The Kinds of Rewards That Make the Wait Worth It

Written by Gerardo Del Real
Posted June 22, 2020

I first started Junior Mining Monthly in 2016. I speculated that everything that is going on now — debt bubbles, central bank asset bubbles, unsustainable spending, geopolitical turmoil, etc — would start percolating then.

I negotiated with several publishers but knew I had a home at Outsider Club from the second I met founder Nick Hodge and the group he had put together.

Immediately after meeting, we got to work on launching the service.

By the time it launched it was May of 2016. Gold had started perking up and there was momentum in the space.

Here’s what I wrote exactly four years ago,

“You can expect a healthy dose of macro-commentary, because I feel that volatility will become a permanent part of most global markets. I am not a gold bug, but I do feel that precious metals — and gold in particular — will play a very important role as a hedge to a very incompetent group of politicians and, by default, a group of central bankers with very few options.

"I also believe that this new gold bull market cycle will last for many, many years. The factors that will contribute to that bull market are structural in nature and can no longer be fixed with traditional approaches. The quick- fixes of the past will no longer work.

"Banking sector woes in Europe, the refugee crisis there and the instability that’s causing among EU member nations, slowing growth in China, slow growth in the U.S., and ineffective monetary policy in Japan are all factors that will lead to capital looking for an alternative to bonds, to Europe, to Japan, and to China.

"Attempts to ignite inflation in Europe and Japan through additional easing will eventually fail and when members of the bond-buying public realize it, they will rush to the exits looking for a new home for their capital.

It will only take small amounts of that capital to move gold much, much higher. Junior mining stocks will, of course, rise many times over."

Here’s how I ended that inaugural issue,

“A popular argument against gold, for many years, has been that for large portfolio managers, gold is a non-yielding asset and therefore not attractive.

"All that is changing as central banks around the globe are now faced with negative-yielding assets, with the result being that gold ends up as a positive carry.

"The big money is starting to take notice. In a matter of five months, influential billionaires Ray Dalio, Stan Druckenmiller, and most recently, Paul Singer, have all advocated gold as a currency allocation and hedge against currency debasement.

"The long-term trend is clear there will be lots of volatility. Understanding the causes of the volatility and the likely results will be critical.”

I was spot on, but four years early. As I explained to a reader who wrote in and recalled that I said we're in the first inning back in 2016, it was a long first inning. 

After a blazing couple of months, the initial momentum waned. Central bankers proved more able to paper over the structural deficiencies that were clear as day even four years ago and that led to the most brutal bear market anyone has seen in the junior resource space.

Easy money in the pot and crypto sectors further drained whatever speculative capital might have still been around. 

That led to a shutdown of most exploration for years as companies looked to survive the downturn and preserve capital for better days.

But in the words of Bob Dylan “The Times They Are A- Changin’.”

Exploration plays finding success with the drill bit have been rewarded and it is clear we are in a gold bull market.

A market that wants and will reward discoveries. A market that is finally starting to reward being early. 

The kinds of rewards that always make the wait worth it.

To your wealth,

gerardo-sig

Gerardo Del Real
Editor, Junior Mining Monthly and Junior Mining Trader.

For the past decade, Gerardo Del Real has worked behind-the-scenes providing research, due diligence and advice to large institutional players, fund managers, newsletter writers and some of the most active high net worth investors in the resource space. Now, he is bringing his extensive experience to the public through Outsider Club, Junior Mining Monthly, and Junior Mining Trader. For more about Gerardo, check out his editor page.

*Follow Outsider Club on Facebook and Twitter.

Heal Your Ailing Portfolio Body