Sprott monthly market update with Rick Rule: Uranium, gold and silver
Rick Rule discusses the arbitrage between the biggest streaming companies and the largest base metals companies. The precious metals by-product streams of the base metal companies are valued at 15 times the EBITDA multiple in the markets. The mining industry has come to rely on 'dumb' money which has all but dried up but there are billions of dollars of 'smart' money looking for the right deal in the best of the best products.
He advises on investing in the uranium market, the low price of natural gas is negatively impacting the price and the best way to invest is to own the uranium itself via proxy. Global commodity demand is the weakest since the 1980's but the recent gold HUI drop is a technically driven sell off as GDX violated long term support.
Talking points from this week’s interview:
• The outlook for all things energy is bleak
• Cameco likely to move first
• The commodity moves before the equity
• How does the China slowdown effect commodities?
Rick Rule began his career in the securities business in 1974.. He is a leading investor specializing in mining, energy, water, forest products and agriculture. Rick founded California-based Global Resource Investments, Ltd., which grew into a much larger organization with significant affiliated companies. As Director, President, and Chief Executive Officer of Sprott US Holdings, Inc., Mr. Rule leads a highly skilled team of earth science and finance professionals who enjoy a worldwide reputation for resource investment management.