I’m Buying These Gold and Silver Stocks Hand Over Fist
John Feneck told Commodity Culture that the backdrop for gold and silver has never looked better in his lifetime. He is buying gold equities hand over fist for leverage to the metal, because he knows the price is going to get better next year. Current prices in the mining sector are a gift. The names he likes will massively outperform.
“The backdrop for gold and silver have never looked better in my lifetime. I’m buying gold equities hand over fist.”
The IMF said bond markets are stable. Feneck said they should be ashamed. Nothing is stable about the U.S. bond market. The ten year has moved from about 3.96 in early March to 5.28. That is a 130 basis point move. The Fed has hiked once in three years. At 6.5 percent people start freaking out. At 7 percent they really freak out. Bessent, Trump, and the Fed do not want that scenario because they cannot control it. Mass chaos follows.
August 19, when Bessent intervened, was the moment Feneck put a lot of chips in after the weak ADP and non farm payrolls prints. GDX went from 73 to 105 in less than a month. The sector is high octane. If you cannot handle the volatility, you should not be in it.
“The IMF should be ashamed of themselves. Nothing stable about what’s happening with the US bond market right now.”
He does both trading and holding. The structure is hub and spoke. The hub is the core ETFs: GDX, GDXJ, SILJ, SLVP, and SIL. Those cover hundreds of stocks. The average investor does not need to trade First Majestic against Agnico against Newmont. Buy the ETFs as the core.
Then add spokes: exploration, development, or early production names that can generate alpha.
When a spoke explodes 200 or 300 percent, he sells. He does not ride it to a five or ten bagger. USAS ran from a buck to 11 last year. He sold some at 9 or 10 and some at 5. It is back near 4.20. He likes the turnaround artist, but he does not get married to positions. Chat rooms said 20. It went to 4.
Rising yields are supposed to hurt gold and silver because Treasuries pay more. Feneck says it is different this time. Loss of faith in the quality of U.S. credit changes the math. The backdrop has never looked better. Patience is the hard part. Not everything aligns to the thesis on schedule. In 2008 and 2009 it took months, not weeks, for GDX to take off after Lehman. The rewards are amazing if you stay in.
“I do think it is different this time. I think the backdrop for gold and silver have never looked better in my lifetime.”
The broad market has to roll over for the miners to fully re rate. Oil stocks are a question he is watching. The gift is the current prices in the quality names. He is buying them hand over fist. The leverage is the point. Next year the metal gets better. The stocks that are still cheap today are the ones that deliver the outperformance.
