Brien Lundin: Fed is Creating the Next Crisis, Fuse is Lit for Gold and Silver
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"You don't go from the easiest monetary policy in human history to one of the harshest rate-hiking cycles ever seen without breaking a few things," said Brien Lundin of Gold Newsletter.
The US Federal Reserve is creating the next crisis, and in doing so it's lighting the fuse for gold, silver and related investments to take off — that's according to Brien Lundin, editor of Gold Newsletter.
"You don't go from the easiest monetary policy in human history to one of the harshest rate-hiking cycles ever seen without breaking a few things," he told the Investing News Network. "The next crisis will bring much more easy money — far easier money — and that's going to send gold and silver and the associated investments much higher in my opinion."
Lundin has said before that now is the time to invest in junior mining stocks, and he still believes that's the case.
"The time to buy is now. The juniors have not by and large reacted to this yet, and there are just bargains galore out there — real opportunities," he said, noting that prices for gold and silver appear to be bottoming out.
"If it plays out as I think it is very likely to — that we're going to see a Fed pivot and another crisis coming up — at some point this could be a generational opportunity," Lundin continued. "Unlike say, 1999 to 2000, when gold was trading at US$252 an ounce, right now we're within a few percentage points of all-time highs, yet the mining share market is still bombed out and really not moving." In his view, a big move in metals prices could bring a quick response among the juniors.
In terms of where to look for these potential opportunities, Lundin said that when it comes to gold and silver there are many companies with large identified resources selling at fractions of what they should be given current metals prices.
"You have the opportunity to get in some of these resource-rich, proven value companies at perhaps a quarter of what they should be selling for, especially if we have a gold rally," he said. "And those are the kind of returns that you would normally associate with a grassroots discovery, a drill play — but with more risk in that scenario. So you can mitigate your risk, you can protect your downside by buying these companies that have real value at these dramatically discounted levels."
Knowing when stocks may start to move is tough to pinpoint, but Lundin is confident that now is the time to position.
"Nobody knows what the future holds again in any great detail, but you can be very confident that you're going to want to own gold — and gold- and silver-related investments like the mining stocks — going into it," he ended by saying.
Watch the interview above for more from Lundin on gold and silver. You can also click here for our Rule Symposium playlist.
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Securities Disclosure: I, Charlotte McLeod, hold no direct investment interest in any company mentioned in this article.
Editorial Disclosure: The Investing News Network does not guarantee the accuracy or thoroughness of the information reported in the interviews it conducts. The opinions expressed in these interviews do not reflect the opinions of the Investing News Network and do not constitute investment advice. All readers are encouraged to perform their own due diligence.
