, BTC has yet to prove itself in preserving purchasing power over decades of time as has gold and silver, nor does it meet all 9 qualities that I deem necessary for sound money.

 

In any event, as some of you may well know, BTC has exhibited massive volatility in 2017, far beyond even the sometimes volatile price fluctuations in spot gold and spot silver prices. BTC started out this year reaching an interim high of $1,129.87 per BTC, then plunged a maddening 31% in just 5 trading days to $775 after the Chinese government placed more restrictions on BTC trading, but since then, has nicely recovered 24% of that plunge and has risen back to $1,052.54 per BTC. At the time, BTC rose to $1,129, many posed the question of whether BTC was better than gold, which in my opinion, it will never be due to its digital nature. Some ask why would Chinese regulations cause BTC to plunge 31% in five trading days, and the answer is simple. Chinese speculators were almost entirely responsible for the rise of BTC from $800 to $1,129 at the end of 2016 into the start of 2017. As the Chinese government took more measures to clamp down on black money leaving China, wealthy Chinese turned increasingly towards BTC as their preferred mechanism to move black money out of China, thus fueling a speculative, unsustainable rise in BTC price. Furthermore, Chinese traders not even using BTC to move black money out of the country piggybacked off of this rising, easy trade because most Chinese BTC exchanges charged no fees on either end of the buy and sell transactions for BTC. However, when regulators changed these rules and implemented a 0.2% transaction fee on both ends of the trade, the easy speculative profits disappeared, and in response, BTC volumes collapsed 90% almost overnight on every Chinese BTC exchange. Read the rest of this entry »

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What Lies Ahead for Gold and Silver Prices?

January 27th, 2017
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Every time gold and silver prices have a good run, there tends to be a proliferation of sensationalistic articles that state something to the effect of “gold ready to break out to new highs now” or “silver about to surge tremendously”. To such sensationalistic articles, I always say, pay no attention to them, because no one really can ever predict the exact date when gold will surge by $100 and silver by $3 or $4 in a single trading session, as these events are likely to happen at some point in the future when most people are not expecting it to happen, and not during a time when everyone is expecting it to happen. It’s good to be optimistic whenever gold and silver have a good run, but it’s also good to stay rooted in realism as well, so one can spot risks when they appear instead of being blinded to such risks by excessive optimism. Furthermore, more often than not, a proliferation of such articles often marks a short-term reversal in prices. Certainly gold and silver have had a good run since the last week of December into the New Year, such that our CIO newsletter has gotten off to a solid January, up by 7.53% in January.

 

Still, risk is risk, and when risk rears her ugly head, much better to heed it than to ignore it. In fact, based upon my analysis of global gold and silver markets, I announced on my Snapchat channel (yes I’m posting every day now) two days ago on 25 January (24 January in the West), when gold was still trading at $1,210 and silver was still at $17.20 in Asia that morning, that there “was significant risk” to gold and silver prices that could very well manifest as we closed this month and headed into February. That very evening in New York, just several hours after I posted this warning on Snapchat, spot gold and spot silver closed down by its largest single-day decline since 21 December. I reiterated the following day on Snapchat, the morning of the 26th in Asia (the evening of the 25th in the West) that even though many thought this gold pullback was just a temporary one to the $1,200 mark or slightly lower, and that gold would rebound off support at $1,200, that there was still considerable risk to spot gold and spot silver prices right ahead. So for those that have supported me on Snapchat, thank you for following, and I hope you heeded my warnings if you are long gold and long silver. Read the rest of this entry »

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In the Banker War on Cash, New Zealand and Canada Are the Next Major Countries on the Banker Hit List

January 12th, 2017
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As we warned more than 4½ years ago in this article here, the criminal banking cartel’s end game involves restricting freedom of speech and curbing any criticism of their criminal banking industry by banning cash and imposing an end game of 100% digital money upon all of us. Now with the benefit of 4½ more years, there can be little doubt that indeed, that the banking industry has advanced their war against all of us by accelerating their war on cash, and attempting to disguise this war on cash as a war on corruption.

 

Any logical person would understand the vast irony in such a statement, especially since bankers are leading these false charges of a war on cash as a war on corruption, not only given the fact that the banking industry is the most corrupt industry on the planet, but also given the fact that bankers provide much of the dirty money that feeds global stock markets by laundering tons of dirty money for the world’s most violent drug cartels. Recall that in 2012, HSBC bankers had to pay a $1.9B fine for willingly laundering hundreds of millions, and more likely billions of dollars, of dirty money for the largest and most murderous Mexican drug cartels. Though HSBC CEO Stuart Gulliver unconvincingly denied approving of these transactions, any logical person would conclude that it is next to impossible for the CEO of a bank not to know that origin of the source of hundreds of millions of dollars of cash flowing into his bank. Read the rest of this entry »

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Investors’ Number One Flaw Often Revealed During Gold and Silver Raids

December 28th, 2016
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In many aspects of life, being ruled by one’s emotions can often cause one to land in hot water. This is not to say that one should be devoid of all emotion and act like a robot, because no one likes a stiff and unfeeling person. However, as with life, balance is necessary. Yin and yang. Unfortunately, many of us, as investors, fall victim to the pitfall of making decisions from a raw emotional place, instead of a place more balanced by logic, far more frequently than we would like. Even in martial arts training, I learned that letting one’s emotions get the best of oneself during a confrontation could be dangerous, whether it was crippling fear that would delay response and reaction time in which fractions of a second make a huge difference, or anger that would cause lapses in judgement that would leave one vulnerable to counterattacks. Furthermore, I even learned that the adrenaline surge that accompanies the onset of anger would soon be followed by an adrenaline dump that would cause one to become unexpectedly and easily tired, a dangerous predicament in a prolonged confrontation.

 

In vlogging about this recent and ongoing gold and silver raid, I’ve discovered that emotions also prevent us from making prudent decisions in investing as well. Though all of us have heard time and time again that investing is an emotional activity, too often, many of us become so emotionally and inflexibly committed to a position that we never waver from our stance, even when we know that there could be a huge possibility of our stance being wrong, rather than to simply step away from the situation for a second, calm our minds, and make rational, logical decisions. Even though I detest the immoral, criminal banker raids against spot gold and spot silver prices that are, without doubt, a misanthropic attack on the freedom of humanity (as an attack on sound money helps elevate the status of counterfeit fiat currencies in the public eye), none of us who are long gold and silver, even if it is just physical gold and silver, should have to relegate ourselves to idly standing by without taking any counter measures against this abominable banker-executed manipulation. Read the rest of this entry »

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Less YouTube, More Snapchat, and Banker Wars on Cash and Gold.

December 19th, 2016
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As all of you that have been long-time readers of this blog know, we have several primary channels of distribution for all the news we distribute – our YouTube channel, our free newsletter (subscribe on our website), and this blog.

 

However, ever since Google bought out YouTube, YouTube has become increasingly hostile towards any distribution of any hard-hitting news about the systemic and rampant criminality of the commercial financial and banking industry. We’ve had numerous problems with censorship issues of our news over the past several years with both Google and YouTube, so we are going to migrate towards other channels of news distribution. Read the rest of this entry »

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Join Our SKWealthAcademy Snapchat Channel

December 19th, 2016
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For daily updates on gold and silver markets, building positive life-building wealth, (not monetary wealth only), and the launch of our new SmartKnowledgeWealthAcademy, please follow us on Snapchat. You may add us by taking a photo of the snapcode below and then tapping “add friends” and “add by snapcode” or by searching for the snapchat username “skwealthacademy.”

 

skwealthacademy snapcode

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With Federal Reserve Uncertainty Out of the Way, the Gold and Silver Bull Will Now Resume

September 23rd, 2016
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Last year, we were consistent in stating all year that every dip in the price of gold and silver assets was a trap and false buying opportunity that would just precede lower prices. This year, we’ve been consistent in our message that every significant dip has been a true buying opportunity and would precede strong rebounds in the price in gold and silver assets.  For example, on 25 August, we wrote a piece titled, “Don’t Worry. Falling Gold and Silver Prices Equals Big Opportunity”, and well before that, on 21 June 2016, we penned a piece titled “Three Charts that Show Much Higher Gold and Silver Prices are Still Ahead.”

 
Read the rest of this entry »

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Don’t Worry. Falling Gold and Silver Prices Equals Big Opportunity

August 25th, 2016
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In mid-June of this year, I wrote an article stating that the gold and silver price rise was only getting underway. A little earlier that that, in our Member Services, we instructed our Members to purchase many gold and silver stocks. Even some of the PM stocks we just purchased this past June are still up, even after the large drop yesterday, by more than 25% and 49%, but unless the situation drastically changes in the next few weeks, we intend to hold through this temporary lull in prices, and to use this opportunity to add a few more gold and silver stocks to our portfolio at these now heavily discounted prices. So I don’t see this drop as a negative at all, but as a big opportunity, especially since a few of the gold and silver stocks we have been waiting to drop to purchase in our Member Services had now dropped 25% to 30% in price.

 

On 26 July 2016, after gold, silver, and PM (precious metal) stocks all pulled back in price, I wrote an article stating that the pullback was just temporary, and sure enough, the very day I released that article, gold and silver prices reversed again. And right now, we once again, are in the midst of another gold and silver asset price pullback. This isn’t the first time a significant pullback in prices has happened this year either. Back in May of this year, many gold and silver stocks dropped by more than 20% to 30% before resuming their climb higher. Depending on what Janet Yellen states this Friday in Jackson Hole, gold and silver asset prices may have even a little bit further to fall before reversing.

  Read the rest of this entry »

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The Current Gold and Silver Price Downtrend Will Prove to be Just a Temporary Lull in a Continuing Uptrend, Part 2.

August 23rd, 2016
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On 14 July 2016, after we purchased many gold and silver stocks in early June to add to very solid positions in physical PMs we’ve established since 2007, I sent this bulletin to our Platinum Members: “We may receive some weakness in the share prices of many of the stocks we hold now as they have increased quite strongly in a fairly short period of time, but we will continue to hold them unless stronger evidence arises in the immediate future that the support levels above for gold and silver prices may not hold.” Indeed from 15 July to 26 July, many gold and silver stocks pulled back in price to a fair degree.

On 26 July 2016, after the HUI Gold Bugs Index had pulled back by 9.4%, silver had pulled back 8.8%, and gold had pulled back 4.7% in a month’s time, there was chatter, as always, of a much greater possible continuing fall in gold and silver prices. In response, I wrote this article to dispel that notion, in which I stated my belief that the pullback we were experiencing at the time was only a temporary lull in a continuing uptrend in gold and silver prices that started at the end of last year. Read the rest of this entry »

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Meditation is the Key to Becoming a Great Investor

August 19th, 2016
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Every once in a while I write about topics that seemingly have nothing to do with investing, but for those that are able to connect the dots, they will actually find great value in these seemingly unrelated topics to wealth building and preservation strategies.

Recently, I wrote about a behavioral phenomenon called the “It Won’t Happen to Me” syndrome that prevents many of us from separating perceived reality from actual reality, and I discussed how acceptance of false precepts about investing and self-preservation can lead us to make wildly irresponsible decisions that are dangerous to our self-preservation, including decisions to do nothing when one should act. One of the easiest things we can do on a daily basis that won’t cost us a penny, yet can help us achieve a tremendous level of clarity that allows us to separate the false paradigms and precepts that we have often already embraced from the staggeringly different reality that often exists, is the simple practice of meditation. Read the rest of this entry »

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We’re Well Beyond the Point of No Return Now. Ignore Federal Reserve Policy Statements in Your Wealth Preservation Strategy

August 18th, 2016
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On 17 August at 2PM New York time, the Federal Reserve bankers will release minutes from their last meeting and traders may move some markets sharply in a knee-jerk reaction to what is contained in these minutes, but don’t let any irrational responses to Federal Reserve bankers steer your focus away from reality. I’ve been discussing the absurdity of planning an investment strategy around Federal Reserve banker policy statements for a long time now. Just check out my entry here from nearly a year ago, in which I discussed how Federal Reserve bankers absurdly rehashed the same statement for six straight years without ever stating anything new, and then in 2015, started placing interest rate hikes on the table again, but again, absurdly have since issued identical statements with slightly different language that virtually state nothing. Just visit their website and pull any of the archived statements from the past two years and you will encounter, in every statement, language that discusses “possible” interest rate hikes if sufficient progress has been demonstrated in the US economy towards their realized and expected objectives of “full employment and 2% inflation”. Read the rest of this entry »

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The Greatest Threat to Future Portfolio Yields is Adoption of the “It Won’t Happen to Me” Syndrome

August 15th, 2016
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Before I start today’s article, I just want to clarify one statement from my article about diversification in which I discussed how most gold and silver mining stocks are still undervalued heavily by comparing the cumulative market cap of all gold stocks in the HUI Gold Bugs index to the market caps of well-known single stocks like Apple, Facebook and Amazon. In that article, I posed the question if Apple’s market value really should be more than four times the market value of all the gold reserves and resource held by all the gold companies that comprise the HUI gold bugs index. Obviously, the public factors in the value of a company’s inventory, which in the case of a gold mining company, is its gold reserves and resources, into a determination of whether or not to buy its stock, which consequently affects its market capitalization. Consequently, by that that statement, I was merely referring to the public’s inferred net worth of this gold as represented by the cumulative market capitalization of these gold mining companies as compared to the market capitalization of Apple.

Moving on, today, I’m going to drill down on a human behavioral trait that I’ve discussed in the past, including here, and it’s the danger of the “It Won’t Happen to Me” syndrome. All of us have fallen victim to the “It Won’t Happen to Me” syndrome” at some point in our lives, whether it’s as simple as going swimming in waters where someone has been seriously injured, or even killed, due to a shark attack, or whether it’s ignoring the possibility of bank seizures in our own countries even though it’s already happened in Cyprus and other multiple red flags since then have been raised by the global banking industry themselves about the future possibility of similar events in multiple other countries.

However, when it comes to wealth preservation, falling victim to this belief could prove tragic over the next several years. Read the rest of this entry »

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