Rick Rule Perfectly Called Silver Crash, Here’s What ‘Goes Crazy’ Next

0:00 I bought silver when it was about 20 bucks an ounce and I bought it because it was roundly aided. The reasons why I bought the silver are no longer true. For people who aren't doing willing to do the work, they need to derisk their portfolios. They need to buy the beta. They need to forget the alpha. Most fiat currencies will decline by 75% over 10 years. And investors need to prepare themselves for that because the outcome I think is inevitable. It's my great pleasure to welcome back Rick Rule, uh very well-known investor in the resource space. He's a founder and CEO of Rule Investment Media, co-founder of Battle Bank, and former CEO of Spot US. Rick is well known in the precious metals and commodity spaces, and will be getting his view on what's next for the entire

0:47 metals complex. Rick has made an extraordinarily correct call on my show just a few weeks ago, end of January. We had him at the VRIC Vancouver Resource Investment Conference. Link down below to check out the full interview where he said right before a few days before the big crash in gold and silver that he has already sold or taken profits in a significant part of his silver holdings. And shortly after we aired that, silver went down 30% in a day. So, we're going to find out what Rick is doing now. Welcome back to the show, Rick. Good to see you. >> Pleasure to be back. Thank you for that kind introduction. >> Well, congratulations on giving us a fair warning. And like I mentioned in the beginning and what people can see. Uh that was a rather appreciient call.

1:33 Uh you were at the VRIC warning people of an imminent correction, which is why you took profits. You didn't sell everything. You took profits in some of your holdings. And immediately after that aired, I'm not saying it was because of you. I'm just saying immediately after that aired, we had a big correction. And all the metals, by the way, copper, uh, palladium, platinum, gold, silver, all moved in the same direction shortly after, down, troughed the same day and then moved up. Before we get into what's next, let me just ask, how did you know, or at least suspected? Nobody knows for sure, but how did you suspect that the metals have already run up beyond what was reasonable, which prompted you to take profits? >> In fairness, David, I didn't. Uh what I know is that when you see um a

2:19 parabolic chart, what Canadians would call a hockey stick chart, that the back side of that stick is just as steep as the front, but it's a lot less fun. Uh and so when I saw silver melt up, um you know, it was pretty clear to me that at some point in time it would melt down, but I'm not a trader. Uh what actually happened for me in that trade and I think you and I talked about at the time was that I bought silver differently than I buy gold. I buy gold as a savings asset. I bought silver as a speculative asset. I bought silver uh when it was about 20 bucks an ounce. And I bought it because it was roundly aided. And I thought a if the hate dissipated that the silver price would go up. And I

3:05 bought it thinking too that a precious metals bull market was inevitable. And at some point in time in the bull market, market leadership would change from gold to silver. When those two things happened, uh that silver became inappropriate in my speculative account and I needed to say what is the best use of capital in my speculative account. The reasons why I bought the silver are no longer true. Uh and what I did, I did, you know, 48 hours worth of soularching. What I discovered in my thought exercise was that if the silver price uh went up, silver stocks would do at least as well, but probably better than silver.

3:52 Remarkably, if silver traded sideways from $75 per year, by definition, I wouldn't make any more money on my silver. And interestingly, because the silver stocks, the high quality silver stocks were being valued on Bay Street with a 40 or $45 price assumption, if the silver traded sideways, the silver stocks could kill could still go up by 50% in the course of a year. And more remarkable still at least arithmetically getting away from the narrative if the silver price declined from 75 to 50 uh the silver stocks perhaps not their market price but rather their value wouldn't decline at all. That meant that for me uh allocating 50% of the money I

4:39 had in physical silver into silver stocks instead was a better use of my speculative capital. Uh so I I I would love to say that I was a spectacular trader. What actually happened is that I was an honest investor, at least honest with myself. Uh the reason that I own the silver ceased to be true. So I sold the silver. I am not one David in my defense who has an iota of fear of missing out. I'm not one of those guys who, you know, immediately after I sold it, it didn't go down. It went up to 100. I couldn't care less. Uh I made I made lots of money in the middle and I was happy about it. My own discipline is

5:24 that when the reason to own something goes away, the asset goes away. I redeploy the capital and that's precisely what happened to me in the silver trade. >> Let's just look in the rear view mirror for uh a few more minutes. Uh now I I like this exercise. Were you we had talked about silver at the VRIC uh when I interviewed you, but were you equally cautious on gold? And I asked this because gold and silver fell on the same day um different orders of magnitude percentage-wise, but both big draw downs in a single day. Silver had the biggest single day draw down since 1980 in gold for at least I can't remember how many years, but it was many, I believe, all the way back to 2011. And so these were major major corrections by um anyone's

6:10 measure. But did you have an inkling of suspicion the same thing would have happened to gold as well? >> I had no care uh because for me gold is a savings asset. It's an insurance asset. >> Silver was a speculative asset. Uh it is well at some point in time because gold's a source of liquidity. I may sell some. I sold in 2009 2010 because there were other asset classes that seem more deserving. In other words, I use it as a source of liquidity. But it wouldn't surprise me if I didn't sell my gold now for another 10 years. >> Yes, >> it's a savings asset. In fact, some of the money that I put in my pocket as a consequence of selling s selling my silver, I moved into gold because I consider it savings.

6:57 Um, I need to say too, David, um, as you can tell by looking at me, I've done this for a very long time. And, uh, the set of circumstance, the pullback that we saw, is one of many that we will see in the future. In the decade of the 70s, my formative year years, pardon me, uh, the gold price ran 26fold. But at least four times that I can remember in the decade of the 70s, the gold price fell by 20% or more. In 1975, the gold price fell by 50% without derailing the gold bull market. So I consider the crash that we just saw uh to be noise, not music. Now certainly

7:44 anytime I see a parabolic chart um I'm inclined to take advantage of that because I have learned that even if uh the backside is uh of less duration or less magnitude than the front side it is equally steep. >> Yeah. >> Rewind the clock to I'm sorry. Please go ahead. No, I just, you know, that's that's something that younger speculators don't understand as well. Uh, you have to have experienced yourself 30 or 40 times before that religion gets ingrained, which I have. While gold has grabbed most of the precious metals headlines, the metal with the most torque in a bull cycle is

8:30 often silver. And there are important macro trends that make the setup hard to ignore right now. First, gold still backs about only 3% of US government debt. If that coverage ratio even partially mean reverted toward prior historical peaks, it implies dramatically higher gold prices, tightening the entire precious metals complex. Second, history shows that after major geopolitical shocks, gold has tended to be one of the best performers in the following months. And when gold runs, silver often follows, then accelerates. Third, with tariffs now viewed as a sticky policy, institutions are increasingly positioning for a weaker dollar regime. A softer dollar is typically supportive for commodities and precious metals. Past performance isn't a guarantee of

9:15 future performance, but it's a reminder of what silver can do when macro conditions line up. Now, silver futures aren't the only way to play this theme. So next I want to highlight a silver company the sponsor of today's video coupney silver ticker KO YF on the US OTC exchange. Coupney silver shares are available on Schwab Fidelity Interactive Brokers and Erade. Coupney is positioned as a silver pure play and one thing that stands out immediately is asset density. The company controls four silver projects. Quality silver assets are scarce and pure plays are even rarer. Roughly 4% of the company is owned by prominent metals investor Eric Spott who has publicly discussed a scenario where silver could reach $150 to $300 plus in this cycle. Across its portfolio, Kudney

10:01 reports a large silver equivalent resource base including approximately 223 million silver equivalent ounces of both measured and indicated plus about 111 million ounces of inferred. And this matters because the physical market backdrop is tightening. The the global silver market has now logged multiple consecutive years of structural deficit with additional shortfalls projected ahead. Leadership is also a key part of the story. Cooney's president and CEO James Macdonald previously helped build Alamos Gold, a company that delivered massive returns during the 2000's gold bull market. On valuation, here's a simple way that investors compare silver companies. Enterprise value per ounce of silver equivalent resources. In a peer comparison presented in the materials, coup is shown around 36 cents per ounce

10:48 versus a peer group average of around $2.18. Kun is scheduled to drill roughly 70,000 meters over the next 12 months. And with a market cap of around $188 million Canadian dollars today, that's about $2,570 of market cap per planned meter. Do your homework on Kney Silver today. That's ticker K O YF. I I I' I'd rather not experience this 30 times myself, but that's why we learn from you, Rick, and not through our own mistakes. Rick, uh rewind the clock, please, back to February 2nd. Uh what were you doing uh on that day, which is when gold and silver dropped? Well, actually, silver uh rebounded and then went down even more on February 5th, but the big correction, the big big single day drop

11:35 happened on February 2nd. Did you want to at the time, you know, buy back some of your uh position? Uh what what what was going on through your head there? >> On February 2nd, I was celebrating my birthday with a select group of friends in Nicaragua. >> Uh completely unconcerned with the gold market. >> Um I I'm not somebody I don't want this to seem like a sexist reference. I'm not somebody that's particularly good at observing tops and bottoms. Um uh and I'm really unconcerned. I'm not any longer a trader. Uh I am a speculator. I am an investor. Uh but

12:21 trying to kid myself that I would have the ability to call anything like a bottom is silly. But if I were to tell you, Rick, I mean, we're looking at in hindsight, but if I were to tell you, hey, silver is going to fall, let's say I have a crystal ball, silver is going to fall tomorrow, 30%. It's going to be the biggest single day drop since 1980. What would you do with that information? Assuming you knew in advance, >> uh, if you were talking to Rick Rule, nothing. Because I I sold my silver. It used up used up its purpose. It fell to a level that already exceeded my greed. I bought it at 20 thinking it will go to 50. Uh it would need to fall really really really substantially for it to be able

13:07 to occupy mind share in the speculative part of my portfolio. It is for me a different asset than gold and it serves a different purpose in my portfolio. other people feel differently and they need to act differently. >> Well, uh you had said in my January interview that you sold I think more than 50% of your physical silver. What have you done since the end of January? Have you bought back any of that silver? >> No. >> No. Okay. >> No. Uh I put about half the money into silver stocks. >> Mhm. >> Uh mostly successfully, but one one spectacularly unsuccessfully. Uh, I bought some physical gold which I bought for liquidity. I bought for savings. You know, I took some money off

13:52 the table. I do that when I speculate. If I have a really successful speculation, I get some of the money out of harm's way, which I did. And I used a bit of the money to increase my holdings in oil and gas equities. >> We're going to talk about oil and gas today. Actually, let's just jump straight into that and then we'll come back to gold. Uh we're going to get uh Rick Rule's uh gold um outlook for the remainder of the year and just the macro forces driving that towards the end of the interview. So stay tuned. Let's talk about oil and gas right now. Uh the WTI chart, let me pull that up before we talk about it. Uh everyone's looking at what's happening in the Middle East as a signal. And uh the WTI uh chart that I have in front of me, Rick, um the oil price has moved up steadily since the beginning of February. I wouldn't say

14:37 there's been a major spike because, you know, nothing's been happening yet in the Middle East. 8.45% up since the beginning of February and since um since the middle of February when tensions really started to ratch up with Iran, it's up 8%. Uh do you think the oil market has priced in any escalatory measures against Iran? In other words, if a strike were to happen in the next week or so, which is starting to look like that, uh, based on the fact that negotiations have not moved beyond stalemate, um, and we have the biggest wartime buildup in the Middle East since 2003, you know, has the oil market priced that in or not yet, you think? If there's a

15:23 military action in Iran, uh, and if Iran is capable of responding by temporarily shutting down the streets of Hormuse or threatening to shut down the streets of Hormuse, the oil quote goes crazy. I mean, crazy. It won't stay there because the Iranians don't have the physical capability to ultimately blockade the streets of Hormuse. They don't have that capability. But uh until it's proven that they can't, which will take what 4 weeks, 6 weeks, something like that, over 50% of the world's export crude moves through that 50k straight. And uh

16:08 the financial and psychological implications of that before they work themselves out would be tremendous. X a problem in Iran, which is to say if we get through this circumstance with no problem in Iran, the oil price in the very near term is ahead of itself. I'm extremely constructive about the oil price over 3 years or 5 years. Uh but I think right now uh WTI is a news trade. You know, it's an Iran trade. It doesn't reflect the imbalance between supply and demand in the oil markets. That balance between supply and demand is going to change and it's going to change dramatically, but that change isn't going to happen for 2 or 3 years, not 2 or 3 weeks. >> The fact that the oil quote hasn't gone

16:54 crazy yet, what does that signal to you? >> Uh perhaps disbelief that the United States and Iran are both stupid enough to take this to the brink. uh and also the fact that at present uh the world is at least adequately supplied. Uh for whatever reason too many people read the news they believe as an example that the US embargo on Russian oil and Iranian oil is working. Oil is fungeible and the US can tell India and China not to buy oil all at once and the U India and China buy oil and they buy it from who they want. So the fact that there's an embargo in place uh largely uninforce

17:42 hasn't affected oil output at all. Uh so in in the very near term you know we're producing or we have the cap we have the capacity to produce 106 107 million barrels of oil a day and we're buying 102 uh without uh Iran the crude market in the very near term would be heavy >> and uh actually this IEA report uh indicates that global supply is going to continue to build uh observed global inventories rose by 37 million barrels in December, taking total 2025 stocks builds to 477 million barrels. Uh inventories are expected to build by 477. Um in uh 2025, yeah, uh that's what the

18:29 number I just quoted. So we have here a situation where supply is growing steadily and this is not even factoring in uh geopolitical tensions. I guess the question is if the straight of hormones were to be closed and you're right about the you know the importance of that area that straight for oil transport do we have enough stockpile to absorb short-term shocks which is that why the oil market is moving currently? >> Uh it depends on how long that lasts really. >> Okay. Uh I mean there's an awful lot of oil and when you look at total oil production you have to segregate between total oil production a and export production. Uh the export production the surplus

19:14 which is Iranian uh Iraqi Yemeni and Saudi oil moves through the straits of Hormuz. If you shut down that, you're shutting down something like 20 million barrels a day. That makes an enormous difference. I I would also point out that the International Energy Agency in the long term has a track record almost unblenmished by success uh in terms of forecasting energy markets. They seem for whatever reason to den to deny the importance of sustaining capital investments in longerterm oil prices. They are much more focused on the six month than the six-year. And so if you look at their ability to give you information that's

20:00 usable in a reliable time frame, it's very low. The API, American Petroleum Institute, uh is probably a much better source of data. And how optimistic are you that Venezuelan oil fields will output considerably more oil now that essentially we're changing hands from Venezuelan uh leadership to American control of these oil fields. This is a uh study done by the center on global by the yeah the center on global energy policy at Columbia University. Uh there's a quote here from a researcher. There is no precedent whereby a regime change in a major oil producer has led to a rapid increase in output. In most cases such as Iraq, Iran, Libya, and the Soviet Union, oil output fell significantly often for years before

20:47 returning to prior peaks. I as an investor, I wonder how you would interpret this if it is true. >> Well, first of all, there hasn't been a regime change. >> Okay? Uh the United States kidnapped the head thug and his wife, but the sub thugs are all in place. Uh and they've been in place for 25 years. They put their cadres in the military. They put their cadres in Pedesa. They put their cadres in state and local governments. And I wouldn't describe them as friendly to Americans. So suggesting that a regime change is fatal plea is I think very premature. It may be uh Mr. Trump doesn't have me in a speed dial, but it may be that he has whispered to those thugs, uh, you can continue to persecute your people and you can continue to

21:34 steal as long as you steal with me for me. You know, we'll facilitate your condo in Miami, whatever you need. I mean, it may be that the fix is in, but there hasn't been regime change. Were there regime change, it would take at least five years to undo the harm done by the shaveistas. The I mean this is a country that has the highest level of proven reserves in the world larger than the Saudis and their production has fallen by 85% in 20 years. Uh it takes real skill to do that. Uh specifically, it takes a government that took all of the free cash flow from the oil and gas industry and they did it for politically expedient domestic spending

22:20 programs. Uh infrastructure shot, pipelines are shot, the human resources are shot. There's probably a hundred billion dollars that would need to be spent in Venezuela to restore that oil industry into competitive into a competitive position before you exploited their uh their equivalent to the Aabaska sands the orunno heavy oil belt. In other words, the conventional production uh offshore in Maraka on onshore would take a hundred billion dollars in 5 years to restore. And with the fiscal regime that's in place in Venezuela today, that won't happen. In addition to the hundred billion that's required, there's $60 billion in

23:06 outstanding judgments against the Venezuelan governments. Uh Mr. Trump thus far when he has stolen Venezuelan cargos, uh has run those cargos through cutter. So that ironically he has shielded uh the US government's theft of Venezuelan oil from judgments owned by US companies like Exxon and Chevron. This is real comedy. Uh all of those things would need to be addressed. Pave Pedvesa, well Venezuela itself had wonderful human resources in oil. Uh those resources are now deployed in Houston and Calgary andQatar and Brazil. Uh Pavvesa isn't an oil

23:53 company anymore. It's the equivalent of Canada Post, >> right? Okay. So bottom line, you're not you're not banking on grossly higher output anytime soon from either Venezuela or anywhere else in the world and you're bullish still on oil today. Is that is that the case? >> Absolutely. Yeah. I I mean in the very near term absent problem in Iran the oil price comes off. The first time that I remember that you and I talked about oil about a year ago. Uh I was pretty aggressive touting Exxon. That was at 100 bucks a share. Uh Exxon's at 160 165 now. I liked it more at 100 than I do at 165. You know that's just simple. If the story doesn't change, I'd prefer the story cheaper. >> Can you just give us your take on natural gas since we're on the subject

24:39 of oil and gas? Uh there seems to be have been a spike in the natural gas futures in late January. I'll just show it chart here. Uh it's come down uh very sharply. I suppose there was a um winter storm um you know in the United States uh that pushed it up and then it came back down very you know very aggressively as well. So um is that was that just weather dependent or are there other fundamentals you're looking at? >> No weather dependent. I mean, we had snow in Memphis, you know, we had snow in the Mississippi Delta. Uh, that doesn't happen very often. So, that was very temporary. Now, listen, the natural gas price, if you look back 3 years, has done extremely well. 3 years ago, you couldn't give away eco gas, right? >> Yeah. Uh and some of the circumstance

25:25 that we talked about, you and I together, uh in your current show and in your prior show had to do with the fact that uh you know 60 cents a buck Canadian per million BTU was unsustainably for unsustainably low for natural gas. It had to go up. It did go up. Uh I think that that period of low prices uh initiated a spending boom on infrastructure and in the United States uh increased gas export facilities and things like that that will enable the natural gas price to be materially stronger in the next few years. But it isn't the type of opportunity today that it was 2 or 3 years ago. there's not the hate around natural gas that there was then.

26:12 >> I'd like to draw your uh the viewers's attention now to the rule symposium which is happening um this July in Boca Raton and it's a summary of what you believe will be the most important thematic issues for resource investors this year and beyond. uh you gather speakers that you think will fulfill this agenda and you gather companies that you personally believe in. So what are the major themes in 2026 that investors need to be watching? I think the most important theme for 2026 and beyond really is uh our society's inability to keep its promises to each other which is to say uh the offbalance sheet

26:58 liabilities associated with entitlements uh and the aggregate level of government expenditures relative to the ability of the economy to sustain that. Uh that suggests to me that for at least a decade uh Americans and Canadians, in fact uh citizens throughout most of the Western world are going to be challenged by continually deteriorating purchasing power of their currency and of their savings. Uh I see myself and I think we'll make the case well at the conference that the purchasing power of most fiat currencies will decline by 75% over 10 years and investors need to prepare themselves for that because the

27:44 outcome I think is inevitable. I think we will also be able to show that uh we have underinvested in productive capacity around natural resources for as much as 30 years. It's particularly acute in places like copper, but it exists other places. And the consequence of that is that we will have two bull markets for the next 10 years. One in precious metals as a consequence of currency debasement and the other in industrial materials and base metals as a consequence of decades decades of underinvestment. Uh we will do that with some spectacular macro speakers. uh people who talk about the big picture but not from the point of view of the CBC or Fox.

28:30 Uh after we've explained to you the arithmetic of economics, uh we will introduce our attendees to analysts who have uh been successful in bull markets and bare markets over 40 years in natural resources. Not like many conferences, people who uh cut their teeth in the last 18 months of a bull market, but people who rather have seen good markets or bad markets. In our conference, unlike any other conference I know, every public company exhibitor has to be owned in the accounts of the conference sponsors, a unique test. At every other conference, the test to be a sponsor sponsor is a check that cashes. uh our test is much much much more

29:16 stout. Unlike any other conference uh before the conference I interview every speaker and every exhibitor those interviews are published on the rule investment media YouTube channel so that you arrive at the conference already for forearmmed you know how to spend your time at the conference because you've had the ability to preview the speakers and the exhibitors. No other conference that I know of does that. Uh but the primary differentiator between my conference and all of the others is that whether or not you come to my conference live or you watch it from the comfort and convenience of your own home via liveream, my conference has an absolute money back guarantee. If you think for any reason, whether you watch it via

30:03 live stream or whether you wa watch it live, that I didn't give you your money's worth, I'll give you your money back. >> How many refunds have you actually gotten in the last couple years? I'm just curious. >> Pardon me. >> How many refunds have you actually gotten in the last couple years? I'm just curious. >> Last year, as I understand it, we had no refunds, okay, requested from the live audience. We had three refunds requested from the online audience, and there were 1,400 people that attended online. Now, maybe we did an extra good job last year because our 30-year average is onetenth of 1% of the tuition raised. In other words, infiniteesimally low. >> Well, I've been told, just personal anecdote, that your conference is one of the better ones for the retail audience. I've never been. I'm very honored to

30:49 been invited this year, so I'm attending for the first time. So, I will see you there. I'll put the link down below where you can uh where you can get your tickets. Rule uh Rick uh so rule symposium in July. We'll follow up closer to the date uh to uh talk about the program in some more detail. Uh let's go back to the markets. So I promise the audience we will get your gold outlook. Uh the major themes that are driving gold even today it's sticky around $5,000. Uh it's 5,252 now. It was just 5,000 a couple days ago. So it's moving up and down $200 in a single day. That's the current environment we're in. Uh, somebody asked me uh an interesting question the other day and maybe we can tie this to gold. Maybe maybe we don't. And the question was, "How are you preparing for

31:34 retirement?" And admittedly, as somebody in my mid-30s, I'm not really thinking about this issue. Maybe I should be thinking about it in a little bit more detail. I don't have an answer to that. How would you answer that question? If I were to show you a chart of the purchasing power of the dollar in the 1900s, let me just open this up right now. uh what would n what would uh $30 look like in 1900? Now, actually, I saw I saw a similar version of this chart where you start with $100 um $100 in 1900 versus 100 $100 in first, sorry. Uh what would that be worth in 2020, that would be worth $36. And I'm not saying I'm going to live another 120 years. I'm just saying if I were to park my cash over time, I'm losing value precisely because of the

32:20 reasons you stated earlier. Fiat money loses value over time. What do we do then? >> David, I can I can scare you even better even at your age. You're looking at this chart and you're saying, "Uh, what use is it to me to take this chart back to 1900?" >> Yeah. >> Run the chart from 1970 >> or run the chart from 2000. This long tail that you see to the right >> if you run the chart over a shorter time frame becomes much more dramatic. M >> since the year 2000, gold has been increasing in nominal terms in US dollar terms by 8.7 or 8.8% a year.

33:06 Um when I I run a thought exercise myself uh and I look at my own accounts in US dollars and I look at it in gold. When I look at it in gold, uh, real estate prices in the period 2000 to 2026 seem cheap. Vancouver real estate priced in gold has gone down since the year 2000. Uh, grocery prices, which are a political issue, have gone down. Health insurance, which in the US is a political issue, has gone down. Uh, it isn't. Uh I would argue that price that aggregate price levels are on a tear. It's that the purchasing power of our media milk has change has gone

33:52 down. And David, if you aren't concerned about your retirement at age 30, you aren't going to have a pleasant retirement. >> Thank you for that. >> Well, I just >> I I agree. Yeah, >> that's just the way it is. Too many Americans believe that the US government or social security or something's going to bail them out. Think about if I'm right that the US dollar and the Canadian dollar lose 75% of their purchasing power over the next 10 years. What that means that a pensioner uh in Canada that's getting $4,000 a month now uh having a tough time with rent and food will need $16,000 a month 10 years from now. What are the probabilities that that's

34:39 going to have a happy outcome? I would suggest zero. >> Most viewers, I'm betting, are either involved with a 401k in the US or an RSP in Canada. So, retirement savings accounts, contributions to retirement savings accounts by your employer. Most people are probably enrolled in that in some form. Uh some people have opted out. Uh but that's what most people are faced with. We don't most of us don't have millions and millions of dollars to park in either real estate or gold. But I'm speaking for the majority of people, including myself. So, what do we do with our retirement savings accounts? Do we still opt in? What how do you feel about 401ks and RRSPs? >> Uh, I think that a 401k or an RRSP or an

35:24 IRA is the only form of savings, not the only, but is one of the best forms of savings to shield your retirement from government theft, which is to say tax. The biggest risk that you face other than uh making investment mistakes is the sure sense that if you're prudent enough to save some money that the government will do their best to take it. uh and uh I am in favor of any kind of savings provided that the savings are invested intelligently uh and provided that to the extent you can you shield the savings from tax uh and when I say invested intelligently

36:11 you know I really do mean prudently if and for the long term not traded David this isn't a question you asked me but I'm going to answer it anyway >> yeah please >> uh Fidelity Investments did a study. You know Fideli handles millions of investors worldwide, tens of millions of investors. And they cut up, sliced and diced their investor universe ethnicity age race sex you know, income, all that kind of stuff, trying to figure out how to market to various subsets of investors and how to serve them better. And they found that the best performing subset of investors in the Fidelity universe over 10 years were estates. They were dead people who didn't chase feds, didn't pay capital gains tax,

36:58 and investors for the long term. And so in addition to the fact that you have to save, uh I think you have to invest prudently, not jump from fad to fad to fad, but whatever you do, you have to save. If you think today that your retirement income will be sufficient depending on your age to fund your lifestyle, what you need to do is factor in the arithmetic of uh a 75% deprec depreciation in the purchasing power of your investments and then say is the yield that I expect to get on my investments 10 years from now sufficient to fund my retirement? with a 75% deterioration in purchasing

37:45 power. Yes or no? If the answer is no, you need to adjust your rate of savings and you need to adjust your lifestyle expectations. And those are very, very, very hard decisions, but you need to do them now. Well, if you just consider the global monetary conditions today and speculate as to whether or not the deterioration of purchasing power will either accelerate or decelerate, meaning we'll get a more stable economy in the future, stable inflation. Which side would you air on? >> Pretty clearly a worsening of the circumstance. The arithmetic of western democracies, the fiscal aris arithmetic of western democracies is

38:31 lousy. I it's in fact unsustainable. Um at some point in time you can you and I can talk about that at length but suffices to say it's unsustainable. The only thing that I can think of that would change it for the positive would be uh really dramatic breakthroughs in technology. Uh perhaps AI is that dramatic breakthrough. But AI while it could benefit society as a whole will be fairly difficult on the people it replaces. >> All right. Uh, how do you feel about uranium uh at current levels and the thesis for uranium now? Uranium's already gone up a lot.

39:17 >> Yep. >> Um, and I'm wondering if there's more room to climb. >> I think this is going to be a reasonably good year for uranium. Uh I think this is the year where the market begins to focus on the fact that the um uh production deficit has eaten away at the above ground inventory enough that uranium users need to lock in supplies. The fact that the spread between the contract price and the spot price is growing fairly substantially means that nuclear utilities are willing to pay more for uranium this year than they would have to spend to buy on the spot price in return for price security in the out years. I didn't attend the World Nuclear Association meetings this year. I had other things to do but I played some of

40:03 the tapes and one of the things that struck me that I'd like to share with your audience is this. There was an assumption from the dis that the above ground inventories of uranium worldwide were about 200 million pounds. I don't know whether that's true because those inventories are very opaque. But they said that in the context of a 200 million pound inventory that a 30 million pound deficit wasn't an alarming thing because you could advertise that inventory that deficit if you will over six years. What they neglected to point out, uh, a rather glaring error, is that the Sprat Physical Uranium Trust owns 82 of those 200 million pound. And while that 82

40:48 million pounds is technically inventory, it's not for sale. There's no mechanism to sell it. So if you cut that uh buffer by 40%. Then you begin to understand the urgency by which uh reactors are starting to come into the uranium market. The spot market where they have traditionally sourced their inventory has become very very thin. Most days the spot physical uranium trust outs sells the spot trust the the spot market 2:1 which is to say the tail's wagging the dog. Uh and that has meant that the industry's reliance on the spot market for fuel supplies for

41:33 20 years is coming to a screeching halt. And the industry is starting to recognize that it's starting that's starting to be recognized in the growing popularity of these term contracts and that can only be good for the Iranian business. >> Uh any other u mining company uh news that you've been following recently that you've been analyzing that you can share with us, Rick? Well, the most interesting thing I've seen in the last week >> Mhm. >> was that huge transaction negotiated by Wheat and Precious and BHP, BHP being the largest mining company in the world, uh, and the mining company with the most financial flexibility in terms of free cash flow. Uh despite that uh BHP sold part of the silver stream for the

42:19 Antimina deposit to uh Wheat and Precious, a much smaller company for $4.2 billion. What does that tell us that's important for us to know? Two things, at least three things. The first, the copper industry worldwide understands that they have to spend a minimum of $250 billion constant dollars, $225 to maintain their current output in a market where there's already a structural deficit where demand is growing by 2% compounded. they need to raise an incredible amount of money uh which BHP has acknowledged with this huge transaction.

43:04 The second thing that we need to understand as investors is that uh free cash flow in precious metals but particularly silver uh in a streaming vehicle where investors don't need to concern themselves about operating costs and sustaining capital investments is priced much higher than that same free cash flow in a copper company. At BHP that cash flow is recognized at a premium at about seven times cash flow. In wheat and precious that same cash flow trades for between 15 and 20 times free cash flow which means that the streamers and the royalty companies have a permanently lower cost of capital than the senior producers.

43:49 What it means also for investors uh the knock on royalty and streaming companies has been that the big transactions that built Wheaten and Franco 20 years ago 30 years ago don't exist anymore which is precisely wrong. The biggest transactions are in front of them uh financing mergers and acquisitions and financing the incredible construction budgets ahead of the copper companies. These are good for the copper companies because they lower their cost of capital and they're good for the royalty and streaming companies because they lock in optionality uh both exploration optionality but also price optionality and they lock in free cash flows for 30 years. Uh I I think this is a very very very

44:36 important trend that resource investors need to pay careful attention to. lots and lots and lots of knowledge in this and there's lots and lots of opportunity in this >> with resource prices the way they're let's finish off here with resource prices the way they are I'm talking about commodities overall with uranium copper gold silver all having risen from a couple years ago uh at this stage in this cycle would you rather heir towards the producers the large companies uh the large producers mid tier producers or explorers transitioning into a producer in In other words, latest stage developers or early stage explorers all offer different, I guess, risk return profiles, but with gold at $5,000, producers are printing cash. Explorers

45:24 are finding it easier to obtain capital. Where would you prefer to go, >> David? At some point, that's a trick question because it depends on who the investor is, what their time frame is, and how hard they're willing to work. I myself uh for some substantial time uh believed that I had better opportunity on the big end of the market in the beta because early in a bull market uh just capturing the beta gives you great returns without much risk. Uh and the alpha got ahead of itself. Uh you'll recall in October I sold 25% of my juniors for the same reason I sold my silver. They gave me too much too quick. Uh, now I'm moving back into the junior end of the market, but I'm doing it as a

46:10 guy with 50 years experience in the market that spends full-time in the market. Most of your viewers have lives. They have kids or grandkids. They have jobs. They like to garden or fish. Uh, for people who aren't doing willing to do the work, they need to derisk their portfolios. They need to buy the beta. They need to forget the alpha. Forget about the fact that when you're walking down Vancouver, you bump into somebody who owned Amalgamated Moose past your minds and accidentally got a 10 to1 return. Uh you need to think about the probability that you'll get that same return not doing any work and the probability of that is zero. So unless you're willing to exercise the advantage of living in Vancouver, uh visiting the companies personally, reading the reading the annual reports,

46:55 the quarterly reports, the proxies heir to the big end of the market. >> Okay. Well, do you still rate people's portfolios? By the way, that's a service provided for years. >> Thank you for that. Any of your listeners who care what I have to say about natural resources can personalize it by going to my website ruleinvestmentmedia.com. And if you list your natural resources, I personally will rank them for free. One being best, 10 being worst. I'll comment on individual issues where I think my comments might have value. Sidebar as always, David, please no crypto. Please no pot stocks. Please, no tech stocks, you know, uh, leave an old resource guy to do what he does best. Rule Investment Media, list your natural resource stocks and I'll rank them. >> Perfect. We'll put the links down below and, uh, we'll put the links to, uh, the

47:41 Rule Symposium as well where you can buy your tickets. Thank you very much, Rick. I'm looking forward to uh, the next interview. Take care for now. >> Always a pleasure and I'm honored that you're coming down to Boca Raton. I look forward to seeing you there. It >> it'll be a great pleasure to attend. Thank you for the invitation and thank you for watching. If you're the audience, don't forget to like and subscribe.