Tom Bodrovics welcomes Axel Merk, the founder, CEO, and CIO of Merk Investments to the show. Together they focus on the current state and future prospects of gold mining investments. Merk expresses that while gold miners have had a remarkable run, they still present a bargain due to the higher price of precious metals not being fully reflected in miner valuations. He notes increased interest from generalist investors and speculators returning to the sector.
Merk notes that gold miners are currently experiencing better margin expansion, which could attract more capital. He discusses the logistical challenges and differences between gold and silver markets, noting that silver’s industrial use makes it more volatile. He attributes gold’s strength to factors like tariffs disrupting currency flows, the weaponization of the dollar, activist politics, and easing monetary policies.
Axel also touches on the depreciation of fiat currencies and the potential for a revaluation of other assets, which could impact gold’s performance. The conversation shifts to the independence of the Federal Reserve, with Merk arguing that maintaining independence is crucial to avoid reckless government spending and inflation. He criticizes the Fed’s involvement in fiscal policy decisions and advocates for a return to basics.
Merk also discusses the potential implications of geopolitical tensions and resource nationalism, suggesting that these factors could drive up the cost of doing business and benefit gold. Merk advises investors to focus on risk management and be prepared for volatile times ahead. He emphasizes the importance of investing in well-managed teams with proven track records in the mining sector.
Timestamps:
00:00:00 – Introduction
00:00:20 – Are Miners Bargain Status?
00:01:05 – Investor Types in Sector
00:03:22 – Attracting Capital Inflows
00:05:23 – Physical Market Observations
00:07:23 – Silver Gold Differences
00:09:09 – Factors Driving Gold
00:13:43 – Fiat Depreciation & Gold
00:19:11 – Gov’t Extreme Measures
00:22:49 – Federal Reserve Independence
00:33:08 – Managing Portfolio Risks
00:37:45 – Evaluating Junior Miners
00:41:00 – Geopolitical Resource Strategies
00:48:04 – Other Metal Opportunities
00:50:23 – Concluding Thoughts
Guest Links:
X: https://x.com/AxelMerk
Website: https://www.merkinvestments.com/
Website: https://asaltd.com
LinkedIn: https://www.linkedin.com/in/axelmerk/detail/recent-activity/
Book: https://tinyurl.com/4ebpcaew
Axel Merk is the President and Chief Investment Officer of Merk Investments, manager of the Merk Funds.
Founder of the firm bearing his name, Merk is an expert on macro trends. He is a sought-after speaker, contributor, and author; Axel Merk’s book, Sustainable Wealth, describes how the greater economic universe works, how it might affect your finances, and how to manage those finances to seek financial stability. Axel Merk holds a B.A. in Economics (magna cum laude) and an M.Sc. in Computer Science from Brown University.
Axel Merk founded Merk Investments in Switzerland in 1994; in 2001, he relocated the business to California. He has grown Merk Investments into an investment advisory firm offering investment funds and advisory services on liquid global markets, including domestic and international equities, fixed income, commodities, and currencies.
Axel lives in the San Francisco Bay Area with his wife and their four children. Furthermore, he is a marathon runner and a private pilot.
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