I just hate it when I have to admit that I was dead wrong about something as important as calling for a major crash in October. Perhaps a little whining would make it go down easier.
Something very bad comes this way. Right out of the blue the Fed began to dump bundles of crisp $100 bills onto a financial fire in the middle of September when the overnight rate shot to 10% with no warning. What was termed a temporary injection of cash into the REPO market has turned into a flood that looks to last a lot longer than forty days and forty nights. With an attempt to show some levity Chairman Powell insists they are not initiating QE infinity but for those of us who can add and subtract, we know it's bull. It looks and sounds a lot more like the end of the financial system. If it relates to a bank with a symbol of DB, it will be the end of the financial system.
So there is no crash but what is hidden behind the curtain is probably far worse. So I was sorta right. Gold and silver had mild responses to the flow of funds but the Fed has pumped new hot air into the stock market which looks a lot more like a corpse than a healthy market.
One day soon the metals will reflect the Fed's balance sheet going ballistic. I'd still like to see a correction in both gold and silver as we slide into the Tax Loss Silly Season expecting shares of juniors to take a dump into mid-December. I suspect there will be a lot of low hanging fruit dangling for the next six weeks just waiting for a well cashed up investor to pluck some nice assets.
Maple Gold Mines Ltd. (MGM:TSX.V; MGMLF:OTCQB; M3G:FSE) comes to mind. I wrote about them a month ago and said you could buy gold for $3 an ounce and that seemed cheap to me. As they promised, they have issued a new 43-101 that counts fewer ounces but of much higher quality. So now at today's prices, you would have to pay $6 an ounce for quality ounces in one of the best jurisdictions in the world. I don't see how that can be anything other than a great deal. I took the opportunity to pluck some shares myself in the open market. When the gold juniors and the metals react to QE Forever and a Day, the leverage Maple offers is superb.
I suspect the shares are cheap because investors are bored with the stock after years of little action. I believe that will change soon and $6 an ounce for gold will be a distant memory. Certainly "Bitcon" and weed stocks have sucked off a lot of the speculative money from the resource sector. But as I have said a lot of times, if you buy cheap and sell dear you can make a lot of money. Maple Gold is cheap.
Maple is an advertiser. I own shares and naturally that makes me biased.
Maple Gold Mines
MGM-V $0.09 (Oct. 30, 2019)
MGMLF-OTCBB 237.4 million shares
Maple Gold website.
Bob Moriarty founded 321gold.com, with his late wife, Barbara Moriarty, more than 16 years ago. They later added 321energy.com to cover oil, natural gas, gasoline, coal, solar, wind and nuclear energy. Both sites feature articles, editorial opinions, pricing figures and updates on current events affecting both sectors. Previously, Moriarty was a Marine F-4B and O-1 pilot with more than 832 missions in Vietnam. He holds 14 international aviation records.[NLINSERT]
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