Panel: Mike Beck, Matt Geiger, & Phil O’Neill: Looking Towards the Next Mining Bull Market
Michael McRae from Kitco chairs our panel, and he asks, “What is it like to be in a bull market, and what are the signs?”
Mike Beck says, “Since the downturn in this sector in 2012 it been tough sledding, increasingly so. In a bull market, if you didn’t make a million dollar by lunchtime, it meant somebody didn’t like you. It means virtually unlimited capital for half-baked ideas. This doesn’t exist anymore due to a structural shift in capital markets.”
Matt feels under-experienced with bull markets. His best example of a bull market was the spring of 2016 when there was a good run in mining equities. Bull markets are times when people loosen their standards and get swept up in the euphoria.
Phil got involved in the industry in 2003 when the market was roaring, and uranium moved to 140 dollars but those days don’t go on forever. The industry has changed a lot, and millennials aren’t interested in resource equities.
Michael asks, “What will it take to start the next major market, upturn?”
Mike Beck feels you need a catalyst like a significant uptick in metal prices like we have seen in lithium and cobalt. Until you have a major run in several metals your not going to attract investors back to the sector, and that will require shortages.
Matt is looking for supply disruptions. Projects that are developing need to stop advancing and marginal ones need to fail. Bear markets provide a springboard for the next bull market.
Phil describes how the market has changed, and juniors are competing against sovereign wealth funds. We need a new catalyst since few investors are interested in mining.
Time Stamp References:
0:45 – Introduction of Panel
2:30 – What is a bull market like?
8:30 – What is needed for a turnaround?
14:40 – Positioning for next bull market.
22:30 – Platinum and palladium
23:00 – Questions
Talking Points From This Week’s Episode
• What does a bull market feel like?
• E.V. may be the catalyst for the next bull market.
• Matt is a big fan of nickel and silver.
• Nuclear and E.V. are needed to clean the environment.
• The cannabis sector is an example of a bull market.
• Many funds don’t exist anymore due to compliance regulations.
Mr. Geiger is Managing Partner at MJG Capital, which is a limited partnership specializing in long-term natural resource investments. They adhere to bottom-up security analysis and maintain a long-only portfolio of resource equities. The partnership adheres to a bottom-up security analysis within the context of four ongoing macroeconomic themes: global food scarcity, global fuel/energy scarcity, regional water scarcity, and the emerging world’s infrastructure build out. Their holdings include explorers, developer, and producers of energy, industrial, precious and agricultural minerals and metals.
Mike Beck is the founder and Managing Director of Regent Advisors LLC, a corporate finance advisory and investment firm. He has advised on equity and debt financings for private and public companies in the natural resources sector, including Signet Petroleum Limited, West African Minerals Corporation, Polo Resources Limited, Direct Petroleum Exploration Inc., Titanium Resources Group, Copper Development Corporation, UraMin Inc., Diamond Fields International Ltd., Weda Bay Minerals Inc., Regent Pacific Group Limited and CCEC Ltd.
Philip O’Neill is President and founder of MP1 Capital, a Calgary based investment company created in 2006 to focus on the natural resources sector. At MP1 Capital, Phil is also the author of Phil’s Natural Resource Blog – an outlet created to share his thoughts, musings, and investment holdings in the sector. Phil was a founder, director, and CEO of TSX listed Sunward Resources. Ten months from going public in 2010, he raised $81 million to advance the Titiribi gold/copper project in Colombia. Before establishing MP1 capital in 2006, Phil worked as a research consultant for Casey Research, the publisher of such iconic newsletters as The International Speculator. Phil holds a Bachelor of Applied Science degree, Honours Program, from the University of Guelph.