'3rd Inning' for Gold & Silver Miners – These Stocks Set to EXPLODE Higher: John Feneck
Summary
Gold and Silver Market Outlook: John Feneck believes we are in the early stages of a significant bull market for gold and silver, with gold recently breaking new all-time highs and silver showing strong performance.
Investment Strategy: Feneck emphasizes a balanced approach between large producers, mid-tier companies, and junior miners, highlighting the importance of diversification within the precious metals sector.
Market Correction Prediction: Feneck anticipates a substantial correction in the broad market, suggesting that investors should consider reallocating from overvalued tech stocks to commodities and precious metals.
Federal Reserve Policy Impact: The potential for upcoming interest rate cuts by the Federal Reserve is seen as a bullish factor for gold and silver, with expectations of increased market volatility if monetary policy shifts.
Junior Miners and Financing: Feneck discusses the impact of new financing methods on junior miners, such as "life" financings, which can create temporary pressure on stock prices but also present buying opportunities.
Commodity Diversification: Beyond gold and silver, Feneck is bullish on tungsten and highlights opportunities in other commodities like helium, emphasizing the importance of exploring various sectors within the commodities market.
Risk Management: He advocates for a hub-and-spoke investment model, using ETFs for core holdings and selectively investing in individual stocks, while maintaining a proactive approach to monitoring market developments.
Broad Market Concerns: Feneck warns of the risks associated with high valuations in the tech sector and advises investors to critically assess their portfolios, especially in light of potential shifts in Federal Reserve policy.
Transcript
Hello and welcome into Commodity Culture where our goal is to make you a better investor in the commodity sector. My name is Jesse Day and on this episode I'm excited to welcome John Fenick to the program, a veteran of the finance industry with stints at Meil Lynch, JP Morgan Chase, Spratu, and more. He is currently the founder and CEO of Fenic Consulting. Both gold and silver mining stocks are on an absolute tear recently, but John thinks we're still in the early innings of what he calls a generational opportunity. John shares the names he's currently invested in in the sector, including some recent additions to his portfolio and one name that he is mentioning for the first time on this show. We also talk about why he's bullish on tungsten, why the broad market is set for a big correction ahead, and so much more. So, strap yourselves in for my conversation with John Fenick. John Fenick, great to have you back on Commodity Culture. Obviously, very exciting times for precious metals markets right now. I want to start by honing in on gold because here we are, new all-time highs, breaking above 3,600 after a 4mon consolidation. What do you make of this breakout and are we still in the early stages of this gold bull market in your view? >> Thanks for having me, Jesse. Um, yeah, I I would say we're not in the early stages. I mean, gold, if you look at GLD, for those that, you know, want to look at a chart, um, has been ripping for months and months, right? like September 22 was September 2022 was the low for GDX and J and gold was probably 1,600ish then you know I mean like it's doubled since then so anytime a commodity doubles um you know you have to look at the RSI the relative strength index you have to do these kind of things different metrics to make sure and check your thesis we do this in a bull run like this I'm doing this every day I'm not kidding like I'm not like taking one day off from checking myself and you know I sold something yesterday with an RSI of 84 like once you get above 70 it's sort of like you start thinking about selling then 75 to 80 in a rally is sort of there I mean just to give your listeners some perspective when we went on camera the RSI is at 76 on gold so like it's already elevated but it's elevated for a reason you know the the the US economy is starting to to turn over and we can talk about that as we move forward. But you know keeping on gold look I mean a lot of the banks have acquiesced right they started to do this first quarter of this year 30 3,00 3200 3500 targets now those targets are more like 3500 to 4200 and sitting here let's say at a round number of 3600 you know you've got a lot of upside to 4200 I don't even know what $600 in gold means to most of the gold stocks I own but it means very good things >> and do you think that I want to pull on one thread there because you mentioned the economy and obviously gold is a commodity but it's also a monetary metal. Some people would just consider it as money. Does that factor in at all to the potential for gold to perhaps not behave like other commodities when it's seemingly overbought and to continue climbing in the face of devaluing fiat currency, rising debt and deficits and all of the problems that we have going on in the US and global economy at the moment? >> Yeah, it's a good point. Um, look, I hope I'm wrong. I I always say that because um I I want the the 4,000 target. I want the 5,000 target. Um you know, we had three targets this year at 3,200, 3,500, and 3,800. Um we missed our target last year by eight bucks. So, we're pretty like, you know, down the middle as far as our estimates go. We don't try to be sensational because I think the targets we hit this year are fantastic, right? Like you don't need, and we just proved this in earning season. We don't need 4,000 gold for Pneumont, Agnico, etc. to do well. >> Yeah, that's a great point. I wonder what your thoughts are on the Fed switching to the US economy here. They're seemingly abandoning their 2% inflation target. At least we don't I mean, Powell's using Fed speak here. We kind of don't even know what he's saying sometimes. But in the last Fed meeting, he seemed to indicate we're going to be changing our policy. Trump obviously declaring on social media that inflation is at zero as he continues to push Fed Chair Powell into lowering interest rates, giving him the nickname too late. Um, I wonder what your thoughts are here on this whole fiasco. And if rate cuts do start being implemented, what do you think the effects would be on the gold price? >> Well, I do think rate cuts are going to be implemented starting September 17th. No question. However, how big is that and how what is the path for the Fed going forward is really the question investors need to be asking. A 25 basis point cut is already baked into the broad market as well as gold and silver. If we get more than that, that would be bullish. Um, if we get Powell to show us a path to 2026, you know, that would be bullish. Remember, Jesse, last year, um, around this time we were all talking four rate cuts for 2025. I was on your show, right? We we talked about that. Um then in December after the Fed meeting, it became three rate cuts and people were like, "Okay, that that's fine." But then it became two rate cuts pretty quick and now we're looking at one or two um between now and the end of the year. So, um, I think that rate cuts obviously are going to be bullish for the broad market, bullish for gold and silver, but I would argue that the broad market is uh, as Steph Pomboy says, just floating on air. Like the broad market has rallied since March of '09. like you know um my message to investors is look at your 401k statement over the last 15 and a half years and ask yourself a tough question which is was this my expertise or is this partially luck or all luck right I mean like you have to start taking some money off the table if you're in the NASDAQ and some of these aggressive ETFs you know I just cringe when I start to see some of this stuff on client statements or when we do a phone call together they mention this stuff and half of their net worth's in some of this stuff and they're 70 years old right like The S&P right now is 45.41% tech as of August 31st. Like you do not want half of your, you know, equity exposure in a 401k. Um, you know, half of that being 25%, right? If you have a 50% waiting in the spy, uh, in technology, like at that age, right, you have to be smart about it. >> And now a quick break to hear from our sponsor. 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Do you think that's a realistic target? And what are your overall thoughts on the silver sector here? Yeah. So, uh, on your show last year, even though silver was my largest holding, uh, physical silver and SLV or any of the ETFs out there, um, you know, uh, we never talked about it breaking 30 ever. We, in fact, said it wouldn't break 30, but we were going to be patient. So, we added to silver last year five times, you know, um, from 23 an ounce all the way to 30 when it broke out, right? And then we stopped adding to it. We're just we're just riding it now because it's a 10% waiting in our portfolio. You know, that's a lot. So, yeah, I have every incentive to tell you silver's going to 100. I'm not going to say that. I think at 41 you've got some resistance between 42 and 43. We keep knocking on that and it's sort of just fluctuating right now. We have to get through that level, but honestly, after that, it's all the way to 50. What Don Durret and I talk about though is that 50 is not really the target here. 50 is an old target given that you have to inflation adjust and that would get you closer to 68 to 70 an ounce. So that's really our target for for next year. Um we think 50 could be achieved by say January. Um and believe me if the Fed is more uh doubbish that will be accelerated right. So, um, silver's looking great. The silver equity ETFs are looking great. You know, SIJ is the equivalent of GDXJ for silver miners and it includes a lot of the mid tiers like Core, First Majestic, etc. Um, that thing is cranking right now. It's up, I think, 80 or 90% year-to date. But what's interesting is that ETF didn't start SIJ until I believe January of 2013. So, you don't really have as an investor a way to look back and see how that thing would have performed in 2010 or 2011, right? But I'm telling you, it's going to be higher than the chart uh the historic chart is. And so, that's what we expect. 23 was the all-time high, I think, on SLJ roughly, and now we're over 20. So, we think 23 is an easy target going into next year. Um, if you want, I can go through some of the other ETFs while we're on the subject. >> Yeah, please do. >> Okay. So GDX is the largest, you know, name out there. It's got over 15 billion US in it. Ban has run it for many years. What's interesting about GDX is that it already has touched and eclipsed the high right from a decade plus ago. Um then GDXJ is the really interesting one which is our second largest holding behind silver. Um in that we're trading around 86 87 or something. Um the all-time high is 179. It It's just mind-blowing. So, you know, you have to go back and look at those 15 to 20 year charts and say, "Wow, this thing still can run." When Don Dret and I were on stage here at Beaver Creek a day ago, we got, you know, a question about like, you know, is this bull run over? And we're like, no, this is like the third inning maybe of of the equity run because the producers have run, yes. The mid tiers have started to run, yes. But then a lot of the mid-tiers still haven't moved that much and the juniors haven't moved much at all. I mean, it it really just depends. The positive thing I'm seeing on the junior side is that the the volume is really picking up. Like I get that question more from high net worth investors uh more than anything. Like if I get into this thing, how do I get out? It's a valid question. Some of this, you know, some of these stocks trade by appointment. So, um, now we're seeing like 5x, 10x volume on some of these juniors and and we started to see that really since August 1st. Um, August 1st was kind of a key day for Don and I in that um the the non-farm payrolls read was bad, but they also revised down the previous two months and that wasn't a small revision. That was 258,000 jobs lost. So, like that for me was like the all-in moment. And then Powell came in August 22nd on that Friday and was doubbish. And then we put like the rest of our money to work, right? Right. Like we we have frictional cash at this point in our portfolio. >> Well, let's dive deeper into the gold and silver mining space because you mentioned there's some very interesting statistics. Obviously, SIL and GDX are both up over 90% year or GDX and SIL. Yeah, both up over 90% year to date. This is obviously a massive outperformance over the broad market. Yet, that seems to be where Main Street and the mainstream financial media is still focused. as you mentioned, dealing with some people you were talking to who have so much of their net worth in these overvalued tech stocks. Um, so I guess similar question to before you're saying we're in the third inning when it approximately when it comes to precious metals miners. Where are you deploying capital when it comes to the gold and silver mining space? Where do you think the most lucrative opportunity lies? Is there still a lot of opportunity in the Agneo Eagles, the numance in the barracks? Um, are you going further down the chain looking at developers and explorers? What are your thoughts there? >> Yeah, we have a pretty balanced approach between those three buckets that you just named. Um, near-term production developers are even more interesting. Like I just had dinner last night with Daenerius Metals. Um, it's DNRSF in the States, DME in Canada. You know, uh, Jesse, there's this new type of financing out there called life. I don't know if you're familiar with it, but it's kind of detrimental to some of these stocks because it allows the buyer of shares to immediately sell them if they wanted to and keep the warrant. Right. That is a common thing in our sector, which we don't do. >> Yes. >> Um but um it really puts artificial pressure on shares. Um you saw this with Guanowato Silver. They just did one for 20 million bucks, much bigger than Daenerius's. Um, and that thing was underwater until Don mentioned it on the market sniper and the stock went up 25% one day. So, I mean like it's this is like go time. You have to figure out a strategy and buy something and and buy a basket of something. And that's why we kind of stressed, you know, Jesse, that you know, Don services, my services are all very affordable in the context of a bull market, right? Maybe two years ago you couldn't justify it. If you're not if you're not aligning yourself with someone like us right now, you're making a huge mistake. This is like lifetime generational opportunity, you're not going to get the same opportunity. I don't I don't think it lasts 10 years like Don. I think it lasts two years, you know, like from here because if you look at the chart of GDX and J from September of 2022, that was the bottom, right? It wasn't this year. It bottomed there. So like you're looking at already a three-year run. Um which a lot of people miss. So yeah, Daenerius Metals, you know, they they they were talking about this at dinner. They were saying, "Look, we got bombed out like we lost, you know, 25% of our market cap because we did one of these financings." And I put out a note to my followers. I have a real-time email service after I got off the phone with the chairman and I just said, "Hey guys, like this is artificially low. This is there's nothing wrong here. There's, you know, we should we should be putting a position on into something like this that just went into production." You know, Don and I pointed out on stage here as well, there's less than 200 producing miners and Daenerius is one of them. So, how is this thing trading at 37 cents as we record this? You know, like that's the opportunity that's like worth, you know, probably 50 to 60 cents by accident by year end, right? Like that's just uh you know, we don't always go for the home runs, Jesse. You know, Don's more like the home run guy. He he he's calculating 5,000 gold and $100 silver into all of his, you know, comments when when you do do hear him talk. And I'm always just looking at the near- term, right? I'm looking at 3, 6, 12 months. How can this develop? Because I find that most high net worth clients are, they don't have patience. They're not going to sit around and wait for three years for something to work, especially when tech is doing what it's doing and Bitcoin is doing what it's doing and real estate is doing what it's doing. There's too many opportunities. So, um, yeah, uh, that's one that we like, um, in the kind of developer going into production, uh, category. Um, do you want me to go through a couple more now or? >> Yeah, but before you do, I just wanted to pull on that thread regarding these financings where people immediately sell their shares and keep the warrants. I've heard this called warrant sniping before as well. What What's the solution to that? Should companies avoid those type of financings? altogether because I've seen several examples of this happening and like you mentioned 20% drop in the market cap of the company that's very normal when those sorts of situations occur. Should should that incentive be taken away when doing a financing in your view? >> Um this is a newer type of financing. I don't think it's going away. It's extremely popular. I've just seen it happen now on the two stocks I mentioned along with maybe three others and every single situation there's a drop for somewhere between one and four weeks. It's pretty brutal. you know, it's not like you could even appreciate out of it easily. Um, so I guess the argument from the CEO's side would be, hey, we need to raise money to drill and that's it, right? Like this is a capital intensive business. And I understand that. But what I encourage people to do when your stocks bombed out, like don't do a5 to$10 million raise here. Do a one to two to $3 million raise and do a non-broker deal potentially where you go out there and talk to people like myself. I' I've been the lead orderer myself in two deals in the last 30 days, you know, where I'm I'm happy to come in and I don't need a full warrant. I'll take a half warrant or no warrant sometimes if it's like a tungsten play where I know I have conviction. Um, and I know it would take me like two weeks to build that kind of a position in the in the open market, right? As opposed to just writing a check at once. And that's where financings are helpful, Jesse, to high net worth people is they don't want to sit on the bid, you know, all day and try to get filled on some of these juniors. interesting. Let's continue on with some other names you're watching or investing in right now when it comes to the gold and silver mining space. >> So, um having dinner tonight with Metallic Minerals. Um I have no idea what the update's going to bring, but I I know that they have a project here in Colorado, not far from where the conference is. They're doing a due diligence meeting this week. So, they'll probably have some analysts out to site. Um they're excited about what's happening at Llata there in Colorado. Um they also just recently did a financing. Guess what? It was life. Um I talked to Greg about it. He's not going to do another one of these probably because of what happened. But again, that was like something we put out to people. Hey, you know, the financing was let's say 1718 US. Stock got to 14 during the financing and I'm just like this is crazy. You got to buy this here. And now it's a 20 right as we record this. So um it's still not much above the the financing. So that's that's the opportunity in our sector. pull up a five-year chart or a 10-year chart on that stock and there's a ton of upside. Um the other piece that they have is in the Yukon. So the Yukon's gotten a black eye this year because of Victoria, right? Um that's a mistake because every company is different. Some of these companies are based 200 300 miles away from Victoria. Like there's nothing that would be to to worry about. But yet people do this, right? Um so they have two ways to win with this stock. You could do the copper uh you know forward thing in in the US or you could do the silver forward thing in the Yukon and Pneumont owns nine and a half percent and they just bought more in the financing. So, you know, when you have a big boy in the stock already, whether it's 9% or 15 or 20, it's always a nice vote of confidence for me. Like I I know that they have dialogue with someone who could buy them in a bull market already, right? That's always a plus. Um I um let me think here on the gold and silver side. Um yeah, so there's another stock that um we we're going to meet we just met with yesterday. It's called uh Alcane. So it's ALKF in the States, Alk in Canada. And these guys were an Aussie based company. Um they acquire they merged with Mandandalay. Um Mandandalay was a super cheap um stock that had a really good balance sheet. That's what attracted me originally. They had about 80 million in cash and zero debt. Well, that's now 96 million as of like re like August in cash in the US in US dollars. And when I asked him how much free cash flow they're thinking about generating, you know, per quarter in 2026, he said probably 25 million Aussie, which is he he said around 16 million US. I I I have not put that into a calculator, but if that's right, you know, you have 100 million in the bank right now with no debt. You've got another 64 million US coming in the next 12 months with no debt. Like they're probably going to end up acquiring someone else, but currently they have three producing projects. So, like that's the kind of thing that's exciting. The stock's at 67 cents as we record this. Um, I don't know how, you know, it's so cheap. He doesn't know how it's so cheap. Um, but, you know, those are the opportunities as a value manager that you're going to be seeing, you know, seeing as we as we move forward. On the silver side, um, we just met with Aftermath Silver for lunch yesterday. Michael's really, uh, excited about his ME, um, is coming out here like in a in a month. Um, and basically he thinks he's going to put up a lot more silver than the market thinks. One of the things that's interesting, Jesse, is is like the the shock at lunch was when you look at his uh presentation deck, he's talking about silver ounces. He's not talking about silver equivalent. And that's what a lot of companies will put in their deck, the silver equivalent, which isn't cheating. It's just how they report it, right? But when you're talking about like 140 million ounces of silver plus all the copper he has plus all the manganesees which is 99.9% battery grade. He said it's like I mean I I don't want to throw out a number. Let's just say it's it's not even close to 140 million. It's over 500 million ounces of silver equivalent. So it's like just a huge number. And the stock's at 57 cents today. So I don't I don't know how the market's up for for gold and silver and the stock is down today. But we bought more today in full disclosure um coming out of that meeting because you know Eric Spratt and him are are are good friends. Eric put in a lot of money into Aftermath. It's actually his third largest holding. Um the ticker is AAGF and AG in Canada. >> Well, let's talk about some commodities outside of the gold and silver markets. You mentioned tungsten. would love to hear your thoughts on the macro for tungsten and why you're bullish there and any other commodities that you're currently watching that you think have upside up ahead and and any companies related to those commodities that you think are worth taking a look at. >> Okay. Sure. Well, we've talked about Guardian Metal on your show at least two or three times. Um that one is GMTF in the States and it has no Canadian counterpart. Has a London ticker GM. Um, so the interesting thing with them is we got involved through a referral in the fall of 2023. Stock was at 15 cents US. It had a 10-cent bid and a 20 cent ask. And this is not unusual when you get listed on the OTC. Um, you have a huge spread for a couple of weeks sometimes. Um, and then hopefully, you know, people place orders into that spread and it starts to narrow. And today the thing trades with like a two-cent, you know, bit ass spread. It's really great. But back then in the in the dark ages it was it was not great in terms of how to buy it and sell it. Um we've just been accumulating it on dips. Honestly, Jesse, it it they it just came out with a news a few weeks ago saying that they um were awarded a $6.2 million US check from the DoD. Um what people don't understand is that when you get that check, it opens doors to the DOE and to other US government, you know, departments. And that's the exciting thing for for a company that was like a you know a very very small micro you know micro cap just a year and a half ago. Um so then they came out with news uh like two weeks ago saying oh by the way the billionaire guy that we've referred to in our press releases is Stan Ducken Miller. So Stan Ducker Miller now owns 15% of GMTLF. Um, which is pretty huge because he doesn't need to sell and and they have a New York fund in the pro in in the stock that doesn't need to sell. And then we're not selling. All my followers aren't selling, right? And the stock's at a$110 now. Um, so, you know, going from we we got in at 17 and a half from 17 and a half to a$110. It's been like amazing run for us. And and that is our largest equity position right now. Um, we just let it appreciate, right? Um, outside of tungsten, uh, there with Guardian in Nevada, um, there's American tungsten, which, um, we did not meet with here. Um, that's TU NGF in the States and TUNG in Canada. Um, I'm going to be watching that one more closely because they are a pass producer in Idaho. Idaho is a good jurisdiction in my view. um it kind of flies under the radar in the states and um they're probably six to nine months away from a government check. You know, I know they've already proposed this to the White House like it's on their desk, so to speak, but this process uh Jesse usually takes 16 to 18 months. Like it's brutal. And then when Trump reshuffled the deck in Q1, a lot of the people that my mining companies were talking to got fired. So you had to start over. Uh, it's crazy, but true. So, so I think that that's kind of the value under the radar here is that you can still buy some of this stuff before they get awarded a check. One I think is getting a check relatively soon is Stillwater, um, which is PGZF in the States and PGE in Canada. I'm having dinner with them tonight as well. They're going to be at the Metallic Dinner. So, um, I'll get a better sense. But the reason I say that is that I introduced Mike to some people in April of 2024 in DC when we were there together. So he has taken that ball and run with it and now has developed really strong relationships with uh some people in US government but also in Montana in his home state. So um lastly, I'll give you another Montana play because I think you know Montana is becoming more and more supportive and that one is Helix Exploration which I've never mentioned uh anywhere before. Um that one is HH exf um otherwise and it's doing good volume. They raised money like real easy um a couple of week a couple of months ago um and and they're basically helium production in Montana. So, I'm not claiming to be a helium expert, but you know what I see as a commodities guy is is I'll have to take a couple dozen hours to learn tungsten, right? A couple dozen hours to learn antimony. And now this company approached me as a referral and said, "Hey, you know, we're like in Montana. We know you have a big position there already. We're going into production in a month." So, like it's it's, you know, regardless of the commodity in a hot commodities market. I'm interested. and u the metrics work like they they kind of walked me through the free cash flow model and it looks tremendous. So that's trading at 30 cents US right now. Um so there's still such good value in our sector as we as we record this. >> A lot of the names that you discuss uh could be considered on the riskier side of the mining stock equation, smaller cap uh particularly compared to the big producers and royalty streaming companies. How do you advocate for mitigating that risk? Is it a matter of position sizing, keeping your largest positions in the in the bigger producers or in an ETF and then speculating on smaller companies with smaller amounts of capital? Is it also a matter of really understanding the companies you own? What are your thoughts there? >> Yeah, so we we proactively get on the phone with CEOs every week. I talked to 15 last week. I've met with 25 here in two and a half days. Um, I'm constantly trying to understand public news so that I can relay that message to uh my my followers using that daenarius example, right? Where you get a press release, it says we're doing a financing for x amount of million dollars through life and then people see the stock dip and they get scared, right? So having those conversations and being able to articulate that to my clients is super important for me. Um, and we'll continue to do that. We have a real-time email service that does that regularly. Yesterday, another stock called Norsemont, right? Uh NRRSF messaged me and said, "Hey, we just saw a 500,000 share block in Europe cross the tape on the short side." Um and the stock was down 8% at the point at that point of the text. The stock went all the way back to close like pretty much flat yesterday. So, that's the kind of market we're in now. anyone who wants to play games with these stocks who used to game them which clearly there there was that ability that ability now is that door is closing and and and it it's great to see because these CEOs work so hard like I mean everyone here uh I I've met with a couple guys that have 40 to 50 meetings in three days like it is not an easy road in in in the mining space um but to answer your question we we use a hub and spoke struct uh structure Jesse which means will use GDX and J as the hub along with SILJ, SIL and SLVP. That whole thing is is over 20% for us. So those are all producing companies. I don't have to think, oh, is CDE better than AG? Like I I don't want to do that. Um so yes, we do have positions in individual producing names like Agnico, which have just kicked, you know, you know what. So I'm not I'm not um worried about that. I don't lose sleep over that. In fact, I don't lose sleep anymore as I go down in capitalization either. I used to. But even some of the ones that I was concerned with, you know, for a time there in terms of how the price action was reacting to the news, like Nex Gold, we met here at the conference as well. Um, NXGCF in the States and NEXG in Canada. I mean, they're real close to a permit and the market, you know, is starting to recognize this. You can see it on the chart, Jesse, when we when we get done here. Take a look. I mean, it's gone from 50 cents US to 90 cents US in a month. So, I mean, this is this is the opportunity. They have 7 million ounces of gold in the ground and now they have two projects with three plus million that they can decide, do we, you know, build this one first or build that one first, which is which is great. So, um yeah, it's it's uh yeah, that hub and spoke structure we've used literally since inception. We we we see the value in owning producers unlike a lot of our competitors um because you have to have producing exposure right now with gold at this price. >> Yeah, that makes a lot of sense. I want to end with discussing the broad market as you touched on it earlier. Um obviously gold and silver miners as we've been discussing have been destroying the big indices but the mainstream press I think most people on both Wall Street and Main Street are still focused on the MAG 7 chasing these overvalued tech stocks. You know, you mentioned that the the market's running on air. I think quoting Steph Palm. Uh I think that that is a sentiment that a lot of guests on this show share, but yet we continue to see this these big tech stocks slowly grind higher, making new all-time highs and the the S&P and the NASDAQ. Um how how much longer do you think this can go on for? And what are the signs that you're watching that make you believe that we're in far too high levels of valuation at this point? >> Well, one of the things I said on stage is, you know, the Russell 2000 has obviously 2,000 stocks. Guess how many of those stocks have actual earnings, less than a thousand. You know, it's pretty crazy that all these financial advisors use IWM, the ETF, you know, to get exposure to small caps and half of the names don't even have earnings. Like, it's it's really like terrible that that you you know you know use your brain and buy some exposure that isn't like you know the herd mentality right um and honestly our website talks about the Russell because it is the most aggressive US indicy so I don't choose something easy to bench against and we're crushing the Russell on on our performance um so I'm doing it with a lower beta I would argue because I've been carrying 8 to 13% cash up until recently all year so you know we're not out there yes we're in riskier names like you pointed out, but riskier risky is like something you have to define, right? Like for me, I think we'll get 10 to 15% pullbacks in the mining space. I do. It's not going to be a straight line up. Um but 15% off to me would be a gift, right? Because we're still in the framework of a of a bull market, so you have to buy those dips. Um Liberation Day was one of those opportunities for investors, right? um you had silver down on that Thursday and Friday over 12 and a half% not silver stocks, silver, you know. So now everyone wish they bought that dip into the 29 range or wherever it went, right? Um because we're at 41 and and we're moving to 50. So it's it's just it's been a tremendous year. I feel blessed. Um I I just can't believe that that this is happening finally. Um you know, it's it's been a long road. But to answer your question, like the serious money is still in the broad market, right? And so that's where I I always tell people, go to your financial advisor and ask hard questions right now. Like what's your path for the next 12 months? I'm happy that you did all this for me. Thank you. But like what what does the next 12 months look like? What they look like to me? I don't go and give 12-month, you know, views. I always do things kind of like three to six months, Jesse. But like it's clear to me if we don't get love from the Fed on September 17th, it's going to be a tough road for the broad market pretty early. Like it's not you're not going have to wait very long to see volatility. Um and that that's coming next week. So yeah. Um and then if you know I got this question too on a recent podcast like what happens if Lisa or Jerome get removed you know from their office? Well, I I don't know what that would look like, but if if the Fed chair got taken out by Trump, you can be sure. Um, gold and silver might dip initially on margin calls, same with GDX and J, but they would rocket higher after that because you'd have a crisis of confidence to deal with and the broad market would tank. So, um, yeah, the thing is most people are greedy, Jesse. This is more greed than 1999 into 2000 uh by far in my opinion. Like it it's just time to to be realistic and and to look at what you have and be thankful for it. >> Well, John, this has been a fantastic conversation. Tell us about Fenic Consulting. >> Yeah, sure. I literally started my business six years ago tomorrow um here at Beaver Creek. I presented to a group of CEOs and three of them came up to me and said, "Hey, that was really good. you should be an analyst for or a consultant for for mining. So I I went back that following Monday with no clients and started that. Um and then you know kind of kind of had a tough road for the first three months. It's hard starting a business when you're in you know working for like the Merrills and the JPs for for most of your life and and pretty pretty uh consistent income, right? Um but then with the February and March selloff of 2020, I identified that direction um which is a large ETF provider wasn't able to keep up with the triple um up um um ETFs that replicated GDX and GDXJ. And I called them four or five times for comment crickets. Uh, so I wrote an article for Kiko about it and it just exposed the fact that they were slipping. Um, and two large podcast hosts like yourself hit me up the next day and said, "Hey, that took a lot of guts. Can you come on my show?" And I had never done a podcast before. So, um, now I'm doing about 10 of these a month. Um, I'm speaking all over the world. It's it's just been life-changing for me. I'm very grateful. So, um, yeah. So, we have a real-time email service. We have phone calls that people can buy with me uh directly, not my staff. Um I basically just, you know, talk to people. Like I just got an email from a really nice younger guy who said, "My mom's kind of crazy and she owns like all this stuff like the S&P and the NASDAQ and doesn't understand anything about what you're talking about. Can can we talk for an hour?" And and so that's great, right? Like if I can help a family like that um you know, and make some income, great. You know, like why not? Um, we don't say buy, sell, hold on those calls, Jesse, because legally you're not allowed to do that without a license, and I gave up my license a couple years ago just because of my consulting um business. But yeah, the real-time emails are huge. Like yesterday, we said, "Hey, PPI came in with a big miss, but market seems to be okay with it, right?" And GDX and Jay were both up to over 2.3% yesterday. So, if you're getting that email in your inbox pre-market, super valuable, right? because you know what I'm thinking about what just happened. And then CPI, same thing this morning. You know, came in in line with numbers, but still inching towards that 3% level. Um, and uh, yeah, I I I think to me it's always like a puzzle, Jesse. You know, these are all pieces of the puzzle. August 1st, non-farm payrolls was the first one. August 22nd with the Fed second one. Now you've had non-farm payrolls and CPI the last two weeks. And now you've got the Fed September 17th. If the Fed really has our back and cuts 50 and then says some doubbish things, it's it's going to be go time in our sector even more than I'm anticipating. So I'm hoping for the best. >> Great. Well, I'll put a link in the description below to Fenic Consulting for people who want to check that service out. Thank you once again, John. It's been a blast. >> Great to see you, Jesse. Thank you. >> And thank you for joining us today. The sponsor of this episode is Arc Silver Gold, Osmium. Take advantage of their specials right now. Silver kangaroos 2023 1oz coins only $247 over spot. Silver maple leaves 2025 1oz coins just $2.87 over spot while supplies last. Reach out to owner Ian Everard today at 3072649441 or by email at ianarchcsggo.com and make sure to tell him that commodity culture sent you. 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'3rd Inning' for Gold & Silver Miners – These Stocks Set to EXPLODE Higher: John Feneck
Summary
Transcript
Hello and welcome into Commodity Culture where our goal is to make you a better investor in the commodity sector. My name is Jesse Day and on this episode I'm excited to welcome John Fenick to the program, a veteran of the finance industry with stints at Meil Lynch, JP Morgan Chase, Spratu, and more. He is currently the founder and CEO of Fenic Consulting. Both gold and silver mining stocks are on an absolute tear recently, but John thinks we're still in the early innings of what he calls a generational opportunity. John shares the names he's currently invested in in the sector, including some recent additions to his portfolio and one name that he is mentioning for the first time on this show. We also talk about why he's bullish on tungsten, why the broad market is set for a big correction ahead, and so much more. So, strap yourselves in for my conversation with John Fenick. John Fenick, great to have you back on Commodity Culture. Obviously, very exciting times for precious metals markets right now. I want to start by honing in on gold because here we are, new all-time highs, breaking above 3,600 after a 4mon consolidation. What do you make of this breakout and are we still in the early stages of this gold bull market in your view? >> Thanks for having me, Jesse. Um, yeah, I I would say we're not in the early stages. I mean, gold, if you look at GLD, for those that, you know, want to look at a chart, um, has been ripping for months and months, right? like September 22 was September 2022 was the low for GDX and J and gold was probably 1,600ish then you know I mean like it's doubled since then so anytime a commodity doubles um you know you have to look at the RSI the relative strength index you have to do these kind of things different metrics to make sure and check your thesis we do this in a bull run like this I'm doing this every day I'm not kidding like I'm not like taking one day off from checking myself and you know I sold something yesterday with an RSI of 84 like once you get above 70 it's sort of like you start thinking about selling then 75 to 80 in a rally is sort of there I mean just to give your listeners some perspective when we went on camera the RSI is at 76 on gold so like it's already elevated but it's elevated for a reason you know the the the US economy is starting to to turn over and we can talk about that as we move forward. But you know keeping on gold look I mean a lot of the banks have acquiesced right they started to do this first quarter of this year 30 3,00 3200 3500 targets now those targets are more like 3500 to 4200 and sitting here let's say at a round number of 3600 you know you've got a lot of upside to 4200 I don't even know what $600 in gold means to most of the gold stocks I own but it means very good things >> and do you think that I want to pull on one thread there because you mentioned the economy and obviously gold is a commodity but it's also a monetary metal. Some people would just consider it as money. Does that factor in at all to the potential for gold to perhaps not behave like other commodities when it's seemingly overbought and to continue climbing in the face of devaluing fiat currency, rising debt and deficits and all of the problems that we have going on in the US and global economy at the moment? >> Yeah, it's a good point. Um, look, I hope I'm wrong. I I always say that because um I I want the the 4,000 target. I want the 5,000 target. Um you know, we had three targets this year at 3,200, 3,500, and 3,800. Um we missed our target last year by eight bucks. So, we're pretty like, you know, down the middle as far as our estimates go. We don't try to be sensational because I think the targets we hit this year are fantastic, right? Like you don't need, and we just proved this in earning season. We don't need 4,000 gold for Pneumont, Agnico, etc. to do well. >> Yeah, that's a great point. I wonder what your thoughts are on the Fed switching to the US economy here. They're seemingly abandoning their 2% inflation target. At least we don't I mean, Powell's using Fed speak here. We kind of don't even know what he's saying sometimes. But in the last Fed meeting, he seemed to indicate we're going to be changing our policy. Trump obviously declaring on social media that inflation is at zero as he continues to push Fed Chair Powell into lowering interest rates, giving him the nickname too late. Um, I wonder what your thoughts are here on this whole fiasco. And if rate cuts do start being implemented, what do you think the effects would be on the gold price? >> Well, I do think rate cuts are going to be implemented starting September 17th. No question. However, how big is that and how what is the path for the Fed going forward is really the question investors need to be asking. A 25 basis point cut is already baked into the broad market as well as gold and silver. If we get more than that, that would be bullish. Um, if we get Powell to show us a path to 2026, you know, that would be bullish. Remember, Jesse, last year, um, around this time we were all talking four rate cuts for 2025. I was on your show, right? We we talked about that. Um then in December after the Fed meeting, it became three rate cuts and people were like, "Okay, that that's fine." But then it became two rate cuts pretty quick and now we're looking at one or two um between now and the end of the year. So, um, I think that rate cuts obviously are going to be bullish for the broad market, bullish for gold and silver, but I would argue that the broad market is uh, as Steph Pomboy says, just floating on air. Like the broad market has rallied since March of '09. like you know um my message to investors is look at your 401k statement over the last 15 and a half years and ask yourself a tough question which is was this my expertise or is this partially luck or all luck right I mean like you have to start taking some money off the table if you're in the NASDAQ and some of these aggressive ETFs you know I just cringe when I start to see some of this stuff on client statements or when we do a phone call together they mention this stuff and half of their net worth's in some of this stuff and they're 70 years old right like The S&P right now is 45.41% tech as of August 31st. Like you do not want half of your, you know, equity exposure in a 401k. Um, you know, half of that being 25%, right? If you have a 50% waiting in the spy, uh, in technology, like at that age, right, you have to be smart about it. >> And now a quick break to hear from our sponsor. Arc Silver Gold Opium. owner Ian Everard is considered one of the most honest and levelheaded gold and silver dealers in the United States. Praised even by his competitors. So give him a call today to take advantage of the specials right now. Silver kangaroos 2023 1oz coins mint fresh only $247 over spot. Mint fresh silver maple leaves 2025 coins 1 oz $2.87 over spot. while supplies last. Reach out today at 3072649441 or by email at ianarchsggo.com and make sure to tell him that commodity culture sent you. And now back to the interview. Yes, absolutely. In the broad market looking very overvalued by a number of metrics. We're going to dive a little bit deeper into that later. But firstly, I want to talk about silver also putting in a fantastic performance up over $41 at this point. A lot of people are talking about $50 silver before end of the year. I know your partner and friend Don Durret has been talking about that in some of our previous conversations over on the VR media channel. Do you think that's a realistic target? And what are your overall thoughts on the silver sector here? Yeah. So, uh, on your show last year, even though silver was my largest holding, uh, physical silver and SLV or any of the ETFs out there, um, you know, uh, we never talked about it breaking 30 ever. We, in fact, said it wouldn't break 30, but we were going to be patient. So, we added to silver last year five times, you know, um, from 23 an ounce all the way to 30 when it broke out, right? And then we stopped adding to it. We're just we're just riding it now because it's a 10% waiting in our portfolio. You know, that's a lot. So, yeah, I have every incentive to tell you silver's going to 100. I'm not going to say that. I think at 41 you've got some resistance between 42 and 43. We keep knocking on that and it's sort of just fluctuating right now. We have to get through that level, but honestly, after that, it's all the way to 50. What Don Durret and I talk about though is that 50 is not really the target here. 50 is an old target given that you have to inflation adjust and that would get you closer to 68 to 70 an ounce. So that's really our target for for next year. Um we think 50 could be achieved by say January. Um and believe me if the Fed is more uh doubbish that will be accelerated right. So, um, silver's looking great. The silver equity ETFs are looking great. You know, SIJ is the equivalent of GDXJ for silver miners and it includes a lot of the mid tiers like Core, First Majestic, etc. Um, that thing is cranking right now. It's up, I think, 80 or 90% year-to date. But what's interesting is that ETF didn't start SIJ until I believe January of 2013. So, you don't really have as an investor a way to look back and see how that thing would have performed in 2010 or 2011, right? But I'm telling you, it's going to be higher than the chart uh the historic chart is. And so, that's what we expect. 23 was the all-time high, I think, on SLJ roughly, and now we're over 20. So, we think 23 is an easy target going into next year. Um, if you want, I can go through some of the other ETFs while we're on the subject. >> Yeah, please do. >> Okay. So GDX is the largest, you know, name out there. It's got over 15 billion US in it. Ban has run it for many years. What's interesting about GDX is that it already has touched and eclipsed the high right from a decade plus ago. Um then GDXJ is the really interesting one which is our second largest holding behind silver. Um in that we're trading around 86 87 or something. Um the all-time high is 179. It It's just mind-blowing. So, you know, you have to go back and look at those 15 to 20 year charts and say, "Wow, this thing still can run." When Don Dret and I were on stage here at Beaver Creek a day ago, we got, you know, a question about like, you know, is this bull run over? And we're like, no, this is like the third inning maybe of of the equity run because the producers have run, yes. The mid tiers have started to run, yes. But then a lot of the mid-tiers still haven't moved that much and the juniors haven't moved much at all. I mean, it it really just depends. The positive thing I'm seeing on the junior side is that the the volume is really picking up. Like I get that question more from high net worth investors uh more than anything. Like if I get into this thing, how do I get out? It's a valid question. Some of this, you know, some of these stocks trade by appointment. So, um, now we're seeing like 5x, 10x volume on some of these juniors and and we started to see that really since August 1st. Um, August 1st was kind of a key day for Don and I in that um the the non-farm payrolls read was bad, but they also revised down the previous two months and that wasn't a small revision. That was 258,000 jobs lost. So, like that for me was like the all-in moment. And then Powell came in August 22nd on that Friday and was doubbish. And then we put like the rest of our money to work, right? Right. Like we we have frictional cash at this point in our portfolio. >> Well, let's dive deeper into the gold and silver mining space because you mentioned there's some very interesting statistics. Obviously, SIL and GDX are both up over 90% year or GDX and SIL. Yeah, both up over 90% year to date. This is obviously a massive outperformance over the broad market. Yet, that seems to be where Main Street and the mainstream financial media is still focused. as you mentioned, dealing with some people you were talking to who have so much of their net worth in these overvalued tech stocks. Um, so I guess similar question to before you're saying we're in the third inning when it approximately when it comes to precious metals miners. Where are you deploying capital when it comes to the gold and silver mining space? Where do you think the most lucrative opportunity lies? Is there still a lot of opportunity in the Agneo Eagles, the numance in the barracks? Um, are you going further down the chain looking at developers and explorers? What are your thoughts there? >> Yeah, we have a pretty balanced approach between those three buckets that you just named. Um, near-term production developers are even more interesting. Like I just had dinner last night with Daenerius Metals. Um, it's DNRSF in the States, DME in Canada. You know, uh, Jesse, there's this new type of financing out there called life. I don't know if you're familiar with it, but it's kind of detrimental to some of these stocks because it allows the buyer of shares to immediately sell them if they wanted to and keep the warrant. Right. That is a common thing in our sector, which we don't do. >> Yes. >> Um but um it really puts artificial pressure on shares. Um you saw this with Guanowato Silver. They just did one for 20 million bucks, much bigger than Daenerius's. Um, and that thing was underwater until Don mentioned it on the market sniper and the stock went up 25% one day. So, I mean like it's this is like go time. You have to figure out a strategy and buy something and and buy a basket of something. And that's why we kind of stressed, you know, Jesse, that you know, Don services, my services are all very affordable in the context of a bull market, right? Maybe two years ago you couldn't justify it. If you're not if you're not aligning yourself with someone like us right now, you're making a huge mistake. This is like lifetime generational opportunity, you're not going to get the same opportunity. I don't I don't think it lasts 10 years like Don. I think it lasts two years, you know, like from here because if you look at the chart of GDX and J from September of 2022, that was the bottom, right? It wasn't this year. It bottomed there. So like you're looking at already a three-year run. Um which a lot of people miss. So yeah, Daenerius Metals, you know, they they they were talking about this at dinner. They were saying, "Look, we got bombed out like we lost, you know, 25% of our market cap because we did one of these financings." And I put out a note to my followers. I have a real-time email service after I got off the phone with the chairman and I just said, "Hey guys, like this is artificially low. This is there's nothing wrong here. There's, you know, we should we should be putting a position on into something like this that just went into production." You know, Don and I pointed out on stage here as well, there's less than 200 producing miners and Daenerius is one of them. So, how is this thing trading at 37 cents as we record this? You know, like that's the opportunity that's like worth, you know, probably 50 to 60 cents by accident by year end, right? Like that's just uh you know, we don't always go for the home runs, Jesse. You know, Don's more like the home run guy. He he he's calculating 5,000 gold and $100 silver into all of his, you know, comments when when you do do hear him talk. And I'm always just looking at the near- term, right? I'm looking at 3, 6, 12 months. How can this develop? Because I find that most high net worth clients are, they don't have patience. They're not going to sit around and wait for three years for something to work, especially when tech is doing what it's doing and Bitcoin is doing what it's doing and real estate is doing what it's doing. There's too many opportunities. So, um, yeah, uh, that's one that we like, um, in the kind of developer going into production, uh, category. Um, do you want me to go through a couple more now or? >> Yeah, but before you do, I just wanted to pull on that thread regarding these financings where people immediately sell their shares and keep the warrants. I've heard this called warrant sniping before as well. What What's the solution to that? Should companies avoid those type of financings? altogether because I've seen several examples of this happening and like you mentioned 20% drop in the market cap of the company that's very normal when those sorts of situations occur. Should should that incentive be taken away when doing a financing in your view? >> Um this is a newer type of financing. I don't think it's going away. It's extremely popular. I've just seen it happen now on the two stocks I mentioned along with maybe three others and every single situation there's a drop for somewhere between one and four weeks. It's pretty brutal. you know, it's not like you could even appreciate out of it easily. Um, so I guess the argument from the CEO's side would be, hey, we need to raise money to drill and that's it, right? Like this is a capital intensive business. And I understand that. But what I encourage people to do when your stocks bombed out, like don't do a5 to$10 million raise here. Do a one to two to $3 million raise and do a non-broker deal potentially where you go out there and talk to people like myself. I' I've been the lead orderer myself in two deals in the last 30 days, you know, where I'm I'm happy to come in and I don't need a full warrant. I'll take a half warrant or no warrant sometimes if it's like a tungsten play where I know I have conviction. Um, and I know it would take me like two weeks to build that kind of a position in the in the open market, right? As opposed to just writing a check at once. And that's where financings are helpful, Jesse, to high net worth people is they don't want to sit on the bid, you know, all day and try to get filled on some of these juniors. interesting. Let's continue on with some other names you're watching or investing in right now when it comes to the gold and silver mining space. >> So, um having dinner tonight with Metallic Minerals. Um I have no idea what the update's going to bring, but I I know that they have a project here in Colorado, not far from where the conference is. They're doing a due diligence meeting this week. So, they'll probably have some analysts out to site. Um they're excited about what's happening at Llata there in Colorado. Um they also just recently did a financing. Guess what? It was life. Um I talked to Greg about it. He's not going to do another one of these probably because of what happened. But again, that was like something we put out to people. Hey, you know, the financing was let's say 1718 US. Stock got to 14 during the financing and I'm just like this is crazy. You got to buy this here. And now it's a 20 right as we record this. So um it's still not much above the the financing. So that's that's the opportunity in our sector. pull up a five-year chart or a 10-year chart on that stock and there's a ton of upside. Um the other piece that they have is in the Yukon. So the Yukon's gotten a black eye this year because of Victoria, right? Um that's a mistake because every company is different. Some of these companies are based 200 300 miles away from Victoria. Like there's nothing that would be to to worry about. But yet people do this, right? Um so they have two ways to win with this stock. You could do the copper uh you know forward thing in in the US or you could do the silver forward thing in the Yukon and Pneumont owns nine and a half percent and they just bought more in the financing. So, you know, when you have a big boy in the stock already, whether it's 9% or 15 or 20, it's always a nice vote of confidence for me. Like I I know that they have dialogue with someone who could buy them in a bull market already, right? That's always a plus. Um I um let me think here on the gold and silver side. Um yeah, so there's another stock that um we we're going to meet we just met with yesterday. It's called uh Alcane. So it's ALKF in the States, Alk in Canada. And these guys were an Aussie based company. Um they acquire they merged with Mandandalay. Um Mandandalay was a super cheap um stock that had a really good balance sheet. That's what attracted me originally. They had about 80 million in cash and zero debt. Well, that's now 96 million as of like re like August in cash in the US in US dollars. And when I asked him how much free cash flow they're thinking about generating, you know, per quarter in 2026, he said probably 25 million Aussie, which is he he said around 16 million US. I I I have not put that into a calculator, but if that's right, you know, you have 100 million in the bank right now with no debt. You've got another 64 million US coming in the next 12 months with no debt. Like they're probably going to end up acquiring someone else, but currently they have three producing projects. So, like that's the kind of thing that's exciting. The stock's at 67 cents as we record this. Um, I don't know how, you know, it's so cheap. He doesn't know how it's so cheap. Um, but, you know, those are the opportunities as a value manager that you're going to be seeing, you know, seeing as we as we move forward. On the silver side, um, we just met with Aftermath Silver for lunch yesterday. Michael's really, uh, excited about his ME, um, is coming out here like in a in a month. Um, and basically he thinks he's going to put up a lot more silver than the market thinks. One of the things that's interesting, Jesse, is is like the the shock at lunch was when you look at his uh presentation deck, he's talking about silver ounces. He's not talking about silver equivalent. And that's what a lot of companies will put in their deck, the silver equivalent, which isn't cheating. It's just how they report it, right? But when you're talking about like 140 million ounces of silver plus all the copper he has plus all the manganesees which is 99.9% battery grade. He said it's like I mean I I don't want to throw out a number. Let's just say it's it's not even close to 140 million. It's over 500 million ounces of silver equivalent. So it's like just a huge number. And the stock's at 57 cents today. So I don't I don't know how the market's up for for gold and silver and the stock is down today. But we bought more today in full disclosure um coming out of that meeting because you know Eric Spratt and him are are are good friends. Eric put in a lot of money into Aftermath. It's actually his third largest holding. Um the ticker is AAGF and AG in Canada. >> Well, let's talk about some commodities outside of the gold and silver markets. You mentioned tungsten. would love to hear your thoughts on the macro for tungsten and why you're bullish there and any other commodities that you're currently watching that you think have upside up ahead and and any companies related to those commodities that you think are worth taking a look at. >> Okay. Sure. Well, we've talked about Guardian Metal on your show at least two or three times. Um that one is GMTF in the States and it has no Canadian counterpart. Has a London ticker GM. Um, so the interesting thing with them is we got involved through a referral in the fall of 2023. Stock was at 15 cents US. It had a 10-cent bid and a 20 cent ask. And this is not unusual when you get listed on the OTC. Um, you have a huge spread for a couple of weeks sometimes. Um, and then hopefully, you know, people place orders into that spread and it starts to narrow. And today the thing trades with like a two-cent, you know, bit ass spread. It's really great. But back then in the in the dark ages it was it was not great in terms of how to buy it and sell it. Um we've just been accumulating it on dips. Honestly, Jesse, it it they it just came out with a news a few weeks ago saying that they um were awarded a $6.2 million US check from the DoD. Um what people don't understand is that when you get that check, it opens doors to the DOE and to other US government, you know, departments. And that's the exciting thing for for a company that was like a you know a very very small micro you know micro cap just a year and a half ago. Um so then they came out with news uh like two weeks ago saying oh by the way the billionaire guy that we've referred to in our press releases is Stan Ducken Miller. So Stan Ducker Miller now owns 15% of GMTLF. Um, which is pretty huge because he doesn't need to sell and and they have a New York fund in the pro in in the stock that doesn't need to sell. And then we're not selling. All my followers aren't selling, right? And the stock's at a$110 now. Um, so, you know, going from we we got in at 17 and a half from 17 and a half to a$110. It's been like amazing run for us. And and that is our largest equity position right now. Um, we just let it appreciate, right? Um, outside of tungsten, uh, there with Guardian in Nevada, um, there's American tungsten, which, um, we did not meet with here. Um, that's TU NGF in the States and TUNG in Canada. Um, I'm going to be watching that one more closely because they are a pass producer in Idaho. Idaho is a good jurisdiction in my view. um it kind of flies under the radar in the states and um they're probably six to nine months away from a government check. You know, I know they've already proposed this to the White House like it's on their desk, so to speak, but this process uh Jesse usually takes 16 to 18 months. Like it's brutal. And then when Trump reshuffled the deck in Q1, a lot of the people that my mining companies were talking to got fired. So you had to start over. Uh, it's crazy, but true. So, so I think that that's kind of the value under the radar here is that you can still buy some of this stuff before they get awarded a check. One I think is getting a check relatively soon is Stillwater, um, which is PGZF in the States and PGE in Canada. I'm having dinner with them tonight as well. They're going to be at the Metallic Dinner. So, um, I'll get a better sense. But the reason I say that is that I introduced Mike to some people in April of 2024 in DC when we were there together. So he has taken that ball and run with it and now has developed really strong relationships with uh some people in US government but also in Montana in his home state. So um lastly, I'll give you another Montana play because I think you know Montana is becoming more and more supportive and that one is Helix Exploration which I've never mentioned uh anywhere before. Um that one is HH exf um otherwise and it's doing good volume. They raised money like real easy um a couple of week a couple of months ago um and and they're basically helium production in Montana. So, I'm not claiming to be a helium expert, but you know what I see as a commodities guy is is I'll have to take a couple dozen hours to learn tungsten, right? A couple dozen hours to learn antimony. And now this company approached me as a referral and said, "Hey, you know, we're like in Montana. We know you have a big position there already. We're going into production in a month." So, like it's it's, you know, regardless of the commodity in a hot commodities market. I'm interested. and u the metrics work like they they kind of walked me through the free cash flow model and it looks tremendous. So that's trading at 30 cents US right now. Um so there's still such good value in our sector as we as we record this. >> A lot of the names that you discuss uh could be considered on the riskier side of the mining stock equation, smaller cap uh particularly compared to the big producers and royalty streaming companies. How do you advocate for mitigating that risk? Is it a matter of position sizing, keeping your largest positions in the in the bigger producers or in an ETF and then speculating on smaller companies with smaller amounts of capital? Is it also a matter of really understanding the companies you own? What are your thoughts there? >> Yeah, so we we proactively get on the phone with CEOs every week. I talked to 15 last week. I've met with 25 here in two and a half days. Um, I'm constantly trying to understand public news so that I can relay that message to uh my my followers using that daenarius example, right? Where you get a press release, it says we're doing a financing for x amount of million dollars through life and then people see the stock dip and they get scared, right? So having those conversations and being able to articulate that to my clients is super important for me. Um, and we'll continue to do that. We have a real-time email service that does that regularly. Yesterday, another stock called Norsemont, right? Uh NRRSF messaged me and said, "Hey, we just saw a 500,000 share block in Europe cross the tape on the short side." Um and the stock was down 8% at the point at that point of the text. The stock went all the way back to close like pretty much flat yesterday. So, that's the kind of market we're in now. anyone who wants to play games with these stocks who used to game them which clearly there there was that ability that ability now is that door is closing and and and it it's great to see because these CEOs work so hard like I mean everyone here uh I I've met with a couple guys that have 40 to 50 meetings in three days like it is not an easy road in in in the mining space um but to answer your question we we use a hub and spoke struct uh structure Jesse which means will use GDX and J as the hub along with SILJ, SIL and SLVP. That whole thing is is over 20% for us. So those are all producing companies. I don't have to think, oh, is CDE better than AG? Like I I don't want to do that. Um so yes, we do have positions in individual producing names like Agnico, which have just kicked, you know, you know what. So I'm not I'm not um worried about that. I don't lose sleep over that. In fact, I don't lose sleep anymore as I go down in capitalization either. I used to. But even some of the ones that I was concerned with, you know, for a time there in terms of how the price action was reacting to the news, like Nex Gold, we met here at the conference as well. Um, NXGCF in the States and NEXG in Canada. I mean, they're real close to a permit and the market, you know, is starting to recognize this. You can see it on the chart, Jesse, when we when we get done here. Take a look. I mean, it's gone from 50 cents US to 90 cents US in a month. So, I mean, this is this is the opportunity. They have 7 million ounces of gold in the ground and now they have two projects with three plus million that they can decide, do we, you know, build this one first or build that one first, which is which is great. So, um yeah, it's it's uh yeah, that hub and spoke structure we've used literally since inception. We we we see the value in owning producers unlike a lot of our competitors um because you have to have producing exposure right now with gold at this price. >> Yeah, that makes a lot of sense. I want to end with discussing the broad market as you touched on it earlier. Um obviously gold and silver miners as we've been discussing have been destroying the big indices but the mainstream press I think most people on both Wall Street and Main Street are still focused on the MAG 7 chasing these overvalued tech stocks. You know, you mentioned that the the market's running on air. I think quoting Steph Palm. Uh I think that that is a sentiment that a lot of guests on this show share, but yet we continue to see this these big tech stocks slowly grind higher, making new all-time highs and the the S&P and the NASDAQ. Um how how much longer do you think this can go on for? And what are the signs that you're watching that make you believe that we're in far too high levels of valuation at this point? >> Well, one of the things I said on stage is, you know, the Russell 2000 has obviously 2,000 stocks. Guess how many of those stocks have actual earnings, less than a thousand. You know, it's pretty crazy that all these financial advisors use IWM, the ETF, you know, to get exposure to small caps and half of the names don't even have earnings. Like, it's it's really like terrible that that you you know you know use your brain and buy some exposure that isn't like you know the herd mentality right um and honestly our website talks about the Russell because it is the most aggressive US indicy so I don't choose something easy to bench against and we're crushing the Russell on on our performance um so I'm doing it with a lower beta I would argue because I've been carrying 8 to 13% cash up until recently all year so you know we're not out there yes we're in riskier names like you pointed out, but riskier risky is like something you have to define, right? Like for me, I think we'll get 10 to 15% pullbacks in the mining space. I do. It's not going to be a straight line up. Um but 15% off to me would be a gift, right? Because we're still in the framework of a of a bull market, so you have to buy those dips. Um Liberation Day was one of those opportunities for investors, right? um you had silver down on that Thursday and Friday over 12 and a half% not silver stocks, silver, you know. So now everyone wish they bought that dip into the 29 range or wherever it went, right? Um because we're at 41 and and we're moving to 50. So it's it's just it's been a tremendous year. I feel blessed. Um I I just can't believe that that this is happening finally. Um you know, it's it's been a long road. But to answer your question, like the serious money is still in the broad market, right? And so that's where I I always tell people, go to your financial advisor and ask hard questions right now. Like what's your path for the next 12 months? I'm happy that you did all this for me. Thank you. But like what what does the next 12 months look like? What they look like to me? I don't go and give 12-month, you know, views. I always do things kind of like three to six months, Jesse. But like it's clear to me if we don't get love from the Fed on September 17th, it's going to be a tough road for the broad market pretty early. Like it's not you're not going have to wait very long to see volatility. Um and that that's coming next week. So yeah. Um and then if you know I got this question too on a recent podcast like what happens if Lisa or Jerome get removed you know from their office? Well, I I don't know what that would look like, but if if the Fed chair got taken out by Trump, you can be sure. Um, gold and silver might dip initially on margin calls, same with GDX and J, but they would rocket higher after that because you'd have a crisis of confidence to deal with and the broad market would tank. So, um, yeah, the thing is most people are greedy, Jesse. This is more greed than 1999 into 2000 uh by far in my opinion. Like it it's just time to to be realistic and and to look at what you have and be thankful for it. >> Well, John, this has been a fantastic conversation. Tell us about Fenic Consulting. >> Yeah, sure. I literally started my business six years ago tomorrow um here at Beaver Creek. I presented to a group of CEOs and three of them came up to me and said, "Hey, that was really good. you should be an analyst for or a consultant for for mining. So I I went back that following Monday with no clients and started that. Um and then you know kind of kind of had a tough road for the first three months. It's hard starting a business when you're in you know working for like the Merrills and the JPs for for most of your life and and pretty pretty uh consistent income, right? Um but then with the February and March selloff of 2020, I identified that direction um which is a large ETF provider wasn't able to keep up with the triple um up um um ETFs that replicated GDX and GDXJ. And I called them four or five times for comment crickets. Uh, so I wrote an article for Kiko about it and it just exposed the fact that they were slipping. Um, and two large podcast hosts like yourself hit me up the next day and said, "Hey, that took a lot of guts. Can you come on my show?" And I had never done a podcast before. So, um, now I'm doing about 10 of these a month. Um, I'm speaking all over the world. It's it's just been life-changing for me. I'm very grateful. So, um, yeah. So, we have a real-time email service. We have phone calls that people can buy with me uh directly, not my staff. Um I basically just, you know, talk to people. Like I just got an email from a really nice younger guy who said, "My mom's kind of crazy and she owns like all this stuff like the S&P and the NASDAQ and doesn't understand anything about what you're talking about. Can can we talk for an hour?" And and so that's great, right? Like if I can help a family like that um you know, and make some income, great. You know, like why not? Um, we don't say buy, sell, hold on those calls, Jesse, because legally you're not allowed to do that without a license, and I gave up my license a couple years ago just because of my consulting um business. But yeah, the real-time emails are huge. Like yesterday, we said, "Hey, PPI came in with a big miss, but market seems to be okay with it, right?" And GDX and Jay were both up to over 2.3% yesterday. So, if you're getting that email in your inbox pre-market, super valuable, right? because you know what I'm thinking about what just happened. And then CPI, same thing this morning. You know, came in in line with numbers, but still inching towards that 3% level. Um, and uh, yeah, I I I think to me it's always like a puzzle, Jesse. You know, these are all pieces of the puzzle. August 1st, non-farm payrolls was the first one. August 22nd with the Fed second one. Now you've had non-farm payrolls and CPI the last two weeks. And now you've got the Fed September 17th. If the Fed really has our back and cuts 50 and then says some doubbish things, it's it's going to be go time in our sector even more than I'm anticipating. So I'm hoping for the best. >> Great. Well, I'll put a link in the description below to Fenic Consulting for people who want to check that service out. Thank you once again, John. It's been a blast. >> Great to see you, Jesse. Thank you. >> And thank you for joining us today. The sponsor of this episode is Arc Silver Gold, Osmium. Take advantage of their specials right now. Silver kangaroos 2023 1oz coins only $247 over spot. Silver maple leaves 2025 1oz coins just $2.87 over spot while supplies last. Reach out to owner Ian Everard today at 3072649441 or by email at ianarchcsggo.com and make sure to tell him that commodity culture sent you. 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