“There’s No Gold” – COMEX Report Exposes Conditions Behind Physical Crunch

Gold miners are being shut down all over the world due to the coronavirus.

The world's largest gold company, Newmont Corporation, has withdrawn its full-year 2020 guidance after being forced to shut down four of its operations due to the COVID-19 outbreak.

According to Bloomberg, Gold Shortages are Happening NOW!

Listen to Legendary Gold Investor Rick Rule of Sprott Global Discuss Where to Position Yourself in the Gold Market…

As discussed in our interview with Rick, here is one of his holdings for upside.

***Special Note*** Unlike Newmont, who has an operating mine, GoldMining acts more like a gold resource mineral bank – or as Rick has referred to call it, 'a gold hoarder.'

It's an investment strategy that has worked spectacularly for Rick Rule and others in the gold investing space.

Amir Adnani: The founder of this company is considered by many to be the next big thing in the gold industry. Those aren't my own words, but those of some of the most experienced analysts and street-savvy magnates in the business.

Direct Leverage to Rising Gold Prices: In 2016, gold traded for $1,380 at its HEIGHT, a 30% rally in the January to August period.

Respectively, GoldMining Inc. (TSX: GOLD & US: GLDLF) went from CAD$0.37 to CAD$3.14, a 665% BLOWOUT.

Resource stocks are HIGHLY CYCLICAL. The entire profession of smart speculation on mining companies centers on three basic PREMISES:

1. Timing.
2. Valuation.
3. Leverage.

Once you’ve (A) identified a serially successful entrepreneur, (B) analyzed his portfolio of world-class projects in safe jurisdictions, (C) researched his balance sheet and found it to be clean, (D) noticed the strong insider ownership in the public stock, (E) and seen that management is actively advancing the pipeline of projects, you MUST be prudent and triple-check that this particular company is undervalued, offers ULTIMATE positive leverage and that the timing is ideal. This isn’t an easy task whatsoever.

After the best year for gold since 2010 and with the possibility that the dollar has PEAKED for this cycle, gold’s latest correction from $1,611/ounce on WW3 rumors, down to the mid-$1,500s today, is an IDEAL entry point for new positions, as we see it.

GoldMining Inc.’s current market is CAD$185M, even though (1) OVER CAD$280M has been spent on the company’s wholly-owned assets ALREADY by past owners, and (2) at their historical highs, the company’s current assets, when held by their previous owners, were collectively valued for CAD$822M, which is over CAD$600M more than the market cap of the company today.

This is a rare opportunity to own what we see as an IDEAL stock, entering 2020 with momentum after a strong 2019. The company has NO DEBT, nearly CAD$9M in cash (so no need to dilute), with gold ready to have another SOLID year.

Since 2011, the major mining companies have been deleveraging, spending less and less on (A) exploration, (B) mergers & acquisitions and (C) on building their portfolios, in general. Consequently, the slump in production, the delays in permitting new mines and putting them into production and the lack of new discoveries, have all played right into OUR HANDS.

Since 2011, GoldMining Inc. (TSX: GOLD & US: GLDLF) has focused on one thing: PURCHASING projects with documented resources, not speculative exploration projects, not dirt that may or may not hold minerals. In other words, no “hail maries,” but instead resources in the Measured & Indicated category and the Inferred category.

When I sat down and compared its properties with other companies in its size, GoldMining (US: GLDLF) controls one of the LARGEST gold resource portfolios across all juniors in the Americas. To put this into context, there is NO OTHER executive on the planet, which in the past decade has been able to purchase on behalf of his shareholders a group of projects with more resources at a lower cost, than Amir Adnani, as far as we can tell. That requires a keen sense of timing on his part, an ability to raise funds in tough times, and the discipline of PATIENTLY WAITING when prices are too high.

The result is this expansive portfolio:

Past performance is not a predictor of future results, but it is fairly obvious that gold stocks, and specifically GoldMining, tend to move with the gold price.

The real question is: do you think gold is going to go up or down over the next 1 to 3 years?

Let's think about the recent headlines…

***Federal Reserve's Balance Sheet Tops $5 Trillion for First Time!

***Senate Passes Massive $2 Trillion Coronavirus Spending Bill.

As Rick Rule noted in his interview, like in 2008, gold stocks didn't react to the crisis, but to all the governments' and central banks' responses to the financial crisis.

And right now, we are seeing an unprecedented level of money printing from global central banks.

Since 2012, the major mining companies have been deleveraging, spending less and less on exploration, mergers & acquisitions, and building their portfolios in general. Consequently, the slump in production, the delays in permitting new mines and putting them into production, and the lack of new discoveries couldn't have come at a worse time…

Congress has approved $2.2 trillion dollars (10% GDP), this dwarfs anything thrown at the 2008 financial crisis!

The COVID-19 crisis has already surpassed the cost of World War 2! WWII remains the most expensive war ever fought… Inflation adjusted it cost the world $6 trillion, the stimulus already committed by global government and central banks in 2020 has already surpassed this number.

There has never been a scenario like this, mines are shutting down, demand for gold is at unprecedented levels, and the Fed's balance sheet just breached $5 trillion for the first time ever!

Since 2011, GoldMining Inc. (TSX: GOLD & US: GLDLF) has focused on one thing: PURCHASING projects with documented resources, not speculative exploration projects and dirt that may or may not hold minerals.

In other words, no 'Hail Marys,' but instead resources in the measured & indicated category and the inferred category.

When I sat down and compared its properties with other companies of its size, I found that GoldMining (US: GLDLF) controls one of the LARGEST gold resource portfolios across all juniors in the Americas.

To put this into context, there is NO OTHER executive on the planet that, in the past decade, has been able to purchase a group of projects with more resources at a lower cost on behalf of his shareholders than Amir Adnani, as far as we can tell.

That requires a keen sense of timing on his part, an ability to raise funds in tough times, and the discipline of PATIENTLY WAITING when prices are too high.

In total, about $80M in cash and shares has been spent to acquire these properties that hold a collective 10.5Moz M&I RESOURCE and 12.4Moz INFERRED RESOURCE.

One asset alone, the Titiribi project in Colombia, had a market capitalization of $334M at the turn of the previous decade – that's nearly DOUBLE the company's entire market cap today.

The point is that the HEAVY LIFTING has been done. Amir has assembled an expansive portfolio of gold projects that we think is IMPOSSIBLE to mimic now that gold prices have increased.

The efficiencies, created by consolidating this array of assets, which were once scattered among seven companies (all issuing salaries and paying regulatory fees) under one roof, with a coherent strategy, is an effective SYNERGY.

Leverage is what GoldMining Inc. (TSX: GOLD & US: GLDLF) offers most clearly, as we view the situation. As the price of gold goes up, its portfolio value should also logically increase.

I own plenty of physical coins. With this investment, though, I’m setting myself up for the rewards that come with LEVERAGE!

The best example of this paradigm shift is with the optionality plays. This is why I'm personally LONG on GoldMining Inc. (TSX: GOLD & US: GLDLF) right now.

As you can see, out of all the gold explorers and developers in the Americas, GoldMining Inc. (US: GLDLF) has one of the LARGEST portfolios of total measured & indicated and inferred ounces across all projects.

In other words, if miners' gold resources begin to get priced at more bullish valuations, GoldMining Inc. (US: GLDLF) has special potential.  

In 2016, the company's assets were valued at a multiple of four compared to today's price. Said differently, in the eight-month rally of 2016, which saw gold peak at around $1,380/ounce, this stock was 400% more expensive than today – that's the potential upside when things heat up, and right now it's starting to boil over when it comes to demand for gold assets!

In our view, the company is one of the best-run in the business with Amir Adnani at the helm. This is why Rick Rule and others are invested.