Frank Holmes: Trouble in China and the Outlook for Gold

Frank discusses the outlook for copper and how it is highly correlated with the PMI index. That index is currently in a very tight zone, and we could get a bit of a bounce.

China has been showing some good faith by reducing tariffs. He thinks that China has been under a lot of stress over the Hong Kong situation and now the coronavirus is affecting air travel in the region.

There is a significant concern about the situation, and the Fed is busy pushing money into the Repo markets to compensate. This is great for gold since interest rates look like they will continue to decline.

Frank discusses the basket of airlines he has in his JETS ETF and how they have limited their exposure to foreign airlines.

Frank notes that we are entering an election season, and therefore we will probably have a strong economy this year. The U.S. dollar remains the currency of the world, and concerns about China and Europe means more bad news, which is good news for gold.

Frank discusses some of the metrics that work well with his Quant fund analysis and how they differ from older methods of technical analysis.

GoldSpot is getting contracts with major companies and doing an excellent job of validating ideas and reducing exploration expenses. They have a fantastic team, and he feels that there is just no other company that compares today. Artificial intelligence is a revolutionary tool that could completely change mining.

Juniors are still very much unloved by speculators, but the biggest upside potential will eventually be in those stocks. He feels that gold could hit $1900 this year.

Time Stamp References:
1:00 – China, PMI, and Copper.
2:30 – Tariffs and Economic Conditions.
5:40 – Airlines in his ETF
8:00 – Election years and a strong economy.
9:00 – Hive Blockchain and crypto markets.
14:40 – Quant analysis vs. Technical Analysis
19:00 – Market Volatility and Gold.

Talking Points From This Week’s Episode
• The outlook for copper and manufacturing.
• Risks from China and the coronavirus.
• Continued Fed money printing and gold.
• Quants, GoldSpot and the JETS ETF.

Frank Holmes is the CEO and chief investment officer of U.S. Global Investors. Mr. Holmes purchased a controlling interest in U.S. Global Investors in 1989 and became the firm’s chief investment officer in 1999. In 2006, Mr. Holmes was selected mining fund manager of the year by the Mining Journal. He is also the co-author of The Goldwatcher: Demystifying Gold Investing. More than 50,000 subscribers in 180 countries follow his weekly commentary in the award-winning Investor Alert newsletter.

Mr. Holmes is a native of Toronto and is a graduate of the University of Western Ontario with a bachelor’s degree in economics. He is a former president and chairman of the Toronto Society of the Investment Dealers Association. Mr. Holmes is a much-sought-after keynote speaker at national and international investment conferences. He is a regular commentator on the financial television networks CNBC, Bloomberg, BNN and Fox Business, and has been profiled by Fortune as well as The Financial Times.

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