The former investment banker has always believed in gold, to the point he’s founded two bullion producing companies so far: McEwen Mining and Goldcorp. (Image provided.)
Robert McEwen, one of the gold’s industry’s best-known bulls, is predicting that the precious metal will continue to surge this year, closing 2017 much higher than today’s prices of around 1,290 an ounce.
The former investment banker, who for years have made bold predictions when it comes to precious metal prices, is sure that bullion will reach $5,000 an ounce, though, he warns, that won’t happen “immediately.”
“The metal is in an upward trend now and while it has years to go before it peaks, gold will continue to climb higher. It won’t be a straight line, but the direction is definitively up,” he told MINING.com.
The executive has never stopped believing in the shiny yellow metal. “Gold is money. It’s the ultimate currency. It’s a store of value that has gone for millennia,” he said, adding that it’s “one of those items” that investors should always have in their portfolios.
“If you don’t have interests in gold, you should give it serious consideration right now,” is his advice. So far, his faith in the metal has paid off. Low prices knocked him off the Canadian Business’ Rich 100 ranking in 2015, but last year, his company soared more than 170% as prices rose again and he made it back.
“Gold is money. It’s the ultimate currency. It’s a store of value that has gone for millennia.” — Robert McEwen.
“2016 was a very good year for McEwen Mining. The best,” he said. “The firm doubled its treasury size, without resorting to financing (we haven’t done that since 2013), selling royalties, borrowing money, selling metal streams, or incurring in debt,” he noted.
McEwen not only has positive cash flow but year to date, the stock is up 6% in Toronto (TSE, NYSE:MUX) and almost 8% in New York as of close Thursday.
On Wednesday, the company received fresh good news after Lexam VG Gold Inc. (TSX:LEX), a junior exploration company with four brownfield properties in advanced exploration stage, voted in favour of being acquired by McEwen.
The legendary mining executive knows how to take gold mining companies to the next level, having built Goldcorp (TSX:G) (NYSE:GG) into a major producer before stepping down as chairman and CEO in 2005.
Now, he’s working on expanding McEwen Mining Inc., with has producing mines in Mexico and Argentina.
El Gallo silver-gold mine in Sinaloa, Mexico. (Image courtesy of McEwen Mining)
As part of that plan, he aims to conduct further exploration on the assets inherited through the acquisition of Lexam, all of them located in the heart of Timmins Gold Camp, northern Ontario, Canada, one of the world’s most prolific gold producing regions, with over 70 million ounces delivered to date.
The idea, he said, is to move them towards construction as soon as possible. He also hopes to receive a permit for its company’s Gold Bar project, in Nevada, in the third quarter of this year, with construction to start shortly after, in Q4.
His goal is to take McEwen Mining to the Standard & Poor’s 500 Index, which groups the 500 largest companies that list either in the NYSE or NASDAQ. In order to qualify, the firm needs a larger maker capitalization.
McEwen said he expected to achieve that over the next three years with a combination of organic growth in production as well as mergers and acquisitions.
Gold prices, at least for now, are on his side. The metal stretched its rally into a third straight session Thursday, as losses in the US dollar lifted gold to its highest finish in more than five months, closing at 1,287 an ounce.
11 Comments
Mark edward marchiafava
In a congressional hearing featuring Ron Paul, Ben Bernanke said “gold is NOT money.”
esqualido
Yeah, but he went on to say “Well, it’s a store of value.” Exactly- and exactly what his FRN’s are not- or any of the fiat currencies as the poor people of India can sadly attest. But the most interesting part of the exchange, which seems to have escaped notice, was when Ron Paul asked if the Fed owned gold. That is indeed the $64,000 question, as the fact is they own what we like to think is “our” gold I(what a laugh). Their counsel replied, “No, just certificates.” Certificates- what is that supposed to mean? To me it means they indeed do have a claim on “our gold” which only makes sense, because that is what central banks are all about- the gold for them, and pieces of paper for you and me.
Bobb Lawrence
With the likely rise in the overall stock market, folks will have more disposable MONEY and the grab bag for good gold will go along with it, so it seems. Those who like jewelry will be able to buy more and head to their local Artists Markets and web sites that feature gold and silver jewelry, so we should see a gradual rise in both in terms of bullion prices, etc. Kona coffee which is like gold when it comes to hot beverages will rise in favor too! Now that I could love!
Fradreck Kunaka
Gold is not money but can be used as a medium of axchnge like any other commodity as long as the transacting parties are agreed the exchange is based on fair value.
Jose1972
I agree with you Fradreck, but gold is not just any form of exchange, its a universal form of exchange recognized the world over. You wont have any problems cashing a gold coin anywhere in the world, and can carry a lot of wealth in your pocket……..try that with a chicken.
Tailgunner
With all due respect, Robert McEwan doesn’t what the price of gold will be in ten days, much less at the end of the year, or a ‘couple of years’ from now. Not because he is stupid(he’s brilliant) but because he just doesn’t know. And the $5000/oz meme? I wish I had an ounce of gold for every time I’ve heard that over the last 4 or 5 years. Is he just drummin’ up investment enthusiasm, maybe, if he is I don’t fault him, that’s part of his job. BUT, IMHO, the price of gold will go up when TPTB allow it to and not until then. Pardon my cynicism!
Boy, wouldn’t $5000/oz be FANTASTIC!
esqualido
You would think, with $5,000 gold on the horizon, McEwen and every other insider would be crawling over each other to be the first to buy shares of MUX, but I can find no sign at U.S. brokerage web sites, or canadian insider.com, that any of them have, the past year, except at highly discounted prices (and most SEC-reported form 4’s have been sales. Wake me when they do.)
Slvrizgold
He already owns 1/4th or 1/3rd of the company.
Ronald West
It is inevitable that it will go much higher, even $10,000 is reasonable but you’re right, nobody knows when. But McEwen has a pretty good idea. And this time, the monkey-punchers won’t be able to stop it. They are quickly losing their grip on the manipulation ponzi scam and gold is being very resilient when it should be falling but isn’t. The reality is that every physical ounce that is produced is being mopped up.
Allen Weintraub
I have an interesting play on a mining and exploration company doing business in Mexico. Let’s talk if your intersted.
Allen Weintraub
Paul N. Gaudet
I like McEwen’s plan for Nevada. Friends of mine have claims in the Eureka area. Proven results that are estimated 200 k oz. gold. There is a unique opportunity for a JV partnership with their corporation. This company is permitted for water and mining to commence this summer/fall. please contact me if you are interested.