How much is de-dollarization driving gold?

Stijn Schmitz welcomes Edward Bonner to the show. Edward Bonner is an Investment Associate at Sprott Asset Management USA, Inc. The discussion centers on the current state of gold and precious metals markets, with Bonner offering insights into the emerging gold bull market and broader commodity trends. He argues that gold remains significantly under-owned, with most portfolios holding less than one percent of gold compared to historical averages of six to seven percent. He believes the current market is in the early stages of a potential bull market, driven by factors such as monetary debasement, fiscal largesse, and central bank buying. The recent geopolitical tensions, including the freezing of Russian assets, have prompted central banks to increase their gold holdings.

They explore various indicators for gold’s potential, including the M2 money supply and the Dow Jones Industrial Average to gold ratio. Bonner suggests that gold is currently an attractive hedge against inflation and geopolitical uncertainty. He sees particular value in gold mining stocks, especially growth producers, developers, and late-stage explorers. When evaluating mining projects, Bonner emphasizes the importance of management teams, jurisdiction, and project metallurgy. He highlights the potential for mergers and acquisitions in the mining sector, given the significant free cash flow of senior producers.

Beyond gold, Edward discusses other potentially undervalued commodities, including platinum, natural gas, and vanadium. He sees interesting opportunities in geographical regions like the Guyana Shield, parts of the Arabian Nubian Shield, Mexico, and Argentina, while cautioning about the challenges of exploration and jurisdictional risks.

Timestamps:
00:00:00 – Introduction
00:00:40 – Gold Market Pullback Analysis
00:02:28 – Long-Term Gold Sentiment
00:05:01 – GDX ETF Outflows Discussion
00:06:22 – Historical Bull Market Parallels
00:08:39 – Key Economic Indicators Tracked
00:10:55 – De-Dollarization and Central Banks
00:13:04 – Value in Gold Miners
00:15:03 – Project Quality and Management
00:18:40 – Platinum Supply Demand Imbalance
00:21:59 – Unloved Commodities Overview
00:25:07 – Vanadium Market Crash Course
00:26:55 – Emerging Geographic Exploration Areas
00:33:39 – Concluding Thoughts

Guest Links:
Website: https://sprott.com
X: https://x.com/sprott

Mr. Edward Bonner is a graduate of the Colorado School of Mines, with a master’s degree in Economic Geology. Prior to joining Sprott in 2021, he worked as an exploration geologist since 2011 for various junior exploration and royalty companies. His fieldwork has spanned the North and South American continents, as well as the African continent.

He specializes in porphyry systems and sed-hosted copper type deposits, but has experience exploring for, and studying, a broad range of ore deposit types. He is fluent in both English and French, and can speak Spanish and German at an advanced level. He is passionate about exploration and discovery, and takes a long-term, value-focused approach to investing. He leverages his years of industry experience and extensive knowledge base, along with the combined intellectual capital in the firm (including geology, engineering, financial analysis and portfolio management), to identify high-value investment opportunities.