Summary
➡ The article discusses the correlation between the national debt and the price of gold, suggesting that as the debt increases, so does the value of gold. It also mentions that the U.S. debt has grown six times since 2000, and this trend is expected to continue. The article suggests that this could lead to an increase in metal prices, especially gold, and that this could be a strategy to manage the growing debt. The article ends by discussing potential future economic strategies and the possibility of using gold to erase the debt.
➡ The U.S. is considering growing the value of its reserve assets, like gold and cryptocurrencies, to manage its debt. There’s speculation that the government may increase the value of Bitcoin to pay off the debt. However, it’s unclear if they have enough Bitcoin or other cryptocurrencies to solely rely on this strategy. They might also revalue the Federal Reserve’s gold certificates, but this would require finding buyers at the new price.
➡ Mining companies have been working hard to cut costs over the past few years, but with inflation and increasing demands from employees and governments, costs are rising again. The easiest and cheapest mining assets have mostly been used up, so future mining will likely be in more expensive or risky areas. Despite higher metal prices, mining companies are not making much profit, especially those producing silver. The companies need to be careful with their spending, as costs will not decrease even if metal prices do.
➡ The company is optimistic about the year 2025, especially for junior equities. They are preparing to be in the best position for the upcoming cycles with one of the best assets in Mexico. The company is cautious about making deals that are beneficial for shareholders and not just selling the asset for a low price. They are looking for the right partner to work together for the benefit of all shareholders and to become a major powerhouse in the equities market.
Transcript
Well, hello there my friends. Chris Marcus here with you for Arcadia Economics as we continue on with our coverage of the gold and silver markets and what has been a historic year. I’m placing this number three in my all time gold and silver years. And yes, anyone out there who’s looking up the price charts, I know that if you look just from start of the year to the end of the year can distort things. Although when we think about the impact and size of moves, I would say pretty safely this stacks right up there under 1980 and 2011.
Then fortunately someone who has been covering this with me along throughout this historic year is Steve Cope of Silver Viper. And Steve, great to have you back on in here today. How are you doing my friend? I’m doing well, Chris. It’s good to be back on. Yeah, I, I certainly would count it as one of my historic years for the metals prices for sure. Yeah. And Steve, to dig right into that first of all is that, you know, we had people panicking after the election which let’s go back on our chart. Okay. So there we have the election.
We had the sell off which brought prices down quite a bit after the sell off last week. You can see we’re a little lower than before that. Although a lot of that has recovered similar picture in silver which I would suggest again I know people like to know how things are going on a day to day basis. So Steve, as I think we talked about last month, wonder if by the time Trump’s get Trump gets in and starts implementing some of the plans that they have talked about if people might have a different view on that.
And sure enough we have seen some recovery in the gold and silver markets. Last one I’ll point out before getting your thoughts on this is again we had a similar situation. The dollar index was rallying into and after Trump’s win in 2016, got over 103 in early 2017, was below 90 by 2018. So I know I said last one. Although, Steve, I’ll tack this on that. As I was looking at some articles of the gold and silver reaction at the last one, you know, they were talking about how gold had just gotten pummeled, but it’s recovered back over $1,300 and obviously here we are at 27, just under 20 726, 71 today.
So, Steve, long intro setup there, but any thoughts on how we have seen a bit of a recovery here and as we end up and round out the end of the year in 2024? Yeah, no, I mean, I think there’s a lot to that. One of the things I think we’re seeing every time there is a dip in prices, we see the east start accumulating metal. At least that’s what it looks like when you look back on it and you see their actual numbers. So I think any dip in price triggers buying from the central banks at other parts of the world.
The other kind of weird one here. And I remember being when Trump was winning the first time and thinking, and I remember midnight as he was winning gold spiking up and then just getting absolutely slammed the next morning. Inexplicably, given that the rhetoric as it was happening was gold was moving up. But I think one of the things with this election cycle is that Trump has really been promoting and pushing and supporting cryptos. And so I think some of it we’re also getting is it’s, it is pulling a bit of that money in the short term.
You know, that would be trying to pick between the two, whether they’re picking gold or bitcoin to invest in that. We did move some money back towards the digital currencies in the short term. But in the grand scheme of things, to me, the bigger player in all of it is, is the east and the central banks around the world. And they, their buying power is a lot bigger than what is buying, you know, the retail guys and this, you know, some of the institutions in North America that are buying cryptos based on Trump’s bullishness on that front.
So I think both of those are playing in, but it’s always nice to see them recover and settle back in. And that’s kind of what we’ve been talking about, you know, every month is, is seeing these metals prices consolidate, you know, after dips, and we’re going to be in a range bound and then we break out to the new level and Then you want to see it consistent and steady over long periods of time and then break out again. Doesn’t need to be a straight up chart because it just, that isn’t as, you know, that doesn’t last as long and, but this type of chart where we see these consolidations is what we normally see in gold and silver.
And we have these, that’s why we have these long drawn out, you know, 10 plus year macro cycles in a bull market for metals. And that’s what we’re in the middle of now, which is great. So hopefully we have, you know, this bull market lasts for years and years moving forward and we see, you know, by the end and whether the peak will be, we should see some dramatically higher prices when we do actually finally hit those peaks. Yeah, I think that’s well said, Steve. And pulling up our gold chart here, it’s funny because I was talking to Rick Rule earlier this morning and he was mentioning how back at the turn of the century you see gold price below 300 bucks.
Obviously it had a bit of a call that a fear spike or when we started learning about QE2 and other sort of assort associated features back in 2011, you know, we had that and it came down. Although when you take a step back, you can see a somewhat smooth curve to that. So when you said hopefully it goes for a couple of years, I mean, I, I know when the price goes down 100 bucks over a couple days, it’s easy to lose track of this. But I mean, we’ve, we’ve been in a bull market for the past 24 years and I know that there’s certainly, you know, and I’ve perhaps said emphatically at times that I think there will be a break point, perhaps more so on silver, where the dynamics are a little bit different.
And I don’t know, maybe we do have a reset or we do have a revaluation or something like that at some point. Yet even without that, the, again, the dynamics that drove us from here to here, it’s not like, well, you know, we withered away the currency a little bit, but now everything is solved. I mean, you could make the argument that the conditions we’re facing here are even more extreme than what we had here 20 years ago. Yeah, I remember, I mean, I remember growing up with my dad being in the industry then. And then when gold crossed 300, that was a game changer.
That was like, open up the bottles of champagne, we’re all now making a fortune because gold’s, you know, gone from in the 2000s to 300. And this is like a major turning point. And then you look back, it’s not that long ago. I mean, it is, but it’s not. And seeing where gold’s at now, and you’ll listen to people and, you know, they’ll talk about, I mean, yes, the gold companies are making money, but they were making more money moving from 250 to 300 on a percentage basis than they have now with this move because costs around the world and inflation have been so high for so many years now that, you know, you need these high prices when you start, you know, just looking back and seeing what, you know, costs were then versus now.
But that’s the nice thing about gold is it’s always held its value. You know, an ounce of gold can buy you a nice suit. It could buy you a nice suit, you know, hundreds of years ago, and now it can still buy you a really nice suit. Now, you can’t say that about currency. That’s the whole point. It’s the paper currency. It costs you a hell of a lot more of that paper currency versus that ounce of gold that holds its value and continues to hold its value throughout, you know, centuries. Yes. And Steve, let’s not just talk about it, but put some visuals behind this one because here we have a chart, which I’ll come back to in just a second.
But again, first, let’s take a look at this where we see total federal debt. And it was funny, I was listening to doing some research this morning, and one of the speakers I heard was mentioning how, you know, we’re crossing 36 trillion in debt now or just cross 35, get approaching 36. Back in 2000, we were only at 6, which is really just stunning below 6. So we’ve gone 6x in debt in the time since then, Tom. And yes, I get it, the gold chart has gone up. But you see some similarities there. And if you go a step further, here’s a chart.
Let me know if you can see that clearly, Steve. But here is national debt against the gold price. Not a perfect correlation, but not far off either. And maybe when you factor in things like this where we have Putin questioning the need for dollar forex reserves, I mean, even before what’s happened the last couple years, you had the investment questions and the purchasing power questions, yet now we tack on a legitimate question from Putin, says why accumulate reserves if they can be lost so easily? Which I think is a fair point. Again, in some sense, what I think about the matter, not as relevant as how central banks and other nations are addressing it themselves.
But it’s not, we’ve had this run. So if you were patient over that period of time, you did well. And while we don’t know the future, but it certainly at least does not seem like Doge board is going to balance the budget economy is going to digest that smooth sailing and that we, we haven’t seen the end of what’s happening in the metals. Well, I mean again, I think that that chart you showed of national debt and you said it’s not a perfect correlation, but I think that also can relate to the upside that we expect to see here over the next couple to get it as more of a perfect correlation to that national debt growing.
You saw it go up, but now it’s had this pullback relative to that chart. And I think if you we start seeing the convergence of the red and blue because the debt’s going to keep increasing, it’s not going to come down. So to see the red catch up again and get more in line with that blue line, I think that’s where you’re going to see a lot of increase in metals prices and is making up that difference on that chart. Yeah. And actually for what it’s worth Steve, I’m realizing as I have this up here, we did this.
Geez, was that already last year? It was a couple of months ago. And you can see this was with gold just crossing 2000. So we are actually right about here. Of course debt raise the blue a little bit too. But look at that chart. Look at the two years where the red line is above the blue line. Where were we at in metals prices? Those are, those are the two peaks that we referenced, you know, in your intro saying your two favorite years of metals prices in history. You know, and, and granted you just said number three is this year.
And like look where we should be, you know, on that chart where we are now. But your, your future top three favorite year is going to be when that red line passes that blue line again and we hit a peak in metals mean. Let’s looks like a pretty good correlation to, to when you’re going to hit peaks and metals is when that red line is going to sharply cross over the blue line. And with an exponentially growing debt, what price in gold in the case of this chart is it going to take to cross that blue line? And, and that’s a very much a dramatically higher number than we’re at today.
Yeah, you would think so. And Steve, I don’t know is this I was going to ask you for your 2025 forecast for the metals. Is 2025 the year or any particular thoughts or expectations of what, what we’ll be thinking about a year from today? I think 2025 is going to be a really good year. I don’t think we’re hitting the peak in 2025 by any means, but I think it is going to be a year where we see a steady increase with the caveat that at any given point, Trump or other governments around the world could have events that trigger, you know, more dramatic swings.
And like you say, is it a repricing of the metals on purpose to cover debt? We’ve talked about that in the past, is a playbook that exists if they choose to use it. And then, you know, that’s an event that would trigger the spike up that we’re talking about because you’re talking about exponential gains on the metal in that instance. Yeah, I mean, I think like I said, we’ve talked about in the past the Fed dealing with, you know, you know, using gold to erase the debt by repricing it. And you know, if that happens this year and they decide to use it as a playbook to wipe away the debt, then that’s what we could be dealing with.
But other than that, I think we are going to have a pretty steady year and see prices just continue to move up, you know, in ebbs and flows, but ultimately end up higher than where we are now. Well, Steve, I hear what you’re saying now. I know some would call that conspiracy theory, but again, you don’t have to take my opinion or your opinion. Why don’t we check in with Scott Besant who is on track to be the next Secretary of Treasury. And he had some interesting comments that he did not say that gold would be the release valve.
He also didn’t say that it wouldn’t yet. Let’s take a listen here and see what he had to say. Now is just a continuation of what I’ve done for 35 years. It’s the geopolitical analysis, it’s macroeconomic analysis, it’s following trends. And I decided to come out from behind my desk because I do believe this election, there’s a big choice and we are going to decide whether we are going to grow our way out of this debt burden. And I think we can. Through deregulation, energy independence and dominance in the US And a growth mindset, we can get back to growth.
I feel very strongly that this is the last chance to grow our way out of this, I also felt very strongly that we’re in the midst of a great realignment, kind of a Bretton woods realignments coming in terms of global policy, global trade. There’s a lot of what I taught at Yale, I’ve been studying my whole life. I’d like to be part of it, either on the inside or the out. Steve, this was made shortly before the election and before he was appointed Treasury Secretary. Interesting. You have J.D. vance and Elon Musk contacting Ron Paul about cost cutting and ideas about the Federal Reserve.
Judy Shelton, former Trump economic adviser, we’re not sure if she’ll be part of the next administration, but talking about gold backed bonds. This comment, you also have Bob Lighthouser, who I haven’t heard him say it directly, but it keeps getting reported that he’s a big fan of dollar devaluation perhaps along with the fact that I don’t know how you, if it’s possible that you can grow your way out of this without some sort of devaluation of the dollar. But again, here it is, soon to be treasury secretary saying it. And Steve, what say you to that? Yeah, I mean, I, I mean like you said, I mean we going into this, the comments that we made about being conspiracy theaters, like, I don’t know, I mean, I don’t know if I believe or don’t believe that the US Is ever going to actually do that to get out.
What’s been interesting to me over the last weeks, couple months is hearing more and more of the mainstream start to suggest that that’s the way out. And I’ve heard a lot of people, you know, that, you know, watching videos and that from some of the major banks from other ways start to talk about this as an option. And that isn’t something you’ve heard from mainstream media or commentary outside of, you know, digging into the gold bugs, you know, over the last decades that you would ever hear. So hearing, you know, grow your way out of it, how are you going to grow your way out of it? You know, he talked about trade changing around the world.
Well, if trade changes around the world, it’s not changing in a way that’s beneficial to the U.S. i mean they’re the center of everything now. So if you’re going to grow your way out of it via trade, I would, you know, while Trump’s talking about putting on 25% tariffs on Mexico and Canada and pissing off some of their closest trade partners in the process and hurting them to where it’s going to cause, you know, US Costs to go up, Canadian costs to go up. I don’t know what the change in trade is going to be that’s going to grow the US out of their debt.
So what are we left with? We’re left with having to grow the value of assets that are held in reserve in the country. And I mean gold is obviously one of them. I think the way Trump’s been talking he would try and move cryptocurrencies into that basket of things that they could revalue. And we’ve started to see the talk of them accumulating bitcoin under Trump as a Federal Reserve asset. Potentially we’ll see But I think it’s a basket of those things is their way out. If they’re going to grow anything, it’s to grow the value of whatever entity they decide is going to be their way out.
Yeah, it does seem that way and it sure does seem like they’re trying to find a way to pay off the debt by raising the bitcoin price is the early indication whether they’re successful with that does seem more and more like if there that can be done that they sure indicating a great interest in doing it that way. So the big, I mean he’s a big crypto guy at various points. I mean they, his favorite coin they can name their committee after is they’re going after the federal government, the Doge committee. So like he’s. There’s definitely some powerful players along with Trump that like cryptos.
So we’ll see what happens in the whole process. But in the, in the. I don’t think they own enough bitcoin to necessarily be able to use that solely or crypto solely to do it. I think it would be a combination. Yeah, well they can just revalue the Fed’s gold certificates, put some cash, go out and buy more. And of course revaluing, you have to find someone to actually buy it at its revalue price, which is another conversation. I guess you can’t just say it’s worth X and no one around the then every gold bug in the world that’s just made 10x or 20x starts blowing out all their physical metal and you have to have someone actually buy the Federal Reserve’s gold to actually pay off the debt, I guess would be my way of looking at it.
So we’ll see how it all plays out. I guess if we see Michael Saylor in the cabinet at some point, that’s, that’s when we’ll know. So yeah. But our next one I would Love to get your thoughts on Steve. I know, and I think our audience gets excited for this too, that it’s become well known your love of the Federal Reserve bastion of power who sometimes I wish they could just skip their Fed meetings. But we have another one coming up this week where let’s take a look at the inflation picture and a little recap here, if you can indulge me on this.
If you go back to July, no rate cut or concerned about inflation. We’re hawks by September. Powell still is saying the economy’s strong, no indication elevated risk of a downturn. Yet something happened in between there that even while we heard for the last three years inflation priority number one. So it’s not like we’re down at 1% below their 2% mandate, which I might add that even Volcker and Greenspan that various comments saying that the idea that inflation should be 2%, questioning that. But in either case, if you have a dual mandate and the economy is fine, yet inflation’s still a problem, why cut 50 after cutting 0? Hey.
And then they cut another 25. And let’s just take a quick look. Here is CPI year over year. You can see actually increasing now, increased the past two months, still well above 2% core CPI. You get an even scarier picture here. The last time we had a print below 2% was in April of 2021. So that’s three and a half years over 3% ticked back up a little bit higher over the summer. And we will, I guess we already saw that one. But where does that leave us, Steve, in the end? 99.1% chance of another rate cut.
The hawkish, the hawkish rate cut. But, and, and Steve, I’ll, I’ll set you up for this one. Steve was telling me before the, before you hit record, they’ll cut a rate, they’ll, they’ll cut a quarter point, but they’ll do it hawkishly. Yeah. Is that what we expect this week? Yeah, I mean, I expect the quarter point, but he’s going to come out and say how great everything is. You say the economy’s good, jobs are good, everything is awesome. Trump’s coming in. He’ll say Trump can’t fire him. I remember that was one of my favorite quotes over the last couple months was when he came out, it was said it would be illegal for Trump to fire, which I had a chuckle about.
But I mean, they’re just starting, I mean, obviously we know they finally turned and started cutting rates. I think your issue here is the more as they’re cutting rates, they’re not lowering the number on their treasury bonds. And that’s a problem because it still costs them a lot to service the debt on those bonds even as they’re cutting rates. And that’s what we talked about beforehand is it’s been interesting to see Canada where I am, we stayed aggressive again and dropped by 50 basis points and have continued to be aggressive and but hearing the rhetoric out of the US of oh, we may not cut, we may not cut in Canada.
I mean, our banks and that tie everything in the U.S. we’re completely tied to the U.S. so to see us front run, I would think they have some sort of knowledge of the fact that the US Is going to continue to cut and for us to be doing it at 50 basis points. A poll right now has been, you know, good and it’s, it’s more stimulating to our economy because our mortgage rates are directly tied to our central bank cutting rates. Which is interesting to me because I was kind of blown away looking at the US again the other day and seeing, you know, US mortgage rates over 6% where our fixed rates here now are close to 4% or even you can find some under 4%.
So it’s, that disconnect is, is different between our countries at the moment. But I kind of remember that, I guess on the way up when US Mortgage rates were low and interest rates are going up, it’s different. But for our country, I know there’s a lot of pressure to lower rates and lower rates and get stimulate our housing market a bit and get it back alive because with high rates, it froze. And I could see that happening in the US as well as people are hurting more and more. And if you’ve got high mortgage rates, you’re going to shut down your whole housing market.
And that’s a whole other crash that we’ve seen in the past that you definitely don’t want to trigger in the U.S. well, Steve, maybe to get those rates adjusted. I know someone who’s a bit of a free agent, unsure how her curveball is. But here’s Janet Yellen who maybe she could come cut rates in Canada. She’s held a wide range of positions and here she mentioned last week I’m concerned about fiscal sustainability and I’m sorry we haven’t made more progress. I believe the deficit needs to be brought down. Unfortunately, it wasn’t brought down while she was there, rose by 8.2 trillion when, well, Yellen was Fed chair and 8.5 trillion while she was treasury secretary.
So I Think we know what we’re going to get there. And you can keep that in the back of your mind. This is interesting how Powell will comment on it saying, well it’s, you know, we have to be independent and as long as the debt comes down, we don’t have a problem. Obviously it’s not going in that direction. Although Steve, one final one for you. Another thing that has not come down is mining costs. Here’s from the World Gold Council. This one came out last week. Again, these are all in sustaining costs. So still some cost on top of that.
But you can really see even from beginning of 2020 up almost $500 in the ASIC. And obviously it doesn’t seem, given what we just looked through of inflation and people like Putin saying we don’t want to hold dollars as reserves. It doesn’t seem like this is going to be coming down anytime soon. But was wondering just if you could share anything. Obviously you’re more on the exploration side but in terms of costs, you’ve talked before about the general labor costs in the mining sector being a problem and anything you could say about the rising cost structure for both of the metals.
Yeah, well what you see when you’re looking at this chart is look, we hit peak prices in 2012 and then metals prices fell off very sharply and not from 2013. Moving all the way to 2020 has been the era of maybe a little less than 2020. But this was where the majors were like we gotta crack the whip. We’ve gotta, you know, get our costs under control. And they went through over those next, you know, especially the next three, four, five years doing everything they could to really cut their costs down and tighten the ship. But there’s only so far you can tighten that ship.
And now with inflation, you’ve seen costs steadily going up from where they were and that number is just gonna. There is no other outside of some form of new technology that could come in into mining that might be cheaper than sending people in that could change how we mine. Those costs aren’t going to come down now. They went through their great tightening period of controlling their costs and bringing it down and then switching cash cost all in sustaining caution how it’s reported even though as we’ve talked in the past, that’s still not the reflective number of what it costs to do business.
But no, those aren’t going to come down anymore. Know we’ve seen that time frame, we’ve seen the other side of that is the, the assets that are out there the easiest to mine Assets, the cheapest of mine assets have mostly been mined. You know, they were found close to surface. So moving forward, a lot of the replacement reserves that are going to be done, are they going to be in new jurisdictions that maybe are higher cost jurisdictions or higher risk jurisdictions? If people are moving back to the safer jurisdictions, they’re going to see higher mining costs.
But because we’ve had this rise in metals prices, they’re still economic, but it goes back to what we talked about earlier. I remember my dad being excited about 250 to 300 gold being the big jump that was going to make everyone all that money. But now we’re at 2,600 gold. And yes, the mining companies, the gold companies specifically are making a good chunk of money. But the other thing that happens when they start reflecting and people see their finances is you see reports of countries wanting more royalties on the production. Employees want to be paid more to get their piece of the pie of how much those big mining companies are making in a, in a boom cycle.
And the problem is, is those same people, when we do finally get a downturn in metals prices aren’t like, you know what, that was great, we raised your royalties, we’re going to cut that royalty back in half and we won’t have as high a royalty. And the workers aren’t saying, you know, you know, I was making 100k a year, you know what, you’re in a bad year, pay me 50k a year. Because metals prices came down 50%. All those costs stay and rise with inflation and won’t change and come back down. So it’s, it’s hard on the mining companies and they have to be very diligent.
But there’s also a lot of pressure because if they don’t cave to a lot of those groups, well, federal, federal governments, you have to, you have no choice but to the miners. You know, you get strikes, you shut down production, you have all these other things if they don’t, you know, keep their people happy. And so those are costs that never come back down. You know, they were smarter about eliminating a lot the frills and different staff and you know, making sure everyone is being paid as people that needed to be paid. But that’s why I say you, they’ve already done that now they, they’ve thinned the company as much as they possibly could to save those costs.
Now it’s about the new world and why we, and why we have to have higher metals prices, especially on the silver side. Because at $30 silver, those primary silver Producers still aren’t making very much money, if at all, if any, unless they, it’s a, their silver is a byproduct. So those costs do or the prices have to move up, those costs are going to continue to move up with prices. But that’s why we said for so many years the metals prices lagged what was happening in the real world. And it was good for the mining companies to go through those lean years because it forced them to, to thin out and, and you know, get everything dialed in on making sure their costs were their costs and they didn’t have anything else frivolous.
But that’s the cycle. It just doesn’t matter. As much as metals mines go up, everything else is going to lag and follow behind it and continue to want to pay everyone else. And then when you get a downturn, if those companies weren’t careful and they paid out too many people and they were too generous, now they’re going to be really hurting. And that’s the scary thing and why they’ve got to be very careful with what they do. Yeah, it’s a great point and obviously I know that you’ve lived through that and probably something that many people don’t think about, but yeah, that is one of the many challenging dynamics in the mining space.
And Steve, I don’t know if we’re in especially on the silver side, I don’t know if it’s Miller celebration time just yet, although I tend to think that there’s going to be a day where we do see a significant increase in the price and at least on your behalf, I, I think if that does indeed occur, it’ll be know if everyone’s going to be sitting listening back to today’s episode two years from now. But I think it will be fun to consider some of these things if indeed that does occur in a lot of what you’ve laid out and I think that hopefully that’s been helpful for people who are watching.
And Steve, the last one to run by you, I know it’s already another month has gone by and in the past couple months you’ve been focused on getting the financing in place for Silver Viper and would love to hear how things have gone in the past month and anything that you can share with people who, especially for the shareholders who very much looking forward to seeing you be able to get out back drilling. Yeah, I mean like I said, we’ve, I’ve, I’ve hinted, I can’t say too much about what’s been being worked on. I am Flying tomorrow to meet with a group in person that, that we’ve been progressing along with that is very interested in getting involved on the project.
I, everyone will know when there’s a deal signed and in place. And we won’t sign a deal unless it makes sense for our shareholders. But you know, we’re, like I said, we’ve been looking at all options of what’s the best way to advance the project and provide value for our shareholders. And we’re going to continue to do so. So I guess, along with all my shareholders, fingers crossed. But I believe we will get a deal done hopefully in fairly short order. And you know, I think we’re, we’re really all really excited to get LaborGinia fired back up because this is one of Mexico’s best undeveloped gold silver projects that there is.
So we’re off to a great start. But we think we can make this into something much, much larger and we’re excited to do so, but it’s just getting through. In spite of metals prices going up, it’s still been a very tough market for juniors. Even some of the most, you know, the best, the most active have taken hits here over the last few months on their share price and are at or below kind of their highs or not at their highs. So they’re at or below what their average costs have been over the last two, three years.
It’s, it’s still just the start on the equity side of money slowly kind of coming back in. You’re seeing the, the majors have performed much better than the juniors, which is always what happens at the start of these cycles on the equity side. And so that money eventually starts trickling down. A lot of the times it, like you said, it’ll skip kind of the mid tier companies. It goes from the producers and then people jump down to the juniors because they, you know, there’s a lot more money that can be made if they make the right bets in the junior space.
So I think that’s coming. I think you asked me if I thought it was going to be a good year for metals prices. I do think it’ll be a very good year for the equities, you know, in spite of metals prices, even if they hover and stay flat, I think the equities, there are a lot of signs pointing to the fact that the equities are going to do well. And in the case of interest rates coming down, that’s a big trigger normally for the equity side because it comes cheaper and cheaper for the large funds or the large high net worth investors to borrow money and make better returns and putting it into an industry like ours.
So again, I think all signs are pointing that the equities market is due and is lagged dramatically behind what the metals prices have done. And so you’re going to see that lift. And even if you bet in the bad companies on that one, you’re still going to do well because those types of runs are good for all companies. The best will obviously go on much larger runs than the other companies. But I think we are coming into a really, really good year in 2025 for the equity side, especially the junior equities. And I mean, hopefully I’m right on that.
But in the interim, all we’re going to do is position ourselves to be in the best position possible for one of those cycles and we’ve got one of the best assets in Mexico to do it. So I’m excited to finally advance the asset. Yeah. And Steve, something that you mentioned in there is that obviously you want to be out advancing it at the same time you want to do a deal that’s good for the shareholders, which I think both of those are important. And I know I hear from some of them and I’m sure you hear from plenty of people and shareholders who are very much saying let’s get out there, let’s do this.
Although I think if you went out and did a deal that wasn’t a good deal to be able to do that, you’d get killed for doing that too. So I think we talked about this a little bit the last time. But just if there’s anything you’d like to comment there, because I understand the reasons that people want to and you want to see it move forward, but obviously you don’t want to do a bad deal to get to that place. Oh, doing a deal is easy. I could do a deal tomorrow but the investors wouldn’t like it.
I could sell the project 100% for heavily under, you know what, we’re already under market value. But even if I sold the company at 100 premium for where we are now, investors would crucify me, you know, selling out what is a world class asset at, you know, 9, 10 cents, you know, that that isn’t why they invested in what we’re looking for. We’re going to do a deal that makes sense and provides the groundwork for everyone to make money moving into the future on the asset and on in the company. And that’s, that’s the type of deal we’re looking to make.
It’s it’s very easy to sell the asset for pennies on the dollar, but then I would get crucified. That’s not what we’re trying to do. So it’s finding the right partner who’s positioned in the right way and working together for their shareholders and our shareholders and making sure that it’s positioned to become, you know, a major powerhouse, moving into what I think is going to be a great market for the equities. So we’ll see. But that’s. That’s what we’re working towards right now. And that takes time. Finding the right and making sure that your partner is positioned and lined up and ready to do and act on everything they promise they can do.
Well, that makes a lot of sense. And we’ll be looking forward to hearing how things go this week at that meeting. And either case, if people would like to get more information or have any questions for Steve, you can find silver viper@silverviperminerals.com and if you go to the upper right corner, there is the contact tab, which is how people can reach Steve. And Stephen, I appreciate you being here as always. I know. Oh, this is gonna be tough. How are you gonna stay focused in meetings this week with. With Jerome only two days away? But if there’s anyone that is up to that herculean task, I know it’s you, Steve.
So I think we’re in good hands. And anyway, it’s a pleasure to see you again, as always, and appreciate you being here and we’ll look forward to doing this again next month. Appreciate it, Chris. It’s always enjoyable. It.
[tr:tra].
See more of Arcadia Economics on their Public Channel and the MPN Arcadia Economics channel.
Author
