John Rubino, [Substack https://rubino.substack.com/ ], joins me for a wide-ranging discussion on gold, the gold equities, silver, the silver equities, macroeconomic factors, and using volatility spreads to smooth out the extreme market moves. We once again reflect on the reasons why gold and the gold stocks have continued to outshine most other market sectors with the backdrop of macroeconomic turbulence and general market volatility.

Over the last few weeks both the US Dollar and bonds have not received a strong market bid, and it showcased gold as the only real safe haven from all the uncertainty in financial assets. John points out the continued bid from central banks under the gold price, and many retail and institutional investors rotating a portion of their capital into precious metals sector as the only  place to hide.  John highlights a recent missive from Jim Rickards postulating that gold has become an asymmetrical bet, where the downside is limited and the upside is potentially unlimited.

We then pivot over to the gold stocks, discussing whether we should have seen more of an increase in gold producers valuations, considering the record high underlying metals prices, and their fattest margins of all time. John points out that it is taking a while for generalists to notice after a few prior years where we saw inflation and inputs costs keeping pace with the increase in gold price.

The conversation spans a number of other topics like, if we’ll see in influx of more merger and acquisition deals, royalty company margins, the gold:silver ratio, why he thinks silver will do better than gold over the next 3-5 years, and the increased action in junior explorers like Snowline Gold, Goliath Resources, Hannan Metal, and Sitka gold all up triple digits over the last year or two. 

Wrapping up we circle back to macroeconomic and the strong potential for a recession, the Fed waiting to cut interest rates, the shift in focus from generalist investors out of sectors that work working and looking for more safety, and techniques for using options and volatility.

https://rubino.substack.com/