The Phaserl


Rick Rule: “Speculative Profits Are Made On The Delta Between Stupidity & Fact”

by Tekoa Da Silva, Sprott Global:

During a time in which downward volatility of the junior resource sector has resumed in force, Rick Rule, Chairman of Sprott U.S. Holdings was kind enough to share a few comments.

When asked if we’ve seen the ultimate capitulation in junior resource markets yet, Rick noted that, “We haven’t had a capitulation yet… we’re beginning to see the types of market volatility, rabid moves up and down on no volume, that are normally the “rattle” of the rattlesnake of capitulation. But the market hasn’t followed through yet, and I think that’s a consequence of the recent strength in the gold price.”

With regard to the recent political and social turbulence associated with West Africa, Rick commented that, “With regards to what happened in Burkina Faso, the probability of that set of events being unpleasant for mining is very small, and so it’s pretty obvious to me that the sell-off engendered an opportunity.”

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1 comment to Rick Rule: “Speculative Profits Are Made On The Delta Between Stupidity & Fact”

  • rich

    World Gold Council Rectifies 2013 Chinese Gold Demand

    The WGC has revised its estimate of China’s 2013 consumer demand to 1,275 tonnes, up from their initial estimate of 1,066 tonnes.

    My research on the Shanghai Gold Exchange and the structure of the Chinese gold market was, inter alia, confirmed in September this year by the work of Na Liu (CNC Asset Management Ltd.). As myself Na concluded Chinese wholesale gold demand equals withdrawals from the Shanghai Gold Exchange and this is far greater than demand reported by the World Gold Council.

    The World Gold Council (WGC) has never openly responded to my publications. However, Na met with the WGC Market Intelligence team, the discussion that ensued led the WGC to rectify their 2013 Chinese demand numbers. From CNC Asset Management, November 27 2014:

    Additionally, 2014 will at least add 900 tonnes to the aggregated difference. At year end the total aggregated difference will be well over 3,100 tonnes.

    In a forthcoming post I will once again share where I disagree with all the excuses the WGC presents in the CNC Asset Management report. A few more details I have to work out about the gold lease market, after which I can demonstrate the WGC is simply unwilling to accurately report on Chinese gold demand.

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