Mickey Fulp: Gold vs. Gold Stocks? Don't Conflate Them

TL;DR

The TSX V has shown a divergence from the price of gold in recent years, but there are three solvable problems that can help salvage it.

Transcript

I'm George Williams with the investing News Network and we're here at the PBA sea convention in Toronto joining me today is mercenary geologist make you folk hi Mickey it's nice to see you nice to you Georgia I really like your tie well you know I'm from Albuquerque so today I got my better call Saul outfit on all right Wow very Saul Goodman outfit... Read More

Key Insights

• 🧑‍🏭 The TSX V has diverged from the price of gold since 2011, and this can be attributed to various factors such as Fukushima and the commodities market downturn.
• 💦 Eliminating zombie miners with negative working capital can help improve the TSX V.
• 🍰 Reinstating the uptick rule can address the issue of algorithmic short sellers.
• 😃 Challenging the limitations imposed by big banks can also help improve the market.
• 🏅 Silver has not participated in the rise of gold prices, and the gold-silver ratio is near an all-time high.
• 🏅 Gold stocks may not perform well during market corrections, and gold explorers are especially high-risk.

Questions & Answers

Q: What are some reasons behind the divergence between the TSX V and the price of gold?

There are several reasons, including the impact of Fukushima, the commodities market bottoming out from 2013 to 2016, and the presence of zombie miners with negative working capital.

Q: Can the TSX V be salvaged?

Yes, it can be salvaged by addressing the three solvable problems mentioned, which are eliminating zombie miners, reinstating the uptick rule, and challenging limitations imposed by big banks.

Q: How can investors identify zombie miners on the TSX V?

Investors can analyze the financial statements and balance sheets of companies to determine if they have negative working capital, indicating they are zombie miners.

Q: How can the market be improved for gold miners?

Reinstating the uptick rule, which is being worked on by organizations like Save Canadian Mining, can help eliminate algorithmic short sellers that have negatively impacted the market. Additionally, reducing limitations on brokers and allowing them to recommend juniors and facilitate private placements can improve the market.

Summary & Key Takeaways

• The TSX V has diverged from the price of gold since 2011, and seven reasons for this were discussed during a presentation.

• Three of these reasons can be solved, including eliminating zombie miners with negative working capital, reinstating the uptick rule, and addressing limitations imposed by big banks.

• Investors can navigate through zombie companies by analyzing their financial statements and identifying negative working capital.