Top Stories This Week: Gold Gets Inflation Data Boost, Tesla's Musk Mulls Lithium Mining

Gold Investing
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Gold rose on hotter-than-anticipated inflation data this week; meanwhile, Tesla's Elon Musk said the company may eventually need to mine and refine lithium.

Top Stories This Week: Gold Gets Inflation Data Boost, Tesla's Musk Mulls Lithium

Gold was able to end this week on a high note. Its lowest point for the period was just over US$1,940 per ounce on Monday (April 11), but since then it's trended upward.

The yellow metal rose to the US$1,980 level for a brief amount of time on Wednesday, and was still relatively elevated on Friday (April 16) afternoon, sitting at US$1,974.

Helping push the metal higher was hotter-than-expected US inflation data — the consumer price index rose 8.5 percent year-on-year in March, marking its biggest increase since December 1981.

Moving away from gold, the lithium space was rocked by the news that Tesla (NASDAQ:TSLA) is considering entering the market. Leader Elon Musk said on Twitter (NASDAQ:TWTR) that prices have gone to "insane levels," and if costs don't improve the company may have to start mining and refining the commodity.

Lithium is a key component in electric vehicle (EV) batteries, and experts like Simon Moores of Benchmark Mineral Intelligence have suggested that supply and demand fundamentals will ultimately make it necessary for EV makers like Tesla to take a larger role in mining, perhaps by providing significant funds to move new projects forward.

So far Musk hasn't issued any follow-up tweets about lithium — although that may be because he's busy with his hostile takeover of Twitter, which clocks in at US$43 billion.

With Musk's comments in mind, we asked our Twitter followers this week if they think Tesla will really mine or refine lithium at some point. Most respondents said yes, although around 40 percent were in the "no" camp.

We'll be asking another question on Twitter next week, so make sure to follow us @INN_Resource and follow me @Charlotte_McL to share your thoughts!

We're going to end with a very brief note on cannabis. If you've been following along, you'll remember that the Marijuana Opportunity Reinvestment and Expungement Act, better known as the MORE Act, cleared the US House of Representatives earlier this month, leaving market participants hopeful about federal legalization.

INN's Bryan Mc Govern has spoken extensively with market watchers about whether this will happen, and the consensus seems to be that the legislation is unlikely to make it past the Senate. But interestingly, it seems that some cannabis companies may not actually want to see the drug gain acceptance at the federal level.

Why? A slew of multi-state operators have worked hard to thrive in America's individual state markets, learning the ins and outs and building their presence without competition from Fortune 500-size firms and companies in Canada, which won't be able to break in until there are changes in federal policy.

"While everybody's waiting for federal legalization — or legislation to allow listing and banking — (multi-state operators) continue to grow state by state. They continue to gain licenses. They continue to grow sales. They continue to generate strong cash flow" — Charles Taerk, Faircourt Asset Management

What would be more useful to these players is banking reform, which is covered by the SAFE Banking Act. It would ease roadblocks in day-to-day operations, and also looks more likely to get approval.

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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.

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