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VIDEO – Fabled #Silver #Gold $FCO.ca Measuring by the Kilogram at Santa Maria Project, Drilling 10 Ounces of Silver over 6 Meters $RDU.ca $KTN.ca $GMBXF $EDR.ca

Posted by AGORACOM-JC at 5:49 PM on Thursday, February 4th, 2021

Fabled controls 100% of the Santa Maria Gold and Silver property in Mexico, a high grade underground mine with a rich history of mining, but with very little modern exploration or drilling.

President & CEO Peter Hawley discusses the second hole at Santa Maria that is returning really high grade silver. Fabled is in the midst of an 8000 meter drill program and is batting 100% with the most recent return of 10 ounces of silver over 6 meters.

The next hole will be the deepest ever on the property.

Take a seat, sit back and discover why Fabled Silver Gold is the next SmallCap #Silver company to own.

Fabled $FCO.ca Drills 3.3 Meters of 561.20 g/t Ag and 0.90 g/t Au within 6.0 Meters Grading 323.88 g/t Ag and 0.54 g/t Au at Santa Maria $RDU.ca $KTN.ca $GMBXF $EDR.ca

Posted by AGORACOM at 8:19 AM on Wednesday, February 3rd, 2021
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  • Over 10 ounces of silver over 6 meters.
  • 2nd hole of 8000m program
  • Followed up with SM20-03, designed to be the deepest hole ever drilled on the property.

Fabled Silver Gold Corp. (TSXV: FCO) (FSE: 7NQ) (“Fabled” or the “Company”) is pleased to announce the second diamond drill hole from the on-going 8,000 meter drill program on the Santa Maria Property in Parral, Mexico, with assays from two additional holes pending.

Peter J. Hawley, CEO and President, remarks, “As expected, the sulphide contents of the Santa Maria vein and structure has increased and intercepted over 10 ounces of silver over 6 meters. These exceptional high- grade results intercepted at -145 meters vertically below surface will be followed up by hole SM20-03 which was designed to hit the Santa Maria structure at a vertical depth of -350 meters below surface which will be the deepest hole ever drilled on the property.”

Peter Hawley continues, “The data being obtained from this fence of drill holes will not only target adding silver ounces to the overall resource but also allow us to interpret and model the behavior of this robust mineralized system for future drill hole success.”

Table 1: Drill Hole Intercepts

Hole NoFrom (meters)To (meters)Width (meters)Au g/tAg g/t
SM20-002150.40156.406.000.54323.88
Including151.00154.303.300.90561.20
Including151.00151.900.900.84156.00
 151.90153.001.100.74822.00
 153.00154.301.101.06621.00

Drill holes SM20-01, SM20-02 and SM20-03 are drilled on the same section with holes 02 and 03 targeting the sulphide intercept of the Santa Maria vein and structure, which is typically higher in grade due to metal values not being leached out by surface ground waters as commonly seen in oxide zones.

Read More:https://agoracom.com/ir/FabledSilverGold/forums/discussion/topics/754516-fabled-drills-3-3-meters-of-561-20-g-t-ag-and-0-90-g-t-au-within-6-0-meters-grading-323-88-g-t-ag-and-0-54-g-t-au-at-santa-maria/messages/2301768#message

St. Georges Eco $SX.ca $SXOOF Altair Provides Update on Lithium Extraction and Battery Recycling Technology $NNX.ca $OM.ca $ICM.ca $ATAO

Posted by AGORACOM at 8:43 AM on Tuesday, January 26th, 2021
  • The two companies to jointly develop a patentable industrial scale process for Electric Vehicle Lithium-ion battery (LIB) recycling.

Altair International Corp. (the “Company” or “Altair”) (OTC: ATAO) is pleased to provide an update on its previously announced partnership with St-Georges Eco-Mining Corp. (CSE: SX) (OTC: SXOOF) (FSE: 85G1) (“St-Georges”) a Canadian public company engaged in the development of new Lithium extraction technologies.

On December 1, 2020 the two companies entered into a Binding agreement that would allow Altair access to St-Georges’ patent-pending Lithium processing technology for Altair’s Nevada based Stonewall project and most importantly bring together the two companies to jointly develop a patentable industrial scale process for Electric Vehicle Lithium-ion battery (LIB) recycling.

As the global Electric Vehicle (EV) market heats up over the coming decade, the demand for battery metals is expected to outpace current production. Even with increased energy density and charge cycles, Lithium based batteries for EVs, laptops, phones and other mobile devices will create cumulative waste challenges both in the environmental footprint of production and end-of-life LIB disposal.

Altair and St-Georges recognize that new optimized recycling technologies will offer valuable solutions to both a waste-management and battery metal supply. Selective, economic and responsible metal extraction of spent LIBs will be an integral part of the multi-billion dollar green economy and play a crucial part in the future of EV dominance of the automotive sector.

Read More: https://agoracom.com/ir/St-GeorgesEco-Mining/forums/discussion/topics/753930-st-georges-eco-altair-provides-update-on-lithium-extraction-and-battery-recycling-technology/messages/2300224#message

Fabled $FCO.ca Drills 68.6 Meters of Continuous Silver Mineralization in Initial Drilling at Santa Maria $GGD.ca $EDR.ca $RDU.ca $KTN.ca $GMBXF $EDR.ca

Posted by AGORACOM at 7:54 AM on Monday, January 25th, 2021
Fabled Silver Gold Corp. (@Fabled_FCO) | Twitter

Fabled Silver Gold Corp. (TSXV: FCO) (FSE: 7NQ) (“Fabled” or the “Company”) is pleased to announce initial diamond drill results from the on-going 8,000-meter drill program on the Santa Maria Property in Parral, Mexico, with assays from two additional holes pending.

Peter J. Hawley, CEO and President remarks, “We are quite excited with the results from our first drill hole drilled to the east of the last underground workings and the exceptional wide intersection of 68.6 meters of continuous silver in shallow oxide mineralization. Within this broad zone, 20 meters reported 0.35 g/t Au, 106.29 g/t Ag and within this 20 meters, widths grading 146 g/t Ag, 238 g/t Ag and 151 g/t Ag were intersected (See Table 1 for widths and values). Drill holes SM20-02 and SM20-03 are drilled on the same section with the target being the sulphide intercept of this broad hydrothermal breccia zone, which is typically higher in grade due to metal values not being leached out by surface ground waters as commonly seen in oxide zones. The data being obtained from this fence of drill holes will not only target adding silver ounces to the overall resource but also allow us to interpret and model the behavior of this robust mineralized system for future drill hole success.”

Table 1: Drill Hole Intercepts

Hole NoFrom
(meters)
To (meters)Width
(meters)
g/t Aug/t Ag
SM20-00178.40147.0068.600.1843.98
Including112.00132.0020.000.35106.29
Including115.00117.002.000.27146.00
Including123.00124.601.601.09238.00
Including124.60126.501.900.34151.00

Drill hole SM20-01 was drilled at an angle of -45 degrees for a total hole depth of 164 meters. Drill hole SM20-02 was drilled at -65 degrees from the same station for a total hole depth and drill hole SM20-03 was stationed 75 meters behind the drill station for holes 01-02 and drilled at an angle of -75 degrees for a total depth of 375 meters.

Read More: https://agoracom.com/ir/FabledSilverGold/forums/discussion/topics/753841-fabled-drills-68-6-meters-of-continuous-silver-mineralization-in-initial-drilling-at-santa-maria/messages/2300012#message

VIDEO – Fabled Silver Gold $FCO.ca Mexican Silver Project Was So Good That CEO Peter Hawley Came Out Of Retirement $GGD.ca $EDR.ca $RDU.ca $KTN.ca

Posted by AGORACOM-JC at 4:00 PM on Friday, January 22nd, 2021
Fabled Silver Gold Corp. (@Fabled_FCO) | Twitter

Fabled Silver Gold controls 100% of the Santa Maria Gold and Silver property in Mexico. It is a high grade underground mine with a rich mining history and a Silver Equivalent 43-101 with 3.2million ounces Indicated and 1.1m inferred.

Now as far as silver projects go 3.2M ounces isn’t very big but when serial mine finder and industry stalwart Peter Hawley was presented with it in 2016, he came out of retirement saying “it was almost too good to be true” and “this is the one I’ve been looking for.

Santa Maria’s best historical intercept to date, reported 11meters of 1,672 g/t Silver & 3.74 g/t gold and ending in mineralization. Moreover, a 2018 PEA is very supportive at current market prices.

Santa Maria has never been systematically, or explored thoroughly with modern methods, until now.   FCO is currently conducting their first drill program to support the 43-101 and expects results to start flowing right into June.

It is definitely in a great “neighbourhood” in the mining friendly jurisdiction of Parral which has produced over 250M oz silver.  Moreover, multiple major operators in the vicinity, including three toll mills within a 20 km distance.

Watch this great first of many anticipated interviews with CEO Peter Hawley.

Beauce Gold Fields $BGF.ca Buys Missing Drill Logs Adding 344 Never Reported Drill Holes $KG.ca $OSK.ca $TIG.ca $GSR.ca $ATC.ca $WGO.ca $OR.ca $KGC.ca

Posted by AGORACOM at 9:28 AM on Thursday, January 21st, 2021
  • Acquired never before published exploration data from 1957 to 1965
  • This effectively triples the overburden drilling data that will give Beauce unprecedented overview of the placer channel

Beauce Gold Fields (TSXV: BGF) (Champs D’Or en Beauce), (“BGF”), is pleased to announce that it has acquired, from a Private Collector, a trove of never before published exploration data by the Beauce Placer Mining company that operated from 1957 to 1965 on the company’s Beauce Gold property located in Saint-Simon-les-Mines, Quebec.

Patrick Levasseur, President and CEO of Beauce Gold Fields said, “This effectively triples the overburden drilling data that will give us an unprecedented overview of the placer channel.” Mr. Levasseur added: “The data will have a profound impact in orientating our future rock drilling program to uncover the source of the gold placers.”

Figure 1: Drill Hole Map 1958, St-Gustave Road and Drill Operator

Active from 1957 to 1965, the Beauce Placer Company was the largest placer gold mining operation in eastern North America. Yet, there was very little documentation available of the work completed during that period. Historical reports found on the Government of Quebec’s geology and mining data registry are but brief summaries and observations. Missing were drill hole logs and subsequent results, geophysics data, field surveys, compilation maps and for that matter, all aspects pertaining to the dredge mining operation itself. These have now been found.

According to the Collector, the documents originated from a field office the Beauce Placer Mining Company occupied in Beauceville, Quebec. The office was abandoned in the 1970s leaving behind filing cabinets full of documents. The documents were given to the Collector, a businessman from St-Simon-les-Mine. Being an avid antiques collector, he recognized the importance of preserving historical documentation pertaining to his town’s heritage.

Document Highlights

– Total 344 drill logs from 7-inch wide overburden drill holes down to bedrock:

  • Gilbert River (St-Simon-les-Mine) – 252 holes
  • Famine River – 40 holes
  • Chaudière River – 36 holes
  • Riviere Du Loup – 12 holes
  • Ruisseau Des Meule – 4 holes

– Geophysics
– Claims and property agreements
– Land surveys
– Documentation regarding the operation of the dragline and the Yuba dredge
– Daily back office operation
– Gold receipts from the mint

Read More: https://agoracom.com/ir/BeauceGoldFields/forums/discussion/topics/753564-beauce-gold-fields-buys-missing-drill-logs-adding-344-never-reported-drill-holes/messages/2299225#message

Beauce Gold Fields $BGF.ca Stakes 30 Placer to Hard Rock Gold Properties $KG.ca $OSK.ca $TIG.ca $GSR.ca $ATC.ca $WGO.ca $OR.ca $KGC.ca

Posted by AGORACOM at 4:37 PM on Tuesday, January 12th, 2021
  • Staked a portfolio of prospective placer to hard rock gold anomalies throughout southern Quebec
  • The Mégantic property extends for at least 30 km along the axis of the Bella Fault.

Beauce Gold Fields (Champs D’Or en Beauce) (TSXV: BGF), (“BGF”), is pleased to announce that it has acquired through map staking, a portfolio of prospective placer to hard rock gold anomalies throughout southern Quebec. The Beauce, the Megantic and Quebec’s Eastern Townships are considered to be the most suitable regions for the discovery of gold deposits near or under former gold placers.

Patrick Levasseur, President and CEO of Beauce Gold Fields said, “Just as major gold companies have found new value in storied placer gold districts of BC’s Cariboo and the Kondike in Yukon, we see untapped potential in Quebec’s placer gold properties.” Mr. Levasseur added: “For example, the Megantic property holds a similar geological model to the company’s flagship Saint-Simon-les-Mines Beauce Gold property whereby a major geological fault line follows along strike historical placer gold deposits.”

The Mégantic property is limited to the southwest by the American border of New Hampshire and to the northeast by Lac Mégantic. The property extends for at least 30 km along the axis of the Bella Fault. It is divided into four areas: the Ditton, the Mining Brook, the Chesham and Bergeron rivers.

The Mégantic property is located at the foot of the granite intrusion of Mont Mégantic. It partly occupies the Compton Formation composed of graphitic and pelitic metasedimentary rocks of Siluro-Devonian age. These sedimentary rocks are in discordant contact in the center of the terrain with the volcanic facies (basalts, andesites and dacites) of the Siluro-Devonian Formation of the Frontenac Formation. The Bella fault, which is the major structural element of the Mégantic property, is in contact between the Compton and Frontenac Formations. Observations at Mount Saddle suggest several intrusive phases that would be favourable to the establishment of gold mineralization.

READ MORE: https://agoracom.com/ir/BeauceGoldFields/forums/discussion/topics/752868-beauce-gold-fields-stakes-30-placer-to-hard-rock-gold-properties-more-than-150-samples-sent-for-gold-analysis/messages/2297438

Beauce Gold Fields $BGF.ca Completes Rang St-Gustave Trench Work; More than 100 Samples Sent to Laboratory $KG.ca $OSK.ca $TIG.ca $GSR.ca $ATC.ca $WGO.ca $OR.ca $KGC.ca

Posted by AGORACOM at 4:14 PM on Wednesday, January 6th, 2021
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  • Mechanized excavations of the overburden exposed the bedrock before it plunges deeper into the historical placer gold channel.
  • Geological mapping and structural study to the east and west of Rang St-Gustave road will provide requisite data to optimize the drill program

Montreal, Quebec–(Newsfile Corp. – January 6, 2021) – Beauce Gold Fields (Champs D’Or en Beauce) (TSXV: BGF) (“BGF”), is pleased to announce that it has completed its trenching and rock outcrop exploration program in the Rang St-Gustave sector of the gold property located in St-Simon-Les-Mines in the Beauce region of southern Quebec.

Patrick Levasseur, President and CEO of Beauce Gold Fields said, “The Rang St-Gustave area was the site of the only major placer mining and dredging operation in eastern North America. In this same sector, the company discovered a major geological fault which could explain, in part, the gold bearing structures.” Mr. Levasseur added: “The data provided by the survey and sampling of the trenches will better guide our future rock drilling program to uncover the source of the gold placers.”

Figure 1. Location of the trenches made in the St-Gustave sector and trajectory of the Yuba dredge used during the exploitation of the gold placer.

Read More:

https://agoracom.com/ir/BeauceGoldFields/forums/discussion/topics/752486-beauce-gold-fields-completes-rang-st-gustave-trench-work-more-than-100-samples-sent-to-laboratory/messages/2296370#message

Fabled Silver Gold $FCO.ca Announces Surface Sampling Over IP Anomalies Results In Three Areas of Highly Anomalous Silver Values and Update on Current Drilling $GGD.ca $EDR.ca $RDU.ca $KTN.ca

Posted by AGORACOM at 7:42 AM on Wednesday, January 6th, 2021

Fabled Silver Gold Corp. (TSXV: FCO) (FSE: 7NQ) (“Fabled” or the “Company“) is pleased to announce the completion of the first ever follow up ground sampling program to evaluate the IP geophysical anomalies on the Santa Maria Property in Parral, Mexico. Fabled is also pleased to provide an update on progress made on its initial 8,000 meter drill program.

Peter J. Hawley, CEO and President, remarks, “The results of the follow up sampling of the IP anomalies have provided favorable silver results over all on anomalies sampled, of which certain results were a pleasant confirmation of not only the location of the IP anomaly but also exhibiting silver grades on surface even though the anomaly is at depth. It is not common to sample almost one ounce of silver over a buried IP Anomaly.”

Of particular interest are two areas to the west and outside the new resource area. The first is anomaly IPSM-10 at the western sector of the property, where sample #816013 reported 29.8 g/t Ag. The anomaly is thought to represent the intersection of the northeast trending Peneto Vein located to the south west of the property and the intersection of the Santa Maria vein structures. Geophysical interpretation suggests it represents a shallow, thin body (“vein type”) response.

The second is located between IPSM-10 and the new resource trend and identified by IP anomaly IPSM-12 and sample #816007 which reported 14.2 g/t Ag and is thought to be the contact between the Santa Maria Vein trends and a felsic mineralized dike contact. Geophysical interpretation suggests a deep seated (>100 m) vein type response.

A total of 11 first priority IP targets have been delineated property wide (see Figure 1 below), which are in a generalized east – west direction. The geological team collected a total of 26 surface samples over all anomalies and nearby areas.

Figure 1: IP Anomalies on the Santa Maria Property with surface sample assay values and locations.

Drilling Update

The Company has completed two drill holes SM20-01 – 02 for a total of 396 metres. Holes 01 and 02 have been sampled and submitted to ALS Chihuahua Laboratory for analysis. Hole SM 20-03 is in progress. The focus of the program is to determine the true potential of the property, which is expected to take several months to complete.

Option Grants

Fabled also is pleased to announce that pursuant to its stock option plan it has granted 200,000 stock options to a consultant for the Company, each exercisable to acquire one common share of Fabled at an exercise price of $0.10 per common share until January 06, 2031. The stock options vest as to 25% on the date of grant, and as to 25% every 6 months until fully vested.

QA QC Procedure

Analytical results of sampling reported by Fabled Silver Gold represent surface rock samples submitted by Fabled Silver Gold staff directly to ALS Chemex, Chihuahua, Chihuahua, Mexico. Samples were crushed, split, and pulverized as per ALS Chemex method PREP-31, then analyzed for ME-ICP61 33 element package by four acid digestion with ICP-AES Finish. ME-GRA21 method for Au and Ag by fire assay and gravimetric finish, 30g nominal sample weight.

Over Limit Methods

For samples triggering precious metal over-limit thresholds of 10g/t Au or 200g/t Ag, the following is being used:

Au-GRA21 Au by fire assay and gravimetric finish with 30g sample.

Ag-GRA21 Ag by fire assay and gravimetric finish.

Fabled Silver Gold monitors QA/QC using commercially sourced standards and locally sourced blank materials inserted within the sample sequence at regular intervals.

About Fabled Silver Gold Corp.

Fabled is focused on acquiring, exploring and operating properties that yield near-term metal production. The Company has an experienced management team with multiple years of involvement in mining and exploration in Mexico. The Company’s mandate is to focus on acquiring precious metal properties in Mexico with blue-sky exploration potential.

The Company has entered into an agreement with Golden Minerals Company to acquire the Santa Maria project, a high-grade silver-gold property situated in the center of the Mexican epithermal silver-gold belt. The belt has been recognized as a significant metallogenic province, which has reportedly produced more silver than any other equivalent area in the world.

For further information please contact:

Mr. Peter J. Hawley, President and C.E.O.
Fabled Silver Gold Corp.
Phone: (819) 316-0919
[email protected]

Crescat December Gold Market Update SPONSOR: Fabled Silver Gold $FCO.ca $GGD.ca $EDR.ca $RDU.ca $KTN.ca

Posted by AGORACOM at 1:16 PM on Wednesday, December 30th, 2020

SPONSOR: Fabled’s mandate is on acquiring precious metals properties in Mexico with blue-sky exploration potential. Fabled is actively developing the Santa Maria property, a high-grade silver-gold property situated in the center of the Mexican epithermal silver-gold belt. The Santa Maria property has never been systematically explored. Click Here For More Info

The End Game

Dear Investors:

Markets are cyclical. Today, stocks trade at record high valuations while commodities are historically undervalued in relation. The setup is in place for a macro pivot in the relative performance of these two asset classes. Comparable conditions were present with the 1972 Nifty Fifty and 2000 Dotcom bubbles as we show in the chart below.

As capital seeks to redeploy towards the highest growth and lowest valuation opportunities, we expect analytically minded investors will soon be rotating, if not stampeding, out of expensive deflation-era growth equities and fixed income securities and into cheap hard assets, creating a reversal in the 30-year declining trend of money velocity.

Today’s Modern Monetary Theory world with its double barreled fiscal and monetary stimulus is crashing head on with an accumulation of years of declining investment in the basic industries such as materials, energy, and agriculture. In our analysis, the “end game” for the Fed’s twin asset bubbles in stocks and bonds is inflation. We can already see it developing on the commodity front.

The scarcity of jobs and abundance of debt were factors preventing the economy from reaching its full growth potential even before Covid-19. Such have been the concepts underlying the output gap, the theoretical paradox that is thought to have held inflation in check over the course of the last business cycle. But based on comparable historic periods, the macro setup for inflation is more likely to be kicked off by an input gap, i.e., shortages in the primary resources needed for both a strong reserve currency and economic growth at the same time as policy makers pull out their biggest bazookas yet to boost aggregate demand. We expect a new wave of rising commodity prices, set up by past underinvestment in basic resources, to soon ripple through the global supply chain creating a headwind for real living standards. Welcome to the Great Reset.

The global economy is at risk of commodity supply shock inflation, something we have not experienced since the 1970s. Both the Bloomberg Commodities Index and the US 30-year inflation expectations are now re-testing a 12-year resistance line. A significant breakout from here would be a big shift in the macro investing landscape. Yes, the aging demographics problem and significant technological advancements are deflationary tailwinds. But in our view, the key reason why consumer prices have not gone higher is due to a long-standing period of depressed commodity prices, a trend which we think is about to change.

The Constrained Supply for Gold

When it comes to scarce commodities, at Crescat, we have an affinity first and foremost for gold and silver, the monetary metals that are among the most supply constrained resources on the planet. Coincidentally, they are facing a new surge of investor demand.

On the supply side, in the disinflationary environment since the precious metals mining industry’s prior peak in 2011, gold and silver miners have been criticized by investors as being capital destroyers. As a result, the industry’s spending discipline in the last decade has swung completely the other way. The majors have underinvested in replacing their reserves creating a supply cliff for the industry while also substantially boosting free cash flow.

Contributing to the supply shortage, the number of major new gold discoveries by year, i.e., greater than 2 million Troy ounces, has been in a declining secular trend for 30 years including the cyclical boost between 2000 and 2007. At Crescat, we have been building an activist portfolio of gold and silver mining exploration companies that we believe will kick off a new cyclical surge in discoveries over the next several years from today’s depressed levels.

Gold mining exploration expense industrywide, down sharply since 2012, has been one of the issues adding to the supply problems today. Crescat is providing capital to the industry to help reverse this trend.

Since 2012, there has also been a declining trend of capital expenditures toward developing new mines. From a macro standpoint, gold prices are likely to be supported by this lack of past investment until these trends are dramatically reversed over the next several years. Credit availability for gold and silver mining companies completely dried up over the last decade. Companies were forced to buckle up and apply strict capital controls to financially survive during that period. Investors demanded significant reductions in debt and equity issuances while miners had to effectively tighten up operational costs, cut back investment, and prioritize the quality of their balance sheet assets.

It is important to consider that the last times this industry had been acting in a similarly conservative fashion, metal prices were at historically low-price levels. This time, however, we are seeing corporate discipline with gold prices remaining near all-time highs. As a result, the major producers today have surprisingly swung into being cash flow machines. They are enjoying more free cash flow than they had in the past 25 years, an incredibly bullish setup for the entire industry, especially the smaller exploration focused players that Crescat is overweight in today. The majors are in a great position to harvest cash for the next few years. But they are also facing a supply cliff because they have not replaced their reserves. Over the next several years, they will need to make acquisitions in the exploration segment to rebuild them. 

The Demand Side for Gold

On the demand side, the first key macro driver for the price of gold is central bank debt monetization, which drives increasing inflation expectations and investor demand for inflation protection for accumulated savings. Today, money printing through central bank balance sheet expansion is widely accepted and embraced. It is the only viable policy as a way out of the otherwise deflationary global debt burden, at a historic high of 365% of worldwide GDP. With deficits at World War II levels in the US, we expect money printing to be the path of least resistance among policy makers towards easing debt burdens and reconciling many of today’s economic imbalances, though it will likely come at a cost to savers who are invested in overvalued traditional financial assets.

As we show in the chart below, gold underperformed the pace of global money printing from 2011 to 2018. But since the Repo Crisis in 2019 and the coronavirus led recession that followed, global QE has been accelerating to the upside once again. Gold is being pulled up with it. Our near-term target price for gold is north of $3,000 per Troy oz. based on our macro model shown below that plots the price of gold vs. the aggregation of the top eight central bank balance sheets. This target will almost certainly be rising in the near-term with $5.8 trillion just in US Treasuries alone maturing in 2021 and much of that needing to be rolled over and funded by the lender of last resort.

The Fed, the printer of the world reserve currency, has given itself, and by extension its central bank counterparts around the world, the green light to err on the side of inflation. The US central bank has declared that it can exceed its 2% inflation target temporarily abandoning one side of its dual mandate to favor the other side of it which is full employment. So, err on the side of inflation, the Fed almost certainly will.

Inflation is a toothpaste that sovereign Treasuries and their central banks throughout history have struggled putting back in the tube once they have let it out. In practice, inflation is driven in large part by the expectations and actions of consumers and investors which are hard to predict and occur with lags and unknown multiplier effects in relation to monetary policies. When consumer and investor psychology shifts toward recognizing and acting upon rising inflation, it becomes highly reflexive, i.e., circular and self-reinforcing.

The second key macro driver for upward trending gold prices on the demand side today is declining real interest rates, which are a combined reflection of central bank interest rate suppression tactics and investors’ rising inflation expectations. The recent plunge lower in real yields (shown inverted in the chart below) has diverged from the price of gold signaling a strong impending move upward again in the metal.

The outlook for gold all ties back to the bigger macro imbalances we see in the US economy today. The Federal Reserve is crippled in its ability to prevent inflation and instead has become the funding mechanism through its massive purchases of US Treasuries that enables the US government to run a large fiscal deficit. The Fed essentially has no independence in the matter. It must fund the government’s fiscal stimulus programs as the lender of last resort. And as the repo crisis showed, the liquidity is also necessary in the short run to prevent the equity and corporate bond markets from collapsing, but this is very shortsighted because rising commodity prices and real-world inflation, that is the byproduct of the newly printed money, is the killer of record overvalued financial assets.

Three Comparable Macro Setups in History

We expect inflation expectations to continue to rise at a faster rate than nominal interest rates. This is ultimately a self-reinforcing catalyst to drive investors out of overvalued stocks and credit and into scarce commodities including precious metals and oil, which is exactly what happened in three similar macro setups to today:

1. During the dotcom bust at the turn of the century, the NASDAQ Composite declined 78% over two and a  half years, a period during which gold stocks diverged to the upside to begin a five-fold march upward over the next seven years, while energy and industrial commodities also caught fire.

2. In the 1974-74 bear market, the S&P 500 declined 50% in two years while gold mining stocks increased five-fold at the same time as oil prices skyrocketed during the 1973 Arab Oil Embargo and a decade of stagflation was born.

We showed the supply cliff setup for gold earlier, but it is important to note that there could also be a supply shortage in oil setting up for the next several years after the most drastic capex cuts in infrastructure and exploration we have seen in the history of this industry. In that vein, the rig count cyclicality has been an incredibly reliable contrarian forward looking indicator for oil prices. As shown in the chart, prior historical dips also preceded key market bottoms in WTI prices and the oil and gas industry.

3. The third comparable period, also highly apt for today, was coming out of the Spanish flu pandemic of 1918 and 1919. At that time, the health crisis had severely limited the industrial capacity of the economy, leading to major supply shortages of raw materials and causing commodity inflation at the same time as the world began to heal. The rise in wholesale prices became a global phenomenon. Grocery stores began hoarding inventories to sell at higher prices, forcing governments to intervene and criminalize these actions to avoid an even larger hit to the consumer. The cost of living surged and prompted major labor union protests on the streets demanding higher wages and salaries only exacerbating the problem. Inflation spiked above 20% in 1920 and the Dow Jones Industrial Average began a decline of 47% from peak to trough from 1920 to 1921 while the world emerged from the pandemic. We will not go there in depth now, but this was the same time that a whole different kind of inflation was arising in Germany from newly printed money to pay off accumulated war debts.

The Opportunity for Activist Gold Exploration

As we showed above, the underinvestment in most of the last decade in the gold mining industry will soon send the majors scrambling to invest their near term soaring free cash flow in the most prospective new gold and silver deposits being explored today. These properties are in the hands of the extremely undervalued and ultra-depressed small cap segment of the mining industry, the junior explorers, a group that has been through a brutal, capital starved bear market that effectively lasted ten years. The whole industry completed a double-bottom retest by successfully holding above its 2015 lows and rebounding sharply to lead all industries in stock price performance coming off the March 2020 correction. We think there is much more performance ahead for this industry as it is still in the early stages of a new secular bull market.

We are confident that within the precious metals mining industry, the most value for shareholders will be created from the small cap exploration segment over the next several years. We think Crescat’s Precious Metals Fund and SMA strategies have already started to demonstrate that potential in 2020.

By working with world-renowned exploration geologist, Quinton Hennigh as Crescat’s geologic and technical advisor, Crescat has already created an activist portfolio of over 50 companies where we are among the largest shareholders of a targeted 200 million ounces new high-grade gold equivalent discoveries. We plan to continue to grow these targeted ounces while getting the needed investment capital to our companies to prove out these economic deposits through drilling and discovery.

Crescat’s activist fund is a large and significant capital deployment opportunity. We are currently seeking a select group of right-minded institutional partners who can understand and appreciate the focus, scale, and timeliness of what we have set out to accomplish in this fund. 

Our activist portfolio is positioned ahead of a likely major new wave of M&A by the large and mid-tier producers which is still to come as they necessarily must replace their reserves through acquisition. We also have a handful of holdings that we call keepers, the cream of the crop companies that control the unquestionably new world class, high grade gold and silver deposits that will catapult them into the next great mid and large cap gold producers in the industry over the course of the new secular bull market.

To be frank, buying gold or silver is not a contrarian investment position today. There are enough people in agreement with the idea that all government backed fiat currencies are doomed to some level of devaluation through inflation due to the level of fiscal and monetary imprudence and unsustainable debt imbalances in the financial system. Naturally, with a constructive view on precious metals, the next step for most investors is to start dipping their toes into well-known and established mining companies. Despite their past reputation of being capital destroyers, investors today are warming up to the idea of buying the “Newmonts and Barricks” of the world or even ETFs such as GDX and GDXJ. What we see as contrarian, however, is a much bigger opportunity to unlock value through a well targeted activist strategy in the exploration segment of the industry. No doubt, many are skeptical of the gold exploration business, given its poor performance during the last downturn in the industry at large, but the biggest gains today in the industry are likely to come from what are the smaller cap names. Between Crescat and its 21 years of money management experience and Quinton Hennigh with his 30+ years of gold mining exploration experience to serve as Crescat’s geologic and technical advisor, we believe we have the expertise and preparedness to navigate this incredible opportunity before us. We hope you will join us as we seek to exploit the mispriced opportunities on the exploration and discovery side of the Lassonde Curve that is still in the early stages of what is likely to be a new rip-roaring secular bull market for precious metals.

SOURCE: https://www.crescat.net/december-research-letter/