Mining’s old guard needs strong medicine
A new report details subpar investor returns in the mining industry over the last decade, particularly big cap diversified companies which have not adapted to new realities.
Rick discusses the surprising lack of volatility in the markets and with the various worldwide challenges one would expect it to be much higher. He is not optimistic when one looks at the collective balance sheets of governments with their underfunded pension plans and is acting on the assumption that the markets will get more volatile.
Watch Interview with Rick Rule
The truth is that you make money by being brave when others are afraid, and afraid when others are brave. Most people’s expectation of the future is set by their immediate past and for most their recent experience has been at least okay or spectacular. However resource stocks in the last months have been relatively painful, while some older investors understand that the markets shifting direction is just a “when” question.
In South Korea the newly elected president is advocating shutting down domestic nuclear production. Rick doesn’t know if that will work politically or what they will use instead for power, this us quite troubling for the uranium market in the near term.
Sprott is putting together a partnership for accredited investors, whose purpose is to assist companies by minimizing risks with rights offerings. Rick discusses the intricacies of rights offerings and how they are one of the fairest ways to raise capital without diluting investor shares.
Collin and Rick discuss the upcoming Sprott Natural Resource Symposium taking place in Vancouver on July 25th-28th. Many interesting speakers such as David Stockman, Robert Friedland and Jim Rickards will be in attendance along with a number of heads of mining companies including a thousand or so high net worth investors.
Talking Points From This Week’s Episode:
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.
